Dycom Industries, Inc.

Good day, and thank you for standing by. Welcome to the DICOM Industries, Inc. fourth quarter 2025 results conference call. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Ms. Callie Tommaso, DICOM's Vice President of Investor Relations. Please go ahead.

Thank you, Operator, and good morning, everyone. Welcome to DICOM's fourth quarter fiscal 2025 results conference call. Joining me today are Dan Pejovic, our President and Chief Executive Officer, and Drew DeFerrari, our Chief Financial Officer. Earlier this morning, we released our fiscal 2025 fourth quarter and annual results, along with certain outlook information. We also announced our Board's authorization of a new $150 million stock repurchase program as our most recent share repurchase authorization has expired. The press releases and accompanying materials are available in the Investor Relations section of our website. Today's discussion will include forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements reflect our expectations, assumptions, and beliefs regarding future events and are subject to risks and uncertainties that could cause actual results to differ materially. A detailed discussion of these risks and uncertainties is included in our filings with the SEC. Forward-looking statements are made as of today's date, and we undertake no obligation to update them. Additionally, we will reference certain non-GAAP financial measures during today's call. Explanations of these measures and reconciliations to the most directly comparable GAAP measures can be found in our press release and accompanying materials. With that, I will turn the call over to Dan Pajewicz. Dan?

Thanks, Callie, and good morning, everyone. Overall, I'm pleased with our performance in fiscal 2025. We delivered another solid year of growth and continued to focus on creating long-term shareholder value. I'll give a brief overview of our Q4 and fiscal 2025 results, and Drew will provide more color on our performance. We closed the year with a strong fourth quarter, generating revenues of $1.085 million and adjusted EBITDA of $116.4 million, or 10.7% of revenue. We accomplished this against a backdrop of unforeseen weather challenges across the country, demonstrating the breadth and durability of our business. Our fourth quarter results punctuated another year of profitable growth for the company with fiscal 2025 revenues of $4.702 billion and an adjusted EBITDA margin of 12.3%. Over the past three years, we have increased our revenues by 50% and expanded our EBITDA margin by approximately 450 basis points. In that same time period, we further diversified our customer base, shifting our top five customers to 55% of revenue in fiscal 2025 from 66% in fiscal 2022. Backlog at the end of the fiscal year was $7.8 billion, with $4.6 billion expected to be completed over the next 12 months. Finally, we remain committed to a balanced approach to capital allocation, prioritizing organic growth augmented by M&A and share repurchases. In fiscal 2025, we completed three acquisitions and repurchased 410,000 shares of our common stock, including 200,000 shares during the fourth quarter. Looking ahead, we believe DICOM remains uniquely positioned to capitalize on the significant tailwinds we see driving the industry. As I said before, our strategy remains consistent. We've always sought to differentiate ourselves through our comprehensive footprint and by offering the highest level of service to our customers and communities. We're in every state and across markets, whether rural, suburban, or metropolitan. We have relationships and understand the municipalities and the challenges at every stage of a project. And we're interfacing with customers on forward planning, advising on how they can get the highest throughput and how we can best augment their businesses so we can optimize value. They have high aspirations and with projects becoming increasingly more complex, our proven capabilities and unmatched footprint position us with the scale and expertise to partner with them to support their digital infrastructure needs. Let me take a minute now to walk you through some of the opportunities that we believe we are well positioned to realize and that will drive our performance going forward. First, Our customers continued to execute against their fiber-to-the-home programs, and in calendar 2024, collectively added more than 35 million incremental passings to their plans, in addition to their already robust fiber-to-the-home builds. In several of our customers' most recent earnings calls, they reiterated their commitment to their fiber-to-the-home plans, and some mentioned opportunities for increased velocity of builds, while others, again, increased total expected passings. We believe Fiber to the Home will continue to be a significant growth driver for our business in fiscal 2026. During Q4 2025, we were awarded new markets for Verizon and also extended several existing agreements. These awards combine both maintenance and Fiber to the Home, and we appreciate our partnership with Verizon and their confidence in our ability to deliver as they increase their programs in calendar 2025. Second, the intensity around new inter- and intracity, high-capacity, private, secure, redundant fiber infrastructure for hyperscalers continues. Our previously announced Lumen Award related to the long-haul overpull work commenced in the fourth quarter and has begun ramping in Q1. In addition, customer dialogue around AI digital infrastructure needs remains robust. Two ISPs recently announced their intent to build a total of more than 5,100 long-haul fiber route miles across the U.S., to meet the growing demands of AI workloads, connect key data center locations, and provide a diverse path to other long-haul routes. During Q4 2025, we rewarded various long-haul route segments by our customers. These deployments will begin in calendar 2025. We maintain our belief that the most significant revenue opportunities for the long-haul market will occur in calendar 2026 and beyond. While the market remains competitive, the addressable opportunity is large, and we will continue to be disciplined and deliberate in how we evaluate projects, ensuring that our work is priced properly to deliver sustainable, profitable growth. This market continues to expand as all the hyperscalers recently reaffirmed their commitment to capital expenditures for AI-related data centers and digital infrastructure, with several announcing increased levels of CapEx in calendar 2025. Third, state and federal programs are making progress against their goal to provide broadband to the rural areas of our country. It remains a bipartisan goal to bridge the country's digital divide despite the present uncertainty related to the BEAD program. Separate from BEAD, there continues to be substantial activity at the state level with over $1 billion awarded across nine states for broadband infrastructure during the fourth quarter. Many states continue to award grants for both rural fiber-to-the-home and middle-mile programs. We believe these state and federal programs present a significant opportunity for DICOM. Lastly, we continue to add backlog to our service and maintenance work and highlight the importance of these programs as part of our core offerings to our customers. In addition, our AT&T wireless activity is ramping through the equipment replacement program and the pace continues to meet our expectations. I'd like now to turn to our outlook for fiscal 2026. We have demonstrated our ability to grow both organically and through acquisition and are confident in our strategy to continue that growth this year. To give you additional perspective, we are providing a full year revenue outlook for fiscal 2026 to provide insight into the opportunities we see for DICOM across our space and how we are positioned to capitalize on them. We expect fiscal 2026 total revenue to increase 10 to 13% over fiscal 2025. This expectation assumes our customers' fiber-to-the-home expansion programs and hyperscaler long-haul network projects proceed as planned, ramping of wireless equipment replacements, growth from recent maintenance awards and other maintenance activity in line with expected run rates, and normal seasonal factors. Opportunities from VEED are not included in our fiscal 2026 outlook, and we remain well-positioned to realize revenue from this program once it begins. Of course, we will adjust our expectations as we see these underlying drivers develop, but want to provide you with some additional insight into how we're thinking about growth in the coming year. I would like to finish by highlighting our top goals for fiscal 2026. First and foremost, given the significant opportunity set I described earlier, we remain focused on providing long-term value for our shareholders and long-term opportunities for our people. We are purposeful in our pursuit of opportunities, unwilling to grow backlog by taking low-margin, high-risk contracts. That patience and discipline has been evident over these past few years as we've driven top-line growth while also expanding margins and broadening both our customer base and the types of programs and builds in our book of work. In addition, and as Drew will discuss, we saw improved free cash flow performance in fiscal 2025, and improving free cash flow continues to be a priority. Our teams made substantial progress this year in the invoicing cycle and converting earnings into cash flow, and we have good momentum going into the new year. Finally, we've worked hard to differentiate our offering to our customers and communities in what I refer to as quality as a brand. That means delivering our work safely and at the highest level of quality in the field, but it goes much further than that. We strive every day to be a partner that delivers quality throughout our engagement, from the first interaction with a customer or in a community, to staying 10 steps ahead from day one to day done so our customers and all our stakeholders can have peace of mind knowing we deliver on our commitments. We believe our customers recognize the difference in working with DICOM, and we continue to work hard to earn their business every day as we pursue our vision to be the people connecting America. Now I'll pass the call to Drew to review our financials.