NPK International Inc.

Hello, everyone. Thank you so much for waiting and welcome to NPK International First Quarter 2025 Earnings Conference Call. Please note that this call is being recorded. After the speaker's prepared remarks, there will be a question and answer session. If you'd like to ask a question during that time, please press star followed by one on your telephone keypad. Thank you. I'd now like to hand the call over to Greg Piont. Please go ahead.

Thank you, Operator. I'd like to welcome everyone to the NPK International First Quarter 2025 Conference Call. Joining me today is Matthew Lanigan, our President and Chief Executive Officer. Before handing over to Matthew, I'd like to highlight that today's discussion contains forward-looking statements regarding future business and financial expectations. Actual results may differ significantly from those projected in today's forward-looking statements due to various risks and uncertainties, including the risks described in our periodic reports filed with the SEC. Except as required by law, we undertake no obligation to update our forward-looking statements. Our comments on today's call may also include certain non-GAAP financial measures. Additional details and reconciliations to the most directly comparable GAAP financial measures are included in our quarterly earnings release which can be found on our corporate website. There will be a replay of today's call and it will be available by webcast within the investor relations section of our website at mpki.com. Please note that the information disclosed on today's call is current as of May 2nd, 2025. At the conclusion of our prepared remarks, we will open the line for questions. And with that, I would like to turn the call over to our president and CEO, Matthew Lanigan.

Thanks, Greg, and welcome to everyone joining us on today's call. We are very pleased with our institution in the first quarter, which continued to validate our long-term growth strategy and the strength of our unique value proposition. We believe our commitment to scale, geographic expansion, and unique product and service quality is being increasingly recognized by our customers. And our investments in our commercial capabilities and rental fleet expansion continue to provide tangible benefits as demonstrated by our strong first quarter results. Entering 2025 the positive momentum from the fourth quarter carried over to the new year and as the quarter progressed we saw demand on both rentals and product sales accelerate leading to a very strong finish to the first quarter. Total first quarter revenue increased 32% year-over-year to $65 million, supported by meaningful growth in both rental and product sales. Rental revenue also increased by 32% year-over-year, reaching yet another single quarter record, supported by a growing demand across our core utilities, transmission and critical infrastructure customers. Product sales increased 55% year-over-year, reflecting both continued wood-to-composite mat conversion by fleet operators supporting utilities in critical infrastructure and markets, and timing of customer projects. Gross margin increased by 300 basis points to 39%, while adjusted EBITDA improved to $19.7 million in the first quarter, an increase of 59% versus the prior year. These improvements were driven by a combination of higher revenue, a stronger sales mix, and improved operating leverage. Given the continued positive demand across our served markets, we maintained our commitment to invest in the expansion of our rental fleet, investing a net $8 million in the first quarter, strengthening our scale, customer responsiveness, and ability to serve the needs of the largest critical infrastructure projects. Also consistent with our plans discussed in February's call, we resumed our return of capital program using $11 million of cash in the first quarter to purchase 2% of our outstanding shares, with an additional $1 million of purchases in April. In support of our program, our Board of Directors has increased the remaining share in purchase authorisation to $100 million as of April 30th. As we entered 2025, we noted that the secular megatrends underpinning investment in critical infrastructure remained robust despite uncertainties being created by the realignment of federal government priorities, including the imposition of tariffs and reassessment of the IIJA and IRA programs. While the industry continues to wait for clarity on government actions, we are encouraged by feedback from our customers and broader market participants during the quarter that their 2025 priorities remain relatively unchanged, indicating a continued robust growth in their capex plans. Given that feedback, in combination with our strong performance in Q1 and the continued strength we see early in Q2, we have raised our full year revenue and EBITDA expectations for 2025. With that, I'll turn the call to Greg for his prepared remarks.