NPK International Inc.

Ladies and gentlemen, good day. Thank you for standing by. My name is Jim and I will be your conference operator. At this time, all lines have been placed into a muted and listen-only mode to prevent any background noise. We are happy to welcome you today to this NPK International Second Quarter, 2025 Earnings Conference Call. As a reminder, today's session is being recorded. And after today's prepared remarks, you will have the opportunity to ask questions. If you would like to signal for a question, simply press star and 1 on your telephone keypad. To remove yourself from the queue, simply press star and 1 as well. And now to get us started with opening remarks and introductions, I am pleased to turn the floor over to Mr. Greg Pionsek. Welcome, sir.

Thank you, operator. I'd like to welcome everyone to the NPK International Second 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 in 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 NPKI.com. Please note that the information disclosed on today's call is current as of August 6, 2025. At the conclusion of our prepared remarks, we will open the line for questions. And with that, I'd 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 execution through the first half of 2025, which continued to validate our long-term growth strategy and unique value proposition. We believe that our strong first half results clearly demonstrate that our singular focus on worksite access and our commitment to rental fleet scale, geographic expansion, and service quality are being increasingly recognized by our growing customer base. Total second quarter revenues were $68 million, delivering a 5% sequential increase. Pleasingly, while the second quarter 2025 was relatively in line with the second quarter last year, last year's results included a record $30 million from product sales, while this year's revenues reflect a much larger contribution from rental activities. Rental revenues came in at $32 million, reaching yet another single quarter record and representing a 34% increase year over year. We believe that the increase in rental revenues provides a more consistent and stable growth profile supported by strong demand across our core utilities and critical infrastructure customers. As we touched on last quarter, customer rental demand surged late in the first quarter, including several concurrent, large-scale transmission projects which continued through the second quarter. To meet this concentrated surge in customer demand, we leveraged our rental fleet and logistics capabilities as well as our third-party network, demonstrating our ability to scale rapidly and to deliver for our customers. Product sales activity also remained robust, generating $22 million of revenue, reflecting continued strength and demand from utility companies and other fleet owners supporting the utilities and critical infrastructure markets. Given the continued demand and robust outlook across our served markets, we maintained our commitment to the expansion of our rental fleet, investing a net $8 million in the second quarter, strengthening our scale, customer responsiveness and ability to serve the needs of the largest critical infrastructure projects. Also consistent with our capital allocation priorities, we used $6 million of cash in the second quarter to purchase 1% of our outstanding shares. As we look ahead to the second half of the year, we are encouraged by the strength in market activity as well as our pipeline of rental projects and product sales heading into the seasonally slower summer months. Given the combination of our strong performance in Q2 and our current visibility into the second half, we have raised our full-year revenue and EBITDA expectations for 2025. And with that, I'll turn the call over to Greg for