Polaris Renewable Energy Inc.

Greetings and welcome to the Polaris Renewable Energy Incorporated fourth quarter 2025 conference call. At this time, all participants are on a listen-only mode and a question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. And please note, this conference is being recorded. I will now turn the conference over to your host, Alba Cispedos, Chief Financial Officer with Palais Renewable Energy. Ma'am, the floor is yours.

Thank you, Ali. Good morning, everyone, and thank you for joining us for our 2025 Fourth Quarter Earnings Call for Palais Renewable Energy Inc. Before we begin, we would like to remind you that in addition to our press release issued earlier today, you can find our financial statements and MD&A on both Cedar Pass and our corporate website at polarisrei.com. Unless noted otherwise, all amounts referred to are denominated in US dollars. We would also like to remind you that comments made during this call may include forward-looking statements within the meaning of applicable Canadian securities legislation regarding the future performance of Collavis Renewable Energy Inc. and its subsidiaries. These statements are current expectations and, as such, are subject to a variety of risks and uncertainties that could cause actual results to differ materially from current expectations. These risks and uncertainties include the factors discussed in the company's annual information forum for the year ended December 31, 2025. On today's call, I will walk through our operating and financial results for the fourth quarter 2025 and full 2025 year. We will then turn the call over to Mark, who will provide a review of our 2025 performance and discuss the outlook for our business and growth prospects. Following our comments, we look forward to taking your questions. Overall, 2025 was a year of measurable progress for Polaris. We deliver year-over-year growth in energy production, revenue, and adjusted EBITDA. solid operational execution and disciplined cost management, strong operating cash flow generation, materially simplified and optimized capital structure, and continued capital returns to shareholders. Importantly, we achieved this while maintaining balance sheet strength and financial flexibility, which remains central to our long-term strategy. Starting with operations, for the full year 2075, consolidated energy production totaled 8010,731 MWh, compared to 764,756 MWh in 2024, representing a 6% year-over-year increase. This increase reflects the addition of the 26 MW Punta Lima wind farm in Puerto Rico, a strong hydrology in Peru and Ecuador, and solid plant availability across our portfolio. The strongest performance over the year was achieved by our hydroelectric projects in Peru and Ecuador. In Peru, favorable hydrology and excellent land availability led to a 12% increase year-to-date in hydro output for the Peruvian projects, following what had been a historically dry year in 2024. Our hydroelectric facility in Ecuador also had an exceptional year, producing 19% more energy year-to-date versus 2024, and 26% more energy in the fourth quarter of 2025 versus the comparative period in 2024, thanks to a strong rainfall and an excellent technical performance, resulting in the highest resource availability since operations began. In Puerto Rico, 2025 marked the first year of contribution from Punta Lima, adding 42,056 MWh acquisition and strengthening our technology diversification. In Panama, solar generation in the border was 5% higher than in the 2024 comparative period. These increases offset lower output from Nicaragua, where expected geothermal normalization and natural steam fill decline reduced generation by about 5% in 2025 versus 2024. Production at our Dominican Republic Canal 1 solar facility decreased slightly 2% year-to-date, reflecting efficiency gains from the new panels installed in 2024, which allowed setting grid-wide curtailments, which were 3,500 MWh in the quarter and 5,900 MWh for the year. Overall, our diversified portfolio, spanning geothermal, hydro, solar, and wind across six jurisdictions, continues to demonstrate resilience and stability, and remains one of Polaris' structural strengths. From a financial perspective, adjusted EBITDA increased up to 56.5 million, reflecting a 3% increase year-over-year. Despite inflationary pressures and the onboarding of new assets, operating margins continue to perform strongly, benefiting from disciplined cost management. I would like to highlight that we have already announced that we will be paying a quarterly dividend on February 27 of 15 cents per share to shareholders of record on February 17. Polaris now has a 10-year track record of consistent dividends, having returned approximately 105 million to shareholders in that period. Also, during 2025, under our Renew NCIB program, we repurchased and canceled 169,800 common shares, for approximately 1.5 million during the year, of which 80,000 were purchased in Q4 for approximately 0.8 million. Today, following debt repayments in Q1 2025 and Punta Lima Wind Farm integration, Olaris has a simplified debt structure, ample liquidity, and the year 2025 with a consolidated cap position of 93.2 million, including restricted cash, and an optimized and energy diversified platform for further growth. This positions the company well to deploy capital into expansion opportunities. With that, I will turn the call over to Mark. Thank you.

Thanks, Alba. So just a few comments about sort of production and guidance on that front for this year. As we messaged, we moved the major maintenance at San Jacinto from the end of last year to this year. It has been completed and executed as expected. No issues with the turbines, which is great. What that means in terms of total production on a consolidated basis for our budget, for this year without any new plants, without any acquisitions. We just take the existing plants in operation. With that, with the major maintenance there and some curtailment in the Dominican, our consolidated range for the year would be around 775 to 790 gigawatt hours for the year. In terms of what we are working on on the growth side, As people know, we really focused on the ASAP project last year because of the size of it, which is very well matched with the excess cash we have on the balance sheet and the profitability of that project. And so we were very focused on that. And what I would say that given the delays and the approval, which I'll get to in a second, we three six months ago really started to call it diversify our development opportunities in some existing jurisdictions as well as some new ones so and i think we're going to start to see the fruits of that very shortly in terms of the actual asap program um the We received approval back in August from the Energy Bureau and it moved to PREPA, which is the actual contracting agent. It turns out that in Q4, the board was basically not properly constituted to approve it. It is now properly constituted. They do now have quorum and our understanding is that the the meeting, basically the first board meeting with properly constituted color quorum will be taking place within the week. And we do know that our ASAP project is on the docket for such board meeting amongst other projects. So we're not the only one, there's numerous projects that they need to get to, given that there's, I would say, been a pause in terms of their approval of projects. So we are expecting that board meeting to happen in the short term now that they have the quorum. And then, so in addition to that, we do have a non-binding LOI that we signed regarding the acquisition of a small solar project in one of our current jurisdictions. It's not big, but it's strategic. And we would look to be going binding on that by the end of March. So that's on the acquisition front. In terms of other development activities, we are participating in an RFP process in Puerto Rico as well that came out in the main Q4. There was a request for qualifications in December which we successfully passed and we're now in the RFP process. We're going to be submitting a solar plus best with a heavy best weighting to it so that it's more dispatchable. And interestingly, despite the PREPA, which has been delayed, I would say that the process in this RFP is moving very quickly. The timeline is very aggressive and any sort of correspondence is, I would say, responding to very quickly. And the actual formal timeline that they have published is that they're looking to have contracts signed We actually had to submit comments on contracts yesterday. So that is actually moving. So we're very interested in that in Puerto Rico. Also in the same area, I would say that while the Dominican is having issues with curtailment, we do think that opportunities centered around storage will emerge from it. And we will be looking at... being ready for that and there are things that we're working on there. And then in terms of importantly in other markets, big focus going forward now is Mexico for us. We yesterday signed an exclusivity agreement with a local developer there which gives us access to approximately a thousand megawatts of projects. So we're very happy about that. The way that things are working in Mexico is there's different processes that are going to be happening throughout the year. The first one is something called mixed projects, which is we were actually invited, given the work that we've done last year. So Polaris was invited to participate, and it's called a convocatory. It's basically a process for them to fast-track projects slash signing of contracts. But the short-term one, which is we actually have to submit by next Friday, is for what they call mixed projects, which is where you're, I would call it basically their build-on-operate-transfer, 25-year build-on-operate-transfer projects with CFE, and they're going to be your contracting entity. So we will, with this portfolio that we've had exclusive rights to, we will definitely be submitting some of those projects in that portfolio for this short-term mixed projects convocatory by next Friday. And then still short-term, but a little bit later, call it Q2 this year, there's gonna be a second process, which will be for more traditional private company, long-term PPAs where they're not boots. So that's expected to be happening in April, May of this year. And so the plan would be to submit more projects from this portfolio into that, as well as likely some other ones based on conversations with other local developers that are quite interested in partnering with us for that. And then beyond that, which I would say is more call it a medium term, is that those most short-term processes, but that's not gonna be the end of it. There's gonna be more abilities to contract either directly with CFV or with other, there's numerous sort of approved purchasers of power there on a wholesale basis. And so we think that that can be back half of the year or sort of early next year in terms of actual contracting. So there's gonna be a lot happening on the development side this year in Mexico. In addition, another opportunity that is there that we're looking at is behind the meter, given the regulation changes, as well as the pent-up demand from industrial consumers there. So we do have several acquisitions we're looking at and projects we're looking at that are behind the meter. And there, the behind the meter can be up to 20 megawatts. So you can get some scale in behind-the-meter projects now in Mexico. I would say with Mexico, with the, call it RSV in Puerto Rico, and with ASAP, I would say we are now sitting here with a lot more product development shots on the net than we had three months ago, and I would anticipate being able to having, taking a reasonable success rate. Obviously, we're not going to advance all of those, but we should be, you know, having news in the next three to six months about defining actual projects that we're going to be starting to build this year, next year, and the following year so that connecting the dots on the five-year plan will be much clearer in the next three to six months. So that's it for the formal remarks. We can open up for questions.