Polaris Renewable Energy Inc.

Good day, ladies and gentlemen, and welcome to the Polaris Renewable Energy Incorporated's first quarter 2026 conference call. At this time, all participants are in 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 Sestedos, Chief Financial Officer with Polaris Renewable Energy. Mom, the floor is yours.

Thanks, Ali. Good morning, everyone. Thank you for joining us for our 2026 First Quarter Earnings Call for Polaris Renewable Energy, Inc. Before we begin, we would like to remind you that in addition to our press releases issued earlier today, you can find our financial statements and MD&A on both CEDAR Plus and our corporate website at polarisrei.com. Unless noted otherwise, all amounts referred to are denominated in U.S. 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 Polaris 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 31st, 2025. On today's call, I will walk through our operating and financial results for the first quarter of 2026. Mark will then provide additional commentary on our Q1 performance and growth initiatives. Following our remarks, we will look forward to taking your questions. Starting with production, overall, the first quarter of 2026 demonstrated the benefits of our diversified portfolio, despite temporary external factors affecting production during the quarter. While consolidated production decreased 5% year-over-year, due primarily to scheduled major maintenance in Nicaragua and elevated containment in the Dominican Republic, The broader portfolio continued to perform well, with a strong hydrology in Peru, a stable production in Ecuador and Panama, and a full quarter contribution from Puerto Rico, helping offset a portion of this impact. Importantly, these temporary factors did not materially affect the company's financial flexibility, liquidity position, or our ability to continue advancing strategic growth initiatives. In Nicaragua, Unit 3 underwent Plan B annual maintenance during February, which resulted in 17 days of downtime. Plan availability outside the maintenance period remains strong. In the Dominican Republic, curtailment averaged 42% during the quarter, compared to an average 7% curtailment in the same period last year, materially impacting realized generation. While curtailment has moderated quarter to quarter, in Q2, the timing of normalization remains uncertain. In Peru, hydroelectric production increased year-over-year due to improved hydrological conditions and resource availability. During March, Peru also experienced temporary energy shortages, which resulted in elevated spot market pricing and positive benefit canchaio following fulfillment of its annual PPA obligations. In addition, Puerto Rico contributed a full quarter of operating results during Q1 2026, compared to only one month of contribution following the acquisition in the comparative period last year. adding 12,698 MWh to the consolidated production during the quarter. In Ecuador and Panama, production remained generally consistent with the comparative period last year, reflecting stable hydrological and solar resource availability as well as continuous strong plant performance. Moving on to financials, from a financial perspective, revenue for the quarter was 19.8 million, down 3% from 20.3 million in Q1 2025. Adjusted EBITDA was 13.5 million compared to 15 million in the comparative period, reflecting the lower production levels and revenue discussed earlier and the cost impacting from integrating our Puerto Rican operations. Direct cost across the rest of the operations remain in line with 2025 levels. Cash flow from operating activities was 8.5 million, and we ended the quarter with 97.5 million of total cash, including restricted cash up from 93.2 million a year in 2025. Our balance sheet remains strong, and we continue to maintain financial flexibility and focus on execution and advancing the pipeline for long-term value creation. I would also like to highlight that we continue to prioritize shareholder returns. We have already announced that we will be paying a quarterly dividend on May 22nd of 15 cents per share to shareholders of record on May 13th. With that, I will turn the call over to Mark. Thank you.

Thanks, Alba. So just a few minor comments on operations. As Alba mentioned, we completed the major maintenance, planned maintenance at San Jacinto on a pure sort of days of downtime that would have cost about eight thousand megawatt hours. But given that we need to close a whole bunch of wells, Some of those take, when you reopen them, but they take a little bit longer to actually reach their pre-maintenance capacity levels. So when we look at the quarter, I would say, given that that process, not for all the wells, but for a couple of the wells, it ends up being that instead of sort of 8,000 negative megawatt hours per quarter, it's closer to 12 to 13,000. So I think the actual, call it maintenance cost in the quarter was about, let's say 12 and a half thousand megawatt hours approximately. And then the wells have definitely recovered to their pre-maintenance capacity levels. And they're at sort of levels that are as per our expectations going into the year. And the Dominican curtailment was somewhat higher than anticipated. We think it was about 7,000 megawatt hours estimate. This will be stronger in their winter months. It has come down in April and continues to come down here in May, so we expect that to continue. We are targeting an annual number of 40 to 45,000 megawatt hours for the year. Given that, continuing to improve next year and the following, given the plans to put large-scale SATA in place in the next 18 to 24 months in the country. So that was a negative, although it was somewhat offset by the hydros in both Peru and Ecuador, which performed really, really well in the quarter. So we're happy about that. Based on those comments, I would say, though, for full year consolidated production guidance, down slightly to about 760 to 770 gigawatt hours. In terms of the growth, on the last call I mentioned, we had signed an LOI on this very small solar project. It continues to move. Unfortunately, the vendor just wasn't legally ready to move the documentation phase. We've finished our technicals, diligence, so we're ready to go. But the ball is in their court, so we are confident it's moving forward. Not likely to close until Q3. The big one that we're all waiting for is the ASAP approval. PREPA board in Puerto Rico did approve the project on Feb 19th, which we've been waiting for for a long time. We are still awaiting approval from the FOMB, which is the last approval needed. Once they approve it, it does go back to PREPA for signature, but that's not an approval at that point. So this really is the last approval. I know this is taking longer than what everybody wants. We do not think that there is a problem with it. There is no issue. There are just some other things that are happening that are taking FOMB's attention right now. And so we are optimistic we will receive it prior to the end of this quarter. In Puerto Rico, we are also participating in an RFP that is where our final proposal is actually due this Monday. So that is an even larger project. It's solar plus best. The process is moving relatively quickly. We think it will move quicker than the ASAP process, given that it's the infrastructure, the P3 group that is driving this. Once we submit the final proposal on Monday, we will have notification as to whether we're, I think, call it being chosen in late June, so end of Q2, with contracting targeted for Q3. So that would be quite soon. And those would be the two main things that we're working on in Puerto Rico. We do have other conversations with developers going, but I would say our priority really is obviously ASAP, but also this RFP, if we're able to have success in that. And then in terms of the other main market we're focusing on right now is Mexico. We have approximately 300 to 400 megawatts of solar projects in a current, technically not a bid process, but let's call it that. It's a bid process that will be concluded very early, key three. So we are moving forward on that, which is a reasonable amount of megawatts for us. We also have approximately three to three fifty megawatts of projects that are going to be in a subsequent process that is going to be on the tail end of that, but not by much time. We think that can likely wrap up in Q3, sorry, at the end of Q3. So the first 3 to 400 will have line of sight beginning of Q3, the next 300 end of Q3, and then I would say in addition to these two processes, we have, and projects, we have another 200 megawatts of solar and a large storage-only project that we will be moving forward throughout the year, and with those, we would be aiming to achieve contracts early 2027. So nothing to announce yet, although I don't think it's that long before we will have some announcements from Mexico. So we have high expectations for news on that front in the near term. And I think with if we achieve ASAP in the short term here and Mexico, although it's taken longer than we want, I think you will see the path forward for the next two, three years will be much more defined and everyone will know where we're driving at, what the capital requirements are, what the uses of capital that we have on the balance sheet are, and sort of what the projected EBITDA numbers are going to be for the next three or four years. So with that, I'll open it up for questions.