Richelieu Hardware Ltd.

Good afternoon, ladies and gentlemen, and welcome to the Richelieu Hardware third quarter results conference call. At this time, all lines are in the listen-only mode. Following the presentation, we will conduct a question and answer session, which will be restricted to analysts only. And if at any time during this call you require immediate assistance, please press star zero for the operator. Also note that this call is being recorded on October 9th, 2025. Hello, ladies and gentlemen, and welcome to the results of the third quarter of 2025 of Kinkairi-Richelieu. Currently, your lines are in listening mode only. Following the presentation, we will proceed to a period of questions and answers that will be limited to analysts only. If you need assistance during the call, please press star 0. Please note that this call was recorded on October 9, 2025. I would now like to give the floor to Mr. Richard Lord, President et Chef de la Direction. La parole est à vous.

Merci. Thank you. Good afternoon, ladies and gentlemen, and welcome to Richer U's Conspiracy Call for the third quarter and first nine months ended August 31, 2025. With me is Antoine Auclair, CFO and COO. As usual, note that some of today's issues include forward-looking information, which is provided with the usual disclaimer, as reported in our financial filings. We had a good third quarter with solid growth and expansion. All our results are on the rise and we successfully pursued our acquisition strategy, closing two additional acquisitions following the quarter. Except for Ontario, all our market segments in Canada and the US performed well, driving our total sales up 6.7%. Our sales in Canada increased by 2.9%, while in the U.S., they rose by 11.4 in U.S. dollar, accounting for 45% of total sales for the quarter. Sales climbed 6.5% in the manufacturer market and 8.6% in the retailers and renovation superstore market. Our margins improved slightly with EBITDA margin of 11.4%, and diluted net earnings per share increased by 4.9% to 43 cents. I would also point out that our operations generated cash flows of 82.7 million in the third quarter. This includes a 16.2 million reduction in inventories. We ended the period with a positive cash position of 12 million and a working capital of 632.7 million, which reflects a solid and healthy financial position and an outstanding balance sheet. I will now ask Antoine to review the financial highlights for the quarter and the first nine months.

Thanks, Richard. In the third quarter, sales reached 499.2 million, up 6.7%, representing an increase of 31.5 million equally driven by internal growth and acquisitions. In Canada, sales totaled $272 million, up 2.9% compared to last year, despite the decline in sales in Ontario, where the business environment is actually more challenging. Sales to manufacturers amounted to $226 million, up 1.9%, while sales to the hardware retailers totaled $46 million, up 8.5%, mainly due to timing differences, as year-over-year sales show a slight increase with the same period last year. In the US, sales grew to $165 million in US dollar, up 11.4%. Sales to manufacturers reached $158 million in US dollar, up 11.6%, with 7.3% coming from internal growth. This internal growth is mainly driven by price increases, partly due to new import tariffs, an increase that offsets the additional cost of the tariff with no impact on gross margin dollar. In hardware retailers and renovation superstores market, sales reached $7.7 million, up 6.9%. In Canadian dollar, total sales in the U.S. reached $227 million, up 11.7%, and accounting for 45% of total quarterly sales. For the first nine months, total sales reached nearly $1.5 billion, up 7.2%, of which 4% resulted from internal growth and 3.2% from acquisitions. In Canada, sales reached $790 million, up 2.2%, primarily due to acquisitions. Sales to manufacturers totaled $657 million, up $14.2 million, or 2.2%. Sales to hardware retailers and renovation superstores were $132.9 million compared to $130.3 million, up 2%. In the U.S., sales amounted to $473 million in U.S. dollar, up 10.4%, with half from internal growth and half from acquisitions. They reached $663 million in Canadian dollar, up 13.8%, accounting for 46% of total sales. In U.S. dollars, sales to manufacturers totaled $447 million, an increase of $42.6 million or 10.5%, driven by 5% internal growth and 5.5% from acquisitions. Sales to hardware retailers and renovation superstores were up 7.9% compared to last year. Third quarter EBITDA reached $57 million, up $4.1 million or 7.7% over last year. This increase reflects higher sales and effective cost management. Growth in EBITDA margins slightly improved with an EBITDA of 11.4%. For the first nine months, EBITDA totaled $154.7 million, up 5.1%, with EBITDA margins at 10.6%. Third quarter net earnings attributable to shareholders amounted to $23.9 million, up 5.2%. This increase mainly reflects higher EBITDA, partly offset by higher amortization and interest expenses resulting from new leases and lease renewals. Consequently, diluted net earnings per share was 43 cents compared to 41 cents last year, an increase of 4.9%, consistent with the improvement in overall profitability. For the first nine months, net earnings attributable to shareholders reached 60.3 million, down 1.8%. Diluted net earnings per share stood at $1.08 compared to $1.09 last year. Third quarter cash flow from operating activities before net change in non-cash working capital reached 48.1 million, up 12.5% from 42.7 million last year. Change in non-cash working capital contributed a cash inflow of 34.6 million, driven by a $16.2 million reduction in inventories. As a result, operating activities generated a cash inflow of $82.7 million for the quarter, reflecting higher net earnings and effective working capital management. For the first nine months, cash flow from operating activities represented a cash inflow of $133.6 million, compared to a cash inflow of $106.4 million last year. The increase highlights the business' ability to generate consistent cash, supporting ongoing investment and shareholder returns. For the third quarter, financing activities used $25.4 million in cash, up from $18.4 million last year, mainly due to the repurchase of common share totaling $3.7 million. For the first nine months, financing activities used cash flow of $70.1 million compared to $76.1 million in 2024. In the first nine months, we invested $39 million, including $27.5 million for six business acquisitions and $11.5 million primarily for equipment required to maintain and improve operational efficiency. We continue to maintain an outstanding balance sheet with working capital of $632.7 million and a positive cash balance. I now turn it over to Richard.