Supremex Inc.

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the SUPREMEX 2026 Second Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question and answer session. Instructions will be provided at that time for you to queue up for questions. If anyone has any difficulties hearing the conference, please press star followed by zero for operator assistance at any time. Before turning the meeting over to management, please be advised that this conference call will contain statements that are forward-looking and subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. I would like to remind everyone that this conference call is being recorded on Friday, July 31, 2026. I will now turn the conference over to Martin Goulet of MBC Capital Markets Advisors. Please go ahead.

Thank you, operator. Good morning, ladies and gentlemen. Thank you for joining this discussion of Supremex's financial and operating results for second quarter ended June 30th, 2026. The press release reporting these results was published earlier this morning. It can also be found in the investor's section of the company's website at www.supremex.com, along with the MD&A and financial statements. These documents are available on CEDAR Plus as well. A presentation supporting this conference call has also been posted on the website. Let me remind you that all figures expressed on today's call are in Canadian dollars unless otherwise stated. Presenting today will be Stewart Emerson, President and CEO of Supremex, as well as Norm Macaulay, CFO. With that, I invite you to turn to slide 14 of the presentation for an overview of the second quarter, and I turn the call over to Stewart.

Hey, thank you, Martin. Good morning, everyone. Well, the momentum we built through the back half of last year carried into the second quarter of this year. Revenue grew across both businesses, adjusted EBITDA margin expanded meaningfully, and importantly, we returned to strong positive free cash flow after a seasonally soft first quarter. Consolidated revenue was up 8.5% year-over-year to $71.6 million, and adjusted EBITDA rose almost 34% to $7.8 million. Our margin expanded 210 basis points to 10.9% from 8.8% a year ago and I want to pause on that number because it's the clearest evidence yet of the earnings power of the platform we've assembled. That kind of operating leverage converting revenue growth into disproportionate EBITDA growth is exactly what we set out to build and it reflects both improved volume and a disciplined cost management as operating and SG&A expenses grew more slowly than revenue. Stepping back for a moment, the story we've been telling you for several years is that of a company extending the runway of its legacy envelope business and using the strong, reliable cash flow to build a growing packaging platform. Packaging grew 19% and now represents 37% of our revenue, up from one-third a year ago. The transition is not a slide in the deck anymore, it's showing up in our results. None of that happens without our people, and I want to thank our teams across each and every one of our facilities. The folks on the plant floor, in sales, and in our support functions, who have executed through a period of real change this quarter, including several acquisitions and plant consolidations. Their hard work is what turns this strategy into performance. Now, let's turn to operations, beginning with packaging, Our growth engine. Packaging delivered another strong quarter. Segment revenue was up 19% year-over-year to $26.4 million. And if you exclude our small non-core commercial print business, the balance of the segment, driven by Folding Carton, actually grew almost 28%. Bold and Carton continues to benefit from share a wallet gains with large multinational consumer packaged goods customers in health and beauty and over-the-counter pharmaceuticals. From new business wins and the contribution from the Transgraphique acquisition we completed last July. We also enjoyed impressive growth in our e-commerce secondary packaging activities with impressive new wins, ongoing expansion within existing U.S. customers and the impressive reactivation of one of our very first large e-commerce packaging wins that has now been brought back to the nest. The headline event of the quarter for packaging was our acquisition of Goldrich Print Pack, which closed on June the 5th. At approximately $30 million in revenue, Goldrich is a sizable first foray into the Greater Toronto Area folding carton market, Canada's largest packaging market. and is a natural extension of the strategy we have been executing. Its manufacturing facility has been well invested in with a skilled workforce and outstanding assets, some of which bring brand new capabilities to Supremex, and it gives us a base in Ontario from which to further pursue acquisition. We acquired it on a cash-free, debt-free basis for approximately $34 million, funded through a new acquisition term loan at our credit facility. We also continue to build scale in label. In the quarter we completed the acquisition of iFlex Labels, a small Saint Laurent manufacturer, and we are consolidating those operations along with our existing Laval label facility into our Lachine folding carton plant. The build out of the Lachine facility is underway now and we expect the consolidation to take place by the end of 2026. Labels are highly synergistic with folding cartons. customers who buy cartons very often buy labels and label customers very often buy cartons and by putting these operations under one roof and machine gives us both cost synergies and a stronger platform to cross-sell. On profitability, packaging delivered an adjusted EBITDA margin of 12.9% holding steady with last year even as we absorbed the acquisition and integration activity and excluding the drag from the commercial print The underlying margin is meaningfully higher. As we capture synergies across the network, we see further upside ahead. Turning to envelope, our cash engine. Revenue was up 3.2% year over year to $45.2 million. Encouragingly, this quarter the growth was driven by both price and volume. Average selling price was up 2% and volume was up 1.1%. That is a noticeable inflection. For several quarters we've been talking about average selling prices, a headwind, and this quarter it turned into a tailwind. The volume gains came from the acquisitions we completed in 2025, Envelope Laurentide and Elite Envelope, along with new customer wins and share of wallet growth in the U.S. market, and a modest rebound as we cycle through the Canada Post labor disruptions, which weighed last year. Just as important as the top line is what happened below it. The envelope operating expense ratio improved to 71.7% of segment revenue from 73.8% a year ago. That improvement reflects the operational efficiencies from the optimization initiatives we launched in January in our U.S. operations. The additional volume flowing through our facilities and the synergies from the Laurentide and Elite acquisitions. The result was envelope adjusted EBITDA of $7 million, or 15.6% of revenue, up from 14.1% last year, 150 basis point improvement. Those optimization initiatives remain ongoing and progressing largely on track and on budget. To give you a sense of the investment behind them, we recorded a $1.6 million of restructuring expense in the first half, most of it in the first quarter related to these U.S. envelope initiatives and the label reorganization I mentioned a moment ago. That is money we are spending deliberately to take cost out and capture synergies, and we expect to keep it contributing to margin expansion as we move through the balance of the year. With that, I turn the call over to Norm for a review of the financials.