Toromont Industries Ltd.

Good morning. Today is Wednesday, April 29th, 2026. Welcome to the Toromont Industries Ltd. first quarter 2026 results conference call. Please be advised that this call is being recorded and all lines have been placed on mute to prevent any background noise. Your host for today will be Mr. John Doolittle, Executive Vice President and Chief Financial Officer. Please go ahead, sir.

Hey, well, thank you, Angeline. Bonjour, everyone. Thank you for joining us today to discuss Toromont's results for the first quarter of 2026. Also on the call with me this morning is Mike McMillan, President and Chief Executive Officer. We're in beautiful Montreal today. Mike and I will be referring to the presentation that is available on our website. To start, I would like to refer our listeners to slide two, which contains our advisory regarding forward-looking information and statements. After our prepared remarks, we would like to We will be more than happy to answer questions, so let's get started and move to slide three. And Mike, over to you. Great.

Thanks, John. Good morning, everyone, and thanks for joining us. Our team performed well in the quarter despite ongoing uncertainty in global trade markets. Both revenue and earnings increased, reflecting good execution across most areas of the business. The equipment group had healthy increases in both new and used equipment sales along with solid activity in rentals and product support. Our AVL enclosure business continues to increase production, supporting data center requirements primarily in the eastern U.S. region. Based upon operating performance and our view of market demand, we continue to consider opportunities to invest in the growth of our power and energy business. As such, effective today, we have increased our percentage ownership of AVL to 80% by advancing the purchase of half of the shares that we did not currently own. It is important to note that these shares were owned by a passive investor and do not impact the ownership or status of Vince DeChristofaro, president of AVL. The purchase price of the shares was $71 million paid in cash and will result in an expense of approximately $45 million to be recorded in the second quarter of 2026. The equipment group's operating income was 52% higher in the first quarter of As the higher revenue and improved gross profit margins were partially offset by the higher expense levels. Simcoe posted higher package revenue, however profitability was lowered mainly due to timing of projects and deferred product support activity. Growth in the package revenue was supported by a strong quarter backlog, operating income decreased largely reflecting the lower gross profit margins and higher expense levels, partially offset by higher revenues. AVL's operational capacity and execution continued to expand in the quarter. Revenues were $129 million versus Q1 of 2025, which was $22.1 million. And the business's full contribution to basic EPS was $0.19 per share versus break-even in Q1 2025. Results in the first quarter of 2026 are net of purchase commitment expenses of approximately $13.9 million, including a dividend that was paid to minority shareholders related to earnings and distributed cash positions for fiscal 2025. Investment in non-cash working capital decreased 4% year-over-year, an effect of lower inventory levels, higher accounts receivable balances, and lower accounts payable balances due to equipment delivery timings. Accounts Receivable Increase largely reflecting the 13% increase in revenue in the quarter, offset by good collection activity. DSO decreased by 3 days to 40 days. Our team continues to do a good job managing receivables aging and customer credit metrics. Inventory levels declined primarily due to executed deliveries against good order backlog from year-end. Inventory management initiatives slightly offset by SINCO's higher work and process levels. Reflecting timing of project construction and product support schedules. We ended the first quarter with ample liquidity, including $1.2 billion in cash and an additional $452 million available under existing credit facilities. Our net debt to total capitalization ratio was negative 12%. Overall, our balance sheet is well positioned to support operations and navigate evolving economic business conditions. As one would expect, we continue to apply operational and financial discipline as we support customer needs and evaluate future investment opportunities. Toramont targets a return on equity of 18% over the business cycle. ROE for the first quarter was 17.3%, slightly below our target, however, improved from 16.9% at year-end 2025 and comparatively lower than 18.5% reported at the end of March 2025. The year-over-year difference reflects higher shareholders' equity, which more than offsets the increase in comparative earnings. Return on capital employed was 24.4%, slightly higher year-over-year, reflecting our increased net earnings. Finally, as announced yesterday, the Board of Directors approved a regular quarterly dividend of $0.56 per share, payable on July 2, 2026, to shareholders of record at the close of business on June 5, 2026. John, back over to you for more detailed commentary on the results.