Toromont Industries Ltd.

Good morning. Today is Wednesday, July 29, 2026. Welcome to the Tournament Industries Ltd. Second Quarter 2026 Results Conference Call. Please be advised that the call is being recorded and all lines have been played 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.

Very good. Thank you, Angeline. Good morning, everyone. Thank you for joining us today to discuss Harmont's results for the second quarter of 2026. Also on the call with me this morning is Mike McMillan, President and Chief Executive Officer. Mike and I will be referring to the presentation that is available on our website. To start, I'd like to refer our listeners to slide two, which contain our advisory regarding forward-looking statements and specified financial metrics. After our prepared remarks,

We are pleased with our second quarter and first half performance. Revenue and earnings increased, reflecting solid execution across the business. The equipment group delivered growth in new and used equipment sales, enclosures, rentals, and product support. The equipment group's operating income was 47% higher in the second quarter as the higher revenue and improved gross profit margins were partially offset by higher expense levels. AVL continued to expand production. During the quarter, we increased our ownership in AVL to 80% and acquired land in Canada to support future manufacturing growth. PIMCO's results were slightly lower in the quarter. Operating income decreased, largely reflecting the lower package revenue due to project timing, lower gross profit margins, and higher expense levels and investments for future growth. Let's turn to slide four for some other financial highlights. Investment in the non-cash working capital was comparable year over year. A net effect of higher inventory levels, higher accounts receivable balances, and lower accounts payable balances due to equipment delivery timing. We ended the first half of the year with ample liquidity, including $1.2 billion in cash and an additional $449 million available under our existing credit facilities. Our net debt to total capitalization ratio was negative 13%. Overall, our balance sheet is well positioned to support operations and navigate evolving economic and business conditions. As one would expect, we'll continue to apply operational and financial discipline as we support customer needs and evaluate future investment opportunities. Farmont targets a return on equity of 18% over the business cycle. ROE for the second quarter was 17% all in, slightly below our target, however improved from 16.9% at year end 2025 and comparatively lower than 17.6 reported at the end of June 2025. The year-over-year difference reflects higher shareholders' equity, which more than offset increased comparative earnings. We would also note that ROE was dampened by approximately 1.5% by the expenses as disclosed associated with the accelerated purchase of certain shares of AVL in the quarter. This increased our ownership to 80%, a decision that was made based on long-term expected returns. Return on capital employed was 24.8%, 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 October 2, 2026. John, I'll turn it back over to you for more detailed commentary on the results.