Atlas Engineered Products Ltd.

Go ahead. Good morning, everyone. Thank you. Welcome and thank you for joining Atlas Engineering Products Q4 and full year 2025 earnings call. I am Jake Boma, an IR consultant for ADP. Today on the line discussing ADP's Q4 and full year 2025 financial results and company highlights are the company's president, CEO, and founder, Hattie Abbasi, and CFO, Melissa McRae. Following their remarks, we will open up the call for an analyst Q&A session. Before handing over the call to Hattie, please note that information we present today could contain forward-looking information that is based on management's expectations, estimates, and projections. Please consider the risk factors, including those in the filings made by AAP on CDAR when reviewing this information. Also, all amounts discussed will be in Canadian dollars unless otherwise noted. Hattie, please proceed with your remarks.

Thank you, Jay. Hello, everyone, and welcome to AVP's earning call to discuss our fourth quarter and full year of 2025 performance. We are excited to be with you, and thank you for your time, and thank you for joining us. I'm proud of the team as we delivered top-line growth in 2025 despite the top market condition, especially in both Ontario and British Columbia. driven partially by a lack of affordability and people not being certain about their future because of all the political stuff going on in the last few years, and lack of home sales. A revenue increase of 12% for the year and 17% in the fourth quarter, driven by both acquisitions and continued organic growth momentum across all product lines. was no easy accomplishment with the current economies of these two provinces. Additionally, across Canada, we faced varying political factors at home and from other countries and changing tariff announcements heavily impacting key markets in Ontario with the steel and auto and British Columbia with the forestry and construction. Despite these factors, we were able to increase our revenues and market share while fighting it out in the market to ensure our success. One of our original goals when the first one public was to have a national footprint across Canada to ensure a geographic and economic diversity which is providing, proving a successful strategy in light of the current market across Canada. The acquisition this year of Trustworthy and PENTRUST have expanded our national footprint, and we are focused on integrating our newest operations. strengthening our sales capabilities, and leveraging automation and scale to improve efficiency and capture additional market shares in a competitive environment. AP is also nearing completion of the first robotic trust manufacturing facility in Canada in Clinton, Ontario. The buildings in its final stages of interior painting and officer of water equipment has been shipped. and is anticipated to be operational at the beginning of July 2026. There were a slight delays of two to three weeks due to the shipping process from impacts of the war. Additionally, impact of the war in Iran. Additionally, we continue adding and strengthening of sales and design force and getting ready for the future, expanding into a different market areas in wall panels, floor panels, and floor cases and trusses. We have seen high coating volume since early 2025 with over 80 million coats in Q1, 2026. Because of coating activity has been significantly higher, all the volumes have also been increasing, reaching over $21 million in Q1. more than $11 million in the same period of 2025. However, shipping during this period was challenging and lower, as much of Canada experienced more severe winter weather compared to prior years. We continue to drive organic growth by expanding our wall panel manufacturing and being able to supply customers with a full package of roof and floor trusses and wall panels and engineer wood products as needed for their projects. This organic growth will increase revenue per order and help mitigate potential recession impacts. While microeconomic factors remain outside of control, we aim to gain market share through a scale, agility, and a strong balance sheet. On the M&A front, we are actively evaluating opportunities across Canada in the cross and wall panel industries with industry conditions stabilizing post-pandemic we see a strong pipeline of deals providing an opportunity for significant value creation for shareholders over the medium to long term. I would like now to introduce Melissa McCrae, CFO of AP, to provide commentary on our financial performance and position 224 and the full year 2025.

Thank you, Hadi. Results for our quarter four, the three-month ending December 31st, 2025, include revenues of $17.6 million, gross profits of just under $3.6 million, and normalized EBITDA of just under $2.4 million. Results for the full year ending December 31st, 2025, include revenues of $62.6 million, gross profits of just under $12.2 million, and normalized EBITDA of just under $7.4 million. Overall, revenue has increased due to acquisitive growth and organic growth related to the walls from the beginning of the year and an increase in roof and floor trusses this year. The company has continued to see an increase in manufacturing metrics, but due to the competitive market, sale prices are still lower than in the same period in 2024, resulting in reduced profits. The company has been working hard to gain market share and keep staff busy, even in the competitive market, which means sacrificing margins of profits at this time in order to be better prepared for the turnaround in the market when it comes. This hard work has shown in our fourth quarter and year-end results as we continue to work hard into 2026. Just a heads up that normalized EBITDA for the year does include adjustments to one-time costs for legal and consulting fees related to the new automation facility in Clinton, acquisition projects throughout that 2025 year, and credit facility update. No adjustment has been made for some other costs associated for future automation, which would be ongoing moving forward, but incurred now for the future expansion and organic growth. These costs include expansion of the sales and management teams. Additionally, there are no adjustments for management labor costs related to the two acquisitions completed in Q2 and Q3. After the acquisitions, continued deposits on automation equipment, and a significant portion of the construction of the new facility complete. The company still has cash at the end of the fourth quarter of $2.4 million, with access to enough capital through the line of credit facility, and the $4 million federal grant recently announced to finish out the Clinton facility project and scale up with the increased capacity. We were excited to announce that grant finally, which With almost a couple years of hard work to apply, I moved through all the phases of the grant process until we were finally selected for the grant. Having this financial support to increase our manufacturing capacity, minimize lumber waste, enhance precision, and improve overall operational efficiency in the manufacturing of roof testers is fantastic, and we are very grateful to have received it. I'd now like to open up the call for questions. Operator, please provide the appropriate instructions.