Atlas Engineered Products Ltd.

Good morning, everyone. Welcome and thank you for joining Atlas Engineered Products Q1 2026 earnings call. I'm Jake Boma, an IR consultant for AAP. Today on the line discussing AAP's Q1 2026 financial results and company highlights are the company's president, CEO, and founder, Hadi Abassi, and CFO, Melissa McRae. Following their remarks, we'll 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 CR when reviewing this information. Also, all amounts discussed will be in Canadian dollars unless otherwise noted. Hattie, please proceed with your remarks.

Thank you, Jake, and good morning, everyone, and thank you for joining us. The first quarter of 2026 presented a challenging operating environment, driven by different difficult market conditions in Ontario and British Columbia, as well as more severe winter weather across much of Canada compared to recent years. However, our team worked very hard through this condition While continuing to prepare for a stronger remainder of the year, we made important progress on our first automation facility, advance our sales and design capabilities, and continue to build all the book. While near-term conditions remain competitive, we believe our scale across the country, automation strategy, and growing national footprint positions as well to be market share as construction activity increases. We are continuing to report high coating volumes from the beginning of 2025. In our year-end call, we reported that the first quarter of 2026, coats exceeded $18 million. Coating has exceeded $109 million up to end of April 2026, compared to $93.4 million up to the end of April of 2025. This sustained activity is translating into a stronger order volume, with orders totaling $29 million up to the end of April 2026, up from $16 million in the same period last year. While these stronger order trends did not fully translate into the first quarter revenue due to weather-related shipping disruptions, We believe AEP's aggressiveness to increase market share despite market condition remaining similar to the prior year. A major milestone for AEP is the near completion of our first robotic thrust manufacturing facility in Clinton, Ontario. Construction of the building is expected to be completed during the second fiscal quarter. The robotic equipment already shipped, and the first shipment has arrived in Canada. Operations are still anticipated to begin in early July 2026. This automation initiative represents an important step in our long-term strategy to improve efficiency, increase capacity, enhance margin, and strengthen our competitive position. A major milestone for AP is the near composition.

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