BuildDirect.Com Technologies Inc.

My name is Bob Chen and I'll be moderating today's call. On the call today are Shawn Wilson, Chief Executive Officer, Kerry Biggs, Chief Financial Officer, and Jay Allen, President, Digital and Commercial. Before we begin, I would like to remind everyone that today's presentation contains forward-looking statements within the meaning of applicable Canadian securities laws, including statements regarding the company's growth strategies, acquisition plans, integration objectives, margin targets, and business outlook. These statements, based on management's current expectations and assumptions, are subject to known and unknown risks and uncertainties that could cause actual results to differ materially. Please refer to advisories on slide 2 of today's presentation and to the risk factors described in the company's continuous disclosure filings available on CDAR+. The company undertakes no obligation to update forward-looking statements except as required by law. If you have any questions during the call, please send them in using the Zoom Q&A function at the bottom of your screen or email them to ir.billedirect.com. We'll address these questions during the Q&A session. A replay of this call will be available approximately 24 hours after the conclusion of this conference call and will be posted on the investor relations section of our website at ir.billedirect.com. With that, I'll turn the call over to BuildDirect CEO, Shawn Wilson. Shawn?

Great, thanks, Bob, and good afternoon, everyone. We appreciate you joining us. The second quarter is a strong quarter for BuildDirect and strong in the way we've been telling the market to measure. We grew, we stayed disciplined, generated cash while doing it. Revenue increased 16% year-over-year to $19.7 million. Gross profit increased 14% to $7.7 million with the gross margin holding at 39.2% despite the mixed shift that comes with the acquisitions. We reported net loss of 0.19 million, just leave it at 0.39, and a positive operating cash flow of 0.45 million. Just as important as the shape of the quarter against the first quarter. Q1 was soft, as we said at the time. In Q2, our revenue increased 34% sequentially, well ahead of the normal seasonal lift, and just leave it a swung from negative 0.34 million to positive 0.39 million. The net loss narrowed from 1.8 to Point2. And that rebound reflects the contribution of the business we acquired and reflects the execution across locations we already owned. All right, I want to be straightforward about the composition of our growth because straightforward is how we want to be measured. Acquired businesses contributed roughly $3.4 million in the second quarter revenue, excluding acquisitions. Same store revenue declined about 4%. Soft demand is real across the deploying industry. We're not going to pretend otherwise. But our answer to the soft market is not hope. It's the two engines that see this quarter, buying great businesses well and running everything we own with increased discipline. Now it's time to call over to Kerry, who will discuss our Q2 and first half 2026 financial results.

Great, thank you, Shawn, and good afternoon to everyone on the call. Starting with the consolidated second quarter of 26, revenue was $19.7 million, up $16.6 million from $16.9 million in Q2 of 2025. Gross profit was $7.7 million, up 14.7% from prior year, and gross margin was down slightly, 70 basis points to 39.2%. Decline reflects acquisition mix rather than pricing erosion. Both segments maintained pricing discipline overall. Adjusted EBITDA was 0.39 million compared to 0.6 million a year ago for the same quarter, reflecting business and sales mix and softer legacy business demand. I would note the $1.08 million bargain purchase gain on TOA as a non-cash item which you'll see in our P&L and excluded from adjusted EBITDA along with restructuring and other items detailed in the reconciliation in our MD&A for EBITDA. Operating cash flow was positive $0.45 million for the quarter through two integrations and cash at June 30th was $4.1 million. So just talking First half of 26, overall revenue was $34.3 million, up 7.2% from $31.9 million in the first half of 25. Gross profit was $13.6 million for the first half of 26 at a 39.6% gross margin. adjusted EBITDA for the first half was 0.06 million, mainly driven by the soft first quarter, which Shawn noted, which had a negative adjusted EBITDA of 0.34 million, but again, recovered positive for Q2. Onto the segment. Segment level by segment for Q2 2026 e-commerce revenue grew was that actually four point five million for the quarter, up twenty two point eight percent year over year, driven by the grain acquisition, which closed in February, excluding grain e-commerce revenue declined approximately 12 percent on the same store basis, reflecting softer demand and lower quality inbound lead flow during the quarter. Gross margin remained very strong, 48.3%, our highest margin segment, while adjusted EBITDA was flat in the quarter versus a positive 0.03 for the overall first half. Moving on to the next slide, for the Pro Centers, Q2 2026, Pro Center revenue was $15.2 million, up 14.9%, representing 77% of consolidated revenue overall for the business. If we exclude Tile of America, TOA, same store, Pro Center revenue declined roughly 2%, primarily reflecting softness in our Michigan locations. Pro Center gross margin was 36.5% for the quarter, and segment adjusted EBITDA grew to $1.55 million in the second quarter and $2.17 million overall for the first half, as noted earlier. Finally, on the balance sheet and liquidity side, cash ended the quarter $4.1 million, down from $8.2 million at year end, primarily reflecting the deliberate deployment of capital into the TOA acquisition and related working capital. Again, partially offset by positive operating cash flow. Total acquisition cash outlays for the first half of the year were approximately $4.5 million across the two transactions that we've noted. Our revolving credit facility was drawn to $4.8 million at quarter-end compared to $3.6 million at year-end, reflecting acquisition-related working capital as well as the timing of certain quarter-end working capital payments. And finally, total assets increased $9 million to $47.2 million, largely reflecting the acquired businesses and associated working capital that came along with them. Our focus in the second half is working capital optimization across our inventory and payables, disciplined capital deployment, and maintaining appropriate liquidity to support the ongoing needs of the business. So appreciate the time. With that, I'll hand it back over to Shawn.