Northstar Clean Technologies Inc.

Okay, good morning, everyone, and thank you for joining us for North Star Technology's second quarter 2026 results webcast. I'm Josh from Kim Communications, and I'll be hosting today's call. Joining me today are Aidan Mills, North Star's president and CEO, and Lynda Paananen, North Star's CFO. During today's call, management will review North Star's second quarter results, provide an update on operations in the power category, and discuss the company's priorities for the balance of 2026. This will be followed by an audience Q&A period. Attendees can ask a question at any time by using the Q&A button at the bottom of their screen. A recording of today's event will be available shortly after the conclusion of this call. Before we begin, I'd like to remind everybody that today's discussion may include forward-looking information and statements that are subject to risks and uncertainties. Actual results may differ materially from those expressed or implied, please refer to the company's public disclosure filings for a more complete discussion of these risks and other practice. With that, I'll turn it over to Aidan.

Thanks, Josh, and thanks for the intro. and all great to be on and welcome to the call. So today's call is all about Calgary. As you've seen from the PR which has just been released, as we talked about in the last couple of quarters, the focus for 2026 for Northstar is to deliver an operating facility in Calgary and today that's exactly what we're going to talk about. So we're going to cover four things. We're going to talk about the Q2 financials and Lynda, who's here in the office with me, will talk about that. The 10,000 foot summary with respect to that is it's pretty much the same as Q1 with one huge difference and that is that we have first product sales revenue. Secondly, we'll talk about the Calgary operation to show the huge progress that we've made there. As you've seen from the PR, we've hit the operational targets as set up by ERA for Milestone 4. We produced a record of over 160 tonnes a day at the facility and we've had consistent production through June and July. The third thing I'll talk about is the path forward for Calgary, the maintenance that we did in August and the path forward over the next couple of months. and then lastly I will do a quick update on the patent PR that we issued last week. We haven't really talked about technology development or patents for a long time so I wanted to give you guys an update on that. So as Josh mentioned, forward-looking statements as always and then we've now got the Q2 financials and I will hand over to Lynda to take us through those.

Okay, thanks Aidan. Second quarter financial results continue to reflect Northstar's transition from commissioning and ramp-up towards commercial operations at Empower Calgary. Starting with revenue, so the first chart on the top left-hand side, total revenue was approximately $209,000 in the quarter, relatively consistent with the first quarter. Importantly, Q2 included approximately $35,000 of product revenue, and this is revenue from asphalt sales, representing the first product revenue under agreement with McCashvolts. Tipping fee revenue remained the primary component of revenue during the quarter. And as production volumes increase, we expect product sales or asphalt sales to become a more meaningful component of the company's revenue mix alongside tipping fees. Gross profit was approximately 54,000 in the second quarter compared with approximately 84,000 The decrease primarily reflects lower tipping fee revenue, which is higher margin, together with the introduction of cost of sales associated with our product revenue that we disclosed. During the current stage of the Calgary facility ramp-up, a significant portion of facility operating expenditures continue to be recorded as what we call pre-commercial operating costs rather than cost of sales. As the facility progresses towards commercial production, the composition of both revenue and cost of sales will continue to evolve. Turning to the bottom line, comprehensive loss, the company recorded approximately $3 million loss during the quarter. The reported results include both cash and non-cash items. In particular, the company recorded a non-cash fair value gain of approximately $2 million related to the derivative liability associated with U.S. dollar-denominated convertible debenture. That's a mouthful. Because this liability is remeasured each period, changes in its fair value may result in meaningful period-over-period volatility in reported earnings. Lastly, Northstar ended the second quarter with approximately $6.2 million in cash and cash equivalents. and this compares with approximately $12.7 million at the end of Q1. The approximately $6.5 million decrease in cash during the quarter reflects several factors, including a meaningful normalization of working capital following the March financing. Approximately $3.5 million was used to reduce accounts payable that had accumulated through the preceding quarters. Cash was also used to support operations at Empower Calgary as well as ongoing corporate costs. $800,000 of capital expenditures and approximately $1.3 million of interest and debt-related payments during the quarter. It's important to note that interest related to convertible ventures is heavily weighted to the second and the fourth quarters. So cash used for financing activities will obviously be hiring those two quarters. These uses of cash will partially offset by $1.4 million received on the second tranche of the U.S. convertible to venture financing and $800,000 of the warrant exercise proceeds that were received in the quarter. It's important to note that Q2 included a greater than normal working capital outflow as the company reduced outstanding payables following the financing completed late in the first quarter, and so the cash usage in Q2 was not representative of a typical quarter. As Empower continues through its ramp-up, the company expects to continue allocating capital towards facility operations, reliability improvements, and corporate requirements as it works towards sustained commercial production. Financial results therefore continue to reflect the business in transition. We are beginning to see product revenue enter the income statement while the near-term financial profile continues to reflect the investment required to bring Empower Calgary to sustained operating levels. I'll turn it back to Aidan to discuss the operating progress.