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Operator: Thank you, and thanks, everyone, for joining us today for Namib Minerals 2025 Earnings Call. Joining me is Tulani Sikwila, Chief Executive and Chief Financial Officer of Namib Minerals. Please note that we will be making forward-looking statements based on current expectations and assumptions, which are subject to risks and uncertainties. These statements reflect our views only as of today and should not be relied upon as representative of views of any subsequent date. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations. A discussion of these factors can be found in our SEC filings, including our Form 20-F filed on April 2, 2026, and the risk factors and forward-looking statements in our public communications. We do not undertake any duty to update forward-looking statements. Today's remarks also reference non-IFRS measurements such as adjusted EBITDA and all-in sustaining cost per ounce. These measures are intended to supplement, not substitute IFRS results. Definitions and reconciliations are available in our filings with the SEC, including our Form 20-F. Additionally, mineral resource and reserve estimates are subject to uncertainty and may not convert to reserves or mined gold. Investors should not assume that any resources will be economically or legally minable. Please refer to our public disclosures for complete definitions and cautionary language in accordance with SEC Regulation S-K 1300. With that, let me turn the call over to Tulani. Tulani Sikwila: Thank you, and good day, everyone. Thank you for joining us for Namib Minerals Full Year 2025 Results Call. I will give an overview of our progress over the year as well as some recent developments before going into detail on the financials. 2025 was a year of disciplined progress for Namib Minerals as we continue to execute against our strategy of building a scalable capital-efficient African gold production platform. At a high level, our focus remains unchanged, optimize operations, increase production capacity and expand our resource base in a disciplined manner. During 2025, we made meaningful advances across our operations. At How Mine, the decrease in production was offset by a high gold price. Regarding the 2025 guidance management delivered on production within range and exceeded on group all-in sustaining costs and EBITDA. For the full year, the company produced approximately 25,000 ounces of gold, generated revenue of $82.6 million, reported adjusted EBITDA of $29 million, net earnings of $101 million after taking account $164.5 million change in fair value of earnout liabilities and warrants. Offset by $65.4 million non-recurring listing expenses, resulting in an operating cash flow of $13.5 million before investing activities. Resource expansion represents a critical value creation lever for the company, and we achieved substantial resource growth at How Mine over the course of the year as exploration revealed greater viable deposits in the ore body. At the same time for gold prices lowered the cutoff grades. Both factors strengthened our long-term outlook of the asset and reinforced our confidence in its continued contribution to the business. Cost management remains critical across all our operations, and we successfully maintained operating costs within both budget and prior year ranges. Our mine costs and all-in sustaining costs were below guidance, reflecting continued cost discipline across the operation. Our priority at How Mine remains operational optimization and incremental improvement as well as disciplined approach to cost management. We are focused on increasing throughput, improving equipment availability, maintaining recovery rates and stabilizing the grade. We have put in place several initiatives to improve grade consistency, including tighter grade control, improved mine planning and stronger operating discipline underground that will support more predictable production and costs performance over time. We are also continuing to advance the planned 36% increase in ore milling capacity from 40,500 to 55,000 tonnes per month. The project is progressing well with key equipment procurement and installation underway. It remains on track for commissioning in the second half of 2026. This expansion is an important step in improving the long-term productive capacity of How Mine and supporting lower unit costs through greater operating leverage. Based on our current mine plan and operating expectations, we are guiding to production of 28,000 to 31,500 ounces with an all-in sustaining cost of between $2,400 and $2,700 per ounce and an adjusted EBITDA of between $50 million to $62 million. This guidance is based on a gold price of $4,500 per ounce. Turning to Redwing. This mine remains an important strategic growth project. As previously announced, dewatering activities officially commenced on 29 January, 2026, and I'm pleased to say that progress to date is meeting expectations with a significant volume of water expected to be removed over an approximate 8-month dewatering period with the dewatering process expected to be completed by late 2026. We recognize there has been some investor focus on timing and sequencing, and we want to be clear about the structured approach to development. Dewatering is only the first step. There are 3 phases to the project. First, we complete the dewatering process. Second, and concurrently, we undertake exploration and a definitive feasibility study based on actual underground access, condition assessments and engineering work. Third, we move into the mine development and build-out phase required to support long-term production. So to be clear, we're not planning to dewater the mine and then move immediately into small-scale or early-stage mining. Our objective is to develop a larger sustainable mining operation at Redwing, and that requires a disciplined and technically robust approach. We believe this is the right way to maximize long-term value, reduce execution risk and build an operation with a stronger production and lower cost profile over time. It is important to frame our capital requirements correctly. The current estimated capital requirement for Redwing and Mazowe is approximately between $300 million to $400 million, but that capital is not required all at once in one funding arrangement. It is expected to be phased over life of the development program into various tranches and aligned to key project milestones. Our capital allocation philosophy is straightforward and disciplined. We will prioritize optimizing existing production at How Mine whilst improving the grade, funding high-return growth initiatives and maintaining balance sheet flexibility. We are very aware of the importance of protecting shareholder value and remain disciplined in our approach to capital allocation, including careful consideration of any equity issuance. Accordingly, we are focused on pursuing non-dilutive or minimum dilutive funding solutions wherever possible. In that regard, we have engaged with strategic capital providers, namely development finance institutions as part of a broader process to evaluate and raise the required funding in a phased and systematic manner. Our objective is to finance the Redwing and Mazowe restarts responsibly in a way that aligns capital deployment, lowers risks and preserves as much shareholder value as possible. We have recently strengthened our leadership platform of the company. In March, I assumed the role of Chief Executive Officer following Ibrahima Tall's decision to step down. We are grateful to Ibrahima for his leadership and contributions during an important period of the company's development. This transition provides continuity in strategy and execution while positioning us for further expansion. We also appointed Antonio Nieto as Vice President of Technical Services, which adds further operational and technical depth to support our brownfield restart projects and exploration initiatives. In addition, search processes for a Chief Financial Officer and a Chief Operating Officer are underway. As we continue to strengthen the leadership team, our focus is on ensuring that Namib has the operational, technical and governance capability required to execute the next phase of growth. While short-term share price performance can be influenced by a range of market factors, including trading liquidity and broader market dynamics, our focus remains firmly on executing our strategy. That means delivering operational progress, allocating capital responsibly and advancing the milestones that underpin the long-term value of this business. As we continue to execute across our How and Redwing mines, we believe the underlying value of Namib Minerals will become increasingly visible to the market. In addition to the headline numbers above, I want to discuss the financial results in more detail. I will cover 5 areas. Revenue and production, cost performance and margins, cash flow and the balance sheet. I will then close with our 2026 outlook. Let me start with the tailwind that defined 2025. The average realized gold price of $3,156 per ounce, up 44% from $2,185 per ounce in 2024. This meant the group came in at $82.6 million, broadly in line with 2024's $85.9 million despite a reduction in production volumes. So the gold price effectively absorbed the volume shortfall and the operating leverage becomes considerably more powerful as production recovers. On production, gold output at How Mine was 25,000 ounces with 24,860 ounces sold. This was below 2024's 36,743 ounces produced. This reduction reflects transition between ore bodies as we advance underground development. Mill throughput was flat at 476,000 tonnes and recovery held at 89%. The plant performed well with a head grade average of 1.9 grams per tonne. On costs, production costs were $37 million, down 4% from $38.7 million in the prior year. In absolute dollar terms, we spent less to run the mine -- that reflects disciplined headcount management, controlled mine input consumption and optimized power costs. On a per ounce basis, cash costs rose approximately $1,653 per ounce from $1,150 per ounce. As with other mining companies, our cost base is largely fixed. So fewer ounces across the same fixed base mechanically increase the per unit cost. That is not a cost problem. It's a volume problem. And volume is exactly what our development investment will address at 28,000 ounces to 31,500 ounces, our 2026 target, this same cost base delivers cash costs closer to $1,400 and $1,650 per ounce. For 2025, gross profit was $34.2 million, which translated to a gross margin of 41.4%, maintaining a margin above 40% through reduced production levels speaks to the underlying quality of How Mine and the strength of the current gold price environment. I now want to address 3 large noncash items in our reported profit and loss. None of these affect cash, and I'll take them in turn. First, the earn-out liability. Under our business combination agreement, founding shareholders are entitled to receive additional ordinary shares upon achieving certain operational milestones relating to feasibility studies and commercial production at Mazowe, Redwing and DRC exploration projects. At closing in June 2025, we recognized this earn-out at a fair value of $168.7 million. By the 31st of December 2025, the fair value had declined to $9.9 million, resulting in a gain of $158.8 million in profit and loss. The reduction results from the decline in the share price used to calculate the fair value. Full disclosure on related assumptions can be found in the notes to our audited financial statements, which has been filed. Second, the warrant liability. The public and private warrants assumed through the transaction were classified as derivative liabilities and marked to market at each reporting period. The $5.7 million gain reflects the decline in our warrant price over the period. Third, the listing expense. Because Hennessy Capital VI did not meet the definition of a business under IFRS 3, the transaction was accounted for as a share-based payment, effectively the cost of obtaining a public listing. The $65.4 million listing expense was noncash and will not recur. Stripping out these 3 noncash items and adding back depreciation, amortization, net finance costs and the $10.2 million in nonrecurring transaction expense related to the listing, 2025 adjusted EBITDA came in at $29 million, up 18% from $24.5 million in the prior year. So despite a drop in production, adjusted EBITDA grew, and this is a metric we believe best reflects the underlying cash generating capacity of this business. Cash flow generated from operations was $13.8 million after payment of $11.2 million for interest and tax. That is a strong result given the production headwinds, and it demonstrates the cash generating capacity of How Mine even at low production levels. On investing, total outflows were $12.4 million, up from $10.1 million. This was primarily $11.3 million in property, plant and equipment investments at How Mine, shaft deepening development drives and equipment replacement. This represents what we view as peak capital intensity at How Mine. As these programs complete through 2026, we expect sustaining capital expenditure to normalize to $5 million to $6 million per annum, which has recovered production levels and assuming all else is equal, should generate additional free cash flow. Turning to the balance sheet. I want to highlight 3 points. First, total assets were $62.8 million, up from $51 million, primarily driven by the deployment of development capital into PPE. Then second, net debt was $3.3 million, a very manageable level relative to our cash generation. And we believe our PPE carrying value of $41 million understates the true replacement cost of a full operational underground mine. The shareholders' deficit of $39.3 million is largely influenced by the SPAC transaction mechanics, specifically the earnout liability recognition at closing. We do not believe this reflects the intrinsic value of our mining assets. Let me close this section with our expectations for 2026 because I want to be specific about why we believe this year represents a step change in performance. First, production growth. As discussed earlier, we are expanding our ore milling capacity at How Mine and targeting production approaching 28,000 to 31,500 ounces. That target, combined with strong current gold price translates to material revenue and margin uplift. Second, unit cost normalization. At 28,000 to 31,500 ounces, our current cost base C1 costs move back towards $1,400 per ounce to $1,650 per ounce. And as sustaining capital expenditure normalizes, we see a clear path to all-in sustaining cost of $2,400 an ounce to $2,700 an ounce. Third, Mazowe and Redwing. We have engaged WSP Global to conduct an SEC S-K 1300 compliant definitive feasibility study at both Mazowe and Redwing. With results expected within 12 to 18 months. At Redwing specifically, an 8-month dewatering program commenced in January 2026, the critical first step towards restarting underground mining. On funding, the total expansion program across all assets is estimated at $300 million to $400 million. Our strategy is to pursue nondilutive or minimal dilutive funding solutions wherever possible as well as utilize internally generated cash. In summary, 2025 was a year of disciplined progress and investment. We made the right capital decisions to deliver against our core operating objectives at How Mine. We advanced the next restart phase at Redwing. We managed costs well, and we delivered adjusted EBITDA growth despite production headwinds. The gold price environment validates the asset quality and the development work completed in 2025 sets up what we believe will be a materially stronger 2026. Looking ahead, our priorities are clear: continue stabilizing and optimizing How Mine, advance Redwing through dewatering and into feasibility stage, allocate capital with discipline and position Namib Minerals for sustainable long-term growth. We remain confident in the strategic direction of the company and in the value creation potential of our asset base. I'll now turn to questions that have been submitted by investors. Operator: Our first investor question is as follows. How is the current conflict in the Middle East impacting the business? Tulani Sikwila: It's something we are watching closely. And I think anyone in the gold space would be paying attention right now. What the conflict has really illustrated is just how sensitive the gold price can be to the day's headlines. We've seen that volatility play out in real time. But honestly, that's not new to us. And it doesn't change our view that gold will sustain levels over the long term that keep our operations firmly in profitable territory. On the cost side, the main concern people usually raise is fuel, specifically diesel. And I want to be straightforward on this. It's actually a relatively modest part of our overall cost base. So while we are not dismissing the situation, we don't see any material impact on the business from where we stand today. Operator: Our next question is, is dewatering at Redwing progressing as expected? When do you anticipate the process being completed? Tulani Sikwila: I'm pleased to say that it is going well. Progress has tracked closely with our planned time line. To give you a sense of where we are at the moment, we've pumped roughly 145,000 cubic meters of water, which has brought the water level down to about 7.8 meters. This is a meaningful milestone. And based on everything we are seeing from data that we've gathered, we feel confident we are on track to hit our targets for this phase. I don't want to get ahead of ourselves, but the trajectory is encouraging. Operator: Our next question is, do you have any update on funding for your expansion program, particularly for the Redwing Mine? Tulani Sikwila: I appreciate the question because I know it's front of mind for all investors. What I can tell you is that we are actively working through our financing options, and we're having the right conversations. The thing I want to emphasize though is we are approaching this with real discipline. Our priority is protecting the shareholder value while securing the capital we need, and we won't rush into something that doesn't meet that bar. I don't have anything specific to announce today, but we do expect to be in a position to update investors soon. And we'll communicate as soon as we are able to. Operator: Our next question is, can you provide an update on your plans in the DRC? Is the interest in 13 exploration assets previously mentioned still active? Tulani Sikwila: To be transparent about it, we made a deliberate decision to let those licenses lapse. After a thorough look at each of those properties, we concluded that pursuing exploration there wasn't the best use of our capital or the team's bandwidth at this stage. That's the kind of distinct call we think we have to be willing to make. That decision itself does not reflect our view of the DRC as a whole. We still see it as a genuinely compelling long-term opportunity for Namib, and we are staying engaged in identifying assets that are the right fit for us strategically from a capital allocation standpoint. Operator: And our next and final question is now that you are back in compliance with the minimum market value requirement for publicly held shares, what are you doing on the Investor Relations front to make sure the stock maintains sufficient liquidity and stays comfortably above the minimum threshold going forward? Tulani Sikwila: We are obviously relieved to have that behind us and are focused squarely on keeping it that way. But to be honest, the most sustainable way to address this isn't through any single IR initiative. It's by executing our business plan, optimizing production at How Mine, advancing Redwing in a capital-efficient way and maintaining the financial discipline. That's what drives a broader investor base and ultimately, a valuation that reflects what we believe this company is worth. That said, we do have an active Investor Relations program running in parallel, focused on increasing our visibility and making sure more investors understand our equity story. Both things matter to us, but the fundamentals come first. Operator: Thank you, Tulani, and thank you to everyone for joining us. That concludes today's call.
Operator: Ladies and gentlemen, welcome to the emeis conference call regarding its full year 2025 results. It will be structured in 2 parts. First, a presentation by emeis management team represented by Mr. Laurent Guillot, Group CEO; and Mr. Jean-Marc Boursier, Group CFO. Afterwards, there will be a Q&A session during which you can ask oral or written questions. I will now hand over to the management team. Gentlemen, please go ahead. Laurent Guillot: Well, thank you, and good morning to everyone, and thank you once again for attending this webcast for our full year earning '25. Before answering to your question with our Deputy CEO and CFO, Jean-Marc Boursier, we will share with you a few thoughts regarding this year 2025 and 2026. I will begin my presentation by reviewing some of the group's key characteristics, which many of you already are familiar with. First, I would like to highlight the geographic diversification of our operation, which includes France, Northern Europe, Germany and Netherlands, Central Europe, Austria, Switzerland and Southern Europe, Spain and Italy. Next, our business diversification with 2/3 of our revenues generated by nursing homes and the remainder by post-acute care clinics and psychiatric clinics. And finally, our shareholder structure, which is built for the long term around solid and reputable [ anchor ] shareholders. It is also important to note that our group also distinguishes itself through its significant real estate portfolio, which is worth EUR 5.6 billion by the end of '25. 44% of the beds we operate are owned by the group, a figure that, to my knowledge, is unmatched among groups of comparable size. And our portfolio is also geographically of real estate is well distributed in Europe. As we previously reported in mid-February, 2025 was a particularly strong year. In '25, the company delivered strong performance with revenue growth by over 6% on a like-for-like basis and occupancy improving by nearly 2 points. Profitability also increased significantly with EBITDA margin up by 19.2%, reflecting sustainable positive momentum. Cash flow generation improved sharply with net operating cash flow rising from EUR 15 million in '24 to EUR 190 million, highlighting a strong operational recovery. Free cash flow reached EUR 347 million, driven in part by substantial asset disposals. Since '22 -- mid-'22, total disposals have reached now EUR 2.35 million (sic) [ EUR 2.35 billion ], exceeding by far initial targets. However, the one that are following us the most closely, this figure is slightly lower than previously reported due to the decision not to proceed with the sale of Swiss nursing homes operations following an internal strategic reassessment. The company also strengthened its financial position by refinancing its entire bank debt by EUR 3.15 billion in new financing, improving visibility and stability. Consequently, the leverage ratio dropped significantly to below 10x compared to 19.5x the previous year. Looking ahead, the company is confident about its growth prospect starting in '26, expecting average annual growth of at least 15% between '24 and '26, including over 10% growth in '26. Medium-term guidance for '24, '28 is reaffirmed. Our operational performance is driven by improvement in our CSR KPI. In '25, we continue to enhance all our quality and satisfaction metrics, reaching levels that now place us among the industry leaders. Regarding human resources metrics, please note that employee turnover while still high, has once again declined significantly this year. We warmly welcome this since this is a key support for quality in our facility and thus occupancy. Also, a new indicator has been launched this year, the engagement rate of our employees starting at a relatively high level of 62%, well over global market average. On the climate front, energy consumption has also fallen by nearly 9% year-over-year, which is also a positive for our energy bill. In '25, indicators relating to the satisfaction of our patients, residents and their relatives have improved significantly once again. The resident satisfaction measured in '25 in the French facilities now stands at 93.4%, up 50 basis points compared to '24 and more than 3 points above the comparable level in '22. Same message when considering the Net Promoter Score, which also measures the satisfaction and loyalty of residents, patients and their beloved ones. It has also risen sharply now reaching the score of 41 in '25, up 4 points from '24 and 23 points from '22. This significant improvement illustrates the successful measures taken in recent years to restore the confidence in the group. As you already know, in France, our facilities are rated by Haute Autorité de Santé, the French National Authority for Health in the same way as all other facilities in the sector. These ratings are divided into 4 groups based on quality assessments. 99% of emeis facilities are on the top 2 categories. It is significantly higher than the sector average and even higher than the private sector as a whole. It is a mark of distinction and illustrates emeis leadership in this area. We are also pleased to see that the improvement in all these metrics is reflected positively through extra financial ratings. Emeis is now ranked above the industry average on nearly all metrics and is even among the best-in-class according to S&P and Sustainalytics rating, but there is still more to come. In our view, the steady process -- progress you see in this chart is not over and should continue in the years ahead. The steady improvement in our extra financial performance in terms of quality of care, patient satisfaction, resident satisfaction and human resources continue to translate into an annual increase of our occupancy rate. In '25, this rate rose by nearly 2 points across our nursing homes. And since '21, we have seen an improvement of nearly 7.6 points and it's not over. Mechanically, this growth translates into the revenues that is largely translated into operating margins. Thanks to the work done on quality and capturing a favorable price effect on accommodation and on segmenting our offering, we have been able to boost our revenue growth. By controlling operating expenses, adapting methods and tools and focusing management efforts on turning around underperforming facilities, we continue to optimize our operating performance. Our revenue growth in '26 was 6.1% like-for-like or nearly 15% over 2 years. And at the same time, our EBITDA margin increased far quicker by 58% like-for-like in 1 year and even 90% in 2 years. And you can trust our midterm target, it's not over yet. There is much more to come ahead, as I already said. As we already told you mid-February, we have exceeded our initial guidance for '25 with like-for-like EBITDA growth of 19%. We are EUR 10 million to EUR 30 million above our initial target. And as already said, it's not over. We are happy to share with you the fact that these encouraging achievements lead our figures to grow comfortably in line with our ambition, confirming that we are now in the right path. It's now fair to say that this set of figures is a good milestone on the road to an embedded recovery that confirms our confidence for the years ahead. We can be confident this positive momentum will continue in 2026 with an EBITDA expected to grow at least by a minimum of 10% at constant perimeter. This means that from the end of '24 to the end of '26, we do expect an average growth rate -- CAGR of more than 15% per year at constant perimeter. Although the global environment seems relatively unpredictable these days, especially regarding inflation pressure that could arise from energy price today, we are relatively confident energy expenses are limited in our P&L and very largely hedged. So this -- the performance we do expect for '26 bang in line with the high side of our midterm outlook by '28. The momentum is set to continue ahead. I will conclude my introduction before handing over to Jean-Marc with this list of the major issue and challenges we had to address and we addressed in the last years. It is clear that we have now made significant and positive progress and that the main achievements are now complete or on the way to be completed. The disposal plan has been largely exceeded now reaching EUR 2.35 billion. The structure of our balance sheet has been considerably strengthened this year in '25 and very beginning of '26. Our debt ratio has already improved dramatically, but there is still more to come ahead. Occupancy rates have risen sharply already, but they should continue to grow significantly in the coming years and especially in '26. And we are halfway there in terms of operating margin, which have grown over the last 18 months and will continue to do so ahead. On top of that, our company is also supported by favorable trends in real estate market valuation. This year is, therefore, a stepping stone and the road again is full of promise and harnessing further value is yet to come ahead. Our focus will now be on continuing this operational improvement trends further ahead, relying on attractiveness, quality and financial results improvements. Jean-Marc Boursier, our Deputy CEO and CFO of the group, will now outline in detail the main elements of our performance for '25. Jean-Marc Boursier: Thank you, Laurent. Good morning to all. We are pleased to present our 2025 financial results to you today, the key highlight of which we already shared with you on February 17. I will be brief on certain topics we have already discussed earlier this year. In my introduction, I will briefly touch on 6 points. First, our revenue, which continues to be a positive trajectory driven by both occupancy rates and favorable price effects. At group level, performance is particularly strong in the nursing home segment. Second, operating margin is rising sharply. EBITDA is up 19% on a like-for-like basis and EBITDAR is up 58%. This is the result of our very effective control on operating expenses and external rent, and this is not fading out in H2. Third, net present group share remained negative at minus EUR 298 million. However, it increased by EUR 114 million despite higher nonrecurring expenses related to exceptional transaction that we carried out in 2025, such as the refinancing of the group and the setup of Isemia real estate vehicle. Fourth, all cash flow indicators are showing a very strong growth. Net operating cash flow improved significantly from EUR 15 million last year to EUR 190 million this year and free cash flow increased even more, now reaching EUR 347 million versus minus EUR 298 million a year ago, which represents an improvement by more than EUR 600 million. Fifth point, net debt is decreasing in 2025 and even considerably so when taking into account the Isemia transaction, which has been finalized on 14th of Jan. The reduction then reaches EUR 1 billion in 1 year. And sixth and final, as a result, the leverage ratio improved significantly, as said by Laurent, now standing at 9.9x, where it was nearly 20x a year ago, and this improvement will continue in the coming semester. I will be relatively quick on that slide regarding revenue as we already commented this element earlier this year. Sales posted substantial organic growth at plus 6.1%, very similar to the one published in H1, driven by a combination of 3 factors: first, a positive price effect of plus 3.3 points; second, occupancy rate effect, plus 1.8%; and finally, the effect of the ramp-up of facilities that we've opened in 2024 and 2025, which brings a further 1% growth. This favorable growth trend can mostly be observed on nursing homes, for which the annual growth is plus 8.1%, whilst clinics have been more muted, only up 2.5%, but I will show you in a minute that we have very encouraging signs in that segment also. We can see on the next slide that revenue is growing internationally very strongly, particularly in Northern and Southern Europe, less so in France. In Northern Europe, momentum is particularly strong in Germany with both a favorable price effect and occupancy rate that continue to grow significantly. In Spain and in the Netherlands, recent openings, which are gaining momentum are accentuating an already favorable revenue trend. The momentum has been supported by the group improvement in occupancy rate. On average, it rose by 1.8 points to 87.6% versus 85.8% at the end of 2024, continuing the gradual recovery in this aggregate that you can see on this slide for the last 3 years. As you can see, the recovery was mainly driven by nursing homes, where the average occupancy rate rose by 2 points to 87.2% and even plus 5 points when considering the comparison between 2023 and 2025. Although solid everywhere, the increase in occupancy rate has been particularly important in Northern Europe and in Central Europe. Although we remain still below our medium-term ambition, we are happy to see that this supportive momentum continues. And I can confirm to you today that the year 2026 has started on the same encouraging path. As you can see on the next slide, the performance on revenue is flowing nicely to operating margin. Staff costs have been reduced. Staff cost and sales have been reduced, reflecting the measures that we progressively implemented during the last 12 months to optimize the allocation of our human resources. At the same time, we also benefited from the initial effect of our cost rationalization measures launched in H1, which has led to a reduction in the intensity of other costs, mainly procurement as well. I'm very confident that those 2 cost components, staff and OpEx can be further improved in the years to come. And as a result, these measures are enabling us to maximize the conversion of revenue growth into operating profitability. In H2 only, EBITDA margin reached 15.8% and EBITDA margin 7.4%. When we break down the EBITDAR growth, we can see that the main contributor of the growth are France and Northern Europe that is mostly driven by Germany and the Netherlands. Not only do those 2 regions account for the largest contribution to EBITDAR in million of euro, but they also have the highest growth rate on a like-for-like basis. And as you can see on this slide, EBITDA growth in Northern Europe was nearly 30% versus 2024 and in France, nearly 15% year-on-year. If we look at H2 versus H1, what can we see over the 6 months period, we can see that this momentum shows no sign of slowing down at all with a 6 months increase in EBITDAR of 19%, again comparing H2 versus H1. It is worth noting that this momentum even appears to be gaining strength in France, particularly thanks to nursing homes, whose performance has been significantly improved since mid of 2024. The positive dynamic in revenue, therefore, largely flew into margin. In euro terms, the positive upside in sales of EUR 259 million versus last year was largely transferred into EBITDAR plus EUR 132 million and then into EBITDA plus EUR 135 million given efficient rental management, another evidence that the operating leverage to the upside is strong and should continue to be supportive again ahead. If I go into a little bit more detail for the rest of the P&L, I would like to highlight a few points. First, to remind you that the growth in EBITDAR is partly attributable in 2025 to capital gain from the sale of PropCo assets for nearly EUR 64 million in 2025 compared to EUR 28 million in 2024. This is due to the particularly high volume of PropCo disposals that we have finalized this year. However, you can see also that organic EBITDAR growth even after deducting those capital gains remained at 15%, which also aligns with the pure operational momentum we expect to see in 2026 and beyond. Thanks to the effective control of rental expenses, EBITDA before IFRS 16 is up EUR 135 million or 58.3% on a like-for-like basis. EBIT is growing strongly by EUR 171 million, now reaching EUR 173 million versus only EUR 2 million last year. This is mainly due to the decline in amortization. But please note also that we have recorded some depreciation, especially in France. This depreciation amounted to EUR 42 million and resulted from a balance sheet cleanup. When breaking down the financial statement to net income, it should be noted that nonrecurring expenses rose significantly this year by plus EUR 86 million. This is a direct consequence of certain exceptional transaction that we finalized in 2025, notably related to the refinancing that we announced on December 18 and the creation of the Isemia real estate company finalized in January. New depreciation and nonrecurring expenses have limited the improvement in net income group share, which nevertheless rose by a considerable EUR 114 million to minus EUR 298 million. The net loss per share have therefore been reduced to EUR 1.9. Regarding now the cash flow statements, I would like to highlight a few points that contribute to a very strong improvement of all our cash flow aggregates. First, an effective management of maintenance CapEx and IT investment. Please note, however, that these components are expected to grow moderately over the next few years to modernize our IT system and to optimize our operational efficiency. Second, an exceptional financial expense of approximately EUR 23 million corresponding to upfront fees related to the refinancing. And if we exclude these upfront fees, please note that the recurring free cash flow is now turning positive in the second half of the year for EUR 20 million, and this is a very significant milestone symbolizing the normalization of the group. Third element, development CapEx continued to decline in line with the pipeline progress and given the higher return requirements now needed for new operation launched. And let me be clear, we will continue to be extremely selective in the coming years. Fourth element, the significant contribution from disposal amounting to EUR 602 million in transaction for both OpCo and PropCo that we closed in 2025. And as a result, as I said earlier, our free cash flow is now positive and stands at EUR 347 million, representing an improvement of EUR 645 million in 1 year. And if we include the Isemia transaction that was finalized on January 14, which brought an additional EUR 703 million of new liquidity, it means that emeis group was able to reduce its net debt by almost EUR 1 billion in 1 year. The next slide illustrates the 3 key drivers behind the improvement in free cash flow. First, the improvement in operating margin, which has already been commented. Second, the sharp acceleration in disposal in 2025 on an unprecedented scale compared to previous years. And please note that EUR 216 million of signed transaction remain to be cashed in today. And finally, [indiscernible] in capital expenditures, particularly for development CapEx, which are now limited to the most promising project and the shortest payback. Across all cash flow indicators, trend continue to be very favorable. The next slide illustrates perfectly the continuous improvement in all of our aggregates, which we expect to see continuing in the coming years. All cash flow, as you can see, have now turned positive and the momentum does not seem to be fading out. As a result of everything we said today with Laurent, emeis financial structure has continued to strengthen significantly this year. Net debt, excluding IFRS 5 and 16 has decreased by almost EUR 300 million in 1 year at EUR 4.5 billion. And if we consider again the Isemia transaction closed on January 14, it brings pro forma net debt down by EUR 1 billion since December. Net debt pro forma is down to EUR 3.8 billion, a massive decrease booked thanks to the important volume of disposal achieved, but also thanks to operational margin improvement. And as a result of both information that we shared with you today, operational improvement on one hand and the net debt reduction on the other hand, you can see that the group leverage ratio has significantly been reduced from 23x in H1 '24 to 19.5x at the end of '24. It now reaches 11.8x and even 9.9x pro forma Isemia. This leverage ratio is already well below the covenant that we have agreed with banks and debt investors for 2026 that is at 12x. An illustration of this embedded improvement is that we forecast with confidence, we anticipate this ratio to fall below 6.5x before the end of 2029. This target being the debt covenant that we have agreed through the refinancing of the group that we've achieved in December. One word about the refinancing. We have refinanced the whole bank debt of [ emeis SA ]and this has enabled the group to raise EUR 3.15 billion of new debt under favorable condition. I remind you the condition, which is Euribor 3 months plus 247 basis points cash or plus 363 basis points, including PIK. The new debt, including a new EUR 400 million bond has fully refinanced the former A, B, C, D financing and have largely enhanced the debt maturity profile of the group, as you can see on this slide. And as a consequence, emeis early exited the accelerated safeguard plan on February 20. We are now comfortable today saying that emeis is now back in a situation that can match our ambition for the future with our priority now being clearly on pursuing the improvement of our operational performance ahead. Thank you for your attention, and I will now hand over to Laurent once again to conclude this presentation. Laurent Guillot: Thank you, Jean-Marc, for these very clear explanations. And before answering the questions you may have, I would like to conclude this presentation with the key elements I would like to summarize in 6 points. First point, the positive trend on top line continues with a strong organic growth of 6.1% and even 8.1% on nursing homes, improvement on quality and satisfaction metrics largely contributed to this performance. Second, the strong momentum on operating margins, up 19% for the EBITDAR and 58% for the EBITDA is mostly driven by the outperformance locations of France and Northern Europe. This momentum didn't fade out in H2 and is set to continue ahead in '26. All cash flow components are largely improved and more is still to come. Third, our EUR 1.5 billion disposal target before end of '25 is now largely exceeded with EUR 2.35 billion now achieved or secured. Now that the disposal plan has been largely exceeded and that the group financial structure has been substantially strengthened and now emeis operating performance continued to show a positive trend quarter after quarter, the group intends from now to be particularly selective regarding any further disposal in the coming years. Four, disposals, improvement of operating performance have strengthened our financial structure with a pro forma net debt of around EUR 3.8 billion, decreasing EUR 1 billion and a leverage ratio nearing now 9.9x versus 15.5x end of '24, as Jean-Marc said, while our debt maturing schedule is now largely reinforced. Fifth, real estate valuation may have bottomed out after several years of adjustments, around minus 25% approximately, raising confidence that the valuation cycle should now be more supportive ahead along with improvement on operations. And sixth and finally, we do confirm our guidance for '26 -- expectations for '26 to grow at least by 10% at constant rate, which corresponds to an average growth rate of 15% for the period '24, '26. Thank you for your attention, and we are now available with Jean-Marc Boursier to answer the questions you may have. Operator: [Operator Instructions] Laurent Guillot: Okay. If there is no question verbally, let's go to the first question, written question. First one, [Foreign language] an update, may we have an update on occupancy rate at the beginning of '26. The answer is no, we will have the communication in a few weeks from now. I can just give you an overall trend. The trend continues to be the same, pretty bang in line with what we've experienced in '25. So continue to be a very good momentum for operation, especially in France and in our nursing homes in France. We have not suffered and we have taken all the measures in our nursing home. We have not suffered from the flu that happened at the end of '25 or the beginning of '26. So we are pretty much in line with our targets and rate with very similar to the trend we experienced in '25. Can you describe the assets that will be sold at the beginning of -- in '26 with impact on the balance sheet and on the cash compared to the situation described at the end of '25? Jean-Marc, do you want to comment on this one? Jean-Marc Boursier: Yes. We still have a little bit more than EUR 200 million that will be cashed in, in 2026 and this mainly relates to PropCo disposal in Switzerland, in Ireland, in France value segment. No transaction in my suggestion is very significant but all it amounted to a little bit more than EUR 200 million and most of that will be cashed in, in the next... Laurent Guillot: [Foreign Language] Can we have the number of headcount at the end of '25? We will take note of that question. It's around 80,000 people. But the exact number we will answer to you directly. Can you list in detail the nonrecurring items of '25 and share the elements of the nonrecurring elements of '26? Well, for sure -- Jean-Marc will answer in detail to that question. For sure, in '25, we had some restructuring. We had some costs that were linked to the refinancing that were quite significant also and all that will disappear in '26. So we will come back to a more normal level and a more normal level is probably between around EUR 40 million, EUR 50 million for '26. So Jean-Marc, for '25, if you can give more detail? Jean-Marc Boursier: The nonrecurring components in 2025 amount to EUR 126 million, abnormally high and nothing compared to last year from '24 and nothing compared to the current year where you will see these nonrecurring elements to be normalized. It's relatively easy to understand this EUR 126 million is almost 50% related to specific project that we have undertaken in 2025, the 2 largest that you know about the refinancing on the group on one hand and the setup of the real estate vehicle Isemia that we have created. And 50% of that amount is some depreciation of asset that we have recorded related to some facility that we have decided to close notably in France, Belgium and Germany. Net of the profit and disposal that our sales averaging [indiscernible]. So 50% project cost, 50% depreciation, but this amount this year will be much different, much lower in 2026 and going forward. Laurent Guillot: Another question, can you give a little bit more details on the growth in Northern Europe? Well, we experienced in -- as a matter of fact, we experienced growth in all the geographies we are in Northern Europe. The biggest country in Northern Europe is Germany, and we have a very nice recovery both in terms of nursing homes with a strong improvement of occupancy rate, but also in clinics. In the Netherlands, most of the activities are in nursing homes. And we benefited a lot in '25 of, I would say, a very strong recovery of one of our 2 business models, but the dynamic in this market continue to be quite strong on the occupancy rate point of view, and we were suffering a little bit in '24. We have a strong recovery in '25, and we continue to enjoy that in '26. And the last market in Belgium, where, as you know, we had to restructure a little bit these activities on the top line. We had a top line that was suffering a little bit in the last 2 to 3 years. But on the opposite, with a good recovery on the bottom line, which is not at the level it should be. Thank you for the call. What is the reason -- another question, sorry, what is the reason why you do not sell the OpCo in Switzerland. We are talking there in terms of nursing homes in Switzerland. What is clear is that the situation now is following. We have launched in '24 a lot of potential disposals, both in terms of real estate and in terms of OpCo. And to be sure to be able to reach our target of EUR 1.5 billion disposal, we've sold and we've launched several processes at the same time. Now we are in a very different situation where we have structurally and we say definitely reinforced our financial structure and we can be more selective in the disposals that we are making. So we reassessed the strategic rationale of these disposals. And you know what, I think that being diversified in terms of countries in a world where we have uncertainty in terms of regulation and budgets and state budgets, I think is a good thing. So we've decided not to sell the nursing homes in Switzerland. Another question, do you expect to hedge a larger share of your debt, Jean-Marc? Jean-Marc Boursier: Yes. Our strategy is clearly to hedge a significant proportion of our debt. Our debt was launched fully at variable interest rates. For your information, we have already hedged EUR 1 billion out of this EUR 3.15 billion that we launched late in 2025. So we are in this process of hedging the debt, and we expect to have a higher proportion of the debt that will be hedged going forward respectively. Laurent Guillot: Two questions. What is the target EBITDA margins pre-IFRS of 2029, 2030? We have not given any guidance in the past in that respect. At the same time, we have given a guidance in terms of EBITDAR growth over the next years on the '24, '28 period with a growth rate of 12% to 16% in average over this period, which then give you the opportunity knowing the rents that we have, give you the opportunity to make your own estimate on EBITDA and EBITDAR margin. What is the target returns for the development CapEx, Jean-Marc, do you want to share with me the question? Jean-Marc Boursier: Yes. For development CapEx, we are targeting new facilities with [indiscernible] which is lower or at least 5 years after construction. So this is our objective. And that enables us to be very selective going forward. So we expect to invest in development CapEx between EUR 100 million and EUR 130 million per annum going forward. That's the order of magnitude. And that would mean probably opening something like 1,000 to 1,500 new beds per annum. So we expect going forward, the increase in revenue to come by something like 1% from new bed openings. But our objective in terms of payback is at maximum 5 years as per construction. Laurent Guillot: Okay. Whether other countries EBITDA has been weak in H2 versus H1. Why? Well, we suffered a lot from the situation we have in Ireland, where given the request in terms of further staffing from the authorities have led us to a significant reduction of the EBITDA performance. We are definitely working on this topic with the management to turn around this country. What has to happen for dividends or buyback to begin? We first have to be positive in terms of net profit for sure. This is definitely something that we are contemplating for the next years, but we are not yet in the situation for the time being. By the way, we need to be also given the documentation, the financial documentation that we have, we need also at the same time to be below 7.5x EBITDA in terms of net debt-to-EBITDA ratio to be allowed to pay dividends. Another question on the board page. How did the Board choose Olivier Dussopt? Well, first, we have to say that Guillaume Pepy that was -- that is our President today has decided not to continue and do something else for the future. So the Board had to find someone. It's also at the same time, a new phase for the company. Olivier's experience in local government and knowledge in nursing homes or health care system are both at the local level and his experience also in the government will be a big help for us. It's important negotiation with the different governments is always important in our activity. So Olivier has been chosen by the Board at the unanimity and is proposed to be our President at the next -- after the next general assembly. Could you comment on the EUR 42 million impairment you did in full year '25, Jean-Marc? Jean-Marc Boursier: Yes. We have decided to be particularly cautious as far as balance sheet management [indiscernible]. So we have not recorded impairment. We have recorded depreciation for various assets, and we will continue to work on balance sheet improvement and I expect part of this depreciation be released in the quarters to come, but we wanted to be particularly cautious as far as the balance sheet cleanup is concerned. Laurent Guillot: To which extent are you impacted by the recent increase in financing conditions regarding your financing and the value of property assets? Two things. First, it's way too early. We have not had any significant impact at this time. Concerning the financing, as Jean-Marc said, 1/3 of our interest is covered so it's fixed. And the rest, well, the reality is that the short-term Euribor 3 months have increased, but not dramatically. So this has no material impact for the time being. We need to see how the things will evolve. And for sure, as soon as we can, we will continue to hedge this financing cost. Concerning the real estate, it's way too early to have a comment on the valuation. You remember that compared to the situation we had in 2022, the situation of the valuation is probably at a low point. And looking forward, we expect the real estate market more to be at a trough and at the same time with our profitability improving to have a progressive revaluation of our assets. Has there been -- you want to add something to this? Has there been any increase in lease cost, lease cash payments in H2 '25, Jean-Marc? Jean-Marc Boursier: Maybe it is worth to reminding you a few things. First of all, we are leasing 56% of our facility and we are owning 44% of our facility and as Laurent explained in his speech presenting that this placed a unique in the nursing homes and clinic industry. And as far as this payment his concerned, we have done, I believe a good management with external rents because as you have seen our presentation, external rents have been brought down from EUR 495 million in 2024 to EUR 492 million in 2025. So most of those things are CPI based but we have been able to start renegotiating some of them. So this payment has been kept in extremely good control in 2025. Laurent Guillot: So recovery in French clinics, what can you say? Well, clearly, we continue to work hard on improving the profitability on the clinics. A lot of the measures are self-help. We do not expect and do not rely on any in the French market. We do not rely on any incoming from the government and from the authorities. But at the same time, I think we can operationally improve significantly how the -- our clinics are currently working. And on that front, there is still a way to go in '26 and '27. So good opportunity for us also there. On the market, as you know, it's a very regulated market with a vast majority of our turnover coming from the social security. And we continue to expect low tailwind coming from the financing in France, but we are working around that with our own self-help measures. Another question, is there a specific ownership rate target for the medium term, please? No, no, no, there is -- I think we are happy today and in the current environment to be the owner of our assets of 44% of our beds. I think it's a strong asset that the company has. We had in the past a target, but this target was also linked to the fact that we needed to deleverage the company, reduce the issues concerning the balance sheet and make disposals. We have done the vast majority of the program and more than what we announced. So now I think we will be very, very opportunistic, continue to grow and invest and at the same time, divest a little bit, but very, very selective, and we have no specific ownership target. We consider our high ownership target as an asset. A few seconds ago -- sorry, another question [Foreign Language]. So what are emeis ambitions concerning care at home? We have already care at home activity, not significantly in France and almost nothing in France. But we are already present in other countries, for example, in Ireland or in the Netherlands. This is a very interesting activity and we are contemplating the possibility to grow further in care at home activity. Well at the same time, for sure, the priority operationally for the time being, the first priority is to improve dramatically because this is low-hanging fruit, I would say, to improve our current operations and develop what we are doing in a way to improve dramatically our profitability. So both ways, I would say this is definitely an opportunity for us but we are developing already in some countries. In France, in particular, as the question is asked in France, we are not very present and the priority is to focus on turning around our clinics and our nursing homes. Any other question? No, apparently, there is no more question. So just to summarize back what we have said already during this call, strong recovery and a strong year in '25, both in terms of operations and at the same time in terms of strengthening of our balance sheet. Moving forward, we continue to have good trends ahead, both in terms of market with a strong demand, but also in terms of conditions in which we operate. We are very confident concerning our guidance concerning '26. I think it went out from what we've said today and the opportunities moving forward in terms of improvement of the profitability and the operation of emeis is very strong. So the future is all us, and there is more to come in terms of improvement, EBITDA improvement and solidity of the company. Thank you for listening to us, and have a good day. Operator: This now concludes the conference call. You may disconnect.
Operator: Ladies and gentlemen, welcome to the emeis conference call regarding its full year 2025 results. It will be structured in 2 parts. First, a presentation by emeis management team represented by Mr. Laurent Guillot, Group CEO; and Mr. Jean-Marc Boursier, Group CFO. Afterwards, there will be a Q&A session during which you can ask oral or written questions. I will now hand over to the management team. Gentlemen, please go ahead. Laurent Guillot: Well, thank you, and good morning to everyone, and thank you once again for attending this webcast for our full year earning '25. Before answering to your question with our Deputy CEO and CFO, Jean-Marc Boursier, we will share with you a few thoughts regarding this year 2025 and 2026. I will begin my presentation by reviewing some of the group's key characteristics, which many of you already are familiar with. First, I would like to highlight the geographic diversification of our operation, which includes France, Northern Europe, Germany and Netherlands, Central Europe, Austria, Switzerland and Southern Europe, Spain and Italy. Next, our business diversification with 2/3 of our revenues generated by nursing homes and the remainder by post-acute care clinics and psychiatric clinics. And finally, our shareholder structure, which is built for the long term around solid and reputable [ anchor ] shareholders. It is also important to note that our group also distinguishes itself through its significant real estate portfolio, which is worth EUR 5.6 billion by the end of '25. 44% of the beds we operate are owned by the group, a figure that, to my knowledge, is unmatched among groups of comparable size. And our portfolio is also geographically of real estate is well distributed in Europe. As we previously reported in mid-February, 2025 was a particularly strong year. In '25, the company delivered strong performance with revenue growth by over 6% on a like-for-like basis and occupancy improving by nearly 2 points. Profitability also increased significantly with EBITDA margin up by 19.2%, reflecting sustainable positive momentum. Cash flow generation improved sharply with net operating cash flow rising from EUR 15 million in '24 to EUR 190 million, highlighting a strong operational recovery. Free cash flow reached EUR 347 million, driven in part by substantial asset disposals. Since '22 -- mid-'22, total disposals have reached now EUR 2.35 million (sic) [ EUR 2.35 billion ], exceeding by far initial targets. However, the one that are following us the most closely, this figure is slightly lower than previously reported due to the decision not to proceed with the sale of Swiss nursing homes operations following an internal strategic reassessment. The company also strengthened its financial position by refinancing its entire bank debt by EUR 3.15 billion in new financing, improving visibility and stability. Consequently, the leverage ratio dropped significantly to below 10x compared to 19.5x the previous year. Looking ahead, the company is confident about its growth prospect starting in '26, expecting average annual growth of at least 15% between '24 and '26, including over 10% growth in '26. Medium-term guidance for '24, '28 is reaffirmed. Our operational performance is driven by improvement in our CSR KPI. In '25, we continue to enhance all our quality and satisfaction metrics, reaching levels that now place us among the industry leaders. Regarding human resources metrics, please note that employee turnover while still high, has once again declined significantly this year. We warmly welcome this since this is a key support for quality in our facility and thus occupancy. Also, a new indicator has been launched this year, the engagement rate of our employees starting at a relatively high level of 62%, well over global market average. On the climate front, energy consumption has also fallen by nearly 9% year-over-year, which is also a positive for our energy bill. In '25, indicators relating to the satisfaction of our patients, residents and their relatives have improved significantly once again. The resident satisfaction measured in '25 in the French facilities now stands at 93.4%, up 50 basis points compared to '24 and more than 3 points above the comparable level in '22. Same message when considering the Net Promoter Score, which also measures the satisfaction and loyalty of residents, patients and their beloved ones. It has also risen sharply now reaching the score of 41 in '25, up 4 points from '24 and 23 points from '22. This significant improvement illustrates the successful measures taken in recent years to restore the confidence in the group. As you already know, in France, our facilities are rated by Haute Autorité de Santé, the French National Authority for Health in the same way as all other facilities in the sector. These ratings are divided into 4 groups based on quality assessments. 99% of emeis facilities are on the top 2 categories. It is significantly higher than the sector average and even higher than the private sector as a whole. It is a mark of distinction and illustrates emeis leadership in this area. We are also pleased to see that the improvement in all these metrics is reflected positively through extra financial ratings. Emeis is now ranked above the industry average on nearly all metrics and is even among the best-in-class according to S&P and Sustainalytics rating, but there is still more to come. In our view, the steady process -- progress you see in this chart is not over and should continue in the years ahead. The steady improvement in our extra financial performance in terms of quality of care, patient satisfaction, resident satisfaction and human resources continue to translate into an annual increase of our occupancy rate. In '25, this rate rose by nearly 2 points across our nursing homes. And since '21, we have seen an improvement of nearly 7.6 points and it's not over. Mechanically, this growth translates into the revenues that is largely translated into operating margins. Thanks to the work done on quality and capturing a favorable price effect on accommodation and on segmenting our offering, we have been able to boost our revenue growth. By controlling operating expenses, adapting methods and tools and focusing management efforts on turning around underperforming facilities, we continue to optimize our operating performance. Our revenue growth in '26 was 6.1% like-for-like or nearly 15% over 2 years. And at the same time, our EBITDA margin increased far quicker by 58% like-for-like in 1 year and even 90% in 2 years. And you can trust our midterm target, it's not over yet. There is much more to come ahead, as I already said. As we already told you mid-February, we have exceeded our initial guidance for '25 with like-for-like EBITDA growth of 19%. We are EUR 10 million to EUR 30 million above our initial target. And as already said, it's not over. We are happy to share with you the fact that these encouraging achievements lead our figures to grow comfortably in line with our ambition, confirming that we are now in the right path. It's now fair to say that this set of figures is a good milestone on the road to an embedded recovery that confirms our confidence for the years ahead. We can be confident this positive momentum will continue in 2026 with an EBITDA expected to grow at least by a minimum of 10% at constant perimeter. This means that from the end of '24 to the end of '26, we do expect an average growth rate -- CAGR of more than 15% per year at constant perimeter. Although the global environment seems relatively unpredictable these days, especially regarding inflation pressure that could arise from energy price today, we are relatively confident energy expenses are limited in our P&L and very largely hedged. So this -- the performance we do expect for '26 bang in line with the high side of our midterm outlook by '28. The momentum is set to continue ahead. I will conclude my introduction before handing over to Jean-Marc with this list of the major issue and challenges we had to address and we addressed in the last years. It is clear that we have now made significant and positive progress and that the main achievements are now complete or on the way to be completed. The disposal plan has been largely exceeded now reaching EUR 2.35 billion. The structure of our balance sheet has been considerably strengthened this year in '25 and very beginning of '26. Our debt ratio has already improved dramatically, but there is still more to come ahead. Occupancy rates have risen sharply already, but they should continue to grow significantly in the coming years and especially in '26. And we are halfway there in terms of operating margin, which have grown over the last 18 months and will continue to do so ahead. On top of that, our company is also supported by favorable trends in real estate market valuation. This year is, therefore, a stepping stone and the road again is full of promise and harnessing further value is yet to come ahead. Our focus will now be on continuing this operational improvement trends further ahead, relying on attractiveness, quality and financial results improvements. Jean-Marc Boursier, our Deputy CEO and CFO of the group, will now outline in detail the main elements of our performance for '25. Jean-Marc Boursier: Thank you, Laurent. Good morning to all. We are pleased to present our 2025 financial results to you today, the key highlight of which we already shared with you on February 17. I will be brief on certain topics we have already discussed earlier this year. In my introduction, I will briefly touch on 6 points. First, our revenue, which continues to be a positive trajectory driven by both occupancy rates and favorable price effects. At group level, performance is particularly strong in the nursing home segment. Second, operating margin is rising sharply. EBITDA is up 19% on a like-for-like basis and EBITDAR is up 58%. This is the result of our very effective control on operating expenses and external rent, and this is not fading out in H2. Third, net present group share remained negative at minus EUR 298 million. However, it increased by EUR 114 million despite higher nonrecurring expenses related to exceptional transaction that we carried out in 2025, such as the refinancing of the group and the setup of Isemia real estate vehicle. Fourth, all cash flow indicators are showing a very strong growth. Net operating cash flow improved significantly from EUR 15 million last year to EUR 190 million this year and free cash flow increased even more, now reaching EUR 347 million versus minus EUR 298 million a year ago, which represents an improvement by more than EUR 600 million. Fifth point, net debt is decreasing in 2025 and even considerably so when taking into account the Isemia transaction, which has been finalized on 14th of Jan. The reduction then reaches EUR 1 billion in 1 year. And sixth and final, as a result, the leverage ratio improved significantly, as said by Laurent, now standing at 9.9x, where it was nearly 20x a year ago, and this improvement will continue in the coming semester. I will be relatively quick on that slide regarding revenue as we already commented this element earlier this year. Sales posted substantial organic growth at plus 6.1%, very similar to the one published in H1, driven by a combination of 3 factors: first, a positive price effect of plus 3.3 points; second, occupancy rate effect, plus 1.8%; and finally, the effect of the ramp-up of facilities that we've opened in 2024 and 2025, which brings a further 1% growth. This favorable growth trend can mostly be observed on nursing homes, for which the annual growth is plus 8.1%, whilst clinics have been more muted, only up 2.5%, but I will show you in a minute that we have very encouraging signs in that segment also. We can see on the next slide that revenue is growing internationally very strongly, particularly in Northern and Southern Europe, less so in France. In Northern Europe, momentum is particularly strong in Germany with both a favorable price effect and occupancy rate that continue to grow significantly. In Spain and in the Netherlands, recent openings, which are gaining momentum are accentuating an already favorable revenue trend. The momentum has been supported by the group improvement in occupancy rate. On average, it rose by 1.8 points to 87.6% versus 85.8% at the end of 2024, continuing the gradual recovery in this aggregate that you can see on this slide for the last 3 years. As you can see, the recovery was mainly driven by nursing homes, where the average occupancy rate rose by 2 points to 87.2% and even plus 5 points when considering the comparison between 2023 and 2025. Although solid everywhere, the increase in occupancy rate has been particularly important in Northern Europe and in Central Europe. Although we remain still below our medium-term ambition, we are happy to see that this supportive momentum continues. And I can confirm to you today that the year 2026 has started on the same encouraging path. As you can see on the next slide, the performance on revenue is flowing nicely to operating margin. Staff costs have been reduced. Staff cost and sales have been reduced, reflecting the measures that we progressively implemented during the last 12 months to optimize the allocation of our human resources. At the same time, we also benefited from the initial effect of our cost rationalization measures launched in H1, which has led to a reduction in the intensity of other costs, mainly procurement as well. I'm very confident that those 2 cost components, staff and OpEx can be further improved in the years to come. And as a result, these measures are enabling us to maximize the conversion of revenue growth into operating profitability. In H2 only, EBITDA margin reached 15.8% and EBITDA margin 7.4%. When we break down the EBITDAR growth, we can see that the main contributor of the growth are France and Northern Europe that is mostly driven by Germany and the Netherlands. Not only do those 2 regions account for the largest contribution to EBITDAR in million of euro, but they also have the highest growth rate on a like-for-like basis. And as you can see on this slide, EBITDA growth in Northern Europe was nearly 30% versus 2024 and in France, nearly 15% year-on-year. If we look at H2 versus H1, what can we see over the 6 months period, we can see that this momentum shows no sign of slowing down at all with a 6 months increase in EBITDAR of 19%, again comparing H2 versus H1. It is worth noting that this momentum even appears to be gaining strength in France, particularly thanks to nursing homes, whose performance has been significantly improved since mid of 2024. The positive dynamic in revenue, therefore, largely flew into margin. In euro terms, the positive upside in sales of EUR 259 million versus last year was largely transferred into EBITDAR plus EUR 132 million and then into EBITDA plus EUR 135 million given efficient rental management, another evidence that the operating leverage to the upside is strong and should continue to be supportive again ahead. If I go into a little bit more detail for the rest of the P&L, I would like to highlight a few points. First, to remind you that the growth in EBITDAR is partly attributable in 2025 to capital gain from the sale of PropCo assets for nearly EUR 64 million in 2025 compared to EUR 28 million in 2024. This is due to the particularly high volume of PropCo disposals that we have finalized this year. However, you can see also that organic EBITDAR growth even after deducting those capital gains remained at 15%, which also aligns with the pure operational momentum we expect to see in 2026 and beyond. Thanks to the effective control of rental expenses, EBITDA before IFRS 16 is up EUR 135 million or 58.3% on a like-for-like basis. EBIT is growing strongly by EUR 171 million, now reaching EUR 173 million versus only EUR 2 million last year. This is mainly due to the decline in amortization. But please note also that we have recorded some depreciation, especially in France. This depreciation amounted to EUR 42 million and resulted from a balance sheet cleanup. When breaking down the financial statement to net income, it should be noted that nonrecurring expenses rose significantly this year by plus EUR 86 million. This is a direct consequence of certain exceptional transaction that we finalized in 2025, notably related to the refinancing that we announced on December 18 and the creation of the Isemia real estate company finalized in January. New depreciation and nonrecurring expenses have limited the improvement in net income group share, which nevertheless rose by a considerable EUR 114 million to minus EUR 298 million. The net loss per share have therefore been reduced to EUR 1.9. Regarding now the cash flow statements, I would like to highlight a few points that contribute to a very strong improvement of all our cash flow aggregates. First, an effective management of maintenance CapEx and IT investment. Please note, however, that these components are expected to grow moderately over the next few years to modernize our IT system and to optimize our operational efficiency. Second, an exceptional financial expense of approximately EUR 23 million corresponding to upfront fees related to the refinancing. And if we exclude these upfront fees, please note that the recurring free cash flow is now turning positive in the second half of the year for EUR 20 million, and this is a very significant milestone symbolizing the normalization of the group. Third element, development CapEx continued to decline in line with the pipeline progress and given the higher return requirements now needed for new operation launched. And let me be clear, we will continue to be extremely selective in the coming years. Fourth element, the significant contribution from disposal amounting to EUR 602 million in transaction for both OpCo and PropCo that we closed in 2025. And as a result, as I said earlier, our free cash flow is now positive and stands at EUR 347 million, representing an improvement of EUR 645 million in 1 year. And if we include the Isemia transaction that was finalized on January 14, which brought an additional EUR 703 million of new liquidity, it means that emeis group was able to reduce its net debt by almost EUR 1 billion in 1 year. The next slide illustrates the 3 key drivers behind the improvement in free cash flow. First, the improvement in operating margin, which has already been commented. Second, the sharp acceleration in disposal in 2025 on an unprecedented scale compared to previous years. And please note that EUR 216 million of signed transaction remain to be cashed in today. And finally, [indiscernible] in capital expenditures, particularly for development CapEx, which are now limited to the most promising project and the shortest payback. Across all cash flow indicators, trend continue to be very favorable. The next slide illustrates perfectly the continuous improvement in all of our aggregates, which we expect to see continuing in the coming years. All cash flow, as you can see, have now turned positive and the momentum does not seem to be fading out. As a result of everything we said today with Laurent, emeis financial structure has continued to strengthen significantly this year. Net debt, excluding IFRS 5 and 16 has decreased by almost EUR 300 million in 1 year at EUR 4.5 billion. And if we consider again the Isemia transaction closed on January 14, it brings pro forma net debt down by EUR 1 billion since December. Net debt pro forma is down to EUR 3.8 billion, a massive decrease booked thanks to the important volume of disposal achieved, but also thanks to operational margin improvement. And as a result of both information that we shared with you today, operational improvement on one hand and the net debt reduction on the other hand, you can see that the group leverage ratio has significantly been reduced from 23x in H1 '24 to 19.5x at the end of '24. It now reaches 11.8x and even 9.9x pro forma Isemia. This leverage ratio is already well below the covenant that we have agreed with banks and debt investors for 2026 that is at 12x. An illustration of this embedded improvement is that we forecast with confidence, we anticipate this ratio to fall below 6.5x before the end of 2029. This target being the debt covenant that we have agreed through the refinancing of the group that we've achieved in December. One word about the refinancing. We have refinanced the whole bank debt of [ emeis SA ]and this has enabled the group to raise EUR 3.15 billion of new debt under favorable condition. I remind you the condition, which is Euribor 3 months plus 247 basis points cash or plus 363 basis points, including PIK. The new debt, including a new EUR 400 million bond has fully refinanced the former A, B, C, D financing and have largely enhanced the debt maturity profile of the group, as you can see on this slide. And as a consequence, emeis early exited the accelerated safeguard plan on February 20. We are now comfortable today saying that emeis is now back in a situation that can match our ambition for the future with our priority now being clearly on pursuing the improvement of our operational performance ahead. Thank you for your attention, and I will now hand over to Laurent once again to conclude this presentation. Laurent Guillot: Thank you, Jean-Marc, for these very clear explanations. And before answering the questions you may have, I would like to conclude this presentation with the key elements I would like to summarize in 6 points. First point, the positive trend on top line continues with a strong organic growth of 6.1% and even 8.1% on nursing homes, improvement on quality and satisfaction metrics largely contributed to this performance. Second, the strong momentum on operating margins, up 19% for the EBITDAR and 58% for the EBITDA is mostly driven by the outperformance locations of France and Northern Europe. This momentum didn't fade out in H2 and is set to continue ahead in '26. All cash flow components are largely improved and more is still to come. Third, our EUR 1.5 billion disposal target before end of '25 is now largely exceeded with EUR 2.35 billion now achieved or secured. Now that the disposal plan has been largely exceeded and that the group financial structure has been substantially strengthened and now emeis operating performance continued to show a positive trend quarter after quarter, the group intends from now to be particularly selective regarding any further disposal in the coming years. Four, disposals, improvement of operating performance have strengthened our financial structure with a pro forma net debt of around EUR 3.8 billion, decreasing EUR 1 billion and a leverage ratio nearing now 9.9x versus 15.5x end of '24, as Jean-Marc said, while our debt maturing schedule is now largely reinforced. Fifth, real estate valuation may have bottomed out after several years of adjustments, around minus 25% approximately, raising confidence that the valuation cycle should now be more supportive ahead along with improvement on operations. And sixth and finally, we do confirm our guidance for '26 -- expectations for '26 to grow at least by 10% at constant rate, which corresponds to an average growth rate of 15% for the period '24, '26. Thank you for your attention, and we are now available with Jean-Marc Boursier to answer the questions you may have. Operator: [Operator Instructions] Laurent Guillot: Okay. If there is no question verbally, let's go to the first question, written question. First one, [Foreign language] an update, may we have an update on occupancy rate at the beginning of '26. The answer is no, we will have the communication in a few weeks from now. I can just give you an overall trend. The trend continues to be the same, pretty bang in line with what we've experienced in '25. So continue to be a very good momentum for operation, especially in France and in our nursing homes in France. We have not suffered and we have taken all the measures in our nursing home. We have not suffered from the flu that happened at the end of '25 or the beginning of '26. So we are pretty much in line with our targets and rate with very similar to the trend we experienced in '25. Can you describe the assets that will be sold at the beginning of -- in '26 with impact on the balance sheet and on the cash compared to the situation described at the end of '25? Jean-Marc, do you want to comment on this one? Jean-Marc Boursier: Yes. We still have a little bit more than EUR 200 million that will be cashed in, in 2026 and this mainly relates to PropCo disposal in Switzerland, in Ireland, in France value segment. No transaction in my suggestion is very significant but all it amounted to a little bit more than EUR 200 million and most of that will be cashed in, in the next... Laurent Guillot: [Foreign Language] Can we have the number of headcount at the end of '25? We will take note of that question. It's around 80,000 people. But the exact number we will answer to you directly. Can you list in detail the nonrecurring items of '25 and share the elements of the nonrecurring elements of '26? Well, for sure -- Jean-Marc will answer in detail to that question. For sure, in '25, we had some restructuring. We had some costs that were linked to the refinancing that were quite significant also and all that will disappear in '26. So we will come back to a more normal level and a more normal level is probably between around EUR 40 million, EUR 50 million for '26. So Jean-Marc, for '25, if you can give more detail? Jean-Marc Boursier: The nonrecurring components in 2025 amount to EUR 126 million, abnormally high and nothing compared to last year from '24 and nothing compared to the current year where you will see these nonrecurring elements to be normalized. It's relatively easy to understand this EUR 126 million is almost 50% related to specific project that we have undertaken in 2025, the 2 largest that you know about the refinancing on the group on one hand and the setup of the real estate vehicle Isemia that we have created. And 50% of that amount is some depreciation of asset that we have recorded related to some facility that we have decided to close notably in France, Belgium and Germany. Net of the profit and disposal that our sales averaging [indiscernible]. So 50% project cost, 50% depreciation, but this amount this year will be much different, much lower in 2026 and going forward. Laurent Guillot: Another question, can you give a little bit more details on the growth in Northern Europe? Well, we experienced in -- as a matter of fact, we experienced growth in all the geographies we are in Northern Europe. The biggest country in Northern Europe is Germany, and we have a very nice recovery both in terms of nursing homes with a strong improvement of occupancy rate, but also in clinics. In the Netherlands, most of the activities are in nursing homes. And we benefited a lot in '25 of, I would say, a very strong recovery of one of our 2 business models, but the dynamic in this market continue to be quite strong on the occupancy rate point of view, and we were suffering a little bit in '24. We have a strong recovery in '25, and we continue to enjoy that in '26. And the last market in Belgium, where, as you know, we had to restructure a little bit these activities on the top line. We had a top line that was suffering a little bit in the last 2 to 3 years. But on the opposite, with a good recovery on the bottom line, which is not at the level it should be. Thank you for the call. What is the reason -- another question, sorry, what is the reason why you do not sell the OpCo in Switzerland. We are talking there in terms of nursing homes in Switzerland. What is clear is that the situation now is following. We have launched in '24 a lot of potential disposals, both in terms of real estate and in terms of OpCo. And to be sure to be able to reach our target of EUR 1.5 billion disposal, we've sold and we've launched several processes at the same time. Now we are in a very different situation where we have structurally and we say definitely reinforced our financial structure and we can be more selective in the disposals that we are making. So we reassessed the strategic rationale of these disposals. And you know what, I think that being diversified in terms of countries in a world where we have uncertainty in terms of regulation and budgets and state budgets, I think is a good thing. So we've decided not to sell the nursing homes in Switzerland. Another question, do you expect to hedge a larger share of your debt, Jean-Marc? Jean-Marc Boursier: Yes. Our strategy is clearly to hedge a significant proportion of our debt. Our debt was launched fully at variable interest rates. For your information, we have already hedged EUR 1 billion out of this EUR 3.15 billion that we launched late in 2025. So we are in this process of hedging the debt, and we expect to have a higher proportion of the debt that will be hedged going forward respectively. Laurent Guillot: Two questions. What is the target EBITDA margins pre-IFRS of 2029, 2030? We have not given any guidance in the past in that respect. At the same time, we have given a guidance in terms of EBITDAR growth over the next years on the '24, '28 period with a growth rate of 12% to 16% in average over this period, which then give you the opportunity knowing the rents that we have, give you the opportunity to make your own estimate on EBITDA and EBITDAR margin. What is the target returns for the development CapEx, Jean-Marc, do you want to share with me the question? Jean-Marc Boursier: Yes. For development CapEx, we are targeting new facilities with [indiscernible] which is lower or at least 5 years after construction. So this is our objective. And that enables us to be very selective going forward. So we expect to invest in development CapEx between EUR 100 million and EUR 130 million per annum going forward. That's the order of magnitude. And that would mean probably opening something like 1,000 to 1,500 new beds per annum. So we expect going forward, the increase in revenue to come by something like 1% from new bed openings. But our objective in terms of payback is at maximum 5 years as per construction. Laurent Guillot: Okay. Whether other countries EBITDA has been weak in H2 versus H1. Why? Well, we suffered a lot from the situation we have in Ireland, where given the request in terms of further staffing from the authorities have led us to a significant reduction of the EBITDA performance. We are definitely working on this topic with the management to turn around this country. What has to happen for dividends or buyback to begin? We first have to be positive in terms of net profit for sure. This is definitely something that we are contemplating for the next years, but we are not yet in the situation for the time being. By the way, we need to be also given the documentation, the financial documentation that we have, we need also at the same time to be below 7.5x EBITDA in terms of net debt-to-EBITDA ratio to be allowed to pay dividends. Another question on the board page. How did the Board choose Olivier Dussopt? Well, first, we have to say that Guillaume Pepy that was -- that is our President today has decided not to continue and do something else for the future. So the Board had to find someone. It's also at the same time, a new phase for the company. Olivier's experience in local government and knowledge in nursing homes or health care system are both at the local level and his experience also in the government will be a big help for us. It's important negotiation with the different governments is always important in our activity. So Olivier has been chosen by the Board at the unanimity and is proposed to be our President at the next -- after the next general assembly. Could you comment on the EUR 42 million impairment you did in full year '25, Jean-Marc? Jean-Marc Boursier: Yes. We have decided to be particularly cautious as far as balance sheet management [indiscernible]. So we have not recorded impairment. We have recorded depreciation for various assets, and we will continue to work on balance sheet improvement and I expect part of this depreciation be released in the quarters to come, but we wanted to be particularly cautious as far as the balance sheet cleanup is concerned. Laurent Guillot: To which extent are you impacted by the recent increase in financing conditions regarding your financing and the value of property assets? Two things. First, it's way too early. We have not had any significant impact at this time. Concerning the financing, as Jean-Marc said, 1/3 of our interest is covered so it's fixed. And the rest, well, the reality is that the short-term Euribor 3 months have increased, but not dramatically. So this has no material impact for the time being. We need to see how the things will evolve. And for sure, as soon as we can, we will continue to hedge this financing cost. Concerning the real estate, it's way too early to have a comment on the valuation. You remember that compared to the situation we had in 2022, the situation of the valuation is probably at a low point. And looking forward, we expect the real estate market more to be at a trough and at the same time with our profitability improving to have a progressive revaluation of our assets. Has there been -- you want to add something to this? Has there been any increase in lease cost, lease cash payments in H2 '25, Jean-Marc? Jean-Marc Boursier: Maybe it is worth to reminding you a few things. First of all, we are leasing 56% of our facility and we are owning 44% of our facility and as Laurent explained in his speech presenting that this placed a unique in the nursing homes and clinic industry. And as far as this payment his concerned, we have done, I believe a good management with external rents because as you have seen our presentation, external rents have been brought down from EUR 495 million in 2024 to EUR 492 million in 2025. So most of those things are CPI based but we have been able to start renegotiating some of them. So this payment has been kept in extremely good control in 2025. Laurent Guillot: So recovery in French clinics, what can you say? Well, clearly, we continue to work hard on improving the profitability on the clinics. A lot of the measures are self-help. We do not expect and do not rely on any in the French market. We do not rely on any incoming from the government and from the authorities. But at the same time, I think we can operationally improve significantly how the -- our clinics are currently working. And on that front, there is still a way to go in '26 and '27. So good opportunity for us also there. On the market, as you know, it's a very regulated market with a vast majority of our turnover coming from the social security. And we continue to expect low tailwind coming from the financing in France, but we are working around that with our own self-help measures. Another question, is there a specific ownership rate target for the medium term, please? No, no, no, there is -- I think we are happy today and in the current environment to be the owner of our assets of 44% of our beds. I think it's a strong asset that the company has. We had in the past a target, but this target was also linked to the fact that we needed to deleverage the company, reduce the issues concerning the balance sheet and make disposals. We have done the vast majority of the program and more than what we announced. So now I think we will be very, very opportunistic, continue to grow and invest and at the same time, divest a little bit, but very, very selective, and we have no specific ownership target. We consider our high ownership target as an asset. A few seconds ago -- sorry, another question [Foreign Language]. So what are emeis ambitions concerning care at home? We have already care at home activity, not significantly in France and almost nothing in France. But we are already present in other countries, for example, in Ireland or in the Netherlands. This is a very interesting activity and we are contemplating the possibility to grow further in care at home activity. Well at the same time, for sure, the priority operationally for the time being, the first priority is to improve dramatically because this is low-hanging fruit, I would say, to improve our current operations and develop what we are doing in a way to improve dramatically our profitability. So both ways, I would say this is definitely an opportunity for us but we are developing already in some countries. In France, in particular, as the question is asked in France, we are not very present and the priority is to focus on turning around our clinics and our nursing homes. Any other question? No, apparently, there is no more question. So just to summarize back what we have said already during this call, strong recovery and a strong year in '25, both in terms of operations and at the same time in terms of strengthening of our balance sheet. Moving forward, we continue to have good trends ahead, both in terms of market with a strong demand, but also in terms of conditions in which we operate. We are very confident concerning our guidance concerning '26. I think it went out from what we've said today and the opportunities moving forward in terms of improvement of the profitability and the operation of emeis is very strong. So the future is all us, and there is more to come in terms of improvement, EBITDA improvement and solidity of the company. Thank you for listening to us, and have a good day. Operator: This now concludes the conference call. You may disconnect.
Operator: Good day, everyone, and welcome to the QuoteMedia Year-end Results Conference call. [Operator Instructions] Please note, today's call is being recorded, and I'll be standing by should you need assistance. Now I'll turn the call over to your host, Dave Shworan. Please go ahead, Dave. David Shworan: Thank you, and welcome, everyone. We appreciate you joining us today. Before we begin, I have a brief safe harbor statement. Except for historical information contained herein, the statements made in this call include forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks and uncertainties that could cause actual results to differ materially from those projected. And now we're happy to go through our 2025 year-end results. 2025 was a very strong year for QuoteMedia. At the beginning of the year, we were focused on rebuilding from the client losses we experienced in 2024. Today, I'm pleased to say that we have not only recovered, but we have moved beyond that period and established a stronger, more diversified foundation for the business. For the full year, we achieved 8% revenue growth over 2024. This is a meaningful result, particularly given the headwinds we were working through at the start of the year. As the year progressed, we saw growth accelerate quarter-by-quarter, supported by new client wins and expansion within our existing client base. This acceleration is reflected in our fourth quarter results where we delivered a 14% increase compared to Q4 of 2024. Importantly, this growth is high quality and increasingly predictable. We are signing larger contracts, expanding relationships with existing clients and continuing to build a stronger base of recurring revenue. Our sales pipeline remains very strong. Arguably the strongest we've seen in several years. And we are entering 2026 with a high level of confidence. Based on our current visibility, we expect to double -- deliver double-digit growth through each quarter of 2026. From a profitability standpoint, we continue to see steady improvement, our gross margin finished the year at 47%, and we expect that to improve further through 2026. The same is true for EBITDA and overall profitability, which we expect to strengthen in the coming quarters as the impact of previously capitalized development cost continues to diminish. We're now seeing the benefits of the investments we made over the past several years. And as revenue continues to grow, we expect that to translate into improved profitability. This reflects in the operating leverage in our business. As revenue grows, our cost structure does not increase at the same rate, allowing us to expand margins over time. In addition, our deferred revenue finished the year at $1.9 million. which reflects strong contracted business that will be recognized in future periods and provides greater visibility into our revenue going forward. From a competitive standpoint, we're very encouraged by what we're seeing in the market. We're constantly winning. We are consistently winning contracts against much larger, well-established competitors. Importantly, these wins are not based on price. They are based on the strength of our product, the depth and quality of our proprietary data and the level of service we provide to our clients. We are winning because we are better not because we are cheaper. That is the clear validation of our strategy and our long-term investments in both technology and data. We are also continuing to expand our product offerings. Our AI initiatives, which we began developing internally several years ago, are now becoming increasingly integrated across our platforms. We believe this will enhance the value we deliver to clients and create additional opportunities for growth over time. We see AI as a meaningful driver of future product value and client engagement. We are entering 2026 with more visibility than we've had in years. Our pipeline today gives us real confidence, not just optimism about the year ahead. Our products are resonating in the market and we are increasingly seeing companies reach out to us to upgrade their services from incumbent vendors. With the momentum we've built this year, we believe we are at the beginning of a multiyear growth phase. Our business is becoming more predictable, more scalable and more resilient, and we are entering 2026 from a position of strength. We are very excited about the opportunities ahead of us. With that, I'll now pass over to Keith Randall to walk us through the financial details for the year. And after that, we'll be happy to take your questions. Go ahead, Keith. Keith Randall: Thank you, Dave, and welcome, everyone. I'll begin with the income statement. Unless otherwise noted, all comparisons are on a year-over-year basis. Total revenue increased 8% compared to fiscal 2024 and with Q4 revenue up 14% versus Q4 of 2024. Corporate Quotestream revenue grew 14%, while Interactive Content revenue increased 5%. Growth was driven primarily by higher average revenue per customer, reflecting our continued success in attracting larger clients and expanding relationships through cross-selling. Individual Quotestream revenue was relatively unchanged from 2024. Cost of revenue includes stock exchange fees, data costs and amortization of capitalized development. Cost of revenue increased by 9%, driven by higher variable exchange fees associated with revenue growth as well as increased in fixed stock exchange fees. Gross margin remained stable at 47%. Looking ahead, we expect gross margin to improve as revenue grows and amortization expense declines with lower capitalization levels. Total operating expenses increased 14% for the year, primarily reflecting lower capitalization of development costs and therefore, higher immediate expense recognition. Sales and marketing expenses were relatively flat, increasing 1%. G&A expenses decreased 12%, driven by lower bad debt expense and reduced office costs. We downsized our Vancouver office after our lease ended in July 2025, as most of our development team now works remotely. Software development expenses increased 58% and reflecting a shift in the capitalization of development costs with 7% of development costs capitalized this year compared to 25% in 2024. This increase was partially offset by lower payroll costs, reflecting a reduction in development staff in December 2024. Net loss for the year was $2.3 million compared to $1.3 million in 2024. Adjusted EBITDA was $1 million, down from $1.8 million. Lower capitalization resulted in more development costs being expensed immediately, while amortization remains elevated due to prior period investments. But while our capitalized development cost accounting impacted earnings and EBITDA, it did not impact cash flow. These dynamics are temporary and will normalize over time. As a result, we expect improvements in gross margin, EBITDA and overall profitability as revenue continues to grow and amortization expense declines. Please refer to the reconciliation in our press release for details on adjusted EBITDA. Turning to the balance sheet and cash flow. We ended the year with $320,000 in cash compared to $585,000 at the end of 2024. Deferred revenue totaled $1.9 million. The associated future costs related to deferred revenue are minimal as this revenue largely relates to setup and development work already completed and will be recognized over the remaining contract terms. Net cash flow from operations was $1.1 million, while investing activities used $1.4 million, primarily for infrastructure and product development. Q4 revenue growth was 14%, and we expect similar growth in 2026. We also expect improvement in profitability as revenue grows and the impact of prior period amortization diminishes. Thank you, and I'll now pass it back to Dave. David Shworan: Thank you, Keith. We'll now open up the call for questions. So please let us know if you have any questions. And as always, if you have any follow-up questions, please feel free to reach out to us at investors@quotemedia.com. So open to questions. Operator: [Operator Instructions] First question today comes from Michael Kupinski of NOBLE Capital Markets. Michael Kupinski: First of all, congratulations on a nice quarter, great print. Just a couple of quick questions here. How much of your expected 2026 revenue is already under contract? And then how does that compare to prior years? If you can just kind of give us some flavor there. Keith Randall: Yes. I think based on -- I did this math, just based on our -- if we just extrapolated our January revenue, we would have about $2 million in revenue growth yearly. So that would give you an indication of how much is already under contract. If you annualize it, it will be around -- it would be about $22 million, I believe, annualized. Michael Kupinski: Okay. Perfect. Thanks Keith. And then how should we think about software development costs going forward? I know it was $2 million in the Q4. Is that a good run rate as we go into 2026? Or was there some -- if you could just give us some thoughts about that. Keith Randall: You're referring to the amount we're capitalizing? Or is that? Michael Kupinski: Yes. Yes. Keith Randall: Yes. I would expect it to go down a little bit further, but not that much further. So... Michael Kupinski: On a quarter... Keith Randall: Partly is being more conservative of what we capitalize as well because we were also running into problems -- not problems, but the more we capitalize, the harder it is to -- for our auditors to audit as well. So that was becoming a problem. We're spending too much time tracking it versus actually developing. So that was a factor as well. Michael Kupinski: Got you. And then -- and Dave, you mentioned a little bit about the competitive dynamics in the marketplace today. I was just wondering if you could just talk a little bit about the current market environment, particularly as you compete against those larger market data providers, what is the big draw for the company? I know that you said it's not on the basis of the price, of course, but what is the feature set that really is attracting the growth right now? David Shworan: Well, I think over time, obviously, we've established our name and our brand in the market. We've got some very big clients. We're were being called to the table every time there's an RFP or a request of some sort, we're invited to quote on it. And we're noticing that we're not having to go in bottom, sometimes we're actually even higher priced. But what we found is our products are better. Our data is our own. It's all proprietary. So we're not dependent on any of these third parties, any other providers out there, usually smaller guys, usually are using third parties for their data. We're not using any third parties where we own everything ourselves. So the power that we have is to be able to price things the way we need to. But at the same time, our service and our product levels, we are hearing that they're better. So our technical charting is much better than competition. We're actually -- you're going to see our technical chart hitting many sites and high-end firms they are all going with our technical chart as an example. So just things like that, we're very focused on higher level product. It's all more modern. It's -- we're just more nimble to work with and also our service levels. We just hear that our service levels are great. People get white glove treatment, we're there for them. If they need other data, if they need other services or other methods of delivery or anything like that, we're there. And they don't have to deal with lots of legal and back and forth. It's much more straightforward with QuoteMedia. So anyways, I guess the main thing is that the bigger contracts are coming our way, which is great. Michael Kupinski: Got you. And just final question. How are you thinking about investment versus profitability trade-off at this stage of growth, particularly as you indicated that you're anticipating double-digit revenue growth going forward here and hopeful for multiyear as you indicated. Can you just kind of give us some thoughts about what your thoughts are in terms of investments and needed to kind of sustain that type of strong revenue growth? And then just your thoughts on the profitability trade-offs? David Shworan: Sure. Yes. I mean it's not like we need to spend a lot more. So I don't really have a target of where I'm going to be spending. We do have very, very good teams. It's -- I think it's just head down, keep going with what we've got. We don't really need more people. If we bring in a whole bunch of big clients all at the same time, then we might need some more implementation or front-end people just to keep up with it. But that's about it. I mean everything else is ticking along. We've got a pretty substantial sized company of people. Every team has redundancy, failover everything that we need. The only thing is I might look at some international expansion. I have been focusing on that knowing that we are going to have some profitability and some extra cash as we go forward. So it's kind of looking at some of the other countries that I want to take us into. But I'm not jumping at that yet. And then the other thing is maybe looking at some share buyback if we have extra profitability. Michael Kupinski: And then, Dave, you mentioned in the past one, sorry, one more. You mentioned in the past the prospect for strategic partnerships and things like that would your international expansion be more interesting to you to bring in a strategic partner? Or are you looking at M&A? Or any thoughts there? David Shworan: Yes, looking at both. So I've actually spent the last few months doing that exactly. So partnership discussions as well as M&A discussions. But it's a little premature. So I'm just kind of feeling it out, I'm talking to people in the industries in those countries to find out what's needed, where the incumbents are, where people are not happy and what we would focus on. The nice thing about QuoteMedia is we already have all the product. We already have all the delivery. We already have the best terminals in the market. You take a look at our Quotestream web product, which is way above everything that's out there. All we have to do is turn on data, really. And just -- but there's obviously some fees and exchange fees and things like that. But we're ready to run. So that's what's kind of great about what we're doing. Operator: Next, you'll hear from [ Eric Nickerson ] of Third Century Partners. Unknown Analyst: Just a question about your taxes. The software development expenditures that used to be amortized over 3 years but are now amortized in 1 year. Do the tax laws match that? Do you get to write them off on your taxes in 1 year as well as so you had to write them off over 3 years previously. Are you able to write them off in 1 year now. Keith Randall: Yes, I can answer that. Unfortunately, that it's different for foreign development. So that is 15 years, which is problematic for us, right? So that's another reason why we want to reduce the capitalized development. So yes, that's -- so to answer your question, unfortunately, the -- any foreign development is treated differently for tax. And our team in Canada obviously. Unknown Analyst: Okay. Well, I was more thinking about the mainstream domestic development. Do you get the same tax treatment about... Keith Randall: You are right about domestic, but I'm just saying that we have -- we also have foreign development. So -- which is the tax treatment is different for foreign development. Operator: Next, we have investor in [ Ankur Shagar ]. Unknown Shareholder: Congratulations on a great Q4 and back to growth in '25. I joined late, so I apologize if you've already talked about this, but I have two questions. One is regarding the growth trajectory, I mean, how do you feel about it? I mean Q4, 14% growth overall in a 25% and 8% growth. Based on the pipeline, do you think these sort of numbers of 14% growth can continue? David Shworan: Yes. Yes. Exactly. That's what we're kind of looking at. And we look at our projections, we look at going forward, and it looks -- that looks like what we're looking at, but there's also so many big things in the works that anything can happen. So we're very confident with the double-digit growth every quarter. And it's more about what's going to kick in that really changes that number even more. But yes, there's your answer. Unknown Shareholder: Okay. And then one on the valuation question, Dave. I mean the company is back to growth, I mean, 14% growth, and you expect that trend to continue the valuation of the company does not really reflect that. And there is a couple of fundamental ways to fix that. I mean, one, I think you just talked about doing a share buyback. And the second is to consider other strategic alternatives like a sale of a company which I know a private market valuation for this company would be higher. So any thoughts on how -- what sort of tools you're thinking about to really fix this valuation gap? David Shworan: Yes. I mean I think that was asked last quarter as well, if I'm going to start focusing on IR. I mean, obviously, my primary focus has been revenue meeting with clients traveling for that and not really doing a lot of IR. But it's also because I found that IR was not helpful if you didn't have a story, right? If you had a bad year if you were not doing great, whatever happened, it's the wrong time. And you just waste money, you waste money and time and you go and you talk to people and nothing really happens. And people are always show me, don't tell me kind of thing. So now we've done it. We've pulled out of that. I'm seeing really good growth. The clients that we're proposing to now are way bigger. Everything is going really, really well. So it's time to put some focus on IR, get some meetings going that way, go to some of those conferences. And then tell our story again. And I think that's going to help. And yes, I just -- I guess we're so were quiet. There's reasons why we're quiet in the industry. We can't press release a lot of things, and there's many reasons and there's many clients that will not allow it. It's a very strange industry that way. But we're -- I just -- it's getting the word out there. We just have to get more eyeballs on the company. But I think the growth and the recurring growth -- double-digit growth numbers, I think, are going to start to spark some interest in the company. I'm hoping, for sure. Unknown Shareholder: Okay. And how is the company using AI sort of like are you using tools to really increase the profitability or sort of like create more products or anything like that? David Shworan: No, yes. It's -- well, AI is a phenomenal thing. So I'm the biggest advocate of AI, forcing it -- almost forcing it down everybody's throat because I've used AI for many years. And the company now is completely wrapped around AI. So every single department has high-level AI access. We are using it for coding. We are using it for data cleansing. We are using it for analytics. We are using it to analyze support tickets to see what the trends are. We are doing so much internally as well as all of our external products have AI. So we're doing a lot of AI there. We're releasing -- we're meeting with a lot of these big firms about AI because they've got a focus on AI and they are obviously linked to us. So we have to do all the development. So we're showing them all of our products that we're building and what we're doing. It's about perfecting and it's about making sure that AI doesn't make mistakes or all those things that people are scared of. So all of our big clients want to move with the AI. The thing is that we you're probably going to see a bit of a delay as far as our open chat product. We've already written it. It's -- our bot is called Q. And it's an amazing bot. It basically -- it only uses media data. So it does not go to the web. It goes through. It uses all of our data calls, all of our database, and it answers all your questions, it analyzes your portfolio. It tells you how a stock is doing. It tells you history, it compares stocks. It does whatever -- it's like ChatGPT. And we are using all of these third-party AI agents. So they do take credit. They do cost money. I mean, obviously, it's going to be flow-through to clients, but that's where you get the high level, and we're not exposing our information into the general AI world. So it's not going into ChatGPT for the world. It's only in our own use, that type of thing, right? Anyway, AI has been huge for us. Absolutely massive. Unknown Shareholder: And the chat but product, I mean, are you creating that internally? Or is that for a client where you plan to white label it? David Shworan: Yes. It's for white labeling. It's for use in our terminals, all of that. Yes, it's available for clients. And we've demoed it to clients. We've demoed it. it's a phenomenal product. And it's always a work in progress, right? It's training, it's teaching, it's making sure that it's not going sideways or doing something wrong. And that's where clients are -- want to make sure like you're not going to have a big bank turn on a chat bot and all of a sudden, it tells somebody something it shouldn't. So I think that's where our other AI products, which is analytics, trading ideas, showing you trends, showing you what -- using all these different strategies if you're a strategy style investor, these are all the things that AI is finding and you don't have to find it. And I think that's where our focus is, analyzing your portfolio, showing if your portfolio is incorrectly weighted or if it's changed since yesterday because a mutual fund or an ETF has bought into different stocks. And now you're heavy in a certain sector and you shouldn't be. Different things like that, right? So it's pretty involved, but the amount that AI can do is it's crazy. It's absolutely insane, and we're jumping all over it, and we have for years. Unknown Shareholder: Got it. Just one last one on the -- I think last quarter, you mentioned some large sort of like deals. Have any of those closed recently? And in general, how does the pipeline look? David Shworan: Pipeline looks great. Yes. So we have had closure. We have had some good deals closing, as you can see by our growth numbers. And -- but some of the bigger ones are actually still going. So there -- I was thinking something would close by now on one of those big ones that we're talking to, but it looks like it might be in the next quarter. So it's -- but we're -- yes, we're doing well. I mean the pipeline is very big. RFPs are coming in like crazy. There's -- we're starting to build that real brand, that real name and the more we can get our products on to external sites, I think, is -- that's the other thing, is we haven't we kind of do everything behind login, so you don't see it all. So now we're doing some focus on those portals and external sites. So you can see QuoteMedia's brand and name and a little bit more in the limelight. Unknown Shareholder: Yes. Got it. Just one more. As we just look at the market, I mean, there has been a scare in the market that with this AI trend software and SaaS is dead, where companies should be able to create their own software. I mean, from what you are telling you see AI as a tailwind, but how are the -- what do you see inside the customer base that you work with? I mean, are they sort of like looking at using AI to replace vendors? Or what is that conversation with the customer base and your thoughts on it? David Shworan: Actually, the opposite. So I haven't seen that at all. It's not like you can just create with AI, and it's all the data and the analytics behind the scenes. So what they're doing is, all of these companies are starting an AI department we've had an AI department for a while. And it's essentially focusing on what do we do with AI and where do we go with the AI. And every single team member can talk to the AI department to say, "I need to do this or I have an idea for improving this or that, how do we use AI". So it's making sure AI is being used across the board for everything. These companies are creating AI departments, but it's more to figure out what AI they're going to use and how they're going to improve their product line, and then they reach out to us to say. How do you -- what are you doing and how do we use you? Like that's -- they don't want to build it. They don't want to chat bot. They don't want to build analytics and portfolio things, all that stuff. They want us to do it. So they're more about the strategy of their firm and then coming to us. And so we're filling out constant questionnaires from all these companies of what kind of AI are you using? What can you provide us? What kind of safety nets do you have all these kind of questions that are coming in to us because they want us to provide. That's what we're seeing. Operator: [Operator Instructions] Dave, we have no further questions at this time. Back over to you for any additional or closing comments. David Shworan: Okay. Well, thank you, everybody. Thanks for joining us today, and we appreciate your continued support, obviously, and interest in QuoteMedia, tell your friends. And as always, if you have any follow-up questions, please feel free to reach out to us at investors.quotemedia.com. We really appreciate it. Thanks again, and we wish you a great rest of your day. Bye-bye. Operator: That concludes our meeting today. You may now disconnect.
Operator: Ladies and gentlemen, welcome to the Fourth Quarter and Full Year 2025 Financial Results. My name is Joseph, the Chorus Call operator. [Operator Instructions] This conference is being recorded. [Operator Instructions] The conference must not be recorded for publication or for broadcast. At this time, it's my pleasure to hand over to Sarah Fakih, Head of Global Communications and Investor Relations. Please go ahead. Sarah Fakih: Thank you, Joseph. Good morning, good afternoon, and welcome to today's webcast and conference call. My name is Sarah Fakih, and I'm the Head of Global Communications and Investor Relations at Evotec. Please allow me to introduce today's speakers. Joining me on the call are Christian Wojczewski, Chief Executive Officer of Evotec; Paul Hitchin, our Chief Financial Officer; and our Chief Scientific Officer, Cord Dohrmann, will be available for the Q&A session. Please note that this call is being webcast live and will be archived in the events calendar on our website. Before we begin, a few forward-looking statements. The discussion and responses to your questions on this call reflect management's views as of today, Wednesday, April 8, 2026. During this call, we will make statements and provide responses that state our intentions, beliefs, expectations or projections regarding the future. These statements constitute forward-looking statements within the meaning of applicable securities laws. They are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied. Evotec disclaims any intention or obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances. For further information regarding these risks and uncertainties, please refer to our public filings and disclosures. With this, let me hand over the call to Christian. Christian Wojczewski: Thank you, Sarah. Good morning, and good afternoon to everyone. Thank you for joining today's call. Let me start with the headline results for 2025 and the first months of 2026. '25 was a year of significant progress for Evotec as we laid critical groundwork for the company's next chapter of sustainable and profitable growth. Throughout a persistently challenging market environment, we remained anchored in the strength of our science and the dedication of our teams, which continue to be the foundation of our performance. Building on these fundamentals, we introduced a new company strategy in 2025 that defined our priorities and now guide the transformation work underway in 2026 and beyond. Our four levers of midterm value creation, scientific leadership, operational excellence, better monetization of Just-Evotec Biologics and capturing pipeline value have already translated strategy into targeted action. As a result of this work in 2025, we have delivered more than EUR 60 million in annualized cost savings, streamlined our asset pipeline and reduced our capital expenditure by around 60%, important steps that have strengthened our balance sheet and our financial resilience. Against the challenging market backdrop of 2025, financial results were at the high end of our guidance range and Paul will go into more detail on that later in this presentation. Both segments of Evotec business have contributed to our progress in the past year. Discovery and Preclinical Development continued clinical advancement across partner programs, delivered milestones and underscored the productivity of our platforms despite continued softness in early-stage biotech funding. Just-Evotec Biologics delivered a breakthrough year supported by the landmark agreement with Sandoz and continued progress across global health programs. And last month, we kicked off our Horizon initiative, a comprehensive transformation of our operating model. We are already making substantial progress across the three Horizon pillars of operations, science and commercial execution. The last of which recently saw the appointment of a new Chief Commercial Officer, reinforcing our commitment to building a more agile, customer-focused organization. As Horizon implementation continues, we expect to see the first structural and financial benefits in the second half of 2026. Turning to the progress in our Discovery and Preclinical Development segment on Slide 5. We saw robust clinical and scientific advancement over the past 12 to 18 months, across key therapeutic areas, including oncology, neurodegeneration and kidney disease, as well as exciting developments in emerging modalities such as condensate modulation. During this period, and as already reported during our Q3 results in November 2025, two partnered assets moved into Phase II clinical studies. Since then, a partnered preclinical asset advanced to a first in human Phase I study, bringing our partnered clinical portfolio to a total of 2 programs in Phase II and 5 programs in Phase I. Let me briefly highlight the progress within some of our key alliances. In our cancer protein degradation collaboration with Bristol Myers Squibb, we are jointly developing a broad pipeline of next-generation molecular glue degraders, a revolutionary modality with a potential to target previously undruggable disease-causing proteins and an area in which BMS is the clear industry leader. The first candidate progressed from IND acceptance in November 2025 into a Phase I clinical study in March 2026 in advanced clear cell renal cell carcinoma, the most common form of kidney cancer. These advancements, which validate the strength of our screening and AI-supported analytical platforms resulted in milestone payments of $5 million and $10 million, respectively. In our neuroscience partnership with BMS, we achieved continued progress across a jointly developed preclinical pipeline focused on therapies for neurodegenerative disorders, triggering a $25 million milestone payment in October 2025. Lastly, in our kidney disease partnership with Bayer, a Phase II clinical study in Alport syndrome, a rare genetic kidney disease was initiated in December 2025, underscoring our discovery and translational capabilities in renal conditions. The momentum across these collaborations highlights our ability to translate our outstanding science into a successful clinical [indiscernible]. It validates our platforms and carries through on our fourth strategic lever, capturing pipeline value as assets advance to generate meaningful financial upside. Looking ahead, we expect the total number of assets in Phase II to have grown from 2 to 4 during 2026. Turning from our small molecule business to biologics, let me give you an overview of our Just-Evotec Biologics segment on Slide 6. 2025 was a breakthrough year for JEB defined by a strategic pivot away from a capacity-constrained manufacturing model toward an asset-lighter technology-focused partner enablement model. This evolution centered on our highly differentiated continuous manufacturing platform is reflected in the news flow throughout the year, featuring technology-enabled partnerships and significant progress in global health programs. However, the defining milestone for JEB was the completion of our strategic agreement with Sandoz, which closed in December 2025. The agreement is valued at $650 million with additional royalty potential for 10 biosimilars, the sixth most advanced of which have an originated value of about $92 billion. Further recent developments include a multi-year BioMaP-Consortium award of up to $10 million from the U.S. government, Biomedical Advanced Research and Development Authority. The program aims to optimize the biomanufacturing of monoclonal antibodies against Ebola and Sudan viruses, strengthening preparedness for hemorrhagic fever outbreaks. In January 2026, we also expanded our long-standing collaboration with the Gates Foundation, receiving a new grant supporting 10 new molecule design projects over the next 3 years. These projects apply our AI and computation-driven J.MD platform to improve antibody developability and advanced access to affordable biologics. Taken together, these advances show how JEB is evolving into a high-margin, technology-driven business with durable long-term value creation potential firmly validating JEB as a core pillar of future growth ambitions. Let me now hand over the call to Paul to walk you through our financial results. Paul Hitchin: Thank you, Christian, and a warm welcome from my side as well. On Slide 7, you can see our condensed income statement is in line with the preliminary unaudited financial results we provided as part of the Horizon Communication on March 10, 2026. For the fourth quarter of 2025, group revenues increased by EUR 32.1 million or 14.5% to EUR 253.3 million. And for the full year 2025 decreased by EUR 8.6 million or 1.1% to EUR 788.4 million compared to the same period in 2024. On a constant currency basis, Q4 revenues grew by 21% and full year revenues grew by 1.7% compared to 2024. While the broader CRO market showed early signs of recovery in 2025, the environment for early-stage drug discovery remained challenging. As a result, the full year revenue decline was primarily driven by lower revenues in our D&PD segment, where revenues declined by EUR 27.3 million or 16.6% to EUR 137.1 million for the fourth quarter and by EUR 82.5 million or 13.5% to EUR 528.9 million for the full year compared to the prior period. Unfavorable foreign exchange movements represented an additional headwind to full year revenues of 2.8%, driven by the U.S. dollar and British pound. However, those effects were largely offset by strong performance in Just-Evotec Biologics segment, including the positive contribution from the Sandoz transaction in the fourth quarter of 2025. Revenues within Just-Evotec increased by EUR 59.4 million or 104.2% in quarter 4 and by EUR 73.8 million or 39.8% and to EUR 259.4 million for the full year 2025 compared to 2024. This growth was driven by the continued progress in the Sandoz partnership, including an incremental contribution from a license payment of approximately EUR 65 million in the fourth quarter. While revenues from the U.S. Department of War-related activities declined in the second half of 2025, following announced budget cuts, revenues of our non-Sandoz and non-DoW customers continue to grow by more than 60% in the full year. Fourth quarter costs in Just-Evotec were temporarily elevated versus the underlying run rate driven by additional expenses associated with the Sandoz transaction and temporarily higher material costs, both of which are expected to normalize early 2026. In line with our guidance, R&D spending decreased further and amounted to EUR 37.5 million or 4.8% of total revenue for the full year 2025 compared to EUR 50.9 million or 6.4% of total revenue in 2024. Investing in our technologies and platforms remains a core part of the strategy and we will continue to allocate capital to scientific capabilities and technology leadership while maintaining a balanced investment approach in a challenging macroeconomic environment. Adjusted group EBITDA increased by EUR 29.5 million or 103.6% to EUR 58 million in the fourth quarter and by EUR 18.5 million or 81.9% to EUR 41.1 million for the full year of 2025 compared to the same period in '24. Adjusted EBITDA in the D&PD segment decreased by EUR 12.6 million to EUR 6.8 million in the fourth quarter and by EUR 24.7 million to minus EUR 12 million in 2025 primarily driven by the aforementioned lower revenues, which contracted faster than the cost base, creating internal overcapacity and weighing on segment profitability, underscoring the need for the operational transformation program recently announced as part of Horizon. Adjusted EBITDA in the Just-Evotec segment increased significantly by EUR 42.1 million or 463% in the fourth quarter and by EUR 43.3 million or 443% to EUR 53.2 million in 2025 compared to the prior periods. This strong result reflects continued progress in the validation of our continuous manufacturing technology as well as favorable shift in revenue mix towards higher margins and an asset-lighter technology enablement model. Turning to liquidity and the balance sheet on Slide 8. We closed 2025 in a solid position. At year-end, cash liquidity stood at EUR 476 million, representing a strong balance sheet with a net cash position. The improvement in our cash liquidity reflects disciplined financial execution, including the monetization of technology leadership through Just-Evotec Biologics, the realization from maturing equity stakes including the upfront payment from the sale of our minority stake in Dark Blue Therapeutics and our continued shift toward a capital-efficient operating model with CapEx spend reducing 38% year-on-year. Importantly, we entered 2026 with no active financial covenants, providing us with a high degree of financial flexibility. Now let me hand back to Christian, who will provide an update on some of our key revenue impacts. Christian Wojczewski: Thank you, Paul. To further contextualize our 2025 results and frame the trajectory into 2026 and beyond, let me briefly address one of our key strategic levers, our long-standing partnership with Bristol Myers Squibb. From 2016 to the end of 2026, our two BMS collaborations in urology and oncology are expected to have generated close to EUR 800 million in cumulative revenues. At their peak, they accounted for more than 20% of group revenues making BMS one of the most significant and successful strategic relationships in Evotec's history. With this partnership, the oncology collaboration today represents a larger contributor to BMS-related revenues. As illustrated on Slide 9, it has evolved through distinct phases from platform built out to expansion and now into portfolio maturation. These phases are characterized by alternating periods of investment and harvest, which are naturally reflected in corresponding changes in revenue contribution. Since the peak in 2023, revenues from the oncology collaboration have declined by more than 1/3 over the 2023 to 2025 period. This reflects a shift into a renewed investment phase focused on molecular glues and areas of exceptionally high scientific and commercial potential. While this transition has temporarily increased cost intensity and weight on D&PD profitability, it does not signal a weakening of the collaboration. Rather, it reflects the cyclical nature of a large multi-program discovery alliance. Looking ahead, it's important to recognize that the collaboration is already creating value in its current phase with a focus on building scientific depth and portfolio quality. While this phase continues to require investment, the scientific value being created today is expected to translate into renewed revenue growth and improved margins. Importantly, this fluctuating profile is expected to evolve as programs progress through the clinic. With the first joint asset having recently entered Phase I, clinical stage programs are expected to progressively complement the base business from 2027 onwards. This clinical progression will have smooth revenue fluctuations, add new growth drivers and support the margin expansion underpinning our midterm framework, which Paul will discuss in more detail later in the presentation. Continuing on Slide 10, I would like to address the second factor that significantly impacted our '23 to '25 revenue profile, alongside our BMS collaboration, the evolution of our EVOequity strategy. Between 2016 and 2022, we invested approximately EUR 200 million to build up an investment portfolio of approximately 40 early-stage biotech companies. The objective was to gain early access to innovation while generating revenues to our role as an operational and scientific partner. At its peak, this portfolio generated close to EUR 100 million in annual revenues. As these companies advance into clinical development, their strategic relevance for Evotec naturally declined. This was accompanied by a reduction in our operational involvement and consequently lower revenue contribution. We've, therefore, moved decisively into the monetization phase of this strategy. Following the divestment of recursion, generating proceeds of nearly $70 million at the end of 2024 and additional access throughout 2025, we have significantly reduced our equity exposure. As of year-end 2025, 29 investments remain with our strategic focus shifting from revenue contribution to value realization. These divestments represent pure upside for Evotec. Recent transactions include the sale of our stake in Dark Blue Therapeutics following its acquisition by Amgen in a deal valued at approximately $840 million, generating an initial cash consideration for Evotec of around $13 million. In addition, the recently announced sale of Toulouse in a transaction valued at approximately $5 billion is expected to deliver cash proceeds of around $100 million to Evotec at closing. In both cases, the upfront amounts are complemented by meaningful contingent milestone payments of more than $150 million, providing additional future upside. EVOequity is transitioning from a cash out to a cash realization model. As operating involvement declines by design, the associate [indiscernible] will fade away in 2026 and beyond as we wind down the portfolio. On Slide 11, let me briefly remind you of Horizon, our major operating model transformation and a core element of Evotec's value-creating strategy. We introduced the Horizon transformation earlier this year to implement a new and focused operating model built across the three pillars of operational excellence, scientific leadership and commercial execution with the goal of creating a more agile, more focused and more competitive Evotec. Under the operational excellence pillar, we are streamlining our footprint from 14 to 10 sites in '26 and '27 with planned closures of sites in Abingdon, Munich, Lyon and Framingham. This continues our shift from a dispersed multisite structure to a focused network. The footprint optimization also anticipates a reduction of approximately 800 positions across affected locations and enabling functions, a necessary step to align capacity with demand and reinforce execution discipline. Under the scientific leadership pillar, Horizon will consolidate key capabilities into dedicated centers of excellence, each with clear mandate and end-to-end accountability, strengthening our ability to deliver integrated high-quality signs. And finally, under the commercial execution pillar, we're expanding our commercial organization and upgrading how we engage with customers under new leadership. Following the appointment of our new EVP and Chief Commercial Officer, we will accelerate growth, drive a more integrated go-to-market model and increase strategic partner engagement to improve our win rates across high-value mandates. We're now progressing at pace through the required legal and regulatory processes to deliver a structural run rate savings of approximately EUR 75 million by the end of 2027. These savings primarily reflect a structurally lower cost base resulting from targeted workforce reductions and reduced footprint related to overheads as we consolidate our global operations. We expect between 20% and 30% of the total savings to materialize in 2026, with the remaining majority becoming visible in 2027. Horizon is a defined time-bound realignment with a clear end state. We plan to execute swiftly and only once. Importantly, we do not expect material disruption to ongoing customer and partner programs. In the context of expanding our commercial organization under new leadership on Slide 12, we are very pleased to welcome Dr. Ashiq Khan as our new Chief Commercial Officer. Ashiq joined Evotec at the beginning of April, bringing more than 15 years of international leadership experience across biotech, COO and AI-driven discovery platform companies. He has closed multibillion-dollar agreements and led business expansion in markets around the world, including several years at Schrodinger where he helped advance AI-enabled drug discovery partnerships and closed major strategic pharma agreements. With a strong track record of driving growth and closing high-value deals worldwide, Ashiq will lead the build-out of a globally integrated fit-for-purpose commercial organization at Evotec. Let me now show you on Slide 13 how our leading commercial indicators are beginning to move in the right direction. It's a new commercial organization we're putting in place is gaining traction. The selected indicators shown here are ordered along the commercial funnel from early customer engagement through to net sales progression and provide us with an early view of business momentum ahead of reported revenues. Over the course of 2025, and into early 2026, we have seen a strong decrease in negative change orders. At the same time, the number of proposals submitted to customers in our Discovery segment has steadily increased reaching levels around 50% higher than at the start of 2025. While this reflects improved commercial outreach and a more systemic engagement with customers, activity in preclinical development has not yet achieved the same momentum, reflecting a low number of fully integrated discovery to development customer engagements. In parallel, the aggregated value of the proposals in the Discovery segment has increased. Streamlining our sales and delivery processes has further led to improvements in execution metrics. Proposal turnaround times have been significantly shortened. And these improvements are translating into better order dynamics and reinforce our assessment that the new commercial organization is operating more effectively. These leading commercial indicators are now feeding through to sales performance. D&PD sales orders declined in 2024 and reached a trough mid of 2025. They recovered towards the end of the second half of 2025 and have since stabilized above early 2025 levels. Today, we are seeing our deal pipeline growing with increasing interest from potential partners. Looking forward, our differentiated technology platforms are expected to enable a higher number of strategic technology-driven deals starting in the second half of 2026. While it is still early, we see initial indicators of recovery and the commercial transformation in D&PD being on track. Let me hand back to Paul to provide an overview of our path to sustainable growth in 2026 and beyond. Paul Hitchin: Thank you, Christian. On the next few slides, I'd like to take you through the building blocks of our 2026 outlook and how the measures we've discussed today translate into our medium-term framework. Let me begin with our full year 2026 outlook on Slide 14. As outlined in our Horizon communication on March 10, we view 2026 as a transition year with Horizon measures phasing in over the course of the year. For the full year, we guide toward the group revenues of approximately EUR 700 million to EUR 780 million and incurred foreign exchange rates and EUR 730 million to EUR 810 million at constant exchange rates. Adjusted group EBITDA is expected to fall within the range of approximately EUR 0 million to EUR 40 million of incurred foreign exchange rates and EUR 10 million to EUR 50 million at constant exchange rates. Turning to the phasing of the year. The first half of 2026 will reflect transformation actions already initiated under Horizon. While we see an improvement in our commercial indicators, we still expect a weaker first half driven by the continuation of early drug discovery market softness seen in 2025 and the nonrecurrence of the $25 million Sandoz license that contributed to the first quarter of 2025. In the second half of the year, we expect a strengthening profile, driven by an increasing number of strategic partnerships and a market recovery. Looking at the segments, Just-Evotec Biologics is expected to maintain a strong underlying growth, recognizing the nonrepeat of the EUR 65 million Sandoz license payment in the fourth quarter of 2025. Non-Sandoz and non-DoW activities are expected to grow by about 40% for the full year of 2026. This more than offset the expected continued decline in the DoW-related revenues following the announced budget cuts and foreign exchange headwinds. In D&PD, we expect soft stand-alone revenues in the first half of the year, with a recovery to low single-digit growth in the second half. In addition, we expect our strategic technology-driven partnerships, to contribute more visibly in the second half, creating incremental commercial opportunities supported by our differentiated platforms. Taken together, these effects are expected to bring full year D&PD revenues into the low to mid-single-digit growth range. For the full year 2026, foreign exchange is expected to represent approximately 3.5% headwind to group revenues. Beyond revenues, operational improvements resulting from the Horizon transformation are expected to become increasingly visible in the second half of 2026, with roughly 20% to 30% of the EUR 75 million in structural run rate savings expected to materialize in the second half of 2026. In addition, removal of the cost drag from the sale of the [ Just-Toulouse Site ] will benefit our Just-Evotec Biologics business contributing an estimated EUR 20 million year-on-year improvement in segment earnings. Having discussed our full year 2026 guidance, let me now broaden the time horizon. And on Slide 15, briefly remind you of our new midrange framework through to 2030, which we announced in March 2026. This framework reflects the phased trajectory from 2026 to 2030 and is designed to align the timing of Horizon transformation measures with the expected evolution of the revenue mix across our two business segments. Within our multi-stage horizon transformation journey, focusing on commercial excellence, operational simplification and technology leadership, we expect group revenues to grow to more than EUR 1 billion for 2030, with an adjusted EBITDA margin expected to reach 20% by 2028 and exceed that level by 2030. The midterm margin progression is supported by a combination of external recovery and internal structural improvements. Externally, we expect the early-stage discovery market to continue normalizing as industry innovations rebound. Internally, the trajectory is driven by the recurring structural savings from Horizon, a continued shift towards higher margin and more capital-efficient revenue streams and increasing operating leverage as growth and productivity resume. The key drivers and building blocks that underpin the anticipated midterm margin expansion are illustrated on Slide 16. We see the D&PD segment growing at high single digits from 2026. This reflects both the stabilization of early-stage drug discovery market and the transition into the realization phase of our BMS collaboration, which will contribute approximately 50% of the expected D&PD earnings growth between 2026 and 2028 as jointly developed assets progress into and through the clinic. The Horizon cost reductions across our operating capacity, footprint and SG&A are expected to contribute 9 percentage points of margin expansion. As previously noted, we expect to reach the full run rate effect of these savings by the end of 2027. In the Just business, the continued expansion of our customer base, together with new revenue streams from the proprietary platform components such as our cell line, cell culture media as well as license opportunities support ongoing margin expansion. These building blocks take us to the expected 20% adjusted EBITDA margin by 2028. Further margin expansion is then projected to come from improved levels of automation and productivity, notably in our D&PD operations, post 2028 margin expansion in the Just-Evotec business is additionally reflecting royalties for the commercialization of the 10 biosimilars under the recent Sandoz transaction. With this, let me hand the call back to Christian. Christian Wojczewski: Before we sum up today's presentation, I would like to share an important governance update. Evotec's Supervisory Board has proposed Dieter Weinand for election as new Chairman at our new Annual General Meeting on June 11, 2026. Dieter is a highly respected industry veteran with more than 3 decades of global pharmaceutical experience. He has held senior executive roles at companies including Bayer, Pfizer, Bristol Myers Squibb and Sanofi and most recently served as President, CEO and Chairman of Bayer Pharmaceuticals. He brings deep commercial expertise, a strong track record of driving performance and disciplined execution as well as extensive board and governance experience. This makes him very well positioned to support Evotec in its new phase, particularly as we sharpen our focus on [indiscernible] and profitability. At the same time, I would very much like to express our sincere gratitude to Professor Dr. Iris Low-Friedrich for outstanding leadership and long-standing commitment as Chairwoman of the Supervisory Board, and for the important role she has played in shaping Evotec's strategic development. Before we turn to your questions on Slide 18, let me briefly summarize the key takeaways from today's presentation. 2025 demonstrated that Evotec can deliver with discipline closing the year at the high end of guidance through strong execution, cost control and CapEx discipline even in a challenging environment. At the same time, Horizon provides a clear and actionable path towards sustainable profitable growth through 2030 with structural optimization and a more focused operating model. As part of this transformation, we have strengthened our commercial organization and will accelerate execution under new leadership. While the D&PD environment has remained challenging, the headwinds are actively managed and expected to fade. With improving market conditions, we see the basis for a recovery building into the second half of 2026. Taken together, we are actively transforming our business model towards higher quality, more capital-efficient growth with Just-Evotec Biologics playing an increasingly important role. These developments position Evotec to deliver profitable growth and sustainable value creation. With this, I would like to open the call for your questions. Thank you. Operator: [Operator Instructions] Our first question comes from Christian Ehmann, Berenberg. Christian Ehmann: I'll start with 3 and would like to get back into the queue. So first of all, I very much appreciate the 40% year-over-year growth figure for non-Sandoz, non-DoW business in the JEB segment. Could you give us a little bit more detail on the starting point in 2025? So how much of your revenues in the segment were from non-Sandoz, non-DoW sources? The second one would be in regards to the future nature of the BMS. So I think in the past, it was mainly FTE rates and also revenues for working packages that had to be finished. Can we assume going forward that this will now shift to more of a royalty milestone-based remuneration plan? And the third question for this time would be, can you remind us about the current clinical plans BMS has for the other asset in Phase I? I think it was called back in the day, Evotec or EVT8683. Christian Wojczewski: All right. Shall we start with the first one, the Sandoz topic, Paul? Paul Hitchin: So yes, you're correct, non-DoW, non-Sandoz revenue growing 40%. We would expect to see that by the end of '26 that the non-Sandoz, non-DoW revenue is about 50% of the overall Just business at this point in time. And that is a significant growth since 2024 when we were approximately 25%. And I believe in 2025, we're approximately 30%, to give you a little bit of a frame. Christian Wojczewski: And I will hand over the third question to Cord, although Christian manage a bit the expectations typically, it should not be us talking about the intentions of the clinical assets of BMS, but maybe Cord can shed some light on that. On the second topic, the whole program was always constructed in a way that at some point in time, there will be an increasing amount of milestones and ultimately also royalty payments through this collaboration. So yes, by design, you're right. Cord, is there anything you can add on the clinical plans? Cord Dohrmann: Not really, but maybe just to try and give a little color on this. I mean, we remain excited on the program. We cannot comment on exact plans from the BMS side to move this asset, EVT8683 forward. But as you can imagine, I mean, entering Phase II clinical trials in Alzheimer's, that's a very significant step. And so I think a more thorough Phase I is usually warranted in this regard. And I think that's currently what's going on. But we have every reason to believe that this will be moving forward. Operator: Our next question comes from Charles Weston, RBC. Charles Weston: Mine are all a little bit more near-term focused specifically on 2026. First of all, you've indicated for the second half that you're expecting a market recovery. And I was just wondering if you could help give us some color in terms of your assumptions or your confidence around market recovery versus your own sort of self-help from your new commercial efforts. Secondly, I wonder if I could ask for a bit of guidance on BMS for 2026. You've indicated that 2026 will be a trough and I think the number was EUR 139 million in 2025. So how much of a headwind ballpark could we expect in 2026 from BMS? And I guess the same question for [ brand of defense ]. And then just last one, please. For 2026 milestone payments, I think in March, you've got a $10 million payment from BMS. In your Horizon presentation, it looked like up to EUR 150 million could theoretically be payable this year. And you've said that you're expecting two more assets to move into Phase II this year. So how much milestone should we be thinking about in total for 2026? Christian Wojczewski: All right. Charles, thanks for the questions. Near term 2026. Yes, obviously, two elements. One is our own doing. You're right. The other is the funding situation in biotech. Now in our view, the funding situation has mildly improved. Also when you look at the executed deals, this money will have to flow back into biotech. It's very difficult to split the increase in proposal and deal activities into what's market and what is our doing, Charles, as probably you will appreciate. We've seen the activities going up steeply. We don't believe it's just our doing. We also believe that it's -- part of that is the market. When it comes to the second question, 2026 trough and impact BMS. Cord Dohrmann: Yes. Charles, directionally on BMS, as you rightly say, we expect the trough to be in 2026. Relative to what you see in 2025, we would expect a high single-digit decline relative to 2025, solely for the BMS segment. I think your third question was assumptions around milestones related to BMS. And you're right, a couple of things here. Firstly, the $10 million that was noted in the recent press release will be recognized in the first quarter as income. And as we think about future milestones, income-related milestones, we would expect somewhere around the same in the second half. The EUR 100 million that you referred to, I think, also reflects the cash payment associated with deals rather than the income-related element associated with those deals as that cash is -- or the income is recognized over a period of time. Charles Weston: Okay. Sorry, can I just clarify, when you say high single digit, do you mean as a percentage or as a euro number? Cord Dohrmann: Sorry. Yes. It's as a percentage. Operator: Our next question comes from Swayampakula Ramakanth from H.C. Wainwright. Swayampakula Ramakanth: A couple of quick questions. One is on the Horizon implementation, with an expectation of 800 positions being cut and consolidation to 10 sites. Just trying to understand what could be the risk of customer disruption, especially from the talent loss? How are you managing some of the project continuity, especially with key partnerships like BMS. And the second question is, post the Toulouse site sale, can you help us quantify the expected development revenues, milestones and the timing of the royalty stream from the 10 biosimilar molecules? And when could we expect the first biosimilar to reach the market? Christian Wojczewski: Okay. All right. First topic, Horizon, you probably appreciate this was top of our minds and one of our most important criteria when we made decisions not to disrupt the business and particularly ensure that the customer relationships amongst the new partnerships will not be implemented -- will not be impacted. As I mentioned in my speech, we don't think that there is any material risk. We've been around that time and since then in constant dialogue with our customers. And I can tell you at this point in time, there was also no negative feedback from the customer side. So it's all well appreciated. By the way, one of the feedbacks that most people were actually telling us, look, the whole market has gone through a similar exercise. So we're not the only player in the market who is resetting. So we handled it with a lot of care. We spent a lot of time in preparing this move. We know exactly what we're doing. We think this is a contained risk. Paul, on the Toulouse site? Paul Hitchin: Yes, I think the question was around timing of the royalty streams post the sale and post the transaction with Sandoz. To give a little bit more context and color on that one, so we would see a ramp-up of both new products and licenses and new products, I mean, cell culture media, cell lines and indeed licenses between now and 2028. So by 2028, that's in the range of around 10% of the Just revenue and growing. And then beyond 2028 is when royalties kick in, and these are linked to the LOE dates of the drugs coming off patent that have been disclosed in our 9-month update, and I think on Sandoz' own update as well. Operator: The next question comes from Brendan Smith TD Cowen. Brendan Smith: Maybe just a bit higher level question for me, if I could. I appreciate all the color on kind of the near-term growth drivers for this year. We started to hear from some of your peers about pharma and biotech kind of deploying AI internally, actually driving some stronger order patterns for some tools companies as a lot of pharma and biotech are looking to validate their models and outsource new protein manufacturing and analysis. I just wanted to ask, if you started to see anything similar from your customers and partners and whether that might be an opportunity for the JEB business in any capacity moving forward? Just trying to kind of understand what some of the pushes and pulls there could be. Christian Wojczewski: Thanks, Brendan. AI and recognize maybe we have not been so vocal about that in the past, but it's an integral part of our drug discovery platforms. Cord in the Q3 call also explained that, for example, our BMS collaboration has extensively utilized those AI platforms. Moreover, it's not just pharma and biotech, Brendan, it's also the AI companies who make use of the services of Evotec. So we definitely see AI as an important tool in future when you look at toxicology, DMPK, ADME-Tox prediction, there's probably a view for the next 5, 6, 7, 8, maybe 10 years, there is a coexistence, which could even drive volume up. So we see that. We also hear that we not only see this from biopharma, but we also see it from AI companies coming to us. I hope that helps. Operator: Our next question comes from Alexa Chan, Bank of America. Michael Ryskin: This is Mike Ryskin today. I want to follow up on a couple of earlier questions -- earlier comments you made in terms of D&PD in 2026. You talked about second half low single-digit growth and sort of what's supporting that in the market. I just want to clarify, is that -- are you seeing orders already? The orders you're seeing, is that already sufficient to justify that? Or are you assuming further order improvement? The comments you have made about orders in the second half of '25 being a little bit firmer. Is that -- do you expect that to continue? Sort of if you could expand a little bit on what's underpinning that, if that's more biotech or pharma and sort of where that's coming from? And then a separate question is going to be on the pacing of Horizon going forward, looking at what you presented in Slide 11 in terms of that time line, site closures, workforce reductions taking off in 3Q, 4Q this year, whether there's any opportunity to move that up a little bit or accelerate that? Just sort of what are some of the constraints on that? You alluded to limitations of local law and things like that. Is that more tied to that or just the decisions haven't been made yet? Christian Wojczewski: Thank you for the question. Maybe I'll start with the second one. When you think about the usual processes around site closures in Europe, there's obviously legal and regulatory requirements. We expect the workers council negotiations which have actually started in the first quarter to continue through Q2 and Q3 with site closures then basically starting in the fourth quarter, workforce reductions starting in the third quarter, all of that subject to agreements with local workers councils. And yes, there is a [ phasing ] and wherever we can be faster, we are and we will be. One of the sites, obviously, is in the U.S. where there are different requirements. And that's also why it's on a different time horizon. But you're right, the limiting factor here is the consultation process. All the other work, the preparation work has been done. So we're not awaiting anything else. With regard to the D&PD business, second half, low single digit when you think about components of that, that's obviously the stand-alone business, the integrated business and strategic deals. We haven't seen a lot of traction on larger integrated deals that we expect, given that our funnel on strategic deals have significantly improved in the last couple of months that there will be an uptick also or a contribution -- a stronger contribution from new strategic deals. The prospects that increased in 2025 have led to better sales order trajectory compared to mid of last year. But I think it's fair to say that it's going to be a mix between this plus the strategic deals that we see coming. Paul, anything you would like to add? Paul Hitchin: No. I think Christian articulated it well. And again, I just refer to the slide where we see that strategic D&PD partnerships coming in, in the second half and cautious on this low single-digit growth in the second half, but we'd see first half remaining challenging for the stand-alone business. Operator: [Operator Instructions] Our next question is a follow-up question from Charles Weston, RBC. Charles Weston: The Tubulis upfront is obviously very considerable for Evotec. And I just wondered if you could comment whether you see other meaningful stakes in your portfolio of companies with clinical stage assets which we should keep an eye on that could lead to some upside in the future in particular. Christian Wojczewski: Charles, we've got about 29, 30 companies left as of December 2025. We definitely believe that there are a couple of really interesting assets. As always, when you have a portfolio, some are more progressed, some are less advanced that we clearly see some of them on a very good path. Now as you can imagine, those are digital events, right? Either you have a buyer, you don't have a buyer like what happened this week. It was fantastic. We do expect that there will be further opportunities in the future. But as I said, for us, this is upside. For us, this is a cash-generating upside going forward. So yes, our portfolio remains interesting. Yes, we believe that there is upside going forward. Quantifying it and timing it, don't ask me, please. Operator: Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Sarah Fakih for closing remarks. Sarah Fakih: Thank you. With this, we would like to conclude today's conference call. Thank you for your participation. And please feel free to reach out to the Investor Relations team should you have any further questions. Thank you, and goodbye. Operator: Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.
Operator: Good afternoon, ladies and gentlemen, and welcome to the RGP conference call. [Operator Instructions] As a reminder, this conference call is being recorded. At this time, I would like to remind everyone that management will be commenting on results for the third quarter ended February 28, 2026. They will also refer to certain non-GAAP financial measures. An explanation and reconciliation of these measures to the most comparable GAAP financial measures are included in the press release issued today. Today's press release can be viewed in the Investor Relations section of RGP's website and filed today with the SEC. Also, during this call, management may make forward-looking statements regarding plans, initiatives and strategies and the anticipated financial performance of the company. Such statements are predictions and actual events or results may differ materially. Please see the Risk Factors section in RGP's report on Form 10-K for the year ended May 31, 2025, for a discussion of risks, uncertainties and other factors that may cause the company's business, results of operations and financial condition to differ materially from what is expressed or implied by forward-looking statements made during this call. I'll now turn the call over to RGP's CEO, Roger Carlile. Roger Carlile: Thank you, and welcome, everyone, to the RGP Fiscal Year 2026 Q3 Earnings Call. I have just completed my fifth month as Chief Executive Officer of RGP, and my optimism regarding the future of our business continues to grow. I have now spent time speaking with many of our employees and shareholders as well as having participated in several client pitches and related discussions. These interactions further convinced me that my first impressions regarding the quality of our employees, the strength of our client relationships and the relevancy of our service offerings to clients' needs were accurate. Furthermore, they indicate our strategy of meeting our clients in terms of what they need us for and in the manner in which they need us, that is 1 or more of our 3 service delivery modes of on-demand talent, consulting and managed services is a competitive differentiator. As I said previously, these elements provide RGP with a competitive right to win in the market, and we expect to do so through focused execution on our strategic priorities. Our third quarter results were aligned with the outlook we previously provided for revenue and gross margin, and our run rate SG&A expenses were better than the outlook. You will hear more about this later in the call from our CFO, Jenn Ryu. For now, let me touch on the progress against our strategic priorities. You will recall our 4 strategic priorities are: one, refocusing our On-demand Talent segment; two, scaling our Consulting segment; three, simplifying how we operate; and four, aligning our cost structure with our current revenue levels. I will touch briefly on each of these areas. In the third quarter, we made focused hires in our On-Demand Talent and Consulting segments, which we expect to drive revenue growth as they ramp up. I invite you to read our recent press releases for more information on these impressive hires. Additionally, we added 2 key leaders to our executive leadership team in the hires of Jessica Block as our Chief Artificial Intelligence Officer; and Prashant Lamba as our new Chief Information Officer. Jessica's professional background sits at the intersection of professional services, operational transformation and emerging technology, and she joins RGP to focus on building real AI capability across the firm. In simple terms, she will help RGP as an organization, RGP's client service professionals and our clients learn, integrate and expand the use of AI in each of their processes and objectives. Prashant joins RGP with a mandate that extends beyond just traditional IT and focuses on simplifying how our employees engage with technology to strengthen operational performance, which will enable them to provide more efficient service to our clients. His leadership will help the firm unlock the full value of advanced technologies, including AI and intelligent automation. Both Jessica and Prashant have extensive experience working in tech-enabled professional service firms and have been leaders in driving AI development and implementation in these organizations. Equally important to me is that I have personally witnessed Jessica and Prashant succeed at other professional service firms, which gives me confidence they will hit the ground running at RGP and accelerate our strategies regarding AI enhancement and operational simplification. Regarding our priority to refocus our On-Demand Talent segment, in the quarter, we added new sales team leadership in our Central U.S. and Northeastern U.S. regions. These new leaders join our already high-performing sales leadership and team members in our Western U.S. region and will help us to enhance our strategic focus on serving existing and new clients as well as offering the new skills and roles they demand. And we anticipate adding additional new leadership in our Southeastern U.S. and Mexico regions. In addition to this new sales leadership, we are also growing our sales team across North America with the addition of new sales team professionals. With respect to refocusing the skills offered through our On-Demand Talent segment, we continue adding on-demand team members in the areas of ERP, finance transformation, data, supply chain and AI. As for scaling our Consulting segment, we have completed the significant organizational and operational aspects of integrating our legacy consulting units into one cohesive Consulting segment led by Scott Rottmann. Those of you who have followed RGP over the past 3 years will know that we previously operated through 3 distinct consulting practices, represented by the legacy RGP project consulting capabilities and the Veracity and Reference Point acquisitions. The result of our integration, which will be completed by the end of our fiscal year in May, is a simplified and unified consulting business with new senior leadership driving our go-to-market service strategy, which is focused on client needs arising at the intersection of the modern CFO and CIO. Regarding our simplification strategy, I've already mentioned 2 key aspects of this effort. The addition of Prashant Lamba, who is focused on simplifying our technology processes to unlock more efficiency in selling work and serving clients and the integration of our Consulting business, which streamlines our go-to-market efforts around a key set of services. In addition to these, we also signed a binding agreement to dispose of the Sitrick crisis communications business to simplify our business portfolio and allow for greater focus on the clients and services where we have a competitive right to win. In addition, we made further progress during the quarter in reducing our cost structure to align more closely with our current revenue levels. And you will hear more about this shortly from Jenn Ryu. It is important to know that to spur further growth, we are reinvesting some of these savings into the areas discussed earlier. We are confident that our continued focus on these 4 priorities will deliver future revenue growth, and our strong balance sheet allows us to make these strategic decisions and the related investments to support this growth in a reasoned and consistent manner. Finally, in terms of the market for our services, the environment has not changed a great deal from our perspective in the prior quarter. Clients are still seeking to activate their key goals in ways that are both cost-effective and value accretive, and RGP fits squarely within that framework. My conversations with our go-to-market professionals lead me to believe that clients were feeling a bit more confident in the quarter regarding their plans. However, it is a little too early to assess whether the Iran conflict will affect clients' attitudes and plans. As for AI, it remains a prominent topic in the market, and we continue to work with our clients to size the opportunity for RGP. The addition of Jessica Block to our leadership team will be of significant benefit in this regard. With that, I will now turn the call over to our CFO, Jenn Ryu. Jennifer Ryu: Thanks, Roger, and good afternoon, everyone. As Roger outlined, the third quarter was about execution against our strategic priorities, delivering results within our outlook while continuing to reshape the business for a return to growth over time. I'll take you through our consolidated performance, cost actions, segment results and then close with our outlook. For the third quarter, our performance was largely in line with expectations. Consolidated revenue and gross margin were both within our outlook ranges, while run rate SG&A was better than expected. Adjusted EBITDA for the quarter was negative $1.4 million. From a demand perspective, our experience during the quarter was, as Roger described, client decision-making remains deliberate, particularly for larger and more complex work, but we saw an uptick in the volume of closed contracts during the quarter. While this has not yet translated into revenue growth, it reinforces our view that demand conditions are steady and our services are relevant in the marketplace. On a segment basis, we saw continued signs of revenue stabilization in on-demand talent with a moderating year-over-year decline. Our focus remains on improving sales execution and investing in leadership and sales capacity in key markets. In Consulting, longer sales cycles continue to weigh on top line results. However, progress on integration and onboarding of new leadership contributed to early improvement in the coordination across the consulting team, cross-selling with our on-demand business and overall client engagement around CFO and CIO-led transformation needs. In the Europe and Asia Pacific segment, our go-to-market activities remain healthy across multinational and local clients. For multinational clients, in particular, demand for our global delivery center offerings continue to resonate as organizations look to outsource and scale critical processes in a cost-effective manner. While revenue for the quarter was impacted by the timing of project starts at a handful of clients, Japan, India and the Netherlands all delivered solid year-over-year revenue growth. Our Outsourced Services segment once again performed consistently with both stable year-over-year results and sequential growth. Across the enterprise, average bill rates increased year-over-year and sequentially in most segments, reflecting our continued focus on disciplined pricing, higher-value consulting projects and more specialized on-demand talent skill sets. Turning to the financial details. Consolidated revenue for the quarter was $107.9 million, representing a 19.6% decline on a same-day constant currency basis compared to the prior year. Gross margin was 35.7%, up 60 basis points compared to 35.1% in the prior year quarter. The improvement was driven by a modest enhancement in pay-to-bill ratio along with favorable consultant benefit costs related to lower health care expenses and fewer holidays during the quarter. Primarily reflecting a revenue mix shift towards the Asia Pacific region, enterprise-wide average bill rate was $120 on a constant currency basis compared to $123 a year ago. On a segment basis, On-Demand Talent's average bill rate grew to $146 from $140 a year ago. Consulting's average bill rate grew to $162 from $159. And in Europe and Asia Pacific, the average bill rate was $57 constant currency compared to $59 last year, reflecting the revenue mix shift to Asia. Now turning to SG&A expenses. As discussed last quarter, we launched a comprehensive organization-wide review with the objective of simplifying the business and better aligning costs with current revenue levels. As part of this effort, we implemented an additional reduction in force in January. Combined with prior actions in the current fiscal year, we expect total annualized cost savings of approximately $12 million to $14 million, with a portion of those savings being selectively reinvested to support growth in fiscal 2027. For the third quarter, enterprise run rate SG&A expenses were $39.4 million, representing a 10% improvement compared to $43.7 million in the prior year quarter. Approximately $2 million of this improvement came from lower management compensation expense, reflecting structural headcount reductions implemented during calendar 2025 and the partial impact of the January 26 action. The remaining improvement came from disciplined spending across travel, occupancy and professional services. Turning now to segment performance. As always, all year-over-year revenue comparisons are adjusted for business days and currency impact and segment adjusted EBITDA excludes certain shared corporate costs. On-Demand Talent revenue was $40.9 million, a decline of 16.3% from the prior year quarter. Despite the lower top line, segment adjusted EBITDA increased to $2.9 million or a 7% margin compared to $2.6 million or a 5.5% margin in the prior year quarter. This improvement was driven by higher gross margin supported by improved average bill rate, lower sales and talent headcount and continued cost discipline. Consulting revenue was $36.9 million, down 32.5% year-over-year, which continued to pressure utilization, therefore, gross margin and segment EBITDA. Segment adjusted EBITDA was $1.7 million or 4.6% margin compared to $5.9 million or 11.2% margin in the prior year quarter. Despite this, we expect the completion of our integration work and leadership onboarding to begin driving more consistent conversion and improved utilization as we move through fiscal 2027. Europe and Asia Pacific revenue was $18.1 million compared to $18.6 million a year ago, a decline of 5.8% on a same-day constant currency basis. Segment adjusted EBITDA was $0.8 million in both periods, representing margins of 4.3% this quarter and 4.5% in the prior year. Outsourced Services revenue was $9.5 million, down 1.7% on a same-day basis from the prior year quarter. Segment adjusted EBITDA was $1.4 million or a 15.1% margin compared to $1.5 million or 15.9% in the prior year quarter. Turning to liquidity. Our balance sheet remains strong. We ended the quarter with $82.8 million of cash and cash equivalents and no outstanding debt. Quarterly dividend payments totaled $2.3 million, representing a 7.4% annualized yield based on our stock price at the end of the third quarter. With our cash position and available borrowing capacity under our credit facility, we will continue to take a balanced approach to capital allocation, investing in the business to support long-term growth while returning capital to shareholders through dividends and potential share buybacks. At quarter end, $79 million remained available under our share repurchase program. I'll now close with our outlook for the fourth quarter. Early fourth quarter weekly revenue trends are tracking below third quarter levels. Based on current visibility, we expect fourth quarter revenue in the range of $104 million to $109 million. We expect gross margin in the fourth quarter to be between 36.5% and 37.5%, reflecting a more normalized number of business days. Total business days in the fourth quarter for the U.S. will be 64 days versus 69 days in the prior year fourth quarter and 61 days in the third quarter. Run rate SG&A expenses for the fourth quarter are expected to be in the range of $39 million to $41 million, reflecting further realization of cost savings from the January actions, largely offset by reinvestments. These reinvestments remain targeted, primarily focused on key leadership roles, revenue-producing capacity and client-facing capabilities. Importantly, they do not change our medium-term goal of improving operating leverage as revenue recovers. Non-run rate and noncash expenses are expected to be in the range of $13 million to $15 million and consist primarily of charges associated with the Sitrick disposition, which is expected to be closed before fiscal year-end, separation costs related to the COO departure and noncash stock compensation expense. In closing, as Roger discussed, we made solid progress against our key priorities this quarter. We strengthened leadership, meaningfully reduced our cost structure, took steps to simplify our business portfolio and began reinvesting selectively to support future growth. While we are not yet seeing a broad-based acceleration in revenue, we believe the actions we've taken have improved our operating foundation and position us to execute more consistently and deliver increased value to our clients and shareholders over time. With that, we will conclude our prepared remarks and open the call for questions. Operator: [Operator Instructions] Our first question comes from Andrew Steinerman with JPMorgan. Alexander EM Hess: This is Alex Hess on for Andrew. Just to confirm, there was no M&A revenue in the quarter, correct? And Jenn, can you elaborate on what the guide calls for on a constant currency same-day organic basis for the May quarter? Jennifer Ryu: Yes. Alex, yes. There's no M&A revenue in the quarter. So Q4's got at the top of the range is about a 16% year-over-year decline on an organic constant currency same-day basis. Alexander EM Hess: Got it. And then just thinking big picture, last quarter, you guys spoke to trying to tease out the impact that automation and AI might be having on some work streams for you guys. Obviously, there's been a lot of press releases and a lot of senior leadership turnover and trying to just understand when it comes to visibility that you have into the long run return to growth of the business, how much do you guys think you have the muscle in place right now to make that forecast? And when do you think there might be looking for a pivot? Roger Carlile: This is Roger Carlile. Excuse me for my voice. I think as I said in the comment in the press release, we're confident that we're going to grow the business. And so at the moment, I mean, the conditions we see right now and the investments we've made and what are the conversations we're having with clients, I'm confident that fiscal year 2027 will be growth over fiscal year 2026 when we wrap up the year. So now you may ask where is that going to be? I think it's going to -- obviously, you've got a lot of investments that are coming to fruition. So I think you're going to see that growth more prevalent in the latter half of the year than the first half of the fiscal year. But at the moment, that's what I believe. I think you're going to see growth in the top line for RGP in fiscal year 2027. Operator: Our next question comes from Joe Gomes with NOBLE Capital. Joseph Gomes: You guys mentioned you've had a lot of new hires or promotions. You've done a lot of press releases on that. In your comments today, you talked about they should help drive revenue growth through an anticipated ramp-up period. Maybe give us a little idea of what that timing of that ramp-up period is? Are we talking 1 quarter, 2 quarters? Where does that stand? Roger Carlile: Well, I mean, it varies in my experience from person to person and from type of service. But generally speaking, I think we expect those things to have maturation periods of between 6 months and 9 months. Sometimes you're lucky and they're shorter. Perhaps in the AI space, for example, we're having a lot of conversations and Jessica joining immediately. We're seeing already impact there. I think that might be shorter. But in other things, it could be longer. So I think with nothing more than just my own instinct from being in the business for a long time, I would say I'm looking at a 6- to 9-month period of time, which is why I'm comfortable that we'll start to see revenue growth in fiscal year 2027, but it will probably come in the latter 2 quarters of that fiscal year. Joseph Gomes: So Roger, so just kind of going on that, you're confident you'll see revenue growth in '27. What needs to happen? Do we need to see an upswing in the overall market? Do we just need to see RGP start to take more share of wallet from existing customers? I mean, what are you kind of counting on when you're saying you're confident we'll see revenue growth in '27 over '26? Roger Carlile: Yes. Good question. I think, first of all, we don't -- I don't need the market to change dramatically worse, right? I mean I just need it to be -- nor do I need it to be, in my mind, dramatically better. I just need it to be sort of in its current condition throughout that maturation period. And then I think it's mostly in our hands, whether we are ultimately taking market share. I mean, probably any time we win something if someone doesn't, that you could say is moving some share, but I don't know if it's significant enough to say you're moving total market share. But we need to continue with the people that we're adding, the new salespeople, the new consulting leaders, the new leaders like Jessica and others, we need to keep having the conversations we're having at the pace we're having them. And frankly, if we just keep winning at the current pace, I mean, I think we'll win more. But if we can win at the current pace, we're having more of those conversations, more opportunities coming to the top of the pipeline, I think we'll see that we're starting to grow the revenue. Essentially, we're going to have -- we're having -- we have more people, we're having more and better conversations, and I think that's going to result in revenue growth. Joseph Gomes: Okay. And then one more for me, if I may. I mean given where the stock is these days and given the cash and the authorized buyback, I mean, kind of what's your thought process on when you would look to step into the market and maybe repurchase some shares here? Jennifer Ryu: Yes. Joe, this is Jenn. Yes, I mean, as you know, we've been working on taking out costs and also been reassessing strategic priorities, and we started reinvesting into the business. So given all the moving pieces, we're still assessing just impact holistically, including where we are from a liquidity standpoint. But yes, I mean, no doubt, we think our shares are very attractive, and we'll look to begin executing on buybacks when we are ready. Operator: [Operator Instructions] Our next question comes from Kartik Mehta with Northcoast Research. Kartik Mehta: Roger, in the previous earnings calls, you talked about AI displacing some lower-level opportunities, but also creating opportunities. And I'm wondering, as you look over the next 12 months to 24 months and maybe as you look at the current pipeline, is AI a tailwind for you or headwind for you or neutral at this point in time? Roger Carlile: I think at this point in time, it's a tailwind. I mean I think it's going to be a tailwind for a lot of professional services companies, notwithstanding what the popular media was saying as long as they're diligently doing something about it and executing. I mean if you said by, you do nothing, then the world will pass you by. In the short run, there's internally just using the tools for ourselves and making ourselves more efficient can be a tailwind on our cost structure and the kinds of conversations we're having with clients that range all the way from helping them get their data prepared to apply AI tools against it up through helping them make sort of buy or buy build decisions and implementing that. Those are all services that we provide to clients. And so I think those are going to also be tailwinds for us. Kartik Mehta: And Jenn, I know you guys are investing in the business. You've hired salespeople. Obviously, you've hired leaders for the business. And as you look at your SG&A, are we at a trough or kind of at a stability level for SG&A? Jennifer Ryu: Yes. I mean I would say, yes, we are nearing the stability level for SG&A. As you know, I mean, we are going -- we started reinvesting this quarter in Q3. So over the next couple of quarters, you'll see the full impact of those reinvestments come in. But offsetting that, we will also be realizing the benefits from the cost actions that we've taken. So those 2 things will have some offset. But timing-wise, it's not going to line up perfectly. I would say that given the reinvestment starting in Q1 of fiscal '27, we will see a slight kind of elevation of our SG&A expenses. But like Roger said, we're also expecting that investment to pay off in the latter half of fiscal '27. Kartik Mehta: And just one last question, Roger. Any other portfolio actions you anticipate over the next 12 months to 24 months? Roger Carlile: Well, nothing that I have in process at the moment. So I couldn't comment, but by portfolio, maybe you mean service areas or business units. But we're constantly -- I think we mentioned, right, simplification is one of our focal points. But that includes a number of things, the processes that we do, the services we offer and where we offer those services. So we're constantly looking at that, and that will be continuing. Operator: Our next question comes from Alexander Sinatra with Baird. Alexander Sinatra: This is Alex on for Mark Marcon. I was just wondering, you mentioned in the press release that there's been some reduced demand in traditional finance roles related to the adoption of AI and automation. And this is something you mentioned last quarter, too. So I was just kind of wondering if we can get a little bit more detail on that, what kind of negative impact you're seeing? Roger Carlile: Yes. Well, I think what we mentioned this quarter is really just consistent with what we were seeing last quarter. I don't think there's been any acceleration on that. I think the comments I made about the overall market for our services was that it was pretty consistent with what we saw in the prior quarter. So I mean there are certainly some kinds of roles that as clients install AI tools that are then less in demand. And the ones that we saw that in were the operational accounting, those types of skills. But nothing accelerating on that. I think it's sort of a steady state on that right now. Alexander Sinatra: Great. Super helpful. And then in terms of the sale of Sitrick, I was just kind of wondering how much you expect to net from that, not just the revenue, but like on a margin perspective, how that's expected to impact you? Jennifer Ryu: Sure. Yes. So the Sitrick disposition, Sitrick has been around $9-ish million on an annual basis from a revenue standpoint. And this will actually be -- from a profitability standpoint, it's not going to have any material impact on the business. Operator: I would now like to turn the call back over to Roger Carlile for any closing remarks. Roger Carlile: Thank you, operator, and thanks, everyone, for joining our call today. As I said last time, we appreciate your interest in RGP, and don't hesitate to reach out with any additional questions. Thank you. Operator: Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.
Operator: Please be advised that this conference call is being recorded. Welcome to The North West Company Inc. Fourth Quarter Results Conference Call. I would now like to turn the meeting over to Mr. Daniel McConnell, President and Chief Executive Officer. Mr. McConnell, please go ahead. Daniel McConnell: Thank you, operator. Good afternoon, and welcome to The North West Company's Fourth Quarter Conference Call. Joining me here today are John King, our Chief Financial Officer; and Alexis Cloutier, our VP of Legal and Corporate Secretary. Alexis will please read the disclosure. Alexis Cloutier: Thank you, Dan. Before we begin today, I remind you that certain information presented may constitute forward-looking statements. Such statements reflect North West's current expectations, estimates, projections and assumptions. These forward-looking statements are not guarantees of future performance and are subject to certain risks, which could cause actual performance and financial results in the future to vary materially from those contemplated in the forward-looking statements. Any forward-looking statements are current only as of the date they are made, and the company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future results or otherwise, other than what's required by law. For additional information on these risks, please see North West's annual information form and its MD&A under the heading Risk Factors. Daniel McConnell: All right. Thank you, Alexis. I will start with an overview of our results for the quarter and then comment on our outlook and the Next 100 program before opening the call for some questions. Overall, the quarter was challenging, particularly when compared to the strong results we delivered in Q4 last year. Headwinds in our Canadian Operations negatively affected our overall results, which were particularly offset by a solid performance in our International Operations. Consolidated sales for the quarter were up slightly year-over-year, following a 4.9% increase in Q4 of 2024. Sales and earnings in Canada were negatively impacted by reduced money in market, including the elimination of the Inuit Child First Initiative food voucher program and lower Water Settlement payments, which contributed to a very strong result in Q4 of last year. In contrast, International Operations delivered strong results with sales up 5.4% and EBIT up 9%, supported by a solid tourist season in the Caribbean and market share gains in certain stores through Alaska. The net impact of these factors resulted in a 7.7% decrease in net earnings this year compared to an exceptionally strong 18.9% increase in net earnings in Q4 of last year. All right. Let's unpack this starting with some sales. Consolidated same-store sales increased by 0.5% this quarter compared to 5.4% increase last year. This is primarily reflecting headwinds in Canadian Operations and the challenge of matching strong sales comps from Q4 of last year. Canadian same-store sales were down 2.8% compared to a strong 6.7% increase in Q4 of last year. And this is all due to the lower money in market with the elimination of the Inuit Child First Initiative food voucher program and the reduced funding for Jordan's Principle programs compared to last year. The expected decrease in Drinking Water Settlement payments compared to the fourth quarter of last year was also a factor, but to a lesser degree. Both food and general merchandise same-store sales were down compared to very strong sales in the fourth quarter of last year. And again, that's due to the lower money -- the less money in market, and also a shift in consumer spending from general merchandise over to food. These factors were partially offset again by increased consumer demand for First Nations Child in Care Settlement payments. Turning now to International Operations. International sales increased 5.4% for the quarter, with same-store sales increased 5.2% in food and 9.5% in general merchandise, which is on top of a solid same-store sales gains in the fourth quarter of last year. The tourist season in the Caribbean was positive compared to last year, and we were pleased with the overall results in the region. In Alaska, we opened a new store in Utqiagvik at the end of October, which contributed to market share gains. These factors more than offset continuing softer economic conditions in some South Pacific markets. With those key drivers of sales in the quarter, I'll briefly comment on consolidated gross profit and our expenses. Gross profit decreased 2% for the quarter and the gross profit rate decreased 74 basis points. These results are comparing against a solid Q4 last year, gross profit increased 9.4% and was up 141 basis points as a rate to sales. The decrease in gross profit rate in the quarter is primarily due to changes in sales mix, including changes in aircraft utilization and higher aircraft maintenance costs over North Star Air. Additionally, an increase in markdowns and shrink in both Canadian and International Operations were also factors. The increased shrink was particularly due to weather and other delays which impacted timely delivery of merchandise to stores in Canada and Alaska and the impact of lower sales in certain stores in the South Pacific resulted in higher shrink and markdowns. On the upside, we continue to see the positive impact of our Next 100 work, including refinements of our merchandise assortments and our procurement. Expenses decreased 1.1% for the quarter and were down 30 basis points as a rate to sales, largely due to lower annual incentive costs, particularly offset by higher depreciation and share-based compensation costs. In the quarter, we also incurred $1.3 million of onetime expenses related to executing the Next 100 program compared to $1 million in the prior year. These onetime expenses were more than offset by the benefits from our Next 100 initiatives, including store labor productivity gains, which are driving lower store staff costs as a percentage of sales other cost savings initiatives and the positive impacts on gross profit I just mentioned. Excluding the share-based compensation cost and onetime costs, the net impact of all these factors resulted in a 1.3% increase in adjusted EBITDA in the quarter. In summary, the good results in our International Operations this quarter were more than offset by the sales headwinds in Canada, which resulted in a decrease in net earnings compared to very strong net earnings gain in Q4 of last year. All right. Now I'll briefly talk about our outlook and provide a few comments on the Next 100 program. First, I want to comment on the money in market outlook for 2026. The elimination of the ICFI food voucher program and a reduction in Jordan's funding -- in funding sorry, for the Jordan's Principle programs are expected to continue to impact Canadian sales in Q1. We expect these impacts in the first quarter to be partially offset from an increase in consumer demand from First Nations Child in Care Settlement payments, which have started to increase modestly compared to the fourth quarter. Although it is still early, based on the settlement payments that have been issued in the communities we serve, our sales capture rate is meeting our expectations. Additionally, we expect the distribution of Child in Care Settlement payments to ramp up in 2026 and extend for a number of years based on the requirement for individuals in the removed child class to reach the majority age before payments are issued, combined with the anticipated opening of the application process and distribution of settlement payments for the other 8 classes. We also continue to monitor macroeconomic conditions, including the ongoing war in Iran and the impacts of higher oil prices, which will affect fuel-related freight and utility costs and have downstream implications on inflation. We are starting to see some fuel surcharges impact freight costs, and we anticipate these pressures will continue in the near term. However, the duration of the magnitude of these fuel cost pressures still remains uncertain. But I do want to stress that keeping in mind that the impacts of these fuel increases is a compound factor in the north as it compared to in Southern retail. But as part -- regarding the Next 100 program, we remain focused on execution and driving cost efficiencies. The refinement of our merchandise assortments and procurement strategies with a focus on expanding our private label offering is ongoing. Throughout 2025, we ramped up the rollout of new assortments and expanded private label offerings in both our Canadian and International Operations. Private label penetration trends remain positive and have sustained as the rollout has progressed. Additionally, the implementation of store-based inventory forecasting and replenishment technology and a new warehouse management system is also underway. These initiatives are expected to improve on-shelf availability, streamline ordering processes for store warehouse teams and reduce inventory shrink and markdowns. The Next 100 operational excellence focus has helped mitigate some of the external headwinds that impacted our 2025 results, and the foundation we are building is expected to continue to deliver value to our customers, shareholders and our employees moving forward. With that, I will now open the call for any questions. Operator: [Operator Instructions] And our first question will be coming from the line of Ty Collin of CIBC. Ty Collin: Maybe just for starters, wondering if you could just provide maybe a little bit more color on how you're seeing the settlement payments playing out in your markets? What sort of impact that's had in Q1 so far? And how are you seeing your customers who've received those payments shop within your stores? Daniel McConnell: Sure, Ty. Yes, definitely. So we identified that -- we saw a slight increase in Q4. And I say slight, it was modest. And I'd say we're on that same trajectory onward into Q1. So the good news is, from our look, it's still a trickle. It's not coming in at the rate that we anticipate it to come in later on in the year. From the perspective of our capture, we are capturing the sales that we anticipated, as far as our capture rate, we put a lot of planning into this to make sure that we're ready in stock at the time when the money hits. And the money that we know that is coming to market, it's hit our expectations as far as our sales capture rate on those particular stores. But again, I would even take it a step further, Ty, and say, probably only half the stores that we anticipate have even seen a check. So that's a little bit more insight for you. So out of the -- probably, what is it, 63 stores that we anticipate, only half of those have received checks at this point. And it's not been a lot of checks. So does that -- that probably provides you -- I think that should provide you some more context. Ty Collin: Yes. Yes. That's really helpful color. I appreciate that, Dan. And I guess on a related note, I noticed that your inventory levels look basically flat on a year-over-year basis, closing out Q4. I know previously, you've talked about building some inventory ahead of some of this money coming into your markets. Certainly sounds like you're anticipating that to ramp up throughout the year. So just wondering if you could comment on your inventory position at year-end and what your expectations are as we move through 2026? Daniel McConnell: No, you wrote the script. That's right. We're ready for business, and we have the inventory that we feel is the right inventory to capture the amount of sales when the money hits. So it's same program. And yes, we're comfortable with both the level of inventory that we're carrying right now and the relationships and the, call it, the network that we've got engaged when we need to call on them. So yes, we're in a good position. Ty Collin: Okay. Great. And if I could just sneak one more in. You mentioned some of the impacts of the Iran war and that you're starting to see some higher freight costs. I'm wondering if you could just discuss any sort of ways that you might be able to mitigate those costs, what you expect the impact might be if this continues? And maybe you could touch on whether you're seeing any impacts to consumer demand as well at this point? Daniel McConnell: It's pretty early. We actually -- we held our -- we didn't pass on that before Easter, in fairness, to our customers. So we haven't seen the reduction in demand at the store levels as of yet. As you appreciate, yes, our carriers have come forward with some freight increases. We're obviously going to take a balanced approach as we have in the past, but we do have to pass on those costs. It's just a matter of trying to be as strategic as possible to make sure that we optimize value for both our customers and our shareholders. But there's no avoiding it. These are costs that are going to have to be passed on to our customers. And yes, so that's unfortunate, but that's -- and obviously, we're not going to do it in full, but we're going to do it strategically and in order to optimize the situation on both sides. Operator: And our next question will be coming from the line of Michael Van Aelst of TD Securities. Evan Frantzeskos: It's Evan in for Mike. So I guess just to start off, getting back to the settlement payments. So for the markets that you've seen, the checks come in, how are you seeing those being spent? Are people spending on big ticket items? Or are they trading up in food? Or any color you can give around that? Daniel McConnell: Yes, definitely. I mean there's -- they're getting both, they're sizable checks. So you can appreciate that we're definitely seeing the uptick in motorized and some of the big ticket items, but there also is some trickle over into the food for sure. Evan Frantzeskos: Okay. Great. And then secondly, with respect to your Next 100 initiatives, where are you relative to getting all the benefits? Like are you halfway? And how has that changed versus last quarter? Daniel McConnell: Yes, I'd say we're continuing to progress. I think about the number, I'd say we're 50% to 60% of our weight into it and through it, but there's some -- I mean, it's not exactly linear because we do have some of the more difficult tasks, our supply chain optimization, which we're undergoing right now. We've worked through, and we've been doing a lot of testing on our forecast and replenishment this past year. And it's not fully mature in the fact that we definitely had some headwinds and some -- whenever you start off on a project like this, you jump in and you learn a lot as you go. So there's been some tweaking, but we're really optimistic and positive about what this is going to deliver for us in the future. But I would say, to answer your question, we're about 50% or 60% of the way through the initiative. But then ongoing, I mean, we're just starting a warehouse management system implementation, and we're going over into Alaska to work -- to try and replicate our forecast replenishment that we've created here in Canada to optimize some of that work for our Alaska division. Evan Frantzeskos: Okay. And then just finally on the airline. So you noted changes in aircraft utilization and higher maintenance costs. Could you elaborate a little bit on those? Daniel McConnell: Not much. I mean it was a tougher quarter for North Star Air, as I mentioned, and it did have a negative impact on our margins. We see a lot of it is -- yes, there was maintenance overall in the year was -- actually, it was fine. But for the quarter, I guess we thought we were outsmarting the maintenance vary, but they caught us in the fourth quarter. And we had higher maintenance than we were -- the trajectory throughout the year. And also, there were some aircraft utilization. There was some bad weather, severe weather actually, some of the markets saw more snow than they had in the accumulation of the 3 years prior. So it was one of those things that was -- yes, it was a tough one for -- a tough quarter for North Star Air. And the reasons for it were those reasons that I mentioned. Operator: And our next question will be coming from the line of Stephen MacLeod of BMO Capital Markets. Stephen MacLeod: I just wanted to follow up on a couple of things. So one, just with respect to the 63 stores that you called out having exposure to the spending coming through in 2026. I seem to recall it was 50 when we spoke last or maybe it was more of a ballpark number. But I'm just curious, have you been able to get more insight into where these payments are going? Is that how you've been able to refine the store count? Just trying to get a sense of how that's evolved. Daniel McConnell: 50 might have been a ballpark. I think 63 is more precision for you. So yes. And do we have more? No, we don't have any more indication as to where they're going. We know, again, where we've received them and where we're anticipating that they will be. But I'd say a pretty good degree of certainty. Stephen MacLeod: Yes. Okay. No, that's great. And then just on the Next 100 initiatives, just to follow up. If you're 50% to 60% of it -- 50% to 60% through it now, do you still expect to be sort of 75% by the end of 2026 and then full run rate 2027? Or has that trajectory changed at all? Daniel McConnell: Yes. No, I'd say 2027 for sure. As far as the 75% at the end of '26, I mean, it's a logical progression, but I have to check back on that. If I was going to give you any kind of direction there. I'd say '27, fully mature, yes. But for the duration of '26, I can't verify that at this point, but it's going to be 75%. Stephen MacLeod: Yes. No. That's fair. That's fair. And then maybe just finally, on the International business, obviously, very strong same-store sales growth in the quarter. You cited the Caribbean tourism markets as well as some gains in Alaska from the new store. Have you seen any slowdown in activity in some of the tourism-dependent markets in maybe more recent periods just with the geopolitical issues that we've seen in Iran and more broadly with the consumer. Daniel McConnell: Since Iran -- I mean, Iran is -- fairly soon, people already book their travel. No, I'd say it's been pretty strong. Like I mean, with the shutdown of Cuba, with some of the redirecting of Europeans and Canadians going into the Caribbean as opposed to maybe to the U.S. It's -- the tourism in the Caribbean has been relatively stable. Keep that in mind too, on that international front. I'd like to add that with the high price of oil, that's other than other places and territories within the world, Alaska, that is a benefit. And so it's something that -- yes, that is something just to keep in mind, I guess. Operator: And our next question will be coming from the line of Ryland Conrad of RBC Capital Markets. Ryland Conrad: I guess just to start off on the higher oil prices, I guess, when you've had to pass on the higher fuel or jet fuel prices in the past, do you typically see a reduction in out shopping from your northern markets? Daniel McConnell: That's the question? Ryland Conrad: Yes. Daniel McConnell: If it's a statement, it would probably be accurate because like depending on the winter roads, but yes, jet fuel, I mean, the cost of departing and leaving the communities is going to go up. So I would say, aside from the prolonged winter road, which is what we're experiencing right now, yes, I would say that's an accurate comment. Ryland Conrad: Okay. Perfect. And then just on the Child and Family Services reform that was approved, I think, last week by the Human Rights Tribunal the Ontario carve-out. I'm curious if you have any sense of maybe how much program spending is expected to increase under that new agreement or at the very least, if it's expected to be a tailwind in your stores in that province after Q1? Daniel McConnell: We definitely anticipate it's going to be a tailwind for us, but the only unknown is when. You know how like some of this, let's say, just government bureaucracy operates, we're anxiously waiting, and I can tell you we're on guard as far as monitoring when we think we're -- when we -- what those infrastructure projects are going to be and where that money will go. And we'll obviously do our best to make sure that we can service appropriately in those areas. But as of right now, given the short time ago that it was actually released, we don't have any other insights for you at this time, but definitely be monitoring it. Ryland Conrad: Okay. Got it. And then just last for me. On the SNAP benefits in Alaska, I guess from my understanding, there was a bit of a grace period after the new eligibility rules went into effect, if they didn't meet the work requirements. So I'm curious if you could just give maybe an update on what you're seeing in Alaska so far in Q1, and just whether there's been any kind of noticeable impact to same-store sales there as maybe some of these benefits roll off? Daniel McConnell: No. I would say at this point, there's been no noticeable impact in Q1. Operator: Thank you. That does conclude our Q&A session. I would now like to turn the call back over to Dan for closing remarks. Please go ahead. Daniel McConnell: Thank you, operator, and no further remarks from us other than thanks for those who attended, and we look forward to speaking with you in June for our Q1 and AGM. Operator: This does conclude today's program. Thank you all for joining, and you may now disconnect.
Operator: Ladies and gentlemen, thank you for standing by. My name is Colby, and I'll be your conference operator today. At this time, I would like to welcome you to the Streamex Corp 2025 Earnings and Corporate Update Presentation. [Operator Instructions]. Thank you. I'll now turn the call over to Morgan Lekstrom. You may begin. Morgan Lekstrom: Thank you, Colby. Hi, everybody. My name is Morgan Lekstrom. I'm the Co-Founder and Executive Chairman of Streamex. Today, I want to focus on 3 main points. We'll discuss the key milestones the company achieved over the past year as we transition into a public company and built the foundation of what is now the Streamex platform. Second, we will do an update on our first product, GLDY, including our early traction, institutional demand and our strategy for scaling the adoption. And third, but not least -- last but not least, our long-term road map into 2026 and beyond as we expand the platform into additional tokenized and commodity assets and products and the expandability and scalability of the platform and product itself. The past year has been transformational for Streamex. We believe that the groundwork we have laid positions the company well for the next phase of growth as we scale our platform and product ecosystem. I do want to remind everybody that there is a disclaimer. We will begin and we'll be having some forward-looking statements. Actual results may differ materially from those expressed or implied. We encourage investors to review the risk disclosures in our SEC filings for additional information. First, I want to talk about some of our key business highlights. Over the past year, we've made meaningful progress in building the Streamex platform and bringing our first tokenized commodity product to market. Some of the key highlights from this last year include launching GLDY, the first institutional grade yield-bearing tokenized gold asset, receiving over $100 million in early institutional indications of interest prior to launch, strengthening our leadership team with Board and executives from firms, including Coinbase, Morgan Stanley and other leading institutions, including Bank of Montreal and ending the year with a strong balance sheet and no outstanding debt, allowing us to focus squarely on growth and execution. These milestones are important because they establish the foundation for what we believe is a highly scalable capital-light platform business model centered around tokenized commodities. A big part of this for us is started out in May of 2025, where we completed the transaction and transitioned Streamex into the publicly traded company it is today. Over the following months, we expanded the leadership team and Board, adding deep experience across the commodities, the capital markets and the digital asset infrastructure. We also strengthened the balance sheet through 2 equity financings, one in August of 2025 and another in early 2026, raising approximately $55 million over the past 12 months. In early 2026, through those raises, we were able to eliminate all outstanding debt and successfully launch our GLDY token, our first tokenized commodity product. With those foundational steps completed, our focus now shifts towards scaling the platform and expanding the product ecosystem. At this point, I'll turn over the call to our Chief Financial Officer, Christine Plummer, to review our financial position. Christine, take it away. Christine Plummer: Great. Thank you, Morgan. One of the most important outcomes of the past year is the strength of our balance sheet. As of year-end, we held approximately $20 million in cash and cash equivalents, $9.7 million in marketable securities and $23 million in other assets held for sale, primarily gold holdings. We also ended the year with no outstanding debt, which provides flexibility as we invest in platform development and product growth. Over the past 12 months, we raised approximately $55 million in equity capital, which provides sufficient runway to execute our strategy. Turning briefly to the income statement. For fiscal year 2025, we reported a net loss of approximately $461 million. Importantly, the vast majority of this loss relates to noncash accounting items, including fair value remeasurement of derivative liabilities, stock-based compensation, acquisition-related accounting items and amortization of acquired intangible assets. These items do not reflect the underlying operating economics of the business. Revenue remained minimal during 2025 as the company transitions away from legacy operations and toward our tokenization platform. We expect revenues from the platform and related services to begin ramping in 2026. With that overview, I'll now turn the call to our Chief Investment Officer, Mitch Williams, who will walk through our first product, GLDY. Mitchell Williams: Thanks, Christine. GLDY is the first of many products to come. It is our launch token and it is gold with yield. Token gives you one-for-one gold backing and that gold is put to work with industrial users like jewelers. The token reflects our philosophy of having a value-added activity underlying our tokens. In the case of gold, we match up investors who want to be long gold price movements with industrial users who want to avoid the impact of price variation. We believe it's truly a revolutionary product, and we are very excited about it, and we've had very good market reception, and we'll talk about that on the upcoming slides. The net lease yield is currently 3.5%. So rather than gold sitting in a vault being unproductive, the gold works for you and compounds. The net effect of that is the token NAV is priced in line with gold pricing and you get the yield as additional return on top of the gold price changes. So let's talk about market opportunity, as I know that's been a topic of great interest for people. We see a huge market opportunity for GLDY. On the lessee side, we believe leasing is a better way for industrial users to finance their working capital requirements for gold. On the investor side, even 1% market share of the gold ETF market would be a 10-figure opportunity for GLDY. As the token seasons, we continue -- and we continue to plan AVEs and yield payments, we believe the real-world data around the token will continue to amplify its clear value proposition. So let's talk about the purchase process for the token. We're extremely proud of our development team and the customer-facing platform they've created. We have multiple channels for token purchase, including our credit investor portal and an institutional process as well. If you haven't already, I encourage you to visit the sign-up page. The KYC process is the same as it would be for any other unregistered offering and our team in [indiscernible] integration have made this largely an automated process. We're set up to accept funding from a variety of sources, including fiat cash or crypto as well as physical contributions of gold. Moving to Slide 12, we'll talk about converting the interest we've received from institutions into AUM. So demand for GLDY, after a month after standing up the platform and working through some of our platform vendor integration growing pains, the fund that issues the tokens has about 3,000 ounces of gold, which is sufficient to provide data on mechanics and execution of the token as a financial instrument. Before launching GLDY, we received over $100 million of nonbinding indications of interest from potential customers. These came from ETF issuers, wealth platforms, funds and other financial intermediaries. So the process of converting these indications of interest, I know, has been of great interest. And I know it can feel slow at times to people. And I'll just say that institutions love data. And in addition to the data they get from our PPM, they've been very interested to see the NAVs struck over time. They're reporting from Chainlink and our soon-to-be published monthly attestation reports and more data to come on top of that. And so I think the punchline there is that institutions continue their due diligence, the token continues to season in the marketplace. And I think all those things will enable institutions to show up with meaningful orders over time. And it certainly makes it easier for institutions to complete their due diligence to have real-world data on the token, which is important -- which is why it was so important for us to get it launched. We're encouraged that the parties we've been speaking with over the last several months remain in constructive dialogue with us and are in various stages of due diligence on the token. We remain confident that the initial indications received are moving towards formal orders and contributing to the AUM growth for GLDY. I think it's important to understand context in the marketplace. And so Slide 14 shows the market comparison for RWA tokens. So we do get questions about comparable products in the marketplace, and I think it's especially salient as we think about marketing the token. So I think this table provides some helpful context. So no comp is perfect, but we've included funds that have a similar legal structure like OUSG and BUIDL as well as 2 of the largest commodity gold tokens out there, PAXG and Tether. So for security tokens like OUSG and BUIDL, we can see that the other -- that the holder counts are relatively modest at 56 and 101. And I think that's indicative of the nascent market you face for security tokens. And it's also a function of bigger ticket institutional nature for security tokens. For commodity tokens like PAXG and Tether, you can see much larger user counts, which implies lower dollars per user. Do you have this intersection of sort of mass market and institutional products. We believe that GLDY can touch both of those marketplaces, at least for qualified investors. So with respect to users, the user counts make it clear that institutions have both the interest and the ability to hold security tokens. The advantage that GLDY has versus other security tokens is that there's no comparable TRI DeFi security available with one-for-one backing token yield. So a lot of other security tokens out there have comparable TRI DeFi products. GLDY does not as far as we know. The encouraging data point from the Gold buoyant tokens PAX and Tether is that they show broad user interest in gold on the blockchain with users in the tens of thousands. So based on this data, one of the key changes we've implemented is to lower our investor minimum dramatically from 200,000 down to 25,000, which we believe will open up the token to a broader audience, which is a step clearly called for by the data. In addition, while GLDY has a redeem capability for liquidity, we're also working to bring online secondary markets, which will further enhance liquidity and broaden investor appeal. At this point, I'll turn the call over to our Co-Founder and CEO, Henry McPhie, to discuss how we plan to scale GLDY. Karl McPhie: Thank you, Mitch, and thank you to the team for the great overview so far. Now let's get into growth, scaling and early traction for GLDY and other assets. It has now been just over 1 month since standing up the platform and launching GLDY. In that time, we've seen solid early-stage growth. And as Mitch mentioned, we are now sitting in over 3,000 assets -- 3,000 ounces in the asset. Since launch, we've seen an increase in platform sign-ups, growing investor onboarding and continued institutional engagement. During this early adoption phase, there's a number of processes that we have streamlined since launch. We received some great feedback around onboarding and KYC flows and implemented a number of changes to the platform to make the onboarding process easier for users. We also continue to work with our fund administrator, Zedra, and other vendors to ensure that the back-end process for the asset continues to be more streamlined. Now that we have launched, our focus is on scaling, scaling GLDY and expanding liquidity for the asset. There's 5 primary pillars to that strategy. First, converting the existing institutional pipeline into GLDY AUM, both through converting the existing indications and continuing to bring in new institutional orders. Second, expanding the distribution channels through partners and intermediaries such as IRA channels, wealth managers, retail brokers and ETFs. Third is building out the robust secondary market liquidity, which I'll touch on in the next slide, but this is one of the biggest focuses for us right now to ensure that investors coming into the asset have robust liquidity to buy, sell and trade the asset. Fourth is integrating additional blockchain infrastructure and using DeFi in a fully regulated and compliant manner to expand distribution and give additional yield opportunities through vaults, staking protocols and lending markets. And fifth, building on point 3, enhancing liquidity infrastructure through market maker and liquidity provider integration, which we are in the final stages in and will aid in accelerating adoption. Building upon liquidity and scalability aspect for GLDY, we are building several layers of liquidity around the GLDY ecosystem. The first is our launch period mint/redeem facility. This is currently operational and provides T+2 liquidity for both minting and redeeming the asset, a similar structure to that both Ondo and BlackRock use for their tokenized funds. To further enhance primary market liquidity, we will be implementing an instant mint and redeem functionality, and this will be done through partner market makers and liquidity providers and will allow for investors to purchase and redeem GLDY using USDC instantly up to a certain threshold. The most exciting aspect around scalability of the asset and building out liquidity will be a fully functional secondary markets with sufficient liquidity and market makers. This is something that has been top of mind since launch, and we are actively working towards with our partners. Due to the nature of the asset being a security, there are certain features that need to be implemented into the secondary markets. But as these come online, it will open up significant liquidity and the growth opportunity for GLDY. Over time, through secondary market infrastructure, we expect this to evolve towards a 24/7 liquid trading environment for GLDY, our gold with yield product, something that traditionally investment -- commodity investment products simply cannot offer. As we look ahead, our next product will be a tokenized silver asset. This is currently targeted for launch in Q2 of this year. This will expand the Streamex platform beyond gold and introduce additional market participants. The tokenized silver asset will be available for retail investors and will not be a security. This opens us up to a wide market opportunity. We will be looking to implement a number of more DeFi-focused strategies for distribution and yield through vaults, staking protocols, lending, decentralized and centralized exchange listings. We anticipate the tokenized silver asset to complement GLDY, allowing Streamex to have both an institutional-focused product in GLDY and a consumer-focused product in silver out there in the market growing in tandem. Beyond silver, we're also exploring tokenized structures tied to royalties, streams, copper and oil and gas assets, with our long-term vision being to build the infrastructure layer for tokenized commodity markets. To launch GLDY, we have built a strong ecosystem of institutional Tier 1 partners and vendors, including the ones you see on screen. These relationships are critical to ensuring that the platform meets the standards required for institutional adoption. And as we look forward into 2026 and beyond, the key milestones investors should look for include the conversion of the institutional pipeline into GLDY and AUM growth from that, the continued growth in GLDY adoption and user sign-ups, the launch of our tokenized silver product, the expansion of the liquidity infrastructure for all assets that we create and the additional commodity products that we bring online. Each of these steps moves us closer to building a fully integrated tokenized commodities ecosystem. So all in all, in summary, over the past year, we've transitioned into a public company. We have significantly strengthened our balance sheet. We've launched our first product, GLDY, and continue to build out the foundation of the Streamex platform. Our focus now is on execution, growth, scaling GLDY, expanding the product suite and continuing to build out the infrastructure for tokenized commodity markets. We believe we are still in the very early stages of this market, and we are excited about the opportunity and scalability of the company and business model ahead. Thank you very much for joining us today. I will now be answering a couple of questions. Karl McPhie: So for the questions, we have received a number of pre-submitted questions that we will be going over on the call today. The first question is, we cited $100 million in indications of interest. Why hasn't that converted to AUM yet? I'll hand this over to Mitch to provide an answer. Mitchell Williams: Thanks, Henry. And we -- look, we acknowledge the interest in this topic. And I'll say that the token is very new and the institutions move at their own space. So the idea that you would launch a token and on day 1, the institutions would all pile in is not really how the institutional marketplace often works. Institutions collect data. They want to see seasoning of the token over time. They want to see a strike in AVs for a period. They want to see attestation reports come in. And so what I would say is that the institutions we've been engaged with, we remain engaged with. The interest remains as strong as it's ever been. We're very confident that these conversations will result in orders. And so I think really, it's a question of timing. It's not a question of product acceptance or product design or product qualification. And I think, Henry, that probably is the best explanation. And hopefully, people understand that and are as excited about GLDY as we are. Karl McPhie: Thank you, Mitch. The next question is regarding secondary liquidity for GLDY. How does it work? And what are its limits? So following up -- I'll answer this one. And so following up on the slides presented and talking about secondary liquidity for the asset. There's a couple of things that we look at there. One is how can we reduce the time line to be instant or primary market activity into GLDY. So that includes minting and redeeming for the asset. That is what we are putting in place with the instant liquidity facility. Right now, it operates on a T+2 where when an investor purchases the asset, they submit their funds and then we go purchase the gold and credit them the amount of gold that they have bought. If they want to redeem the same process, but we then sell the gold and then credit them the amount of cash or USDC that, that gold is worth. For us to be able to put together an instant liquidity facility, that will dramatically increase our ability for users to have a liquidity market on the primary issuance side. And so that is currently being worked on. As we continue to expand beyond that into secondary market liquidity, which is one of the most important things for us as a firm, that will allow for a fully functional secondary market to be available and you can trade the asset similar to how you would trade any other asset, whether it's tokenized or a stock or a bond. That will most likely be via some decentralized avenues that we have. And so that is something that I think the way that we look at it is it is top of mind. It is very important, and all of these facilities are currently coming online. The next question is talking about the specific marketing strategy to drive GLDY adoption. So what is the specific marketing strategy to drive GLDY adoption? I'll hand this question over to Morgan Lekstrom, our Executive Chairman. Morgan Lekstrom: Thanks, Henry. So when you're thinking about market adoption of a product like this, it's a multipronged approach. Not only do you have your standard conferences from the Streamex side of things, you have your institutional sales representatives and institutional engagement that Mitch has been talking about this entire time as well as Henry. A part of that is Streamex building out their entire sales force and institutional grade sales force behind that. So not only will we be talking and going out to these conferences and doing that type of marketing, we actually are building our own internal product sales force, much like you would see in any of the large ETFs or any of the large asset managers out there. So going forward, you'll see a lot more engagement, not only on social media, but also out there in the public with these institutions, but on our side as well, you'll see us around. So please drop us a link, give us a call, we're happy to talk. Back to you, Henry. Karl McPhie: Thank you, Morgan. The next question is regarding the CLARITY Act. So how does the Draft CLARITY Act impact GLDY and Streamex? So this is a very interesting question, and I'll answer this one. So the CLARITY Act itself, the way that it is currently worded, does not affect GLDY as an asset. So GLDY is structured in a fully compliant way. It is a restricted Reg D security for credit investors. And so that does not apply within the CLARITY Act structure. The CLARITY Act is more focused on stablecoins, how they provide rewards, et cetera, which is actually very good news for us because we have a fully compliant essentially gold-backed stablecoin that provides a yield. And so that is not something that impacts us. The way that we see it in terms of how it could benefit us the CLARITY Act specifically is clarity, no pun intended for essentially secondary markets and the centralized exchanges. And so we've been having a number of conversations with the large centralized exchanges out there about when will securities be able to be issued on the platform? When will you be able to trade securities the same way on, say, Coinbase or Binance as you would within your Schwab or Ameritrade account? They are waiting to see what CLARITY says in terms of that. And so we are eagerly waiting as well to see what the CLARITY Act says about both stablecoin rewards as well as some more information on centralized exchanges and crypto centralized exchanges being able to issue securities, but it does not affect our asset. But I think it's going to be a very, very good thing for the industry when it does come. The next question is regarding the balance sheet and liquidity position. And so Christine, I'll hand this one to you. So you mentioned the strength of the balance sheet. Is the company comfortable with its liquidity position currently? Christine? Christine Plummer: Thank you, Henry. So our financing activities in the end of 2025 and 2026 have significantly strengthened the balance sheet to support our launch and early growth activities. When we think about spend, we prioritize it based on revenue-generating infrastructure and strong controls. So we are very comfortable with our balance sheet position and how it is setting us up as we think about our launch of our GLDY product as well as our future launches. Karl McPhie: Thank you, Christine. The next question that I'm going to answer is in regards to the 5 pillars, what is management's timing on seeing more of these efforts hit GLDY volume growth? And it seems that we should expect a step function growth at some point. Is that fair? So touching on the 5 pillars in terms of growth of GLDY and how we're implementing those pillars into scaling and liquidity. The way that we see it is these are all things that are currently being advanced very rapidly. And so I think the way that we want to position the asset and the way that we want to be able to grow it is by continuing to increase the amount of both operational and usability of the asset while also continuing to increase liquidity. As we continue to talk with people within the market and continue to talk with investors who want to participate in the asset, the big things that we hear from them is, hey, will there be secondary market liquidity? Will there be liquidity for us to be able to include it within ETFs because they have requirements -- and the answer for those is yes. Those are all things that are actively being worked towards. And I anticipate those contributing to GLDY growth exponentially in the coming months. When you talk about the step function growth, I think this is something that if you look at other sort of tokenized products and tokenized securities like Ondo's OUSG, BlackRock's BUIDL, they do follow that step function growth. And so we do anticipate seeing something similar where essentially large orders coming in, AUM increasing rapidly through those large orders and then continuing to increase on that staircase and in that step function. And so as the market develops, as we continue to build out the infrastructure for liquidity in secondary markets, we do anticipate that impacting the -- positively impacting the growth of GLDY. The last one and last question that we'll talk about, and I think this is an important one is can you in detail, talk a bit more about your specific capabilities and platform in tokenized real-world asset markets? I'll touch on this one. And I think this is something that, one, we're very proud of the technologies that we've been able to build and especially considering the onboarding flow and the back-end infrastructure that allowed us to create GLDY. The platform itself, if you think about it from a UI or user experience standpoint, has been essentially been improved and very much thought about and feedback taken as we've continued to hear that feedback from users since launch. And so the onboarding process, the KYC process, the accreditation process, the things that people need to go through to be able to buy the asset are very important for us. And those are things that when we first launched, we got feedback from people saying, "Hey, maybe you should change this, okay, maybe this could be a lot easier. And we took that feedback and implemented it. And so we were able to reduce the time for onboarding exponentially. We will be able to make it a lot easier for people to onboard. And so now as we continue to grow, we'll continue to take this feedback and continue to apply it into what we create. When you think of the more in-depth technical infrastructure for the asset, so how does it work when we buy -- when we mint the GLDY, the smart contract infrastructure for the asset, those are things that all took one a number of years to create as well as a number of months to really hone in on now that we've been launched. And so those are things like the smart contract for GLDY, implementing the token gating features and implementing the white listing within that, the ability for us to streamline the process between verification of gold purchase and Mint and then also the process of paying out the dividends and paying out the yield itself. Those were all things that we had to build from scratch essentially for stream ads. And so there's no real playbook or there's no way to know what these are. And so we have put a lot of time and a lot of effort in building our platform and creating a platform that isn't just for GLDY and isn't just for a single asset, but it is scalable and repeatable across many assets. You will see that with the silver asset that comes online. You will see that with the copper asset, the royalty streams, oil and gas. These are all things that now we have the plumbing in place and we have all the infrastructure in place, we can continue to scale and continue to bring more assets on market while also integrating more DeFi compatibility and DeFi features into the asset, which I think are very important for us as a company. You've seen the growth of hyperliiquid. You've seen the growth of the DeFi market, especially with real assets right now. And so for us, the ability for us to really be at the leading edge of that and use our technology stack to integrate within these existing protocols that are getting a lot of traction will be quite beneficial, I think, for Streamex, and our team has the expertise and the knowledge and know-how to be able to do that. With that, that will be the last question that we'll be taking. I want to say thank you to everybody for joining the call today. We are excited to be able to move forward and excited to be able to continue growing GLDY, both with the assets that we have on the road map and expanding as we continue on. Thank you very much for joining. And if you have any questions for the company, feel free to reach out to our IR team at Alliance Advisors. You can reach out to Adele and excited to be able to move this forward. Thank you. Operator: This concludes today's conference call. You may now disconnect.
Ilana Goldstein: Good morning, and welcome to Beasley Broadcast Group Full Year 2025 Earnings Call. Before proceeding, I would like to emphasize that today's conference call and webcast will contain forward-looking statements about our future performance and results of operations that involve risks and uncertainties described in the Risk Factors section of our most recent annual report on Form 10-K as supplemented by our quarterly report on Form 10-Q. Today's webcast will also contain a discussion of certain non-GAAP financial measures within the meaning of Item 10 of Regulation S-K. A reconciliation of these non-GAAP measures with their most directly comparable financial measures calculated and presented in accordance with GAAP can be found in this morning's news announcement and on the company's website. I would also remind listeners that following its completion, a replay of today's call can be accessed for 5 days on the company's website, www.bbgi.com. You can also find a copy of today's press release on the Investors or Press Room sections of the site. At this time, I would like to turn the conference over to your host, Beasley Broadcast Group's CEO, Caroline Beasley. Caroline Beasley: Thank you, Ilana, and good morning, everyone. Thank you for joining us. We've certainly been busy over the last several months, as you may have read. Let's start with 2025, which was a year of significant challenge for the company. But more importantly, it was a year of decisive action and meaningful transformation across every part of our business. We operated in an environment where traditional Audio revenue continued to decline at an accelerated pace, particularly within Agency-driven channels where we have historically had greater exposure. And as a result, full year net revenue declined to approximately $206 million from $240 million in 2024. This decline reflects the negative impact of Political of $13.6 million. So ex the impact of Political on a same-station basis, revenue was down 7% on a year-to-date basis. Adjusted EBITDA declined to approximately $10.5 million in 2025 from $25.8 million in 2024 for the year. These results are not where we expect this business to perform, and we are approaching them with a clear-eye and accountable mindset. In addition, the company recorded a $224.8 million noncash impairment loss, reflecting the write-down of our SEC license, and we received a growing concern from our auditors that should be eliminated once our debt restructure is closed. What defines '25 is not simply the outcome. It's the work we did to fundamentally reposition the company. Over the past 18 months, we executed approximately $30 million in annualized cost reductions, implementing structural permanent changes that have reset our operating model and aligned our cost basis with today's revenue environment. This was not incremental optimization. This was a comprehensive restructuring of how we operate. We streamlined our organizational structure, reduced layers across the company, centralized key functions and implemented more disciplined cost controls at both the corporate and station level. We made difficult decisions around headcount and resource allocation, and we built a leaner, more agile organization that is better positioned to operate in a lower growth Audio environment while still investing in areas that drive long-term value. At the same time, we've been equally focused on improving the quality of our revenue. Our Digital business continues to scale and evolve with full year Digital revenue of approximately $49.5 million, increasing by $2.7 million or 5.9%. On a same-station basis, Digital revenue increased $7.7 million or 21% and Digital now represents roughly 24% of our total revenue. More importantly, Digital segment margins reached approximately 24% for the full year with even stronger performance on a same-station basis, reflecting the continued shift toward owned and operated products. Digital segment earnings were $12.8 million for the full year, indicating a full year operating margin of 28.8% on a same-station basis, up from 22.7% on a same-station basis in 2024. And while we are very proud of our Digital growth, it was not enough to offset the traditional Audio declines. We're shifting more to O&O Digital and moving away from lower-margin third-party pass-through revenue and toward products that we own, control and can scale. And that transition is already improving both margin and visibility into future growth. We also took deliberate steps to optimize our portfolio. The sale of WPBB in Tampa and the sale of our Fort Myers market, which closed earlier this year together generated approximately $26 million in proceeds and reflects our continued focus on concentrating capital behind our strongest assets. These were not isolated transactions. They're part of a broader strategy to continuously evaluate our portfolio and ensure our capital is deployed where it can generate the highest return. Taken together, these actions represent a full reset of the business operationally, strategically and financially. And that leads to what we believe is the most important development for Beasley as we enter 2026, the transformation of our balance sheet. But before I come back to that, I want to take a moment to introduce you all to Kevin LeGrett. Many of you already know him. He joined our company on February 1 and is already playing a key role in helping us move from restructuring into execution. He brings more than 2 decades of experience across media, digital strategy and revenue transformation with a strong track record of driving growth, building high-performing teams and modernizing go-to-market models. He's operated at the intersection of content, distribution and monetization and has a deep understanding of both the traditional broadcast business and the evolving digital ecosystem. We brought Kevin in, very intentionally to help accelerate the next phase of this company, which is about execution, growth and operational discipline, and he has not let any grass grow under his feet. I'll turn it over to him to share with you what he's been focused on since joining Beasley. Kevin? Kevin LeGrett: Great. Thanks, Caroline, and good morning, everyone. As Caroline mentioned, 2026 is a reset year for the company. From an operating standpoint, that reset started with a very clear understanding, where the pressures were coming from. And just as importantly, what needed to change to reposition the business for growth. The most significant challenge we faced was a continued decline in Agency business, both locally, regionally and nationally. That pressure was structural, not cyclical, and it requires us to rethink how we operate, from how we sell to how we manage accounts to how we prioritize our inventory. At the same time, when we look at the underlying health of the business, particularly from a ratings and audience standpoint, our brands remain very strong. We continue to hold top positions in the majority of the markets that we work in and reach nearly 18 million listeners on a weekly basis. The issue was not relevance. It was execution, monetization and alignment with where demand is moving. We had the years. Now we need to put money against those years. So the focus in 2026 is very simple: rebuild the revenue engine with discipline, accountability and a digital-first mindset. We've been executing against what I would frame as three core pillars: First is accountability and sales execution. We fundamentally changed how the sales organization operates. The move to a 5-day in-office structure has significantly improved CRM engagement and pipeline visibility. We are no longer managing the business based on estimates or emotions. We are managing it based on real-time data with active pipeline management and clear accountability at the market and individual level. We've also introduced what we call a war room operating cadence, particularly at quarter end, where all leadership is directly engaged in pacing, deal flow and closing activity. That has already led to a measurable impact. This is a very different operating rhythm than what existed previously. It's more hands-on, more data-driven and significantly more accountable. The second pillar is accelerating the Digital transition. Digital is just not a growth area. It is the foundation of how we improve both revenue quality and margin profile over time. We've seen strong momentum here. Same-station Digital revenue increased over 33% in fourth quarter of 2025, and the Digital operating margins have increased meaningfully from 17.4% in Q4 of 2024 to over 29% in Q4 2025, putting us close to what we view as a Digital inflection point, where incremental revenue drops through at a much higher margin. We are also more intentional about what types of Digital revenue we prioritize. We're shifting towards owned and operated projects and integrated campaigns, all of which carry better margins and greater scalability than third-party or pass-through revenue. This is not just about growth. It's about building a higher-quality revenue base. The third pillar is rebuilding our local revenue engine. One of the most important shifts we've made is moving away from reliance on National and Agency-driven revenue and refocusing the business on local-direct relationships. This includes three key components. One, is actively managing churn through targeted retention efforts at the market level. Two, is increasing our share of wallet through asset bundling, combining Audio, Digital, Events and Content into integrated solutions for our clients and prospects. And lastly, driving new business through a more disciplined pipeline-driven approach and using AI to prospect in key vertical areas. We've spent a significant amount of time in the field. I personally visited the markets in my first 8-weeks, resetting expectations, coaching teams and in some cases, making leadership changes, where needed. What we're seeing is a clear separation between markets that are executing well and those that require intervention. Markets like Tampa, Boston and Augusta are pacing above prior year levels and are becoming the models for the rest of the organization, while others are receiving more targeted, surgical support to improve performance. As we move into the second quarter of 2026, we're starting to see early signs that these changes are taking hold. Local revenue is stabilizing and in some markets beginning to grow. Digital continues to accelerate within owned and operated channels, and the organization is operating with a much higher level of urgency and discipline than we've seen historically. At the same time, we remain realistic about the environment we're in. National and Agency channels are likely to remain under pressure, and we are not building our plan around a recovery in those areas. Instead, we're focusing on what we can control, improving sales execution, increasing our local share of wallet, scaling Digital, hunting for Political dollars in all of our markets and continuing to drive accountability across the organization. To put it simply, the foundation is being rebuilt in real-time. We are leaner, more disciplined, more focused on the right parts of our business. The local engines are starting to accelerate. Digital is approaching that inflection point, and the organization is aligned around execution. We still have a lot of work to do, but we believe the changes we've made position us to move from decline to stabilization and even growth, as we progress through 2026. And with that, I'll turn it over to Ilana. Ilana Goldstein: Thanks, Kevin. I'll walk through the financial performance for the year in more detail, including revenue trends, expense structure, profitability and our cash flow and balance sheet position. Starting with revenue. Full year net revenue was approximately $205.9 million, down from $240 million in 2024. This decline was primarily driven by continued weakness in Agency revenue, both Local and National as well as the absence of $13.6 million in Political Advertising in 2025, which had been a meaningful contributor in the prior year. From a category perspective, Audio revenue declined meaningfully year-over-year, reflecting these pressures. Digital revenue, on the other hand, increased to approximately $49.5 million, representing roughly 24% of our total revenue and grew 21% on a same-station basis for the full year, reflecting continued demand for our Digital offerings. As a result, the overall revenue mix continues to shift in a positive direction. Local revenue, inclusive of Digital now represents roughly 76% of total revenue, which provides greater stability and visibility compared to National and Agency-driven revenue streams. New business represented approximately 13% of net revenue for the full year and 12% in the fourth quarter, reflecting our continued focus on expanding our advertiser base and driving incremental demand across our markets. While New business declined 14% for the full year and 18% in the fourth quarter on a year-over-year basis, this performance must be viewed in the context of the broader revenue environment. Importantly, we are seeing improved pipeline activity and engagement as we enter 2026, supported by increased CRM accountability, more disciplined sales execution and a renewed focus on local-direct relationships, which Kevin previously discussed on this call. We believe these changes position us to reaccelerate New business growth as the year progresses, particularly towards the second half of the year. Turning to National. Revenues continued to decline in 2025, consistent with industry-wide trends that have persisted since the COVID period as national advertisers continue to shift spend away from traditional audio. National revenue was down approximately 34% for the full year and 50% in the fourth quarter. However, these comparisons were significantly impacted by Political Advertising in the prior year, including $8.2 million in the fourth quarter and $13.6 million for the full year 2024. Excluding Political, National revenue declined approximately 10% in the fourth quarter and 13% for the full year, which we believe reflects a more normalized run rate and early signs of stabilization. While we remain cautious on the outlook for National, this trend is consistent with what we outlined in our restructuring materials and reinforces our strategic shift toward local-direct and Digital revenue streams as the primary drivers of growth going forward. Turning to expenses. Total operating expenses declined year-over-year, reflecting the impact of the cost reduction initiatives that Caroline referenced earlier. Station operating expenses were reduced through a combination of headcount optimization, vendor rationalization and tighter cost controls, while corporate expenses also declined as we streamlined our organizational structure. Station operating income was $16.2 million for the full year 2025, down from $38.5 million in 2024. The decline in SOI was largely driven by our declines in revenue, although partially offset by the aforementioned expense cuts that occurred throughout the back half of '24 and the full year of '25. Adjusted for $2.3 million of severance and $34,000 in stock-based compensation, SOI would have been $18.5 million for the full year. Adjusted EBITDA for the year was approximately $10.5 million compared to $25.8 million in 2024. The decline was primarily driven by lower revenue, particularly in higher-margin spot advertising, partially offset by the structural cost reductions implemented over the past 18 months. Below the EBITDA line, cash interest expense for the year was approximately $20.7 million, relatively flat versus the prior year. From a cash flow perspective, net cash used in operating activities was approximately $8.5 million reflecting delivered EBITDA performance, while investing activities provided approximately $5.6 million, primarily related to asset sales. Total capital expenditures for the year were $4.8 million. Capital expenditures remain disciplined as we continue to prioritize investments that support digital growth and operational efficiency while maintaining overall capital discipline. We saw an uptick compared to last year, primarily due to costs associated with our Charlotte build-out, which we discussed in detail last call. Turning to our balance sheet. We ended the year with approximately $235 million of total debt and approximately $10 million of cash. As we've discussed, addressing our capital structure has been a central focus for the company. Given the significance of the transaction that we have underway, I'll now turn it back to Caroline to walk through it in more detail. Caroline Beasley: Thank you, Ilana. As we announced, we are currently executing a comprehensive debt exchange with our second lien bondholders that represents a meaningful inflection point for Beasley. Upon completion, we expect to reduce our second lien debt by approximately 50% and repay roughly $15 million of first lien debt, resulting in a reduction of total outstanding debt from approximately $220 million today to approximately $110 million. The process is actively underway with bondholders having until April 20 to participate, and we expect the transaction to close by the end of April. In addition, we are in discussions with an ABL lender to provide liquidity on a go-forward basis. This transaction is the result of a significant amount of work behind the scenes, working with Guggenheim as our adviser, engaging with our lenders, aligning stakeholders and structuring a solution that meaningfully improves our balance sheet while positioning the company for long-term success. Importantly, this is not just about reducing debt, it's about resetting the financial foundation of the company. A stronger balance sheet gives us greater flexibility, reduces risk and allows us to focus more fully on execution and growth. Looking ahead, our priorities are clear. We're focused on stabilizing and growing EBITDA, continuing to scale our Digital business and further optimizing our portfolio. Over time, we expect to continue de-leveraging through a combination of operational improvement and disciplined capital allocation. To step back, while 2025 was a difficult year from an operating standpoint, it was also a year where we did the hard work required to reset the business. We reduced costs, improved the quality of our revenue, streamlined our portfolio and are now in the process of fundamentally improving our balance sheet. 2026 is a year of reset for the company, and we are at an inflection point. We're rebuilding the foundation in real time. The strategy is clear and the organization is aligned around execution. This is the year where the work begins to translate into performance, further supported by the midterm election cycle as Political Advertising returns across our key markets. As such, we are looking at same-station Q1 revenue to be down in the mid-single digits. And I am pleased to report that we saw gradual improvement through the quarter with January ending down 8%, February down 6% and March increasing 3%, and on an actual basis, including Fort Myers and Digital Direct, revenue was down double digits for the quarter. We remain focused on what we can control, having the best leadership, our cost structure, our digital road map, our direct-local relationships and the strength of our brands. And we believe the actions we've taken position Beasley to unlock the full earnings potential and value of the company. Thank you very much. Thank you for joining us, and we look forward to speaking again for first quarter earnings. Operator: Ladies and gentlemen, this concludes today's call. Thank you all for joining. You may now disconnect.
Operator: Ladies and gentlemen, good afternoon, and welcome to Applied Digital's Fiscal Third Quarter 2026 Conference Call. My name is Abby, and I will be your operator today. Before this call, Applied Digital issued its financial results for the fiscal third quarter ended February 28, 2026, in a press release, a copy of which has been furnished in a report on Form 8-K filed with the Securities and Exchange Commission, or SEC, and will be available in the Investor Relations section of the company's website. Joining us on today's call are Applied Digital's Chairman and CEO, Wes Cummins; and CFO, Saidal Mohmand. Following their remarks, we will open the call for questions. Before we begin, Matt Glover from Gateway Group will make a brief introductory statement. Mr. Glover, you may begin. Matt Glover: Thank you, Abby. Hello, everyone, and welcome to Applied Digital's Fiscal Third Quarter 2026 Conference Call. Before management begins formal remarks, we would like to remind everyone that some statements we are making today may be considered forward-looking statements under securities laws and involve a number of risks and uncertainties. As a result, we caution you that there are a number of factors, many of which are beyond our control, which could cause actual results and events to differ materially from those described in the forward-looking statements. For more detailed risks, uncertainties and assumptions relating to our forward-looking statements, please see the disclosures in our earnings release and public filings made with the SEC. We disclaim any obligation or undertaking to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made, except as required by law. We will also discuss non-GAAP financial metrics and encourage you to read our disclosures and the reconciliation tables to the applicable GAAP measures in our earnings release carefully as you consider these metrics. We refer you to our filings with the SEC for detailed disclosures and descriptions of our business as well as uncertainties and other variable circumstances, including, but not limited to, risks and uncertainties identified under the caption Risk Factors in our annual report on Form 10-K and our quarterly reports on Form 10-Q. You may access Applied Digital's SEC filings for free by visiting the SEC website at www.sec.gov. I would like to remind everyone that this call is being recorded and will be available for replay via link available in the Investor Relations section of Applied Digital's website. Now I'd like to turn the call over to Applied Digital's Chairman and CEO, Wes Cummins. Wes? Wesley Cummins: Thanks, Matt, and good afternoon, everyone. Thank you for joining our fiscal third quarter 2026 earnings conference call. This quarter, we continued to differentiate ourselves in the industry. Over 2 years ago, we were one of the first companies to recognize the surging demand for large-scale, high-power density AI data centers and broke ground on our first 100-megawatt facility. This early investment is now paying off in 2 important ways. First, we now operate one of the only 100-megawatt direct-to-chip liquid cooled data centers in the world online today. This, coupled with key learnings gives us the experience and the ability to demonstrate to major hyperscalers and others that we can execute on time and deliver fully functional state-of-the-art facilities. Second, what investors are seeing today in our reported financials, including over $44 million in adjusted EBITDA for the quarter across our core businesses is just the early stages of what we expect to achieve. In the HPC segment, this first 100-megawatt building represents only 1/10 of the total capacity we currently have under construction. While many variables and uncertainty involved in developing large-scale power infrastructure such as new power plant construction, transmission lines and regulatory approvals, we're currently -- we currently estimate that we have contracted only a small fraction of our long-term power potential. Turning to execution. All buildings under construction at PF1 and PF2 are progressing on time and on budget. Building large-scale data centers through a North Dakota winter is no small task, but with years of experience and thousands of skilled professionals on site, along with trusted partners such as McGough, ABB, Adolfson and Peterson and BASX, we're executing effectively. At Polaris Forge 1, the 400-megawatt CoreWeave campus, the first 100-megawatt building is now operating and our 1,200 skilled craft professionals are progressing in parallel on 2 new 150-megawatt facilities. At Polaris Forge 2, the 200-megawatt investment-grade hyperscaler campus, both buildings are advancing well with foundations largely complete and work now shifting to precast direction as well as mechanical, electrical and plumbing trades mobilizing for interior fit-out. During the quarter, we also broke ground on Delta Forge 1, a 300-megawatt critical IT load AI factory campus spanning more than 600 acres in a strategic Southern U.S. market with initial operations expected in mid-2027. We have some great videos reflecting our progress on X and LinkedIn pages. Last quarter, we shared we were actively marketing 3 potential sites. During the quarter, we made the decision to delay the South Dakota site as we evaluate its long-term viability and explore opportunities to reallocate the associated power agreements. As a result, we have brought 2 additional sites into the pipeline and are now actively marketing 4 development sites in total. These include Delta Forge 1 in the Southern U.S., an additional site in North Dakota and 2 sites in unnamed states. Subject to receiving all necessary approvals for these sites and total grid power capacity across these locations, the total grid power capacity across these locations is approximately 1 gigawatt, and the campuses are in various stages of negotiation with some in advanced stages of negotiation. While there can be no assurances we will successfully match any specific site with a customer and many variables must align to bring a new data center campus to fruition, we believe it is helpful to provide investors with visibility into our expanding development pipeline and future growth opportunities. Turning to our data center hosting business, where we host 2 sites for Bitcoin mining. This segment has our highest return on assets, and we had another strong quarter. Many of the sites in the U.S. are being converted to data centers and thus, anyone who has high-performance powered sites is sitting on very valuable assets, especially in lower-cost regions with a great climate like the Dakotas. Now turning to cloud. As discussed last quarter, after reviewing strategic options, the Board announced plans to separate Applied Digital Cloud and combine it with EKSO Bionic Holdings through our proposed business combination to form ChronoScale Corporation, a dedicated accelerated compute platform for GPU-optimized AI infrastructure. We believe this is an ideal time to pursue this transaction, particularly in light of the significant recent increases in demand and GPU rental rates we are observing in the market. This move positions the cloud business to raise capital independently, create differentiation and drive accelerated growth with the long-term goal of spinning the business to our shareholders. With that, I'll turn the call over to our CFO, Saidal Mohmand, for a detailed review of financials. Saidal? Mohammad Saidal Mohmand: Thank you, Wes, and good afternoon, everyone. This quarter, we realized a full quarter of lease revenue from our 100-megawatt data center in the HPC hosting business. Going forward, we expect revenues to ramp significantly over the next 12 months as our 2 [ 150-megawatt ] buildings come online. We have also completed the majority of our equity and debt financing for our first 2 campuses. Note, this past March, we disclosed a $2.15 billion private offering of 6.75% senior secured notes due 2031 to support our 200 megawatts of critical IT load at our Polaris Forge 2 campus. We now have only one remaining tranche of debt to place for the final 150-megawatt building at our Polaris Forge 1 site. We have some very positive news for our debt and equity investors. On March 30, 2026, we executed amendments and related agreements with CoreWeave that included restructuring portions of the ELN-02 and ELN-03 leases through a special purpose vehicle, or SPV, subsidiary wholly owned by CoreWeave. This included delivering an unconditional springing parent guarantees from CoreWeave, Inc. and securing a $50 million letter of credit. These enhancements were supported by CoreWeave's SPV receiving an investment-grade A3 rating, a meaningful improvement from its previous BB rating. We believe this improved credit support not only derisk the existing 250 megawatts lease capacity, but should also help lower our cost of capital when placing the remaining 150-megawatt tranche, although there can be no guarantees on timing or pricing. Longer term, we expect these enhancements will position us well to refinance that debt at more attractive rates in the future. We are actively working with top institutions to place that debt at the right time and at the lowest possible cost of capital. From here, we believe we have a straightforward financing model. We have access to $4.1 billion in preferred equity from Macquarie Asset Management following a mutually agreed upon executed lease with an investment-grade hyperscaler. We would then follow a similar approach for the debt financing. This structure allows Applied Digital shareholders to retain over 85% common equity ownership of future sites while significantly reducing reliance on the public capital markets. Now let's turn to the quarter. We reported total revenues of $126.6 million, a 139% increase from the comparative prior quarter. Our HPC hosting business generated $71 million of revenue, consisting of $44.1 million related to base rents, $18.9 million related to tenant fit-out services and $8.1 million related to power pass-through arrangements and other ancillary revenue streams. This resulted in segment operating profit of $17.6 million. The Data Center segment, which operates our crypto data centers, had another strong quarter with $37.5 million in revenue, up 7% year-over-year. We are very pleased with this business, which continues to deliver the highest return on assets in the company, generating $13.9 million in operating profit in just 1 quarter, and that's on $119.6 million in reported assets. Given that the cloud business is merging with EKSO and that we will be a majority holder, we have consolidated cloud's revenues of $18.1 million for the quarter. We also recorded a $59.7 million noncash write-down of the business due to the reclassification from held for sale. As a result, this segment reported a loss of $52.2 million. As the cloud business is pursuing a separate strategy from our core business and will have -- and will be placed in a separately publicly traded company, we have excluded the segment from our non-GAAP results. Cost of revenues increased by $23.7 million for the quarter. This increase was primarily driven by $18 million in tenant fit-out services, an increase of $4.8 million in personnel expenses, an increase in $4.1 million of energy costs associated with our data center hosting business and an increase of $2 million in D&A expense. These increases were partially offset by a decrease in $5.2 million in lease and lease-related expenses. SG&A expense increased $57 million to $79.7 million this quarter. The increase was primarily driven by $39.3 million in stock-based compensation due to increased headcount and performance rewards, $8.6 million in professional service expenses, mainly related to legal support for onetime transactions and business growth, $5.1 million in personnel expenses also related to the increase in headcount and $8 million in other SG&A expenses. These increases were partially offset by a decrease of $3.9 million in lease and lease-related expenses. Net interest income was a positive $2.4 million this quarter. This was primarily driven by a $19.3 million increase in interest income from our money market accounts. Net loss attributable to common stockholders was $100.9 million or $0.36 per share. Adjusted net income was $33.2 million or a positive $0.09 per share. Depreciation for the quarter was approximately $18.5 million and adjusted EBITDA for the quarter was $44.1 million. Turning to the balance sheet. We are exceptionally well positioned. We ended the quarter with $2.1 billion in cash and cash equivalents against $2.7 billion in debt with no significant maturities due in the next 2 years and approximately $1.6 billion in equity. Our goal is to maintain one of the strongest balance sheets in the industry throughout the majority of the construction phase, and we believe we are achieving those goals. Now I'll turn over the call to Wes for closing remarks. Wesley Cummins: Thanks, Saidal. We are seeing a clear acceleration in demand for high-performance AI data center capacity as hyperscalers are as aggressive as we've ever seen them. While some have questioned the slower pace of new lease signings industry-wide, I want to be clear. There is significant demand for credible, well-located data center sites almost anywhere in the world. Just 3 months ago, we referenced approximately $400 billion in annual capital expenditures from the largest U.S. hyperscalers. That figure has now been reported to have increased to nearly $700 billion. This represents one of the largest investment cycles in U.S. history compressed into an extremely short time frame. These enormous investments highlight the intense pressure on power and infrastructure. Leaders such as Elon Musk have publicly stated that even if we utilize all available excess power on the grid, it will still not be enough to meet the demand for new data centers. This concern is so significant. It has driven major strategic moves across the industry, including efforts to develop data centers in space. We believe these trends only increase the long-term value of high-quality, low-cost sites like those that we operate today. Recognizing this dynamic early, we are advancing our own power strategy through support of Base Electron, an independent power producer. Base Electron will work with Babcock and Wilcox to build a power plant that will supply initially roughly 1.2 gigawatts of natural gas-fired generation capacity to the grid in the Dakotas region. This power will be in front of the meter and developed in partnership with regional utilities. We are providing the support based on insights gained from discussions with some of the largest hyperscalers in the world. We believe that if we build it, they will continue to come to our region. The objective is to add reliable power to the Dakotas and help contain electricity costs for consumers, reduces the need for utilities to raise capital and allows for the development of new large-scale sites in the region. Applied Digital is providing limited credit support through a guarantee on the project. As Base Electron successfully raises at least $50 million in financing or completes an IPO, Applied Digital's guarantee will be terminated. In exchange for the guarantee, Applied Digital shareholders will own approximately 10% of this new company. We believe we are once again ahead of the curve by supporting an IPP just as we were 2 years ago when we began building one of the first state-of-the-art liquid-cooled AI data centers. We expect to see more companies follow this model of developing dedicated power solutions in the coming years. We're not only investing in infrastructure and power, we're also investing in our communities through Applied Digital Cares where we recently awarded our first round of grants supporting important local initiatives in education, health, wellness, innovation and public safety, including upgrades for local fire departments. In closing, we recently celebrated our 5-year anniversary. In that short time, we have successfully navigated multiple business lines, built billion state-of-the-art data centers in remote locations and secured approximately $16 billion in contracted lease revenue. Given the significant demand we are seeing, our focus is on scaling the platform, where new leases will continue to be a natural outcome as we expand across campuses in a disciplined, repeatable way. Our long-term vision is to build a dominant data center region in the Dakotas with multiple hyperscalers while also expanding into strategic locations across the United States. Every new campus we secure is intended to create one of the most valuable annuity streams available, a 15- to 30-year revenue stream backed by some of the strongest credits in the world. Once the site is secured, we will focus on growing that site. Then from a financial perspective, we know that today, our cost of capital is higher than it should be, but we plan to refinance that down over time as we shift from project finance loans into ABS or equivalent market at lower rates. We believe that should be the key tipping point where shareholders' return on investment will significantly ramp and the majority of our shareholder value will be unlocked. We believe our first 2 hyperscaler partnerships are just the beginning. We remain confident in our ability to exceed our long-term goal of $1 billion of NOI within 5 years. To drive accountability, we've implemented new internal targets for our leadership team at both $1 billion and $2 billion of NOI levels. With that, operator, we're happy to open the call for questions. Operator: [Operator Instructions]. And our first question comes from the line of Mike Grondahl with Northland Securities. Mike Grondahl: Two questions. One, Saidal, could you give us a little bit maybe more insight into the restructured leases at PF1? Is -- if you had to estimate what kind of cost savings when you go to refinance do you think you could see? And then maybe secondly, Wes, drilling down a little bit on the demand environment. How would you say it's changed over the last 90 days? And what's kind of the breadth of your discussion with various hyperscalers? Wesley Cummins: Saidal, why don't you go first? Mohammad Saidal Mohmand: Yes. So on the lease restructuring, so there is -- as you can see, obviously, the observable trading of the bonds that are outstanding today, there's been a significant improvement in pricing. And there's really a couple of changes that are driving that. One, the offtake for CoreWeave is a high investment-grade offtake. So there is a look-through benefit. There is also a lockbox structure whereby operating expenses such as lease payments, which are really the fulcrum to run the GPUs, they're 100% required. We are first in the waterfall and contractually obligated to get those payments through their own financing facilities. So there is a payment benefit from that. While at the same time, we also retain the parent or a springing parent guarantee from CoreWeave. So effectively, we have improved our positioning of the lease where we get a minimum credit enhancement. And then there's other structural protections, letter of credit, et cetera. So it's a significant improvement. In terms of rate, we've seen that CoreWeave through their DTL, they've been able to lower their financing costs significantly. We expect, obviously, no guarantee, but we expect to continue to move our borrowing costs more in line with an investment-grade tenant under the structure as we go forward. Obviously, no assurances, but from looking at trading levels of our bonds today, it appears quite favorable. Wesley Cummins: And Mike, on the demand side, so you always see -- we always see shifts in demand quarter-to-quarter, who's super aggressive and who steps back and sometimes that will go 6 months, maybe 12 months. But we still see every hyperscaler that we target engaged pretty aggressively in the market. And it just depends also location by location. So it's hard to give a total market view. So what I always give you is what we see, right? And so what we see is for the locations that we're marketing. But we see multiple hyperscalers at every location with interest. And when you -- when I think about how we go and contract the capacity that is available, right? So first, you have Polaris Forge 1 and 2, now we have Delta Forge 1. We have 2 customers at those separate campuses. And thing that I think about a lot is 2 things: diversifying customers. So we have those 2 customers instead of signing additional with those customers, get a new customer at those campuses. So even if it were very easy for me, for example, to sign more with one of my current customers, my preference right now is to continue to diversify the business. So this is, again, very Applied Digital specific. And then we also have a pretty clear goal of getting our total contracted revenue to 70% investment grade. So today, we have $16 billion of total contracted revenue, and that splits $11 billion of CoreWeave and $5 billion to an investment-grade hyperscaler. And so you can just do the math of how we get to that -- the split that I'm looking for -- and we have those campuses in play, and we're marketing those campuses, and we're in advanced stages of negotiation with some of those campuses. But we feel good about the assets that we have, which it's important to distinguish the assets we have versus some of the other assets that we see in the market. Everything that we're marketing is grid power, and that's always top priority. So that's going to go in front of almost anything that is behind the meter on-site generation. So we feel really good about our assets. Now it's just making sure that we get the right tenant and the right contract in place. And I know on the side of a lot of investors, it's just how quickly can you sign these and announce them. But on our side, we don't put these deadlines on ourselves. We just make sure that we end up with the right customer and the right contract, and I'm really confident that we'll end up with that at the campuses that we're marketing because they're great assets. Operator: And our next question comes from the line of Darren Aftahi with ROTH Capital. Darren Aftahi: Congrats on all your progress. Two things, if I may. So Delta Forge 1, your commentary about potentially being operational mid-2027. I guess what does that say or infer about when a lease effectively needs to be signed? And then on your last call, you talked a fair amount about being in exclusivity with a hyperscaler, 3 sites, 900 megawatts, if my memory serves me correct. Are you still in exclusivity with that potential tenant? And is there any update on that project in general? Wesley Cummins: Yes. So Darren, on the first question, so with Delta Forge 1, you should expect -- I expect -- I'll say that, I expect a lease in the near term on that for hitting that goal. As you -- as everyone knows, we've been working on that for a few months now. We've made a lot of great progress there. And so feel good about getting the lease in the time frame to hit that RFS date as well. And then we had some shifting around, as I mentioned in the script, from the South Dakota campus, we didn't get the tax exemption we were looking for from the legislature this session. And so we've paused that development. We're working on 2 other sites that we had somewhat previously, and we've gotten a lot more active on those. But we have still 3 sites in exclusivity with hyperscaler, and we'll see how all of that plays out. But we feel really good, again, about those assets and getting those leases signed at a minimum, I would say, during this year, but I'm more optimistic that it will be more near term. But I don't -- we're not going to sign a bad lease just to get an announcement on the tape. So -- but we feel really good about the progress we've made on those sites. Operator: And our next question comes from the line of George Sutton with Craig-Hallum. George Sutton: So for those of us that are nonfixed income guys, I wondered if you could just walk through what it generally means if you go from BB to single A, if you were to go into the refinance market, what kind of spread differential is there? Mohammad Saidal Mohmand: Yes. Great question. So right now, so for -- obviously, single A is investment grade. Spreads are anywhere from -- they're sub-300 basis points, so low 2s to mid-2s depends on obviously structure remaining, how the lease is placed, et cetera. But generally, think about it mid-2s historically. And then for the BBs, right, they're generally -- single Bs to BBs can be anywhere from 350 to 450 basis points, once again, depending on the offtake and the structure of the contract. George Sutton: Okay. So pretty significant. Wes, I'm curious, I know there are certain sites that you're working on. Some of them have the 6-month moratoriums put on by local counties. My sense is, correct me if I'm wrong, but as time goes on, the ultimate value that you'd get from these same contracts, same properties continues to rise. Is that -- in other words, we're all waiting for the near-term deals and all of that. But to the extent that these actually extend out a little further, the value capture for you is ultimately greater. Is that a correct statement? Wesley Cummins: George, it's been the trend we've seen so far. So I think that's directionally correct. And on those -- on the moratoriums on those things, we're working through those, and we feel really good about getting through just in an education process. If you look at what we've done in North Dakota specifically, because we have a site that's operating, we went through the process that we have very specific evidence to point to on the Polaris Forge 1 campus in Ellendale, both the economic benefits, but also our impact on ratepayers on the grid. As you've seen, there's been some news on that recently. So since that site has been operational, we've saved ratepayers about $31 million because of the use of the infrastructure there and how we site our campuses and where we take these and then the work with the community, you get -- we get a lot of great reviews. So it's easier for us to continue to do things in that state and educate people and get through those, the moratoriums and the zoning and all of those pieces. So we feel really good about doing that in North Dakota and continuing to expand there. But -- but George, back to the big picture on these, again, the sites that we have, I think, are premium in that their utility power that's available in '27. And we see a lot of demand for those types of assets. And the goal for us this year, as I stated, the one goal was total contract value, getting 70% investment grade and 30% other over that number. So you can imagine the type of growth in total contracted value we would need to hit that. But then the goal is really get to -- we're marketing 4 new campuses, we can get to 5 total campuses or 6 total campuses and all of those campuses grow over time. Some of them grow immensely over time. And so it gives us a really good path to 5-plus gigawatts of critical IT load across all of our campuses over time. And for us, I think it's easier once you've landed a customer at a campus, it's an established location to either expand that customer at the campus or bring other customers on that campus. So when I look to the future, I look at not only new sites, but expansion in our current campuses. And if we can put ourselves in a position where we have a clear view to 5 or 6 gigawatts just across the campuses that we have already contracted and are looking to contract here this year, it's going to be a really great growth runway for the company and fairly locked in and probably easier for us to do than just continue to add new campuses. Operator: And our next question comes from the line of Nick Giles with B. Riley. Nick Giles: Nice job, guys. So Wes, I think you mentioned you're marketing 4 sites, one of which is Delta Forge 1, 2 unnamed sites. And I think other than maybe Garden City way back when this is new geographic exposure for you. So what drew you to the south? And what kind of contrast would you draw between it in your Dakota sites? And was this really a result of customer indications or more applied led? Wesley Cummins: So Nick, what always drives us first is where power is available. So that's always first when we find our sites. And then it goes to fiber. And then there's a lot of other variables that we look at. And those variables include how crowded is that market. That's one we definitely look at. So -- why do you want to look at how crowded the market is? One aspect that's good because the more density you have, it's easier to get more customers there. There's a lot more infrastructure. Right now, it's hard to be in crowded markets because of labor force. So we look at markets where we think we can definitely secure the labor force to go and build these. So like for example, on these, like we're not looking at something in West Texas right now. We're in states that are outside of that so that we can attract a different labor force and make sure that we can build these. We look at states that are definitely pro-business and business-friendly, have governors and legislatures that want data centers in their state. They're looking to expand business. So it's a lot of different variables, but it's always first driven by power and power availability and when it's available. And we're still very focused on grid power. We've looked at a lot of projects where people have what they call powered land, what they really have is they have land and then they have a gas pipeline that runs nearby where you can do offtake for gas and then you need to figure out power generation and you typically do off-grid. We're seeing some of those projects happen. I think that -- but what we see is the preference by far for the hyperscalers that we're looking to work with is that the grid power is definitely still the preferred solution. And so those are the kind of sites we keep developing, and that's what we continue to market. Nick Giles: Got it. Makes sense. I appreciate that, Wes. And then it sounds like things are on track, but just would be nice to get an update on the next building at PF1. Can you just remind us when we would first see revenue recognition? I think the guide is sometime 2026. Wesley Cummins: Yes. RFS date for PF1 is July 1, I believe. And so -- and Nick, just to remind you how these buildings energize -- so they have 6 data halls in each building. You don't energize all 6 at the same time. So in July, you'll energize some of the data halls, and I believe they're all energized, so it goes July, August, September, and then they'll be fully energized. And then later in the year, the first building at PF2 comes online. And so you'll get the same type of energization ramp on that building. And so you'll see some revenue step-up in the August quarter from the new building and then you should get basically close to a full quarter of it in the November quarter and then a partial from the Polaris Forge 2 building and then getting close to full quarters in the February quarter of fiscal '27. So that's how those will start to ramp up. And then as you start into '27, you'll have those buildings continue to ramp the third building, the Polaris Forge 1 and then Delta Forge and then whatever else we start contracting as well. So you kind of have those pretty clear step-ups. And this was -- I think this was a really great quarter for us from a revenue results perspective because you start to see the earnings power of what we're building. We're still -- it's still subscale versus all of the people that we employ because we're building so much, right? We have almost a gigawatt under construction, 900 megawatts under construction. So it's still a little bit top heavy from that perspective, but you going to start to see the flow-through and then easier for you guys to model out what the earnings power of the platform looks like. Operator: And our next question comes from the line of Rob Brown with Lake Street. Robert Brown: Congratulations on all the progress. Just wanted to follow up on the power availability commentary and I guess, the base electron strategy. Just a sense of when you think you start to run into constraints in, I guess, the North Dakota market and how you see that -- maybe when you see constraints and how you see that playing out? Wesley Cummins: Sure. So we have the Polaris Forge 1, Polaris Forge 2 and another site in North Dakota. So we have the 3 sites that we'll be building through '28 on all of those. And that's going to take up the significant amount of the excess power that we see right now in North Dakota. And then towards the end of '28, we'll start to commission some of these. Base Electron will start to commission some of these new power generation assets. And so what that's really designed to do is to meet when we feel like we start to tap out of the available grid power and then we're adding -- Base Electron is adding more power to the grid. And we said this, Rob, in the prepared remarks, but I think it's worth reiterating the Base Electron business model is actually adding grid power. It's not building on-site generation specifically for the Applied Digital data centers, but it's strategically adding it in places on the grid in North Dakota that will definitely feed the Applied Digital sites, but it's meant to make the grid overall better and more resilient and be a benefit to all of the stakeholders and the ratepayers in the state and not just putting it on site to generate electricity for Applied Digital. But that's really the timing and what we've spaced out is, okay, here's when we start to run out of what we think is available grid power for us. And so we need to add more to the grid to continue to expand these campuses. And as we've mentioned previously, the Ellendale, the Players 4:1 campus and the new campus in North Dakota, they all have the ability to expand significantly from an electrical infrastructure delivery perspective, and we just want to make sure that we enable that. Operator: And our next question comes from the line of John Todaro with Needham & Company. John Todaro: Congrats on all the progress. First question, Wes, you made a couple of comments about not just signing any deal, you want the right terms. And also, it's taken maybe a little bit longer than you had hoped or expected. While appreciating that the demand is quite strong, has there just been any aspect, whether terms or rates that have changed that have maybe made conversations a little bit more difficult in getting the leases done? Is there any kind of like sticking point that is coming up? Wesley Cummins: Every lease is different, John. And so there's always different parties in the lease and what needs to happen. And in some instances, there's a lot of stuff that needs to happen for the utility as far as guarantees and what gets negotiated in the entire package, and that's been newer for us. So that's definitely one aspect. But it's not in every lease. It's just in certain ones. But it's -- I can't say that the entire landscape has changed because it's just every campus when you're dealing with a different utility and a different counterparty, they all have their own nuances. And of course, I would -- if you ask my team, I would say every lease takes longer than I would like. I just wish we get to the terms that were great for us and we would sign it. But I feel like these are all on track for us. And I would just say that I think we feel really good about where they are and signing a lot of these campuses up this year. But we will make sure that we get these right and with the right tenant and the right structure. But it's hard to say market-wide if there's anything different, but there's always different details and nuances in every single site. John Todaro: Understood. Appreciate that. And then maybe one for Saidal. Just trying to maybe reconfirm the cadence of the fit-out service revenue. Has all that been recognized now? Or should we expect some more in the coming quarter to contribute? Mohammad Saidal Mohmand: Yes. So for ELN-02, a majority of the fit-out revenue has been recognized. There will be a small amount remaining for the first building. And then towards the end, you'll see some ramp on ELN-03 or the second building in PF1 start to ramp up. Once again, timing, right, timing can be lumpy from quarter-to-quarter, and it's a low-margin line item that's nonrecurring. John Todaro: Correct, around like 5% or so, right? Mohammad Saidal Mohmand: That's fair. Yes, correct. Operator: And our next question comes from the line of Michael Donovan with Compass Point. Michael Donovan: Congrats on the progress. Saidal, could you walk us through what still needs to happen between now and June 30 for the PF2 financing escrow tied to the $2.15 billion of 2031 notes to be released? Mohammad Saidal Mohmand: Yes, exactly. Great question. Effectively, the ESA needs to be finalized between the utility and the counterparties involved, and that has been progressing as scheduled. For instance, there was recently on the substation construction. So the longest pole in the tent has been the substation construction items. So -- and we had a [indiscernible] signed a construction agreement to build that last October, and we're in a good -- really great shape on the substation progress there. Michael Donovan: Appreciate that, Saidal. And I guess for Wes, what was the strategic rationale for structuring base Electron outside of Applied rather than owning the generation directly? Wesley Cummins: Yes. So we thought a lot about this. It's a great question. And what we landed on with this was that the power generation aspect, the power generation business is fundamentally different than the data center business. And so we did not think that it was the right thing to take a lot of risk inside of Applied Digital to go and build the power generating assets that will help expand the data center capacity for Applied Digital. But -- and when you think about the different risk profiles, so on Applied Digital, we signed long-term data center leases. We get 15 years of lease payments. And if our customer doesn't use the facility, they still owe us the lease payments. But when you look on the power side of the business, the power will feed into the data center. But if the customer is not using the data center, they still pay the lease payments to the data center, but there's no power being drawn into the data center. So it's fundamentally different risk and return profiles for those. So it's been created as a separate company. Applied Digital have ownership in that company. So the Applied Digital shareholders get upside of the success in Base Electron but take no risk on the downside of any catastrophe that happens inside of that. So we expect it to eventually trade publicly as well, so people can choose if they want to have power generation exposure, if they want to have data center exposure and now as ChronoScale spins out, do you want to have GPU cloud exposure. So you really get those choices instead of us just forcing it into Applied Digital where there could be some upside to shareholders, but it creates a totally different risk profile for the company in our opinion. And so I think it was the right choice to put it outside, let it create its own capital stack. Investors come in and put capital into the business. It will need to raise its own capital to go build these assets. But that was really the fundamental choice as to why it's not just folded as another unit inside of Applied Digital. Operator: And our next question comes from the line of Paul Meeks with Freedom Capital Markets. Paul Meeks: Excuse me if this was asked and answered, but do we still have 100 megawatts at PF2 that is still uncontracted? Wesley Cummins: That's correct. Paul Meeks: And going forward, you'll make an announcement, not to who the hyperscaler may or may not be. Those are always easy to figure out, but you will make an announcement when it is contracted. Wesley Cummins: Yes. And we do expect that to be contracted in the near term. Paul Meeks: Next question is for both PF1 and PF2. Are you sticking with the site NOI margins that I think you last showed in the presentation last fall? Mohammad Saidal Mohmand: That is correct. Yes, that is correct. So high 80s to 90s is the range that we've been operating at on a cash basis. Paul Meeks: Right. And last quick one. When you meet this 5-year NOI target, you're going to start with the project financing and then switch over time. But once we get there, 5 years out, what is your firm's capital structure look like? Mohammad Saidal Mohmand: So this is Saidal. So there's a couple of different ways. So one, as you complete the construction period and construction risk is removed from the overall financing, your cost of capital comes down. If you look at some of the private peers, leverage tends to be very high in excess of 10x NOI. We feel it's a prudent way to be in that 5 to 6x NOI leverage, which when you're against, call it, high investment grade and investment-grade credits for long-term leases with escalators, that's very prudent. So I think as you get to that 5-year mark, once our platform is fully humming. And as we surpass our NRI goals of $1 billion and $2 billion of NOI, that, call it, 5 to 6 turns of leverage is prudent. Now once again, the caveat being there's always going to be new potential opportunities that we're building out, and we are also opportunistic across the spectrum for financing with the view of always having paper that is constructive both for shareholders and obviously, for other stakeholders in the company as well. Operator: And ladies and gentlemen, that concludes our question-and-answer session. I will now turn the conference back over to Wes Cummins for closing remarks. Wesley Cummins: Thanks, everyone, for joining us today, and I want to make sure that I thank all of our employees who are working over time to make all of this a reality for the company and its shareholders and look forward to speaking with you in July. Operator: Ladies and gentlemen, that concludes today's call, and we thank you for your participation. You may now disconnect.
Operator: Good afternoon, and thank you for joining us for the GameSquare Holdings 2025 Fourth Quarter Conference Call. On the call today, we have Justin Kenna, GameSquare's CEO; and Mike Munoz, CFO. [Operator Instructions] Before management discusses the results, I'd like to remind everyone that certain statements in this call may be forward-looking in nature. These include statements involving known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements. For information about forward-looking statements and risk factors, please see our 10-K for the quarter ended December 31, 2025, which will be available on the company's website or with the Securities and Exchange Commission. I will now turn the call over to GameSquare's CEO, Justin Kenna. Justin, please go ahead. Justin Kenna: Thank you, and good afternoon to everyone joining us on today's call. I'm extremely proud of the progress GameSquare delivered in 2025 as the platform we've been building reached an important inflection point during the fourth quarter. Over the past year, we took decisive actions to streamline our business, strengthen our balance sheet and build a more focused, scalable platform, and our efforts reached a clear inflection point in the fourth quarter. Our fourth quarter results reflect a meaningful step change in profitability, driven by the success of our strategic investments, improved profitability across the business and the contribution from our recently acquired creative marketing platform, Click. As a result, we delivered positive adjusted EBITDA of $1.7 million, marking a key milestone for GameSquare and demonstrating the earnings power and scalability of our operating model. In fact, when considering the contribution from TubeBuddy, our adjusted EBITDA would have been even stronger, underscoring the immediate accretive benefit of the transaction. More broadly, our performance highlights the strength of the integrated ecosystem we've built, combining data and analytics, a scaled creative talent network, integrated agency services and proprietary owned and operated IP. 2025 was all about optimizing our model. As a result, GameSquare strengthened its position as the entry point for the creator economy and expanding our land and expand strategy. While GameSquare's roots are in gaming, what we've really built is creator economy infrastructure. Across our 4 units, we offer what no single competitor can, tools that power creator growth, managed creator networks, full-service campaign execution and one of the most recognized creator-led brands in the world. For any brand looking to reach, understand or activate within the creator economy, GameSquare is where they can enter. As our platform has evolved, so has our go-to-market strategy. Today, we're operating with a more integrated and intentional approach that reflects the full capabilities of GameSquare's end-to-end ecosystem. At the front end, we are increasingly focused on landing new customer relationships through our technology and agency businesses. These offerings provide measurable performance-driven solutions that align closely with how brands are allocating spend in today's digital and creator economy. They also create a strong entry point into the GameSquare platform, allowing us to demonstrate value quickly and establish long-term partnerships. From there, our model is designed to expand relationships across our broader ecosystem. By leveraging our creative media and selling capabilities, we are able to deepen engagement and deliver more comprehensive integrated solutions for our clients. This land and expand strategy is a key driver of our current and future growth model. It enables us to build higher quality, more durable customer relationships while improving revenue visibility and increasing lifetime value. As our platform continues to scale, we believe this approach will drive more efficient customer acquisition, stronger cross-selling opportunities and ultimately higher margin growth over time. With that as context, I'd like to step back and review the actions we took throughout 2025, and more importantly, how those actions have fundamentally repositioned GameSquare for profitable growth and improved operating performance in 2026 and beyond. Throughout 2025, we executed a deliberate strategy to optimize our business model, rationalize our portfolio and build a differentiated end-to-end platform that is both scalable and resilient. Significant actions during the year include divesting our remaining stake in FaZe Media, winding down Frankly Media and acquiring Click. These operational moves have sharpened our focus, improved efficiency and created a more powerful and unified platform that is purpose-built for scale with multiple durable revenue streams working together. Simultaneously, we fortified our financial foundation through a series of opportunistic capital raises at an average cost of $1.41 per share that raised gross proceeds of approximately $85 million. Through the proceeds of these transactions, we paid off essentially all existing debt, ended the year in a significant net cash position and meaningfully strengthened our capital structure. These moves position GameSquare with the strongest, most flexible balance sheet in our history. It provided us with the financial strength and agility to both invest in growth and navigate dynamic market conditions. In parallel, we deployed a portion of our capital into high-performing yield-focused digital asset treasury strategy. While on-chain markets have experienced increased volatility more recently, we believe our disciplined yield-focused approach, combined with the strength of our core operating business has created a differentiated and complementary earnings stream for GameSquare. As part of our initial on-chain strategy, we also acquired a portfolio of digital assets, including NFTs, most notably the Cowboy Ape, which was acquired through a strategic all-stock transaction priced at $1.50 per share. During the first quarter of 2026, we monetized our NFT positions, generating proceeds of approximately $1.5 million in cash and $0.4 million in Ape at the time of the sale as we actively optimize our treasury allocation. These proceeds were used in combination with the yield we received from our treasury strategy to repurchase our stock. Since we initiated the program in October of 2025 and through March 6, 2026, we have repurchased a total of 5.06 million shares for $2.5 million at an average price of $0.49 per share. We view these repurchases as a highly attractive use of capital, particularly given our confidence in the intrinsic value of the business, and they reflect a disciplined and balanced approach to capital allocation. Overall, we view our treasury management strategy as a dynamic and opportunistic capital allocation lever. As market conditions evolve, we will continue to actively allocate capital, deploying or monetizing assets where we believe we can maximize risk-adjusted returns and drive long-term shareholder value. At the same time, I want to emphasize that our core operating business remains the foundation of GameSquare and our primary focus as we move into 2026. So let's look at our core operating business in a bit more detail. Our priorities in 2025 were focused on achieving profitability, streamlining operations and driving higher-margin revenue opportunities across our core media, technology and esports businesses. I'm pleased to report that we made significant progress and achieved every one of these strategic priorities and in many cases, exceeded them. During the fourth quarter, we successfully executed against several of our 2025 strategic actions. Reported revenue on a year-over-year basis increased by 142% and gross margin expanded year-over-year by approximately 20 percentage points to 45.9%. The combination of revenue growth, expanding gross margins and disciplined cost control drove a more powerful financial model. Along these lines, we delivered positive adjusted EBITDA of $1.7 million for the fourth quarter, marking a key milestone for GameSquare and demonstrating the earnings power and scalability of our operating model. The continued improvements to profitability throughout 2025 reflected the second quarter divestiture of FaZe Media, the wind down of Frankly Media in the third quarter of 2025 and the contributions of our improved balance sheet. As we noted in September, we discontinued the operations of Frankly Media, a legacy programmatic advertising solutions provider. The closing of Frankly reflects our strategic shift toward optimizing our business model by exiting noncore, lower-margin operations. This decision also aligns with our goal of eliminating operating losses and cash burn while concentrating on high-growth areas such as agency, media and technology. M&A remains a key component of our growth plan. During the third quarter, we acquired Click Management, a leading talent management firm founded in Australia with a growing U.S. presence. Regularly named as one of the top digital creator agencies by Business Insider and recently awarded Best Talent Management Agency by industry body, AiMCO, Click creators delivered 548 million views across YouTube alone in March of 2026, and currently has a total of 123 million YouTube subscribers. Click has assembled one of the largest English-speaking gaming rosters with approximately 85 active talent. It is important to note that talent is at the core of today's creator economy and bringing Click into the GameSquare family accelerates our long-term strategy. Together, GameSquare and Click will expand the company's reach into creator-led brand partnerships and activations, accelerate growth opportunities within GameSquare's media, agency and experiences ecosystem and drive immediate cost and revenue synergies by integrating Click throughout GameSquare's existing platform. We are actively leveraging Click's platform to aggressively expand our talent roster. Over the coming months, we expect to add high-impact creators, materially expanding our North American presence and enhancing our ability to drive higher-value brand partnerships, increase campaign volume and improve monetization across our platform. This momentum reflects the strength of Click's platform and our ability to consistently attract and retain top-tier talent in an increasingly competitive market. More recently, in February 2026, we announced the acquisition of TubeBuddy from BENlabs in an all-stock transaction. TubeBuddy provides powerful search engine optimization, workflow analytics and productivity tools powered by proprietary AI, which are used by creators and digital publishers to grow, manage and monetize their content. The acquisition adds a scaled creative technology layer to our technology platform, which we believe will accelerate our strategy to build an integrated ecosystem spanning content, community data and performance marketing. TubeBuddy is a high-performing asset. For 2025, TubeBuddy had revenue of $10.2 million, gross margin of over 88% and an EBITDA margin of over 30%. We are excited by the operational and financial opportunities that TubeBuddy represents. Importantly, the accretive acquisition of TubeBuddy demonstrates the evolution of our M&A strategy. As our scale increases and our capabilities expand, we are focused on pursuing compelling operating assets that we expect to be accretive to earnings. With the addition of TubeBuddy, GameSquare's platform includes an AI-enabled software platform with proven tools embedded into creator workflows, anticipated increase to recurring software and subscription revenue, first-party creator and channel data capabilities, powerful cross-platform brand and performance marketing solutions creates new integration opportunities across GameSquare's media, esports and creator networks. Our strategy is designed to leverage our existing relationships with some of the world's leading and most forward-looking brands while also building on the momentum we generated through key customer wins in 2025. Across our platform, we partner with some of the world's most recognized brands, including LEGO, Paramount and TurboTax, alongside leading gaming publishers such as Roblox, Epic Games, Capcom and Ubisoft. These engagements highlight our ability to deliver integrated creator-led campaigns at scale. Within our technology and data platform, Stream Hatchet continued to strengthen its position as a trusted partner to brands, publishers and creators. We saw strong customer retention and expansion, including renewals with Riot Games, Activision Blizzard and Electronic Arts, reinforcing the value of our data and analytics capabilities. We also continue to expand our capabilities with new AI-powered tools, and we were selected as an official data provider for the Esports World Cup. In our agency and brand partnerships business, we executed integrated campaigns for leading global brands and publishers, including Capcom, Roblox, World of Dance, Dairy MAX, Jack in the Box, the Dallas Cowboys, Mastercard and Paramount. Within our talent platform, we recently announced new partnerships with H-E-B, while our own media IP and experiential assets drove growth with a new licensing agreement with SpongeBob SquarePants and the production of the 2025 100 Thieves Block Party. Finally, we continue to expand our relationships across broader gaming ecosystem, including a new management services agreement with Ubisoft. These wins reflect the expanding value of our integrated platform. We are landing customers through our technology and agency capabilities and expanding those relationships across our broader ecosystem, driving higher-value engagements and more durable revenue streams over time. Over the past several months, we have made several strategic leadership additions and organizational changes designed to enhance execution, drive revenue growth and improve operational discipline. We recently appointed Doug Rosen as Chief Commercial and Strategy Officer, where he is responsible for leading our global commercial strategy and driving revenue growth across the platform. Doug brings deep experience from leading media and gaming organizations and his focus on building scalable, repeatable revenue streams and integrated go-to-market execution is directly aligned with our strategic priorities. In addition, we appointed Amaree Tanawong as Chief Operating Officer, further strengthening our operational leadership. Amaree brings nearly 2 decades of experience across strategy, finance and operations, including leadership roles at YouTube and other high-growth media platforms. In her role, she is focused on driving operational scalability, executional discipline and supporting the launch of new revenue initiatives across our integrated ecosystem. We also continue to evolve our organizational structure to better align with our platform strategy. This includes the promotion of Paul Ioakim to Head of Agency, bringing together our agency capabilities under a unified leadership structure to deliver a more cohesive integrated solutions for our clients. These leadership updates reflect a deliberate effort to align our organization with our long-term strategy, enhancing our ability to scale efficiently, drive revenue growth and execute with discipline as we enter 2026. As you can see, 2025 was a transformative year for GameSquare. We took decisive actions to streamline the business, strengthen our balance sheet and build a more focused, scalable platform. Those efforts are now translating into improved operating performance and a clear step change in profitability. Importantly, we believe we are still in the early stages of realizing the full earnings potential of the platform as we move into 2026. So with this overview, I'd like to turn the call over to Mike to review our 2025 fourth quarter financial results. Mike? Michael Munoz: Thanks, Justin. Our reported results for the fourth quarter reflect the successful strategies underway to drive profitable growth. Comparing our 2025 fourth quarter reported results to the prior year, total revenue was $18.5 million compared to $7.6 million. The 142% year-over-year increase in revenue was primarily due to growth across our agency and owned and operated IP segments, including the full quarter contribution of Click. Reported gross margin for the 2025 fourth quarter was $8.5 million or 45.9% of sales compared to $2.0 million or 25.8% of sales for the same period last year. The 20.1 percentage point improvement in gross margin reflects the ongoing efforts to improve profitability and the margin contribution of our digital asset treasury strategy. Adjusted EBITDA for the 2025 fourth quarter was $1.7 million profit compared to $3.1 million loss for the same period last year. The $4.8 million improvement reflects the strategies we are pursuing to drive profitable sales. On a pro forma basis, which includes the contribution of TubeBuddy, revenue was $20.6 million and pro forma adjusted EBITDA was $2.3 million or 11.2% of pro forma revenue. We believe pro forma sales and adjusted EBITDA demonstrate the accretive contribution TubeBuddy will have on our financial performance. As of December 31, 2025, we had cash and cash equivalents and digital asset treasury assets, excluding NFTs of $52.0 million. We ended the quarter with $35.7 million of shareholders' equity compared to $12 million at the end of the last year. As you can see, GameSquare has a strong financial position with excellent liquidity to pursue strategic initiatives, invest in our operating platform and return capital to shareholders. So with this overview, I'll turn the call back over to Justin. Justin Kenna: Thanks, Mike. As you can see, the progress we are making has fundamentally reshaped the company. Over the past year, we've expanded margins, streamlined our cost structure, rationalized our platform, fully cleaned up and strengthened our balance sheet and added a highly scalable growth engine through Click and TubeBuddy. The result is a business that is meaningfully stronger, more focused and more scalable than it was even a few quarters ago. Our balance sheet is healthy. Our strategic priorities are fully funded, and we are entering 2026 with clear operating momentum across every part of the platform. We are winning new programs, expanding relationships with leading brands and publishers, scaling our creator network and continuing to innovate across our operating businesses. We are also positioning the company for our next phase of growth. We are advancing our talent strategy with an expected addition that will bring meaningful creator relationships onto our platform. We plan to extend our agency and platform capabilities to drive growth in the U.S. and internationally, while pursuing opportunities to expand our reach into some of the largest, most high-profile gaming markets. We believe these actions will drive new revenue streams in 2026 and beyond and further establish GameSquare as a scaled leader in the global creator economy. On a pro forma basis, which reflects our plans for the TubeBuddy business, we are reiterating our previously announced annual guidance for fiscal year 2026. We expect revenue in the range of $85 million to $90 million, gross margins of 35% to 40% and adjusted EBITDA of over $5 million. Our outlook reflects continued strong organic growth and the durability of the improved margin profile we established exiting 2025. With the structural efficiencies we have implemented and the operating discipline now embedded across the organization, we believe we are well positioned to scale profitability as the business grows. We are excited about the opportunities ahead and confident in our ability to deliver sustained value for our shareholders. So with this overview, Mike and I are happy to take your questions. Operator, please open up the call to questions. Thanks all. Operator: [Operator Instructions] The first question comes from Jack Codera with Maxim Group. Jack Codera: This is Jack Codera calling in for Jack Vander Aarde. It was nice to see the guidance. Given all the acquisitions and divestitures, are you able to give any color as to what you expect for seasonality going forward, maybe like a very rough percentage range for each quarter? Justin Kenna: Yes, I can take that one, Mike. I'd say probably less so than quarter-by-quarter, Jack. I think the easiest way to think about it is really that the back half of the year is generally a little stronger for a number of reasons, added brand spend ramps a little. We have more activity in the esports market. You have holiday buying formats and consumer product and so forth. I wouldn't say it's extreme in terms of seasonality, but I think the easiest way to think about it is 40-60 in terms of sort of 40% to the first half of the year, 60% to the back half of the year. Within that, I would generally say that Q1 is typically our weakest quarter and Q4 is typically our strongest. But there can be some fluctuation within that. But the easiest way to think about seasonality is 40-60 on a H1, H2 basis. I would sort of preface that by saying Q1 is off to a historically strong start. We have been very busy closing out the year-end orders. So we haven't closed the books there yet, but we certainly feel really, really comfortable about Q1 and the activity that we saw within that quarter. Jack Codera: Okay. That's great to hear. And I saw the revenue segmentation for the full year, but I recognize that, that was kind of adjusting for some of these acquisitions and divestitures. Are you able to provide just the revenue segments for the fourth quarter specifically, kind of where the revenues fell into those segments for that quarter -- for the quarter? Michael Munoz: I can take that one, Justin, if you want. Yes. So I know the quarterly segment disclosure isn't included in our financials, but of our $18.5 million of revenue, $4.2 million was from our owned and operated IP segment, $12.5 million was from our agency segment, which includes our talent agency, Click. $1.2 million was from our SaaS and managed services segment and then $560,000 was from our digital asset treasury yield. Operator: The next question comes from Greg Gibas with Northland Securities. Gregory Gibas: I wanted to, I guess, maybe follow up. You mentioned a strong start to Q1 in terms of the performance there. Maybe more broad, what kind of gives you guidance in your 2026 outlook? And could you maybe speak to the growth pipeline of opportunities as it stands today? Justin Kenna: Yes. Yes, I'll take that one, Mike. I would say, Greg, we feel really, really comfortable in terms of guidance. We believe that these are really conservative numbers. As mentioned, Q1 is off to an extremely positive start. Some of the areas of sort of growth and I would say, outsized growth into 2026, I think to look for. Certainly, our creative deployment business has had an enormous Q1. It's a really big area of growth for us. And we talked in the earnings call a little bit about being the entry point to the creator economy. And what we've been able to do through our creator platform and our data business is really layer those together and have a huge competitive advantage in helping game publishers and brands execute creator deployment campaigns at real scale. We saw a huge amount of activity there within Q1 of the year, and that's certainly going to be a large growth area for us in 2026 off of what we did there in 2025. It's been a bit of an area of focus for us, something we're investing into and certainly taking advantage of. So I'd look to that area as certainly being a big contributor into Q1 and the remainder of the year. We had really nice sort of flow on within our esports business. We spoke last year about really professionalizing the esports space. We've moved our FaZe Esports business to our headquarters in Dallas. And with that, there's some inventory that we've been able to sell against it's been really healthy, and we're seeing one of the very few sort of profitable North American esports businesses. So expect that to be a nice contributor also into Q1. Our agency business continues to go from strength to strength. You can see there in the numbers in Q4. But yes, the most pleasing part of that is just entering 2026 with more locked-in revenue than ever before, right? So certainly, we're still out there looking for new business, but I'd say with our current client mix and recurring revenue base. So Q1, we feel really, really good about, off to a great start to the year. In terms of sort of guidance, I think some of the areas of outsized growth that aren't necessarily baked into those numbers are sort of opportunities into new markets. MENA is certainly one for us. We've talked about it before. There's been obviously increased investment into the esports space with the Esports World Cup and everything going on over in Riyadh, there's some really interesting opportunities for us there. We spoke about the talent and creative space. We're just scraping the surface in terms of the growth into the U.S. I think the acquisition of Click and the business that they built with Australian talent and now growing that U.S. space has been incredible. We have an incredible foundation and now it's really about pouring gasoline on that. So these are some of the areas I look for outsized growth for us to really sort of hit and exceed guidance, which we very much believe we will do so. But yes, in terms of Q1, I'd say really healthy mix of revenue, but certainly, I'd look for a big sort of contribution from that creative deployment managed services space that I mentioned. Gregory Gibas: Great. That's very helpful. I appreciate the color there and good to hear. If I could secondarily ask about kind of capital allocation going forward. And maybe just starting with your stance on M&A, how profiles of future M&A would be relative or similar, I guess, to your acquisitions of Click and TubeBuddy more recently or different in any deliberate way? And maybe as it relates to just capital allocation, maybe, wondering if you're willing to maybe discuss your stance on share buybacks going forward, considering you've been active the last several quarters. Justin Kenna: Yes, happy to touch on both. So yes, I think that profile Greg, is certainly similar to assets that we're looking at. I think we touched on it. I think really, our focus would be within the technology, performance marketing, media, gaming space, really in, call it, $10 million to $50 million of revenue, 5% to 20% EBITDA margins. It's really the businesses that we're looking at. I think, again, to reiterate, in the past, we acquired some really valuable assets, but assets that were burning cash. We've moved beyond that. We've now got to profitability, and we want to scale it. So we're only looking at assets that are accretive. We realized the challenge that exists with really trading where we trade today and obviously, using equity as currencies is challenging. So really, the way that we look at these M&A opportunities is relative value deals. And what I would say is while there's challenges not only for us but many in the micro-cap space in today's markets, within the gaming industry more broadly, we have a great reputation. We get a lot of inbound on M&A for these sort of small to medium-sized stand-alone companies that lack access to capital and liquidity. We're a really nice home. And within that, I think a lot of people see the longer-term vision and understand that we're undervalued today, but hey, 1 plus 1 could equal 5 here, and we believe in the long-term vision. So long story short, Greg, I'd say that profile of company is certainly what we're looking at. But we are very cognizant of dilution. We are obviously working to increase share price. But within that, we'll continue to be opportunistic within M&A, but certainly from a relative value type deal. Again, if you look at TubeBuddy, that was exactly what that deal was, right? 5 million shares to a company that did $10 million in revenue or 30% EBITDA margin. It's basically unheard of. And that's finding a partner that really believes in the long-term vision. So we continue to be active within M&A, but certainly more opportunistic until share price really starts to move. And then on share buybacks, I think we've been using the yield we've been generating from our [indiscernible] to buy back shares. We bought back obviously, over 5 million shares. We have space currently from our current sort of approval from the Board to do another $2.5 million worth. We will continue to buy back stock. Whether we get more aggressive on the buyback or not remains to be seen. And that will really come down to how the share price moves off the back of profitability, continued catalysts that we have coming. What I would say is we are really excited, I'd say, by the progress that we've made and by what lays in front of us. We understand how undervalued we are. We're equally impatient. We share shareholders' frustration. And so we will continue to look to buy back stock. and really depending on how -- obviously, there's macro factors at play as well. But depending on how the stock starts to move based off of the catalysts we have coming here over the next 3 to 6 months, we'll really determine how aggressive we are on that front. Operator: This concludes the question-and-answer session. I would like to turn the conference back over to Justin Kenna for any closing remarks. Please go ahead. Justin Kenna: Yes. I just want to say thanks, everybody, for joining today and certainly for the continued support. Again, I think it's the elephant in the room, it's certainly our share price. And I just wanted to reiterate that we share the frustration around where the share price sits today. But we really do view this in terms of a longer-term play and building really long-term value for shareholders. What I would say, we've talked about hitting profitability in the back half of '25 for some time. We did a lot of work to get there. I'm really proud of the team and want to really give applause to all of our team. We've got a really dedicated workforce who works extremely hard. So I just wanted to give a huge shout out to all of our staff. But yes, I feel really, really good about the progress that we've made in terms of doing the things that we say we will do, and we feel really strongly about where we're headed in 2026. So again, I just wanted to thank everybody who joined the call and our shareholders for their continued support. We're not going to leave any stone unturned in terms of continued progress in growth and ensuring that we drive value for shareholders. And we really believe that things are going to start to turn here in 2026. But thank you, everyone, for joining the call. We're really excited to touch base again and report back on our progress with our Q1 results in very short order here. So I look forward to that, and thanks for joining the call. Cheers. Operator: This brings to a close GameSquare's 2025 Fourth Quarter Financial Results Conference Call. You may disconnect your lines. Thank you for participating, and have a pleasant day.