Q4 2025 Mattr Earnings Call

March 13, 2026

Operator 2: Good day, and thank you for standing by. Welcome to the Mattr Q4 2025 Results Webcast and Conference Call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Meghan MacEachern, Vice President of Investor Relations and External Communications. Please go ahead.

Operator: Good day, and thank you for standing by. Welcome to the Mattr Q4 2025 Results Webcast and Conference Call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again.

Speaker #1: To ask a question during the session, you will need to press star on one of your telephone. You will then hear an automated message advising your hand is raised.

Speaker #1: To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I will now hand the conference over to your speaker today, Meghan MacEachern, Vice President, Investor Relations and External Communications.

Operator: Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Meghan MacEachern, Vice President of Investor Relations and External Communications. Please go ahead.

Speaker #1: Good morning. Before we begin this morning's conference call, I would like to take a moment to remind all listeners that today's call includes forward-looking statements that involve estimates, judgments, risks, and uncertainties that may cause actual results to differ materially from those projected.

Meghan MacEachern: Good morning. Before we begin this morning's conference call, I would like to take a moment to remind all listeners that today's call includes forward-looking statements that involve estimates, judgments, risks, and uncertainties that may cause actual results to differ materially from those projected. The complete text of Mattr's statement on forward-looking information is included in Section 4.0 of the Q4 2025 earnings press release in the MD&A that is available on SEDAR+ and on the company's website at mattr.com. For those joining via webcast, you may follow the visual presentation that accompanies this call. I'll now turn it over to Mattr's President and CEO, Mike Reeves.

Speaker #1: The complete text of the matter statement on forward-looking information is included in Section 4.0 of the fourth quarter 2025 earnings press release in the MD&A, which is available on CDAR Plus and on the company's website at mattr.com.

Meghan MacEachern: The complete text of Mattr's statement on forward-looking information is included in Section 4.0 of the Q4 2025 earnings press release in the MD&A that is available on SEDAR+ and on the company's website at mattr.com. For those joining via webcast, you may follow the visual presentation that accompanies this call. I'll now turn it over to Mattr's President and CEO, Mike Reeves.

Speaker #1: For those joining via webcast, you may follow the visual presentation that accompanies this call. I'll now turn it over to Mattr's President and CEO, Mike Reeves.

Speaker #2: Good morning, and thank you for attending our fourth quarter conference call. Today, Meghan and I are joined by our Senior Vice President of Finance and CFO, Tom Holloway.

Michael Reeves: Good morning, and thank you for attending our Q4 conference call. Today, Meghan and I are joined by our Senior Vice President of Finance and CFO, Tom Holloway. Mattr delivered a strong finish to the year. Rising operational efficiency and opportunistic sales, particularly in Xerxes, Flexpipe, and AmerCable, minimized normal late-year seasonal slowing and drove Q4 adjusted EBITDA to more than double versus the prior year quarter. Operationally, we extracted further performance improvements from our newly established sites, a trend that has continued into early 2026. Our teams remain nimble, resilient, and cost-conscious in the face of an ever-shifting business environment, and we continue to focus on those variables we can control. Across Mattr, we are consistently prioritizing those actions and investments necessary to enable sustained technical differentiation, production flexibility, and progressively greater operational efficiency.

Speaker #2: Mattr delivered a strong finish to the year. Rising operational efficiency and opportunistic sales, particularly in Xerxes, Flexpipe, and Amercable, minimized normal late-year seasonal slowing and drove Q4 adjusted EBITDA to more than double versus the prior year quarter.

Michael Reeves: Operationally, we extracted further performance improvements from our newly established sites, a trend that has continued into early 2026. Our teams remain nimble, resilient, and cost-conscious in the face of an ever-shifting business environment, and we continue to focus on those variables we can control. Across Mattr, we are consistently prioritizing those actions and investments necessary to enable sustained technical differentiation, production flexibility, and progressively greater operational efficiency.

Speaker #2: Operationally, we extracted further performance improvements from our newly established sites, a trend that has continued into early 2026. Our teams remain nimble, resilient, and cost-conscious in the face of an ever-shifting business environment, and we continue to focus on those variables we can control.

Speaker #2: Across Mattr, we are consistently prioritizing those actions and investments necessary to enable sustained technical differentiation, production flexibility, and progressively greater operational efficiency. Turning to the full year, 2025 was a year of unprecedented disruption.

Michael Reeves: Turning to the full year, 2025 was a year of unprecedented disruption. As we executed our growth, technology development, and operational improvement strategies, the world around us rapidly evolved, a trend that has continued in 2026. Despite this, Mattr delivered meaningful year-over-year growth in revenue and adjusted EBITDA, driven primarily by the successful early year acquisition of AmerCable and significantly improved results from Xerxes. We were effective in executing our 2025 strategic priorities, nimble in mitigating direct tariff impacts, and continued to advance those initiatives that matter most to our long-term growth. However, there were some areas where operational execution fell short of our expectations and slowing in certain end markets, particularly the Canadian industrial wire and cable sector, demanded an accelerated shift of resources and focus.

Speaker #2: As we executed our growth, technology development, and operational improvement strategies, the world around us rapidly evolved—a trend that has continued in 2026. Despite this, Mattr delivered meaningful year-over-year growth in revenue and adjusted EBITDA, driven primarily by the successful early-year acquisition of AmerCable and significantly improved results from Xerxes.

Speaker #2: We were effective in executing our 2025 strategic priorities, nimble in mitigating direct tariff impacts, and continued to advance those initiatives that matter most to our long-term growth.

Michael Reeves: We were effective in executing our 2025 strategic priorities, nimble in mitigating direct tariff impacts, and continued to advance those initiatives that matter most to our long-term growth. However, there were some areas where operational execution fell short of our expectations and slowing in certain end markets, particularly the Canadian industrial wire and cable sector, demanded an accelerated shift of resources and focus.

Speaker #2: However, there were some areas where operational execution fell short of our expectations, and slowing in certain end markets, particularly the Canadian industrial wire and cable sector, demanded an accelerated shift of resources and focus.

Speaker #2: While these challenges impacted 2025, the actions taken in response have already driven improvements and positioned Mattr to deliver more consistent performance going forward. Our Composite Technologies segment reported a modest full-year adjusted EBITDA increase in 2025.

Michael Reeves: While these challenges impacted 2025, the actions taken in response have already driven improvements and positioned Mattr to deliver more consistent performance going forward. Our Composite Technologies segment reported a modest full-year adjusted EBITDA increase in 2025. Despite significant oil field activity level declines, Flexpipe results were stable as the business successfully levered new, larger diameter products to onboard additional customers and gain market share. Within Xerxes, improved manufacturing efficiency allowed greater capture of customer spend as strong demand for underground fuel and water tanks continued, driving year-over-year business growth. The segment also benefited from the absence of one-time modernization, expansion, and optimization costs, which impacted 2024. Entering 2026, Flexpipe is positioned to continue gaining market share, including through the addition of 7- and 8-inch products, for which we have already secured our first commercial order.

Speaker #2: Despite significant oilfield activity level declines, Flexpipe results were stable, as the business successfully leveraged new, larger-diameter products to onboard additional customers and gain market share.

Michael Reeves: Within Xerxes, improved manufacturing efficiency allowed greater capture of customer spend as strong demand for underground fuel and water tanks continued, driving year-over-year business growth. The segment also benefited from the absence of one-time modernization, expansion, and optimization costs, which impacted 2024. Entering 2026, Flexpipe is positioned to continue gaining market share, including through the addition of 7- and 8-inch products, for which we have already secured our first commercial order.

Speaker #2: Within Xerxes, improved manufacturing efficiency allowed greater capture of customer spend, as strong demand for underground fuel and water tanks continued, driving year-over-year business growth.

Speaker #2: The segment also benefited from the absence of one-time modernization, expansion, and optimization costs, which impacted 2024. Entering 2026, Flexpipe is positioned to continue gaining market share, including through the addition of seven- and eight-inch products for which we have already secured our first commercial order, and Xerxes is expected to further accelerate productivity across its manufacturing network, enabling another year of profitable growth.

Michael Reeves: Xerxes is expected to further accelerate productivity across its manufacturing network, enabling another year of profitable growth. Connection Technologies benefited greatly from the addition of AmerCable in 2025, which drove a significant rise in full-year adjusted EBITDA. Successfully completing this highly accretive acquisition, moving efficiently through an onboarding protocol, and positioning the experienced AmerCable leadership team to outperform our first-year expectations was a significant accomplishment. AmerCable's strong performance offset a number of challenges within the segment's legacy DSG-Canusa and Shawflex businesses during the year, where performance was impacted by one-time modernization, expansion, and optimization costs, by ramp-up challenges in the newly established DSG-Canusa Ohio facility, and by late-year Canadian industrial wire and cable market softening.

Speaker #2: Connection Technologies benefited greatly from the addition of Amercable in 2025, full-year adjusted EBITDA. Successfully completing this highly accretive acquisition, moving efficiently through an onboarding protocol, and positioning the experienced Amercable leadership team to outperform our first-year expectations was a significant accomplishment.

Speaker #2: Amercable's strong performance offset a number of challenges within the segment's legacy DSG Canusa and ShoreFlex businesses during the year, where performance was impacted by one-time modernization, expansion, and optimization costs, by ramp-up challenges at a newly established DSG Canusa Ohio facility, and by late-year Canadian industrial wire and cable market softening.

Michael Reeves: AmerCable's strong performance offset a number of challenges within the segment's legacy DSG-Canusa and Shawflex businesses during the year, where performance was impacted by one-time modernization, expansion, and optimization costs, by ramp-up challenges in the newly established DSG-Canusa Ohio facility, and by late-year Canadian industrial wire and cable market softening.

Michael Reeves: Q4 saw solid productivity and efficiency gains in the DSG Ohio site and accelerating US utility market share capture within Shawflex, progress that has continued in the early part of 2026. In a year of escalating and constantly shifting trade friction, our teams demonstrated their agility by rapidly realigning supply chains, ultimately allowing the company to avoid material direct impacts from tariffs during 2025. I would like to thank our employees who worked so hard throughout the year to overcome these challenges. We are a stronger organization for it, and I have confidence we are positioned to navigate whatever external factors 2026 may bring, while maximizing performance by focusing on the things we can control. Tom will now walk us through some additional financial details.

Speaker #2: Q4 saw solid productivity and efficiency gains at the DSG Ohio site, as well as accelerating U.S. utility market share capture within ShoreFlex. Progress has continued into the early part of 2026.

Speaker #2: In a year of escalating and constantly shifting trade friction, our teams demonstrated their agility by rapidly realigning supply chains, ultimately allowing the company to avoid material direct impacts from tariffs during 2025.

Michael Reeves: I would like to thank our employees who worked so hard throughout the year to overcome these challenges. We are a stronger organization for it, and I have confidence we are positioned to navigate whatever external factors 2026 may bring, while maximizing performance by focusing on the things we can control. Tom will now walk us through some additional financial details.

Speaker #2: I would like to thank our employees who worked so hard throughout the year to overcome these challenges. We are a stronger organization for it, and I have confidence we are positioned to navigate whatever external factors 2026 may bring, while maximizing performance by focusing on the things we can control.

Speaker #2: Tom will now walk us through some additional financial details.

Speaker #3: Thanks, Mike. Fourth quarter revenue from continuing operations was $312.5 million, 50% higher than the fourth quarter of 2024, while adjusted EBITDA from continuing operations was $31.8 million, a 150% increase from the comparative period in the prior year, primarily attributed to the inclusion of Amercable results in 2025.

Tom Holloway: Thanks, Mike. Q4 revenue from continuing operations was $312.5 million, 50% higher than Q4 2024, while adjusted EBITDA from continuing operations was $31.8 million. A 150% increase from the comparative period in the prior year, primarily attributed to the inclusion of AmerCable results in 2025. The Connection Technologies segment delivered a new Q4 revenue record of $190.7 million, which was 118% higher than Q4 2024, with segment-adjusted EBITDA being $14.3 million higher than the prior year. Both outcomes are primarily driven by AmerCable's results being included within the segment's reported numbers.

Speaker #3: The Connection Technology segment delivered a new fourth quarter revenue record of $190.7 million, which was 118% higher than the fourth quarter of 2024, with segment adjusted EBITDA being $14.3 million, higher than the prior year.

Speaker #3: Both outcomes are primarily driven by AmerCable’s results being included within the segment’s reported numbers. While the ShoreFlex business saw continued Canadian industrial market weakness, DSG showed positive activity in the European market and improvement in the new Ohio facility.

Tom Holloway: While the Shawflex business saw continued Canadian industrial market weakness, DSG showed positive activity in the European market, and improvement in the new Ohio facility. AmerCable had a favorable sales mix and improved production efficiencies in Q4, which drove overperformance against expectations. Composite Technologies segment revenue was CAD 121.8 million, relatively flat compared to Q4 of 2024, while adjusted EBITDA increased by 57% over the same time period. Sales in Q4 of 2025 versus the prior year quarter skewed more heavily to the Xerxes business, as fuel and water tank demand remained robust and late-year seasonal slowing was less pronounced than normal.

Speaker #3: Amercable had a favorable sales mix and improved production efficiencies in the fourth quarter, which drove overperformance against expectations. Composite Technology segment revenue was $121.8 million, relatively flat compared to the fourth quarter of 2024, while adjusted EBITDA increased by 57% over the same time period.

Tom Holloway: Sales in Q4 of 2025 versus the prior year quarter skewed more heavily to the Xerxes business, as fuel and water tank demand remained robust and late-year seasonal slowing was less pronounced than normal.

Speaker #3: Sales in the fourth quarter of 2025 versus the prior-year quarter skewed more heavily to the Xerxes business, as fuel and water tank demand remained robust, and late-year seasonal slowing was less pronounced than normal.

Speaker #3: Improved segment profitability versus the prior year quarter was primarily driven by a favorable margin mix and increased production efficiencies in both businesses, as recently completed production facilities matured and existing facilities continued to deliver improvements.

Tom Holloway: Improved segment profitability versus the prior year quarter was primarily driven by a favorable margin mix and increased production efficiencies in both businesses, as recently completed production facilities mature and existing facilities continue to deliver improvements. Full-year revenue from continuing operations was approximately $1.3 billion, a 43% increase versus 2024. Adjusted EBITDA also increased by 43% over 2024 to reach $154.8 million in 2025. Year-over-year growth was primarily attributed to the AmerCable acquisition, which performed ahead of expectations, in addition to strong results in the Xerxes business. Flexpipe performed well to offset the oil field activity declines and end the year roughly neutral to 2024, while Shawflex and DSG saw declines tied to facility relocation disruption, startup challenges within the DSG Ohio plant, and late-year Canadian industrial wire and cable market slowing.

Speaker #3: Full-year revenue from continuing operations was approximately $1.3 billion, a 43% increase versus 2024. Adjusted EBITDA also increased by 43% over 2024 to reach $154.8 million in 2025.

Tom Holloway: Year-over-year growth was primarily attributed to the AmerCable acquisition, which performed ahead of expectations, in addition to strong results in the Xerxes business. Flexpipe performed well to offset the oil field activity declines and end the year roughly neutral to 2024, while Shawflex and DSG saw declines tied to facility relocation disruption, startup challenges within the DSG Ohio plant, and late-year Canadian industrial wire and cable market slowing.

Speaker #3: Year-over-year growth was primarily attributed to the AmerCable acquisition, which performed ahead of expectations, in addition to strong results in the Xerxes business. Flexpipe performed well to offset the oilfield activity declines in the year, roughly neutral to 2024, while ShoreFlex and DSG saw declines tied to facility relocation disruption, startup challenges within the DSG Ohio plant, and late-year Canadian industrial wire and cable market slowing.

Speaker #3: Moving to cash flow, cash provided by operating activities from continuing operations in the fourth quarter was $80.2 million. Strong operating cash flow in the quarter was driven by higher gross profit and cash generated from working capital releases.

Tom Holloway: Moving to cash flow. Cash provided by operating activities from continuing operations in Q4 was CAD 80.2 million. Strong operating cash flow in the quarter was driven by higher gross profit and cash generated from working capital releases. Strong collections and reduced inventory were the key contributors to the reduced working capital levels. Cash used in investing activities was primarily made up of capital spending on property, plant, and equipment, which was CAD 13.2 million during Q4. This cash outflow for capital spend includes amounts previously accrued that were paid in Q4 2025. Discontinued operations includes cash flow from the settlement of the liquidation of working capital tied to the sale of the Thermotite business, which also contributed to overall Q4 cash flow.

Speaker #3: Strong collections and reduced inventory were the key contributors to the reduced working capital levels. Cash used in investing activities was primarily made up of capital spending on property, plant, and equipment, which was $13.2 million during the fourth quarter.

Tom Holloway: Cash used in investing activities was primarily made up of capital spending on property, plant, and equipment, which was CAD 13.2 million during Q4. This cash outflow for capital spend includes amounts previously accrued that were paid in Q4 2025. Discontinued operations includes cash flow from the settlement of the liquidation of working capital tied to the sale of the Thermotite business, which also contributed to overall Q4 cash flow.

Speaker #3: This cash outflow for capital spend includes amounts previously accrued that were paid in the fourth quarter of 2025. Discontinued operations include cash flow from the settlement of the liquidation of working capital tied to the sale of the Thermotype business, which also contributed to overall fourth quarter cash flow.

Speaker #3: During the fourth quarter, cash used in financing activities was $48.1 million, primarily driven by $43.5 million of net repayment on the company's credit facility.

Tom Holloway: During the Q4, cash used in financing activities was CAD 48.1 million, primarily driven by CAD 43.5 million of net repayment on the company's credit facility. Cash outflows also included recurring lease liability payments. Full year capital spending, net of amounts accrued in 2024 was CAD 52.3 million, in line with previously provided expectations. We anticipate 2026 capital spending will be between CAD 35 million and 45 million, which is modestly below our previously communicated normal run rate. At quarter end, the company's net debt to adjusted EBITDA ratio was 3.1x or 2.2x if lease liabilities are excluded.

Speaker #3: Cash outflows also included recurring lease liability payments. Full-year capital spending, net of amounts accrued in 2024, was $52.3 million, in line with previously provided expectations.

Speaker #3: We anticipate 2026 capital spending will be between $35 million and $45 million, which is modestly below our previously communicated normal run rate. At quarter-end, the company's net debt to adjusted EBITDA ratio was 3.1 times, or 2.2 times if lease liabilities are excluded.

Tom Holloway: We anticipate 2026 capital spending will be between CAD 35 million and 45 million, which is modestly below our previously communicated normal run rate. At quarter end, the company's net debt to adjusted EBITDA ratio was 3.1x or 2.2x if lease liabilities are excluded.

Speaker #3: While we continue to expect some fluctuations in the reported ratio, we remain committed to returning to a normal course ratio of 2x or below and continue to prioritize debt reduction in the near term to ensure maximum future balance sheet flexibility.

Tom Holloway: While we continue to expect some fluctuations in the reported ratio, we remain committed to returning to a normal course ratio of 2x or below, and continue to prioritize debt reduction in the near term to ensure maximum future balance sheet flexibility. While we have paused activity under our share repurchase program in the short term, this does not represent a change in long-term strategy. With strong debt reduction since the end of Q3 2025, management is evaluating and will provide an update on the plan for share repurchases during the Q1 2026 earnings release. I will now turn it back over to Mike.

Speaker #3: While we have paused activity under our share repurchase program in the short term, this does not represent a change in long-term strategy. With strong debt reduction since the end of Q3 2025, management is evaluating and will provide an update on the plan for share repurchases during the Q1 2026 earnings release.

Speaker #3: I will now turn it back over to Mike.

Speaker #2: Thank you, Tom. I'm extremely proud of the manner in which NATO's employees responded to opportunities and challenges, both internal and external, during 2025. As we enter 2026, external factors continue to prove unpredictable; however, there are clear opportunities in every business, and particular strengths in certain end markets.

Michael Reeves: Thank you, Tom. I'm extremely proud of the manner in which Mattr's employees responded to opportunities and challenges, both internal and external during 2025. As we enter 2026, external factors continue to prove unpredictable. However, there are clear opportunities in every business and particular strength in certain end markets. We remain tightly focused on operational execution, new technology introduction, and the strengthening of our commercial focus and capabilities in key sectors. We are prioritizing actions that further enhance our business and build resiliency, ensuring we are well positioned to win regardless of external influences. The work completed over these last five years has provided a strong foundation from which we can efficiently develop and deliver highly differentiated critical infrastructure products from an optimized footprint.

Speaker #2: We remain tightly focused on operational execution, new technology introduction, and the strengthening of our commercial focus and capabilities in key sectors. We are prioritizing actions that further enhance our business and build resiliency, ensuring we are well positioned to win regardless of external influences.

Michael Reeves: We are prioritizing actions that further enhance our business and build resiliency, ensuring we are well positioned to win regardless of external influences. The work completed over these last five years has provided a strong foundation from which we can efficiently develop and deliver highly differentiated critical infrastructure products from an optimized footprint.

Speaker #2: The work completed over these last five years has provided a strong foundation from which we can efficiently develop and deliver highly differentiated, critical infrastructure products from an optimized footprint.

Michael Reeves: With the company's modernization, expansion, and optimization actions concluded, capital spending will reduce and is expected to be slightly below our normal range in 2026. We have concluded the work to establish an appropriate long-term production footprint capable of supporting growth across both segments for years to come, and have redirected resources to further accelerate progressive efficiency gains from this new footprint. In tandem, we continue to invest in the development of new technology, including the recent release of 7- and 8-inch Flexpipe products for early commercial use. I was particularly pleased to see one of our largest North American customers issue the first order for these products and expect to report multiple incremental orders at our next earnings call. We believe our greatest controllable near-term opportunity lies within the four walls of our manufacturing facilities.

Speaker #2: With the company's modernization, expansion, and optimization actions concluded, capital spending will reduce and is expected to be slightly below our normal range in 2026.

Speaker #2: We have concluded the work to establish an appropriate, long-term production footprint capable of supporting growth across both segments for years to come, and have redirected resources to further accelerate progressive efficiency gains from this new footprint.

Speaker #2: In tandem, we continue to invest in the development of new technology, including the recent release of seven- and eight-inch Flexpipe products for early commercial use.

Michael Reeves: I was particularly pleased to see one of our largest North American customers issue the first order for these products and expect to report multiple incremental orders at our next earnings call. We believe our greatest controllable near-term opportunity lies within the four walls of our manufacturing facilities.

Speaker #2: I was particularly pleased to see one of our largest North American customers issue the first order for these products, and expect to report multiple incremental orders at our next earnings call.

Speaker #2: We believe our greatest controllable near-term opportunity lies within the four walls of our manufacturing facilities. Both segments successfully accelerated workforce proficiency and operational efficiency across every new factory and many legacy sites during the fourth quarter, and have continued to drive that progression early in 2026.

Michael Reeves: Both segments successfully accelerated workforce proficiency and operational efficiency across every new factory and many legacy sites during Q4 and have continued to drive that progression early in 2026. These improvements will enable greater productivity and contribute to margin and cash flow enhancements in the quarters and years to come. In parallel, we continue to prioritize identification of and migration towards higher value end markets, particularly within our wire and cable businesses. During Q4 and into early 2026, this focus led to the capture of incremental orders tied to US and Canadian utility and data center applications, attractive end markets with long-term demand growth drivers. Subsequent to the quarter, we entered into a multi-year frame agreement with a large Canadian nuclear operator, further solidifying our confidence in continued contributions from this growing end market for the coming decade and beyond.

Speaker #2: These improvements will enable greater productivity and contribute to margin and cash flow enhancement in the quarters and years to come. In parallel, we continue to prioritize identification of and migration towards higher-value end markets, particularly within our wire and cable businesses.

Michael Reeves: During Q4 and into early 2026, this focus led to the capture of incremental orders tied to US and Canadian utility and data center applications, attractive end markets with long-term demand growth drivers. Subsequent to the quarter, we entered into a multi-year frame agreement with a large Canadian nuclear operator, further solidifying our confidence in continued contributions from this growing end market for the coming decade and beyond.

Speaker #2: During the fourth quarter, and into early 2026, this focus led to the capture of incremental orders tied to U.S. and Canadian utility and data center applications.

Speaker #2: Attractive end markets with long-term demand growth drivers. Subsequent to the quarter, we entered into a multi-year frame agreement with a large Canadian nuclear operator, further solidifying our confidence in continued contributions from this growing end market for the coming decade and beyond.

Michael Reeves: While underlying unfavorable near-term oil field and Canadian industrial fundamentals are likely to yield a lower full-year activity baseline than 2025 in our wire and cable businesses, as a corporation, we expect to largely offset this weakness through sales expansion into other targeted markets, operational efficiency improvements, and new technology introduction, particularly in Composite Technologies and DSG-Canusa. Consequently, we currently anticipate 2026 reported revenue and adjusted EBITDA will be similar to or modestly below 2025. Early year performance provides confidence that seasonal factors, which typically cause Q1 to be the slowest quarter of the year, can largely be mitigated. We currently believe Q1 revenue and adjusted EBITDA will be similar to Q4 of 2025.

Speaker #2: While underlying unfavorable near-term oilfield and Canadian industrial fundamentals are likely to yield a lower full-year activity baseline than 2025 in our wire and cable businesses, as a corporation, we expect to largely offset this weakness through sales expansion into other targeted markets, operational efficiency improvements, and new technology introduction, particularly in composite technologies and DSG Canusa.

Michael Reeves: Consequently, we currently anticipate 2026 reported revenue and adjusted EBITDA will be similar to or modestly below 2025. Early year performance provides confidence that seasonal factors, which typically cause Q1 to be the slowest quarter of the year, can largely be mitigated. We currently believe Q1 revenue and adjusted EBITDA will be similar to Q4 of 2025.

Speaker #2: Consequently, we currently anticipate 2026 reported revenue and adjusted EBITDA will be similar to, or modestly below, 2025. Early-year performance provides confidence that seasonal factors, which typically cause Q1 to be the slowest quarter of the year, can largely be mitigated, and we currently believe the first quarter revenue and adjusted EBITDA will be similar to the fourth quarter of 2025.

Michael Reeves: We maintain high conviction that our differentiated technologies, which support increased generation, movement, and use of electrical power and the ongoing transition to composite materials in fuel and water management applications, provide Mattr with substantial long-term growth and profit expansion opportunities. I'll now turn the call over to the operator and open it up for any questions you may have for myself, Tom, or Megan.

Speaker #2: We maintain high conviction that our differentiated technologies, which support increased generation, movement, and use of electrical power—and the ongoing transition to composite materials in fuel and water management applications—provide NATO with substantial long-term growth and profit expansion opportunities.

Speaker #2: I'll now turn the call over to the operator and open it up for any questions you may have for myself, Tom, or Meghan.

Operator 2: Thank you. As a reminder to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Yuri Lynk with Canaccord Genuity. Your line is now open.

Operator: Thank you. As a reminder to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Yuri Lynk with Canaccord Genuity. Your line is now open.

Speaker #1: Thank you. As a reminder, to ask a question, please press star one one (*)11 on your telephone and wait for your name to be announced. To withdraw your question, please press star one one (*)11 again.

Speaker #1: Please stand by while we compile the Q&A roster. Our first question comes from the line of Yuri Link with Canaccord Genuity. Your line is now open.

Yuri Lynk: Hey, good morning, guys.

Speaker #3: Hey, good morning, guys.

Michael Reeves: Morning.

Tom Holloway: Morning.

Speaker #4: Good morning.

Speaker #5: Good morning.

Yuri Lynk: Just on the guidance, best I can tell, it appears to be implying 10-11% EBITDA margin in Q1, but then a marked improvement at some point thereafter. First, is that the right characterization? If so, what would be the drivers of any margin improvement later on in the year?

Speaker #3: Just on the guidance, best I can tell, it appears to be implying a 10–11% EBITDA margin in Q1, but then marked improvement at some point thereafter.

Speaker #3: First, is that the right characterization? And, if so, what would be the drivers of any margin improvement later on in the year?

Tom Holloway: Yeah. Good question, Yuri. I think your guide on Q1 is about right. I'd say low double digits is where we would expect to be. A movement up from there with the normal seasonal activity in Q4 kinda causing Q4 to be a little bit more similar to Q1, which is generally what we see. Those middle quarters tend to be our best. Activity itself drives up the margin. Remember, we are operationally improving several of these facilities, and we're seeing good progress there. That's also going to continue to move those margins up.

Speaker #2: Yeah, good question, Yuri. So, I think your guide on the first quarter is about right. I'd say low double digits is where we would expect to be.

Speaker #2: And then a movement up from there, with the normal seasonal activity in Q4 kind of causing Q4 to be a little bit more similar to Q1, which is generally what we see.

Speaker #2: Those middle quarters tend to be our best. Activity itself drives up the margin. And remember, we are operationally improving several of these facilities, and we're seeing good progress there.

Speaker #2: So, that’s also going to continue to move those margins up.

Yuri Lynk: Okay. Then just on some of the headwinds in Canada, industrial, and I think you mentioned mining as well. I mean, mining to me would seem to be pretty strong. Industrial, I mean, when I look across my coverage universe, I struggle to see where the weakness is. Can you provide any more color on that and any leading indicators that you're tracking and which direction they're flashing, either more positive or negative?

Speaker #3: Okay, and then just on some of the headwinds in Canada, industrial, and I think you mentioned mining as well—I mean, mining to me would seem to be pretty strong.

Speaker #3: And industrial, I mean, when I look across my coverage universe, I, I, I struggle to see where the where the weakness is. So can you provide any more color on that and any leading indicators that, that you're tracking and which direction they're, they're flashing, either more positive or negative?

Michael Reeves: Yeah. On the mining side, what we've seen in the second half of 2025 and into the early part of 2026 is strength across many mining sectors. There was a period there where we saw particularly potash miners pause on investments to extend mines, which is where we typically would see the most meaningful revenue generation for our wire and cable business. I can say that as we've crossed into the early part of 2026, we've started to see those potash miners become a bit more active again. While I think we enter 2026 on a slightly lower activity baseline across the full mining spectrum for the wire and cable business, I do think that we're going to see a progressive improvement in that potash mining space, which is obviously a good thing for us.

Speaker #2: Yeah, so on the mining side, what we've seen in the second half of 2025 and into the early part of '26 is strength across many mining sectors, but there was a period there where we saw particularly potash miners pause on investments to extend mines, which is where we typically would see the most meaningful revenue generation for our wire and cable business.

Speaker #2: I can say that, as we crossed into the early part of 2026, we've started to see those potash miners become a bit more active again.

Michael Reeves: While I think we enter 2026 on a slightly lower activity baseline across the full mining spectrum for the wire and cable business, I do think that we're going to see a progressive improvement in that potash mining space, which is obviously a good thing for us.

Speaker #2: So, while I think we enter 2026 on a slightly lower activity baseline across the full mining spectrum for the wire and cable business, I do think that we're going to see a progressive improvement in that potash mining space, which is obviously a good thing for us.

Michael Reeves: On the industrial side, I agree with you that the broad industrial sector is showing decent stability. Remember that our exposure to the industrial market in Canada is largely centered on wire and cable. As we've discussed on previous calls, a portion of that exposure is to what we have termed industrial stock products. These tend to be the less differentiated wire and cable components that are held by distributors and then used on various projects. We've seen that particular sector hit very hard over the course of the last three quarters, particularly, largely as a result of US tariffs being placed on those products from foreign manufacturers and those foreign manufacturers redirecting their capacity into the Canadian market. We've seen pricing for industrial stock products move to a point that we've not seen in many decades.

Speaker #2: On the industrial side, I agree with you that the broad industrial sector is showing decent stability. Remember that our exposure to the industrial market in Canada is largely centered on wire and cable.

Speaker #2: And as we've discussed on previous calls, a portion of that exposure is to what we have termed industrial stock products. So, these tend to be the less differentiated wire and cable components that are held by distributors and then used on various projects.

Michael Reeves: We've seen that particular sector hit very hard over the course of the last three quarters, particularly, largely as a result of US tariffs being placed on those products from foreign manufacturers and those foreign manufacturers redirecting their capacity into the Canadian market. We've seen pricing for industrial stock products move to a point that we've not seen in many decades.

Speaker #2: We've seen that particular sector hit very, very hard over the course of the last three quarters, particularly, largely as a result of US tariffs being placed on those products from foreign manufacturers, and those foreign manufacturers redirecting their capacity into the Canadian market.

Speaker #2: We've seen pricing for industrial stock products move to a point that we've not seen in many decades. And as a consequence, as I announced at the August conference call last year, we made the conscious choice to pivot away from that market.

Michael Reeves: As a consequence, as I announced at the August conference call last year, we made the conscious choice to pivot away from that market, and I do not currently anticipate pivoting back towards that industrial stock market during 2026. I don't think there are returns for us in that space. What is important to note is that that pivot away from the industrial stock wire and cable space was offset by a pivot towards both US and Canadian utility opportunities. What we've seen in the late stages of 2025 and continuing into the early part of 2026 is good positive progress there. I can see in our numbers that we are capturing incremental business both north and south of the border in these utility applications with margins that make sense for us.

Speaker #2: And I do not currently anticipate pivoting back towards that industrial stock market during 2026. I don't think there are returns for us in that space.

Speaker #2: What is important to note is that that pivot away from the industrial stock wire and cable space was offset by a pivot towards both U.S. and Canadian utility op opportunities.

Michael Reeves: What we've seen in the late stages of 2025 and continuing into the early part of 2026 is good positive progress there. I can see in our numbers that we are capturing incremental business both north and south of the border in these utility applications with margins that make sense for us.

Speaker #2: And what we've seen in the late stages of '25 and continuing into the early part of 2026 is good, positive progress there. So, I can see in our numbers that we are capturing incremental business, both north and south of the border in these utility applications, with margins that make sense for us.

Michael Reeves: Over the course of 2026, I think what you'll see from our wire and cable business is that we strengthen that exposure to utility, which in turn strengthens the margin profile of the business progressively as we work our way through the year. Hopefully, that provides the color you're looking for.

Speaker #2: So, over the course of 2026, I think what you'll see from our wire and cable business is that we strengthen that exposure to utility, which in turn strengthens the margin profile of the business progressively as we work our way through the year.

Speaker #2: Hopefully, that provides the color you're looking for.

Yuri Lynk: Yeah. That's great. Okay. I'll turn it over there and get back on the queue, guys. Thanks.

Speaker #3: Yeah, that's great. Okay, I'll turn it over there and get back on the queue, guys. Thanks.

Michael Reeves: Thank you.

Speaker #2: Thank you.

Operator 2: Our next question comes from the line of Ian Gillies with Stifel. Your line is now open. Ian, your line is open. Please check your mute button.

Operator: Our next question comes from the line of Ian Gillies with Stifel. Your line is now open. Ian, your line is open. Please check your mute button.

Speaker #1: Our next question comes from the line of Ian Gillies with Stifel. Your line is now open. Ian, your line is open. Please check your mute button.

Ian Gillies: Oh, morning, everyone. Sorry. I got cut off when they were announcing it was me in the queue.

Speaker #6: Oh, morning everyone. Sorry, it got cut off when they were announcing it was me in the queue.

Yuri Lynk: Morning.

Michael Reeves: Morning.

Ian Gillies: As it pertains to margins, you've kinda talked a little bit about what the shoulder quarters are gonna look like in Q1 and Q4. Can you talk a little bit about where you think the high water marks may be in the middle part of the year as you have a bit more activity based on the scope of work you know today?

Speaker #5: Good morning.

Speaker #6: As it pertains to margins, you've kind of talked a little bit about what the shoulder quarters are going to look like in Q1 and Q4.

Speaker #6: Can you talk a little bit about where you think the high watermarks may be in the middle part of the year, as you have a bit more activity based on the scope of work you know today?

Michael Reeves: Perhaps I can talk a little bit about, you know, how we see margins evolving here. The first thing to recognize, of course, is that we enter 2026 with activity levels in a number of our end markets at a lower place than they were when we entered 2025. The combination of our outlook for markets and our continued penetration of key markets, combined with the work that we have done and are continuing to do, which is driving incremental improvement in operational efficiency, I think leads us to a place where we certainly would expect that our overall margin profile in the second half of 2026 is favorable to where we were in the second half of 2025.

Speaker #2: Perhaps I can talk a little bit about, you know, how we see margins evolving here. So the first thing to recognize, of course, is that we enter 2026 with activity levels in a number of our end markets at a lower place than they were when we entered 2025.

Speaker #2: But the combination of our outlook for markets and our continued penetration of key markets, combined with the work that we have done and are continuing to do—which is driving incremental improvement in operational efficiency—I think leads us to a place where we certainly would expect that our overall margin profile in the second half of 2026 is favorable to where we were in the second half of ’25.

Michael Reeves: I think largely speaking, you're going to see on average, the second half of 2026 margins will be higher than they will be in the first half of 2026. I think the high point in any of the quarters in 2026 is probably still in the low teens, but I would say there is a great deal of opportunity for us to you know explore moving above that level if the external markets cooperate a little bit. I feel very confident that we're doing all of the right things internally, executing very well operationally, driving the right refocus and growth in the right end markets and capturing many opportunities that the market's offering us. It's a difficult world to predict at this point in time.

Speaker #2: And I think, largely speaking, you're going to see, on average, the second half of '26 margins will be higher than they will be in the first half of '26.

Speaker #2: I think the high point in any of the quarters in 2026 is probably still in the low teens, but I would say there is a great deal of opportunity for us to, you know, explore moving above that level if the external markets cooperate a little bit.

Michael Reeves: I feel very confident that we're doing all of the right things internally, executing very well operationally, driving the right refocus and growth in the right end markets and capturing many opportunities that the market's offering us. It's a difficult world to predict at this point in time.

Speaker #2: I feel very confident that we're doing all of the right things internally, executing very well operationally, driving the right refocus and growth in the right end markets, and capturing many, many opportunities that the market's offering us.

Speaker #2: So, it's a difficult world to predict at this point in time. There are certainly things that could evolve externally that might give us a little bit of extra help.

Michael Reeves: There are certainly things that could evolve externally that might give us a little bit of extra help. But there's also things out there that could give us a little bit more of a headwind. We'll be cautious and say lower teens as the upper end of the range for now.

Speaker #2: But there are also things out there that could give us a little bit more of a headwind, so we'll be cautious and say kind of lower teens as the upper end of the range for now.

Ian Gillies: Got it. As it pertains to Q4, and apologies if I missed this in the prepared remarks, was there anything notable in Q4, maybe specifically tied to AmerCable related to one-time sales that helped revenue and margins? It just came in a bit stronger than I was expecting.

Speaker #6: Got it. As it pertains to Q4—and apologies if I missed this and didn't prepare remarks—was there anything notable in Q4, maybe specifically tied to Amber cable related to one-time sales that helped revenue and margins?

Speaker #6: It just came in a bit stronger than I was expecting.

Michael Reeves: Their revenue certainly was a nice end to the year. Obviously, there was some effect there of the run-up in copper price that inflated revenue, and that's just a typical response to that commodity movement. We've continued to see that team be very successful in finding and taking advantage of, let's call them non-traditional opportunities. We spoke last quarter about the early success winning and delivering in the data center market. We saw more of that in Q4. We also saw some opportunistic sales into some mining applications. We've had one or two customers that ran into some issues in mines and needed to replace wiring cable, and we were in a position to move very quickly and help them with that.

Speaker #2: So there, there revenue certainly, was a was a nice end to the year. Obviously, there was there was some effect there of the run-up in copper price that, that inflated revenue, and that's just a typical response to that, that commodity movement.

Speaker #2: But we've continued to see that team be very successful in finding and taking advantage of, let's call them, non-traditional opportunities. So we spoke last quarter about the early success winning and delivering in the data center market.

Michael Reeves: We spoke last quarter about the early success winning and delivering in the data center market. We saw more of that in Q4. We also saw some opportunistic sales into some mining applications. We've had one or two customers that ran into some issues in mines and needed to replace wiring cable, and we were in a position to move very quickly and help them with that.

Speaker #2: We saw more of that in Q4. And we also saw some opportunistic sales into some mining applications, as we've had one or two customers that ran into some issues in mines and needed to replace wire and cable, and we were in a position to move very, very quickly and help them with that.

Michael Reeves: We've benefited from a few items that perhaps don't happen every quarter. Broadly speaking, I would say the AmerCable team have been very consistent in their execution. As we roll here into 2026, I continue to expect that we will see AmerCable find and win incremental work in that data center market, while we navigate what is likely to be a little bit less active oil field market, than it was in 2025.

Speaker #2: So, we've benefited from a few items that perhaps don't happen every quarter. But broadly speaking, I would say the Amber Cable team have been very consistent in their execution.

Speaker #2: And as we roll here into 2026, I continue to expect that we will see Amber Cable find and win incremental work in that data center market, while we navigate what is likely to be a little bit less active oilfield market than it was in '25.

Ian Gillies: Understood. I'll turn the call back over for now.

Speaker #6: Understood. I'll turn the call back over for now.

Operator 2: Thank you. Our next question comes from the line of Tim Monticello with ATB Capital Markets. Your line is now open.

Operator: Thank you. Our next question comes from the line of Tim Monticello with ATB Capital Markets. Your line is now open.

Speaker #1: Thank you. Our next question comes from the line of Tom Monicello with ATB Quarmark Capital Markets. Your line is now open.

Tim Monticello: Hey, good morning.

Michael Reeves: Morning.

Tim Monticello: Just with the new Shawflex facility in Vaughan, and some of the headwinds that you talked about in terms of demand for stock products and everything else, how's that facility doing in terms of utilization, the amount of the lines that are running currently?

Speaker #5: Hey, good morning.

Speaker #7: Good morning.

Speaker #1: Morning.

Speaker #5: Just with the new SHAWCOR facility in Vaughan, and some of the headwinds that you've talked about in terms of demand for stock products and everything else, how is that facility doing in terms of utilization and the amount of lines that are running currently?

Michael Reeves: Yeah. We're definitely not fully utilized. Q3, you may recall we talked about setting a new revenue record in Q3. Some of that was catching up from the move disruption that we experienced in the first half of 2025. I think Q4 is a fairer reflection of the current run rate of activity that business is experiencing. We're below, certainly we're below the full capacity of the facility. I'd say we are suboptimal in terms of efficiency at this point in time, but moving in the right direction, as I mentioned on one of the earlier questions. The mix of business that's flowing through that facility is moving in the right direction, less industrial stock and more utility.

Speaker #2: Yeah. So we're, we're definitely not fully utilized. Q3, you may recall the you know, we talked about setting a new revenue record in Q3.

Speaker #2: Some of that was, was catching up from the, the move disruption that we experienced in the first half of 2025. I think Q4 is a, a fairer reflection of the current run rate of activity that that, that business is, experiencing.

Speaker #2: So we're, we're below—certainly, we're below the full capacity of the facility. I'd say we are suboptimal in terms of efficiency at this point in time.

Speaker #2: But moving in the right direction. As I mentioned on one of the earlier questions, the mix of business that's flowing through that facility is moving in the right direction—less industrial stock, and more utility.

Michael Reeves: We need a little bit more volume for that facility to show its full capability, and obviously, that's the push here. We've made some investments in incremental commercial capabilities, particularly in the US utility space. We've seen early success there, but we need to continue to see that. I'm confident we will. As we see a little bit more volume flow through that facility, the margin expansion that they'll be able to deliver will certainly start to accelerate.

Speaker #2: We need a little bit more volume for that facility to show its full capability. And obviously, that's the push here. We've made some investments in incremental commercial capabilities, particularly in the U.S. utility space.

Speaker #2: We've seen early success there, but we need to continue to see that. I'm confident we will. And as we see a little bit more volume flow through that facility, the margin expansion that they'll be able to deliver will certainly start to accelerate.

Tim Monticello: Do you think your cost structure is scaled correctly for the business as you see it for the next 12 months?

Speaker #5: Do you think your cost structures are scaled correctly for the businesses you see over the next 12 months, over and everything else?

Michael Reeves: I think so.

Tim Monticello: Over and everything else?

Michael Reeves: I do. Yep. I think we're appropriate. We've been thoughtful about the volume of workforce that we have in facilities where demand is not as robust as we'd like to see it. In other parts of the business, Xerxes, for example, we are adding shifts in virtually every facility. Demand continues to be extremely high in that business. Our opportunity in 2026 is to take full advantage of that through producing more and more tanks. The actions that have been taken over the last 12 months and that are continuing to occur there in Xerxes, I think can yield 10% or greater tank output increase year-over-year. You know, a lot of that is down to our ability to attract, retain, train labor where we're doing a much better job than we were 12 months ago.

Speaker #2: I think so. I do. Yep. I think we are—we're appropriate. We've been thoughtful about the volume of workforce that we have in facilities where demand is not as robust as we'd like to see it.

Speaker #5: Okay.

Speaker #2: And in other parts of the business—Xerxes, for example—we are adding shifts in virtually every facility. Demand continues to be extremely high in that business.

Speaker #2: Our opportunity in '26 is to take full advantage of that through producing more and more tanks. So the actions that have been taken over the last 12 months and that are continuing to occur there in Xerxes, I think, can yield 10% or greater tank output increase year over year.

Michael Reeves: The actions that have been taken over the last 12 months and that are continuing to occur there in Xerxes, I think can yield 10% or greater tank output increase year-over-year. You know, a lot of that is down to our ability to attract, retain, train labor where we're doing a much better job than we were 12 months ago.

Speaker #2: And, you know, a lot of that is down to our ability to attract, retain, train labor, where we're doing a much better job than we were 12 months ago.

Tim Monticello: The Canadian government announced a package of spending around, you know, defense, and Arctic, infrastructure and stuff like that. Do you think that Shawflex has any exposure to, cabling for anything defense-related? I know it was sort of an end market that had been targeted and, probably somewhere that you're not super exposed today, but how do you think about that end market and opportunities there?

Speaker #5: The Canadian government announced a package of spending around, you know, defense and Arctic infrastructure and stuff like that. Do you think that Shawcor has any exposure to cabling for anything defense-related?

Speaker #5: I know that was sort of an end market that had been targeted, and probably somewhere in that year—not super exposed today—but how do you think about that end market and opportunities there?

Michael Reeves: I think there's always opportunities. As you say, Shawflex hasn't historically focused on defense, and we would have to work through the process of being an approved vendor for those applications. It depends on the specific opportunity. I can tell you that we have in the past secured fairly meaningful orders for icebreakers and other marine vessels. I think there's opportunity there, whether it comes through the Shawflex or the AmerCable brand. We also sell heat shrink tubing into a number of aerospace and defense applications through the DSG brand. I think that could be interesting for us. We'll just have to see exactly where these dollars ultimately get directed. I can certainly assure you that the sales teams are very aware that defense broadly is an interesting market.

Speaker #2: I think there's always opportunities. As you say, Shawflex hasn't historically focused on defense, and we would have to work through the process of being an approved vendor for those applications.

Speaker #2: But it depends on the specific opportunity. I can tell you that we have, in the past, secured fairly meaningful orders for icebreakers and other marine vessels.

Speaker #2: So, I think there's opportunity there, whether it comes through the Shawflex or the Amber Cable brand. We also sell heat shrink tubing into a number of aerospace and defense applications through the DSG brand.

Michael Reeves: We also sell heat shrink tubing into a number of aerospace and defense applications through the DSG brand. I think that could be interesting for us. We'll just have to see exactly where these dollars ultimately get directed. I can certainly assure you that the sales teams are very aware that defense broadly is an interesting market.

Speaker #2: So I think that could be interesting for us, but we'll just have to see exactly where these dollars ultimately get directed. But I can certainly assure you that the sales teams are very aware that defense, broadly, is an interesting market.

Michael Reeves: We have invested R&D in the DSG business in particular to ensure that our full portfolio is ready to take advantage of increased defense spending. We are most advanced in that journey in Europe, where we have, for many years, supported the European defense industry and expect that increased spending in that region will help us as well.

Speaker #2: We have invested R&D in the DSG business in particular, to ensure that our full portfolio is ready to take advantage of increased defense spending.

Speaker #2: We are most advanced in that journey in Europe, where we have, for many years, supported the European defense industry, and expect that increased spending in that region will help us as well.

Tim Monticello: Last one. Can you just talk a little bit about the expansions that you're doing at AmerCable and what you think that does to your revenue capacity?

Speaker #5: And last one. Can you just talk a little bit about the expansions that you're doing at Amber Cable and what you think that does to your revenue capacity?

Michael Reeves: Yes. Spread over 2026 and 2027 into the very early part of 2028, we're investing in total around about CAD 30 million, which is consistent with the indications that we provided earlier. That will give the facility order of magnitude about 20% incremental productive capacity, but that will not become available until we are into 2028. The lead time on equipment is quite substantial in the wiring cable space.

Speaker #2: Yes. So, spread over '26 and '27 and into the very early part of '28, we're investing, in total, around about $30 million Canadian dollars, which is consistent with the indications that we've provided earlier.

Speaker #2: And that will give the facility order of magnitude, about 20% incremental productive capacity, but that will not become available until we are into 2028.

Speaker #2: The lead time on equipment is quite substantial in the wiring cable space. So, between now and then, the focus is on timely, safe, and cost-effective execution of this expansion project.

Michael Reeves: Between now and then, the focus is on timely, safe, and cost-effective execution of this expansion project while ensuring that we are optimizing productive output from the equipment that we have, and ensuring that we are building a very robust backlog of business to ensure that new equipment has work to do when it comes online, and I'm very confident that it will. The AmerCable team have performed extraordinarily well in the first 12 months of our ownership, and I have every confidence that as we roll through 2026, 2027, they will expand their end market exposure, their customer exposure, so that when we have meaningful incremental capacity available, it will be in high demand.

Speaker #2: While ensuring that we are optimizing productive output from the equipment that we have, and ensuring that we are building a very, very robust backlog of business to ensure that that new, new equipment has work to do when it comes online.

Speaker #2: And I'm very confident that it will. The Amber Cable team have performed extraordinarily well in the first 12 months of our ownership, and I have every confidence that as we roll through '26, '27, they will expand their end market exposure, their customer exposure, so that when we have incremental, meaningful incremental capacity available, it will be in high demand.

Michael Reeves: The AmerCable team have performed extraordinarily well in the first 12 months of our ownership, and I have every confidence that as we roll through 2026, 2027, they will expand their end market exposure, their customer exposure, so that when we have meaningful incremental capacity available, it will be in high demand.

Tim Monticello: Thanks so much for the answers. Appreciate it.

Speaker #5: Thank you so much for the answers. Appreciate it.

Michael Reeves: You're welcome.

Speaker #2: You're welcome.

Operator 2: Thank you. Our next question comes from the line of Nathan Poe with National Bank Capital Markets. Your line is now open.

Operator: Thank you. Our next question comes from the line of Nathan Poe with National Bank Capital Markets. Your line is now open.

Speaker #1: Thank you. Our next question comes from the line of Nathan Poe with National Bank Capital Markets. Your line is now open.

Nathan Poe: Good morning, everyone. Thank you for taking my questions.

Speaker #6: Good morning, everyone. Thank you for taking my questions.

Tom Holloway: Morning.

Michael Reeves: Morning.

Speaker #7: Morning.

Nathan Poe: My first question is on capital allocation. Let's say for the execution of internal initiatives and NCIB, your multiple discount is largely addressed and you get leverage in check. Longer term, 2, 3 years out, how do you view your capital allocation?

Speaker #2: Morning.

Speaker #6: So, my first question is on capital allocation. So, let's say through the execution of internal initiatives and NCIB, your multiple discount is largely addressed and you get leverage in check.

Speaker #6: Longer term, two, three years out, how do you view your capital allocation?

Tom Holloway: Yeah, good question. If we think longer term, I think a couple points here. One, we still believe a 2x net debt to adjusted EBITDA normal course ratio makes sense for the normal business. But having said that, we're gonna continue to invest organically. We're gonna continue to invest inorganically if opportunities arise. As Mike has said before, we don't have to do M&A, but there likely are some M&A opportunities down the road for us that would make good strategic sense. I think you'll see us continue to evaluate and build our pipeline and work towards finding the right thing that may be a good fit for the business.

Speaker #2: Yeah, good, good question. So, if we think longer term, I think a couple points here. One, we still believe a 2-times net debt-to-adjusted EBITDA normal course ratio makes sense for the normal business.

Speaker #2: But having said that, we're going to continue to invest organically. We're going to continue to invest inorganically, if opportunities arise, as Mike has said before.

Speaker #2: We don't have to do M&A, but there likely are some M&A opportunities down the road for us that would make good strategic sense. So I think you'll see us continue to evaluate and build our pipeline, and work towards finding the right thing that may be a good fit for the business.

Tom Holloway: Both of those things, organic and inorganic, will be a key point of growth for us, 'cause as we've also talked about on the organic side, these factories that we put in or on the ground over the last several years, they have lots of extra capacity for us to add line. We're not actually even talking about large dollars there. Those are two points. We'll continue to keep the debt in check and of course, the NCIB will continue to be a critical piece of returning capital to shareholders.

Speaker #2: So both of those things, organic and inorganic, will be a key point of growth for us. Because, as we've also talked about on the organic side, these factories that we put in or on the ground over the last several years, they have lots of extra capacity for us to add line.

Speaker #2: So we're not actually even talking about large dollars there. So those are two points. We'll continue to keep the debt in check. And of course, the NCIB will continue to be a, a, a critical piece of returning capital to shareholders. We view that as a good long-term use of capital.

Tom Holloway: We view that as a good long-term use of capital, and as you will have seen in the documents, we are evaluating where we are in that process, and we'll give an update in the Q1 call as to what our go-forward plans are because things have progressed quite well operationally and we wanna make sure that we're being prudent with the use of capital as we can.

Speaker #2: And, as you will have seen in the documents, we are evaluating where we are in that process. And we'll give an update in the Q1 call as to what our go-forward plans are, because things have progressed quite well operationally, and we want to make sure that we're being prudent with the use of capital as we can.

Nathan Poe: I just wanna also follow up on those organic growth initiatives. You specifically mentioned high return growth initiatives, including the expansion of the AmerCable business. I was just wondering about other segments of your business because you did mention clear opportunities across those as well. For example, like Xerxes is running very well with an ample backlog.

Speaker #6: And I just want to also follow up on those organic growth initiatives. So, you specifically mentioned high-return growth initiatives, including the expansion of the Amber cable business.

Speaker #6: I was just wondering about other segments of your business, because you did mention clear opportunities across those as well. For example, Xerxes is running very well with an ample backlog.

Michael Reeves: Yeah, I'll jump in there. First, I should say that Organic investments, we continue to hold ourselves to a 20% after-tax IRR hurdle rate, so we're not making meaningful investments into anything that we don't believe will deliver at least that kind of return. We talked already about the AmerCable investment, which is the first meaningful investment that business will have received in the best part of 15 years. As you know, we've made fairly substantial investments in each of the other businesses over the last 2 years, and as Tom mentioned, what that's given us is the physical footprint that we think is necessary to drive solid growth and margin expansion for many years to come. The infill investments will come with incremental lines and incremental automation.

Speaker #2: Yeah, I'll jump in there. The first thing I should say is that for organic investments, we continue to hold ourselves to a 20% after-tax IRR hurdle rate.

Speaker #2: So we're not making meaningful investments into anything that we don't believe will deliver at least that kind of return. We've talked already about the Amber cable investment, which is the first meaningful investment that business will have received in the best part of 15 years.

Michael Reeves: As you know, we've made fairly substantial investments in each of the other businesses over the last 2 years, and as Tom mentioned, what that's given us is the physical footprint that we think is necessary to drive solid growth and margin expansion for many years to come. The infill investments will come with incremental lines and incremental automation.

Speaker #2: As you know, we've made fairly substantial investments in each of the other businesses over the last two years. And as Tom mentioned, what that's given us is the physical footprint that we think is necessary to drive solid growth and margin expansion for many years to come.

Speaker #2: The infill investments will come with incremental lines and incremental automation. So, specifically to Xerxes, we have opportunities to add incremental lines within the four walls of the facilities that we currently have.

Michael Reeves: Specifically to Xerxes, we have opportunities to add incremental lines within the four walls of the facilities that we currently have. The big opportunity, the big lever, is to take a manufacturing process that has, for the last 50 years, been largely manual and migrate towards at least semi-automation, and perhaps in the longer term, more complete automation. Capital dollars will be fairly modest this year in that respect, because that's all that's needed. We are moving through the process of establishing prototype more fulsome automation for the Xerxes business. Once we've proven it out and are confident that we can propagate it, without interruption to the business, then that's what you'll see us do.

Speaker #2: But the big opportunity, the big lever, is to take a manufacturing process that has, for the last 50 years, been largely manual and migrate towards at least semi-automation and, perhaps in the longer term, more complete automation.

Speaker #2: So capital dollars will be fairly modest this year in that respect, because that's all that's needed. But we are moving through the process of establishing a prototype, more fulsome automation for the Xerxes business.

Michael Reeves: We are moving through the process of establishing prototype more fulsome automation for the Xerxes business. Once we've proven it out and are confident that we can propagate it, without interruption to the business, then that's what you'll see us do.

Speaker #2: And once we've proven it out, and are confident that we can propagate it without interruption to the business, then that's what you'll see us do.

Michael Reeves: I think we continue to believe that our total capital spend on an annual basis will be somewhere in the CAD 40 to 50 million range in most years, and that about CAD 15 million of that will be maintenance capital, the rest being growth, and the kind of investments will be centered on what I've just described, infill production lines, enhanced automation, things that will allow us to not just grow the top line, but materially expand the margin profile of this business. That's exactly what we expect to see as we move through the next 2 and 3 years.

Speaker #2: So, I think we continue to believe that our total capital spend on an annual basis will be somewhere in the $40 to $50 million range in most years.

Speaker #2: And about $15 million of that will be maintenance capital, with the rest being growth. The kind of investments will be centered on what I've just described.

Speaker #2: Infill production lines, enhanced automation—these are things that will allow us to not just grow the top line, but materially expand the margin profile of this business.

Speaker #2: And that's exactly what we expect to see as we move through the next two to three years.

Nathan Poe: Great color. Thank you. Have North American Flexpipe customers given you any indication they're reevaluating their 2026 budgets in reaction to the closure of the Strait of Hormuz?

Speaker #6: Great color. Thank you. And have North American Flexpipe customers given you any indication they're reevaluating their 2026 budgets in reaction to the closure of the strait?

Michael Reeves: Not yet. I think particularly the public oil and gas producers have become very disciplined with their capital budgets, so I think it will take a little more time for them to determine whether they believe this is a longer term uplift to commodity prices, and that might cause them to modify their capital spending for 2026. I think what we should expect is that this movement up and I think probably a kind of semi-permanent shift in the low end of the range that oil will trade at means we're unlikely to see any declines in US activity. That is a helpful fact, I would say. Entering this year, there were certainly some customers that indicated they might do a little less this year than they did last year.

Speaker #2: N-not yet. I think particularly, the public oil and gas producers have become very disciplined with their capital budgets. So I think it will take a little more time for them to determine whether they believe this is a longer-term uplift to commodity prices.

Speaker #2: And that might cause them to modify their capital spending for '26. I think what we should expect is that this, this movement up—and I think probably a kind of a semi-permanent shift in the low end of the range that oil will trade at—means we're unlikely to see any declines in US activity.

Michael Reeves: I think what we should expect is that this movement up and I think probably a kind of semi-permanent shift in the low end of the range that oil will trade at means we're unlikely to see any declines in US activity. That is a helpful fact, I would say. Entering this year, there were certainly some customers that indicated they might do a little less this year than they did last year.

Speaker #2: And that is a helpful fact, I would say, entering this year. There were certainly some customers that indicated they might do a little less this year than they did last year.

Michael Reeves: I think that's now unlikely, but I don't think we've crossed the threshold where customers have complete confidence that now is the right time to lean into incremental capital. Let's give it another couple of months and see where this thing lands. In the event that customers choose to lean in here, I think what we will see is, first attack will be to drilled but uncompleted wells or DUCs. There are several thousand of those in US land, which would allow customers to deploy a little incremental capital to complete more wells than they planned originally and extract more production. It is that completion process where our Flexpipe products are consumed. If we see that would certainly be a good thing for our business.

Speaker #2: I think that's now unlikely. But I don't think we've crossed the threshold where customers' confidence is that now is the right time to lean into incremental capital.

Speaker #2: So let's give it another couple of months and see where this thing lands. In the event that customers choose to lean in here, I think what we will see is, first attack will be to drilled but uncompleted wells, or DUCs. There are several thousand of those in US land, which would allow customers to deploy a little incremental capital to complete more wells than they planned originally and extract more production.

Michael Reeves: There are several thousand of those in US land, which would allow customers to deploy a little incremental capital to complete more wells than they planned originally and extract more production. It is that completion process where our Flexpipe products are consumed. If we see that would certainly be a good thing for our business.

Speaker #2: And it is that completion process where our Flexpipe products are consumed. So if we see that, that would certainly be a good thing for our business.

Nathan Poe: One last one for me, just on Flexpipe again. I believe those, the higher temperature spec pipes were originally slated for more so international markets. How are you adjusting operations to account for any turmoil in the Middle East?

Speaker #6: And one last one for me, just on Flexpipe again. I believe those higher temperature spec pipes were originally slated more so for international markets.

Speaker #6: How are you adjusting operations to account for any turmoil in the Middle East?

Michael Reeves: You're right. Our new high temperature variant will have its first use in the field in the Middle East. The product is physically there. Obviously, during a period of conflict and higher security risk, we will not be sending people into the Middle East to install it, but it was not scheduled for installation just yet. At this point, it hasn't had any impact. If we see an extended conflict, there might be a modest impact to when that first installation happens. Our anticipation was that we'd get one full installation done this year, give ourselves and our customer a chance to evaluate the performance of the product. Assuming that it performs well, which I'm sure it will, that the first real revenue associated with that product would not have been until 2027 anyway.

Speaker #2: So, you’re right. Our new high-temperature variant will have its first use in the field in the Middle East. The product is physically there.

Speaker #2: Obviously, during a period of conflict and higher security risk, we will not be sending people into the Middle East to install it. But it was not scheduled for installation just yet.

Speaker #2: So, at this point, it hasn't had any impact. If we see an extended conflict, there might be a modest impact to when that first installation happens.

Michael Reeves: Our anticipation was that we'd get one full installation done this year, give ourselves and our customer a chance to evaluate the performance of the product. Assuming that it performs well, which I'm sure it will, that the first real revenue associated with that product would not have been until 2027 anyway. I'm not expecting to see a meaningful impact.

Speaker #2: But our anticipation was that we'd get one full installation done this year, give ourselves and our customer a chance to evaluate the performance of the product and, assuming that it performs well—which I'm sure it will—that the first real revenue associated with that product would not have been until 2027 anyway.

Michael Reeves: I'm not expecting to see a meaningful impact.

Speaker #2: So, I'm not expecting to see a meaningful impact.

Nathan Poe: Thank you. I'll turn it over.

Speaker #6: Thank you. I'll turn it over.

Operator 2: Thank you. Our next question comes from the line of John Gibson with BMO Capital Markets. Your line is now open.

Operator: Thank you. Our next question comes from the line of John Gibson with BMO Capital Markets. Your line is now open.

Speaker #7: Thank you. Our next question comes from the line of John Gibson with BMO Capital Markets. Your line is now open.

John Gibson: Well, thanks for taking my questions. In your preamble, and apologies if I missed this, you talked about some nuclear work. Is this some new work you've won? Or, you know, we've obviously seen some impacts to margins in a positive direction for historical nuclear work, but can you maybe expand on it and what the pipeline is for work on that side right now? Yeah. The comment that I made in the preamble referenced a post-quarter contract that we executed with a large existing nuclear operator in Canada that effectively secures our position with them for greater than 10 years going forward. I think at a minimum, what it does is de-risk our position with that customer. It certainly creates a platform from which we can earn incremental work.

Speaker #8: Well, thanks for taking my questions. In your preamble, you mentioned nuclear work. Is this new work you've won? Or, you know, we've obviously seen some impacts to margins in a positive direction for historical nuclear work.

Speaker #8: But can you maybe expand on it, and what the pipeline is for—for work on that side right now?

Michael Reeves: Yeah. The comment that I made in the preamble referenced a post-quarter contract that we executed with a large existing nuclear operator in Canada that effectively secures our position with them for greater than 10 years going forward. I think at a minimum, what it does is de-risk our position with that customer. It certainly creates a platform from which we can earn incremental work.

Speaker #2: Y-yeah. So, the comment that I made in the preamble referenced a post-quarter contract that we executed with a large, existing nuclear operator in Canada.

Speaker #2: That effectively secures our position with them for greater than 10 years going forward. So I think, at a minimum, what it does is de-risk our position with that customer.

Speaker #2: But it certainly creates a platform from which we can earn incremental work. There's no incremental awards associated with that contract at this time.

Michael Reeves: There's no incremental awards associated with that contract at this time, but it creates the opportunity for that as we move forward. I would view it as a de-risking event at this point, and we'll give further updates as we roll through the year. I'm hopeful that it creates an opportunity for expansion.

Speaker #2: But it creates the opportunity for that as we move forward. So, I would view it as a de-risking event at this point.

Speaker #2: And we'll give further updates as we roll through the year. I'm hopeful that it creates an opportunity for expansion.

John Gibson: Okay, got it. Lawson, from what I understand, it's early stages, and you talked about the effect of higher copper prices, but just wondering, given the run in some commodities here, net net, where does this help or hurt your businesses the most, whether it be input costs or maybe an uptick in certain end markets?

Speaker #8: Okay, got it. And last one from me. I understand it's early stages, and you talked about the effect of higher copper prices. But just wondering, given the run-ins in commodities here, net-net, where does this help or hurt your businesses the most?

Speaker #8: Whether it be input costs or maybe an uptick in certain end markets?

Michael Reeves: Yeah. Copper obviously is at an elevated price and we'll have to see where it goes. If it stays somewhere in its current range, obviously it has an inflationary impact. We pay what we pay for copper. We pass that through to customers. It moves our cost of goods up, it moves our revenue up. It doesn't move our profit dollars very much. If we see copper continue to move up, it will have an effect of compressing the apparent margins in the wire and cable businesses. If it moves down, we will see an expansion of the margin in those businesses. We'll just keep our eyes on that.

Speaker #2: Yeah, so copper, obviously, is at an elevated price. And we'll have to see where it goes. But if it stays somewhere in its current range, obviously, it has an inflationary impact.

Speaker #2: So, we pay what we pay for copper. We pass that through to customers. It moves our cost of goods up; it moves our revenue up.

Speaker #2: It doesn't move our, profit dollars very much. So if we see copper continue to, to move up, we will it will have a, a, an effect of compressing the, the apparent margins in the wire and cable businesses.

Speaker #2: If it moves down, we will see an expansion of the margin in those businesses, so we'll just keep our eyes on that. But I think the hydrocarbon prices, following what's happened in the Middle East—we are a fairly large consumer of plastics and resins across most of our businesses.

Michael Reeves: I think the hydrocarbon prices, following what's happened in the Middle East, we are a fairly large consumer of plastics and resins across most of our businesses. While it hasn't happened yet, I would not be surprised if we see some inflation on our input costs. I think our customers recognize that we will pass that through to them. I don't think in terms of direct impact to our business, we're anticipating anything of great substance. I think what we have to keep our eyes on is duration and magnitude of impact here. If it's relatively short term, then I think the impact to economies around the world is somewhat limited.

Speaker #2: So, while it hasn't happened yet, I would not be surprised if we see some inflation on our input costs. And I think our customers recognize that—that we will pass that through to them.

Michael Reeves: I don't think in terms of direct impact to our business, we're anticipating anything of great substance. I think what we have to keep our eyes on is duration and magnitude of impact here. If it's relatively short term, then I think the impact to economies around the world is somewhat limited.

Speaker #2: So, I don't think, in terms of direct impact to our business, we're anticipating anything of great substance. I think what we have to keep our eyes on is duration and magnitude of impact here.

Speaker #2: If it's relatively short-term, then I think the impact to economies around the world is somewhat limited. If it lasts a little longer, then we will start to see some economic impact, which, broadly speaking, would not necessarily be a good thing for us.

Michael Reeves: If it lasts a little longer, then we will start to see some economic impact, which broadly speaking, would not necessarily be a good thing for us. You know, on the flip side of that, if we see it last for an extended period of time and oil prices remain high, we could see an upward movement in activity in the North American oil fields, which would be a good thing for us. It's difficult to say. For right now, we are viewing it as having both upside and downside. We're ready for anything, but we're not gonna try to get ahead of this thing because it could go in any direction. We'll be thoughtful, but we're ready.

Speaker #2: But if it, you know, on the flip side of that, if we see it last for an extended period of time and oil prices remain high, we could see an upward movement in activity in the North American oil fields, which would be a good thing for us.

Michael Reeves: It's difficult to say. For right now, we are viewing it as having both upside and downside. We're ready for anything, but we're not gonna try to get ahead of this thing because it could go in any direction. We'll be thoughtful, but we're ready. For now, we've assumed that there is a nominal impact from the Middle East in the outlook that we've given you for 2026.

Speaker #2: So, it's difficult to say. For right now, we are viewing it as having both upside and downside, and we're ready for anything. But we're not going to try to get ahead of this thing because it could go in any direction.

Speaker #2: So, we'll be thoughtful, but we're ready. And for now, we've assumed that there is a nominal impact from the Middle East in the outlook that we've given you for 2026.

Michael Reeves: For now, we've assumed that there is a nominal impact from the Middle East in the outlook that we've given you for 2026.

John Gibson: Thanks a lot. I really appreciate the color. I'll turn it back to you.

Speaker #8: Thanks a lot. I really appreciate the color. I'll turn it back here.

Michael Reeves: You're welcome.

Operator 2: Thank you. Our next question is a follow-up from Tim Monticello with ATB Capital Markets. Your line is now open.

Operator: Thank you. Our next question is a follow-up from Tim Monticello with ATB Capital Markets. Your line is now open.

Speaker #2: You're welcome.

Speaker #7: Thank you. Our next question is a follow-up from Tim Monticello with ATB CoreMark Capital Markets. Your line is now open.

Tim Monticello: Just follow up on Flexpipe. Has your expectations around large diameter pipe sales in 2026 changed? How do you think about your, I guess, penetration and maturity in the 5- and 6-inch diameter market right now?

Speaker #9: Hello. Just following up on FLEXPIPE—have your expectations around large diameter pipe sales in 2026 changed? And how do you think about your, I guess, penetration and maturity in the 5- and 6-inch diameter market?

Michael Reeves: Yeah. I'd say broadly speaking, our outlook for Flexpipe in 2026 has not changed. I said before. I still think Flexpipe will be a source of growth both in terms of revenue and margin expansion for this organization in 2026 versus 2025. That growth will come from continued penetration with the 5-inch and 6-inch products. Obviously, they're now a meaningful part of our revenue stream, but we are not yet approaching a mature market share. We continue to see the market generally skew towards larger diameter, which makes the addressable market for 5-inch and 6-inch bigger year over year. We continue to see that while we're gaining share, we have a fairly good runway there. I think there's a good 2, 3, 4 years of continued share gain in 5-inch and 6-inch ahead of us.

Speaker #9: Right now.

Speaker #2: Yeah, so I'd say, broadly speaking, our outlook for FLEXPIPE in '26 has not changed. I have said before, I still think FLEXPIPE will be a source of growth, both in terms of revenue and margin expansion, for this organization in '26 versus '25.

Speaker #2: That growth will come from continued penetration with the 5-inch and 6-inch products. Obviously, they're now a meaningful part of our revenue stream, but we are not yet approaching a mature market share.

Michael Reeves: We continue to see the market generally skew towards larger diameter, which makes the addressable market for 5-inch and 6-inch bigger year over year. We continue to see that while we're gaining share, we have a fairly good runway there. I think there's a good 2, 3, 4 years of continued share gain in 5-inch and 6-inch ahead of us.

Speaker #2: We continue to see the market generally skew towards larger diameter, which makes the addressable market for 5-inch and 6-inch bigger year over year. And we continue to see that while we're gaining share, we have a fairly good two, three, four years of continued share gain in 5-inch and 6-inch ahead of us.

Michael Reeves: Seven-inch and eight-inch, obviously, we are at the very beginning of a revenue generation curve there. We've got our first order. I expect we'll have other orders in hand here shortly. We told the market to expect, you know, perhaps, you know, high single-digit, low double-digit millions of revenue coming from that product line in 2026. I don't think our expectations have changed. We would anticipate that it would follow an uptake curve that looks quite similar to five-inch and six-inch. A modest first year and a fairly good acceleration as you move into years two and three. That's our outlook. The only other thing I'll say with Flexpipe is obviously 25 was a year where international orders for that product were near zero.

Speaker #2: Seven-inch and eight-inch—obviously, we are at the very beginning of a revenue generation curve there. We've got our first order. I expect we'll have other orders in hand here shortly.

Speaker #2: We told the market to expect, you know, perhaps, you know, high single- to low double-digit millions of revenue coming from that product line in 2026. I don't think our expectations have changed.

Michael Reeves: We would anticipate that it would follow an uptake curve that looks quite similar to five-inch and six-inch. A modest first year and a fairly good acceleration as you move into years two and three. That's our outlook. The only other thing I'll say with Flexpipe is obviously 25 was a year where international orders for that product were near zero.

Speaker #2: We would anticipate that it would follow an uptake curve that looks quite similar to 5-inch and 6-inch. So, a modest first year, and a fairly good acceleration as you move into years two and three.

Speaker #2: So, that's our outlook. The only other thing I'll say with FLEXPIPE is, obviously, '25 was a year where international orders for that product were near zero.

Michael Reeves: We don't wanna get ahead of ourselves, but I will tell you that we are seeing a substantially higher level of bid requests from international customers as we roll into 2026. We'll have to see how the conflict in the Middle East impacts the timing of things, but I do think there are at least some green shoots there in that space, and we'll keep you updated as we make progress.

Speaker #2: We don't want to get ahead of ourselves. But I will tell you that we are seeing a substantially higher level of bid requests from international customers as we roll into 2026.

Speaker #2: We'll have to see how the conflict in the Middle East impacts the timing of things. But I do think there are at least some green shoots there in that space.

Speaker #2: And we'll keep you updated as we make progress.

Tim Monticello: That's helpful. Haven't heard much on this copper tariff change, and certainly there is some pushback from the courts in the US on tariffs in general. Are you thinking about that any different? Is that still high on the risk profile for Shawflex?

Speaker #8: Yeah, that's helpful. And then, haven't heard much on this copper tariff change, and, certainly, there is some pushback from the courts in the US on tariffs in general.

Speaker #8: But are you thinking about that any differently? Was that still high on the risk profile for Shawcor?

Michael Reeves: I don't think our view of it has changed. Obviously, it feels like something that if a tariff were to be introduced, it could happen with short notice. We're ready for it if it happens. We know what we have to do to respond to it. For now, we will continue to operate our business as we always have, with Flexpipe delivering everything out of its Canadian facility. If we have to adjust and begin to deliver some things out of the AmerCable facility in the US, we'll do so. You're right, the tariff world is a bit crazy right now. I'd say broadly speaking, our outlook for 2026 that we've shared with you assumes that there are some puts and takes in the tariff space, but nothing of great substance changes from where we are today.

Speaker #2: So, I don't think our view of it has changed. Obviously, you know, it feels like something that, if a tariff were to be introduced, it could happen with short notice.

Speaker #2: We're ready for it if it happens. We know—we know what we have to do to respond to it. For now, we will continue to operate our business as we always have, with SHOWFLEX delivering everything out of its Canadian facility. If we have to adjust and begin to deliver some things out of the Amercable facility in the U.S., we will.

Michael Reeves: If we have to adjust and begin to deliver some things out of the AmerCable facility in the US, we'll do so. You're right, the tariff world is a bit crazy right now. I'd say broadly speaking, our outlook for 2026 that we've shared with you assumes that there are some puts and takes in the tariff space, but nothing of great substance changes from where we are today. That's our expectation, but we'll have to see what happens.

Speaker #2: We'll do so. You're right. The tariff world is a bit crazy right now. I, I'd say broadly speaking, our outlook for '26 that we've shared with you assumes that there are some puts and takes in the tariff space, but nothing of great substance changes from where we are today.

Michael Reeves: That's our expectation, but we'll have to see what happens.

Speaker #2: So that's our expectation, but we'll have to see what happens.

Tim Monticello: We haven't talked about DSG-Canusa. What's your expectation and what's included in your sort of 2026 guidance at, for DSG?

Speaker #8: And then we haven't talked about DSG Canusa. What's your expectation, and what's included in your sort of 2026 guidance for DSG?

Michael Reeves: Full year, we expect DSG is a bigger contributor to EBITDA generation in 2026 than it was in 2025, largely on the back of improving and continued improvement in the new Ohio facility, which now supports the North American business sector. Demand is robust in North America for DSG's products. The facility in Ohio is already producing more than we had historically produced from our Toronto facility that it replaced. But we are still in a position where we need to import a portion of the supply from our German and Chinese sites, which obviously comes with tariff costs. The expectation is that the progression we've seen from Q3 to Q4 to early Q1 continues all the way through this year, and that DSG exits this year with an EBITDA run rate that is materially better than it entered the year.

Speaker #2: For the full year, we expect DSG to be a bigger contributor to EBITDA generation in '26 than it was in '25, largely on the back of improving and continued improvement in the new Ohio facility, which now supports the North American business sector.

Speaker #2: Demand is robust in North America for DSG's products. The facility in Ohio is already producing more than we had historically produced from our Toronto facility that it replaced.

Michael Reeves: But we are still in a position where we need to import a portion of the supply from our German and Chinese sites, which obviously comes with tariff costs. The expectation is that the progression we've seen from Q3 to Q4 to early Q1 continues all the way through this year, and that DSG exits this year with an EBITDA run rate that is materially better than it entered the year.

Speaker #2: But we are still in a position where we need to import a portion of the supply from our German and Chinese sites, which obviously comes with tariff costs.

Speaker #2: So the expectation is that the progression we've seen from Q3 to Q4 to early Q1 continues all the way through this year, and that DSG exits this year with an EBITDA run rate that is materially better than it entered the year.

Tim Monticello: When do you think that you're gonna be able to fully, or sorry, fulfill, I guess, the demand in North America out of that facility and not have to supplement with international manufacturing products?

Speaker #8: When do you think that you're going to be able to fully—or, sorry, fulfill, I guess—the demand in North America out of that facility and not have to supplement with international?

Michael Reeves: I think there will likely always be a very small amount of international product that we need to bring in. There's a very wide range of products that we offer to the market. Some are sold in fairly small volumes and require unique manufacturing equipment to produce, and I'm not sure it will ever be in our best interest to have those products made in the Ohio site. I do think that the majority of what we sell in North America can be made in the US. I don't think we get all the way to that outcome by the time we get to the end of 2026, but we'll make good progress, and I think we probably get to a point of stabilization in 2027.

Speaker #2: I, I think I think there will be there will likely always be a very small amount of international product that we need to bring in.

Speaker #2: There’s a very wide range of products that we offer to the market. Some are sold in fairly small volumes and require unique manufacturing equipment to produce.

Speaker #2: And I'm not sure it will ever be in our best interests to have those products made at the Ohio site. But I do think that the majority of what we sell in North America can be made in the US.

Speaker #2: I don't think we get all the way to that outcome by the time we get to the end of '26, but we'll make good progress.

Speaker #2: And I think we probably get to a point of stabilization in 2027.

Tim Monticello: Yeah. Perfect. Thank you very much.

Speaker #8: Okay. Perfect. Thank you very much.

Michael Reeves: You're welcome.

Speaker #2: You're welcome.

Operator 2: Thank you. I would now like to turn the call back over to Michael Reeves for closing remarks.

Operator: Thank you. I would now like to turn the call back over to Michael Reeves for closing remarks.

Speaker #1: Thank you. I would now like to turn the call back over to Mike Reeves for closing remarks.

Michael Reeves: We appreciate your time and interest in Mattr. Thank you for joining us for today's quarterly conference call. We look forward to hosting you again in a couple of months and wish everybody a great day.

Speaker #2: So, we appreciate your time and interest in Mattr. Thank you for joining us for today's quarterly conference call. We look forward to hosting you again in a couple of months.

Speaker #2: And wish everybody a great day.

Operator 2: This concludes today's conference. Thank you for your participation. You may now disconnect.

Operator: This concludes today's conference. Thank you for your participation. You may now disconnect.

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