Glen Akselrod: September 30, 2026 financial results conference call. Joining me on the call today are Randy Boomhour, President and Chief Executive Officer, Marie Cantin, Chief Financial Officer, and Jordan Wolfe, President of MixOnSite. After management's formal remarks, we will conduct a Q&A session. We will take covering analyst questions live through the online stream, in the webinar portal, and all other questions through the Q&A text box that you should see in the bottom portion of your Zoom window. Before we begin, I'd like to remind everyone that today's call and the accompanying presentation contains forward-looking information within the meaning of applicable securities laws. These statements reflect management's current expectations and assumptions and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those we discuss today.
Glen Akselrod: The complete forward-looking statements disclaimer is set out in the slide now displayed, and the presentation is also available on our website at cematrix.com. For a full description of the associated risks and assumptions, please refer to the 2025 Management's Discussion and Analysis and other filings available on SEDAR. The company undertakes no obligation to update these statements except as required by law. Today's discussion will also include certain non-GAAP measures, which are defined and reconciled in the company's MD&A. With that, I'll turn the call over to Randy. Randy, please go ahead.
Randy Boomhour: Thank you, Glen. We're really appreciative of the opportunity to talk to shareholders about our Q3 results. We know there's some questions, and we're looking forward to providing you guys with some answers. With that sort of quick introduction, I'll turn it over to Jordan, who will go through a little bit about CEMATRIX, before we get into the numbers.
Jordan Wolfe: Hello, everybody. To talk about some of CEMATRIX's key investor highlights, I would say that CEMATRIX is a leading specialty contractor providing lightweight, cost-effective cellular concrete solutions for infrastructure projects throughout North America. Our customers typically turn to us to solve challenging geotechnical problems where conventional materials or construction methods may not be practical or cost-effective. We pride ourselves in delivering these solutions safely, on schedule, and within budget. Looking at our financial performance, we have established a pretty strong track record of growth with a compound annual revenue growth rate of approximately 25% since 2017. Through our first nine months of 2026, we have generated CAD 37.9 million in revenue, and on a trailing 12-month basis, revenue has reached CAD 50.5 million. We are also maintaining a healthy gross margin of approximately 30%, while generating CAD 8.3 million in adjusted EBITDA over that same trailing 12-month period.
Jordan Wolfe: Our balance sheet remains strong with over CAD 20 million in cash, providing us with significant financial flexibility. Looking ahead, we believe the combination of increased infrastructure investment, growing awareness of cellular concrete, and our established market positions provides us a substantial opportunity for continued growth. Next slide, please. Thank you, MJ. This slide represents our team and corporate timeline. It is mostly data. I will not go through this too much at length. I will capture the highlights, and I can assure you that CEMATRIX benefits from an experienced leadership team and board of directors with a broad range of operational, financial, and industry experience. One point worth highlighting is that we have significant inside ownership representing approximately 11% of the company. We believe that that level of ownership provides a strong alignment between management, board, and our shareholders.
Jordan Wolfe: As you can see from the timeline, CEMATRIX has evolved considerably since its founding in 1999. Over the years, we have expanded our operations, strengthened our market presence through strategic acquisition, and successfully navigated several challenging economic environments. Today, we are a much larger, more established organization with experience, resources, and financial strength to pursue increasingly complex infrastructure projects. Next slide, please, MJ. All right. For those who may be less familiar with cellular concrete, I would like to briefly explain the product and why it provides such an effective solution for our customers. Cellular concrete is produced by combining cement, water, and a preformed foam, creating a lightweight engineered material that can be designed to meet specific project requirements. One of its greatest advantages is its versatility. It is significantly lighter than conventional concrete, highly flowable, self-compacting, and can be pumped over considerable distances.
Jordan Wolfe: The properties make it particularly well-suited for projects where access is limited, weight restrictions exist, or traditional fill materials would be difficult or expensive to install. Some of our most common applications include lightweight engineered fill, retaining wall backfill, road construction, pipe, tunnel abandonment, and foundation-related applications. Ultimately, what makes cellular concrete attractive is its ability to solve difficult construction challenges while often reducing cost, construction time, and overall project complexity. That ability to provide practical, cost-effective solutions is what continues to drive demand for our products and services. With that, I will pass it back to Randy.
Randy Boomhour: Thank you, Jordan. We are going to skip these two slides here about the customers and the opportunity because it is really about our Q3 results. We always think it is really important to help our investors or potential investors understand the business, because there are elements of our business that are fantastic and investors like, and there are elements that some investors do not like, and we would rather just be upfront and honest about those. I am going to start on the right-hand side of this slide and just talk about some of the keys to understanding our business. Revenue growth will be lumpy. It will not be a staircase. Our financial results will be variable based on the timing of when large projects start and stop.
Randy Boomhour: This year, in 2026, we are on track for our best year ever, but we have really seen direct evidence of this variability, where Q2 was extremely strong and higher than any second quarter we have ever had, and Q3 was a little bit smaller than last year. We have seen some of that variability. We have also provided some guidance around Q4 that Q4 is going to be one of our best quarters ever. It is a seasonal business, which we have talked a little bit about. Our revenues are going to be higher in the warmer months. Our average revenue over the last five years in Q1 has been 18%, Q2 17%, Q3 34%, and Q4 31%. There has been a lot of variability in each of those quarters, but those are the averages. If you want to see the actual numbers, you can see them in our MD&A.
Randy Boomhour: We are a specialty contractor, so that means the margins tend to be higher than general contractors, but we have bench time or fixed costs that we have got to cover. When we do not have work or we are less busy, our margins are going to get depressed because of covering this bench time or fixed costs. Project size matters. Larger projects always attract more competition because the mobilization cost becomes a much smaller component of the overall build, and so it attracts more competition. As a result, we will have lower margins. We do have excess capacity, which enables us to do significantly more revenue with existing equipment and staffing levels. Jordan already touched on it, but 2025 was a record year for us. Our EBITDA was higher than the previous 20 years combined. Our adjusted EBITDA of 8.3 was higher than our two best years before that.
Randy Boomhour: We passed the Rule of 40, which is really hard for a traditional bricks and mortar construction company to do. Top-line growth, positive bottom line, generating cash, healthy balance sheet with low leverage. We came into this year with just under CAD 12 million in cash. We have exited Q3 with over CAD 20 million in cash, and we continue to be profitable. I am going to pass it over now to MJ, who is going to go through some Q3 specific figures with our investor group here.
Marie Cantin: Thank you, Randy. We have put this slide. I will not go through it. It is just a good snapshot for you and a reference if you want to access it. We also post these financials on our website, and since we are publicly traded, it is also on SEDAR+ if you are interested in having more information. As Randy mentioned, I will briefly walk you through our financial results for Q3 and year to date. Our revenue was a bit lower, as Randy mentioned, at CAD 11.9 million. Still solid. I think that is our third highest Q3 revenue in the history of the company, but still a bit lower than last year at CAD 15.3 million. A record CAD 37.9 million year to date compares to CAD 32.6 million last year. That is a 16% increase. Our margins are lower for both the quarter and the year to date.
Marie Cantin: One of the main drivers for this is a key contract structure that Randy will touch base on briefly in a moment. We do have a proportion of large projects that sometimes have lower margins. A good news story for us is our SG&A. Despite the year-to-date increase in revenue, we were still able to decrease our SG&A. For a quarter, we decreased SG&A by CAD 300,000 to CAD 2.1 million, compared to CAD 2.4 million last year. Year to date, we had a CAD 600,000 improvement at CAD 6.3 million compared to CAD 6.9 million last year. That leads us to an operating income of CAD 0.7 million in Q3 compared to CAD 2.8 million last year, and CAD 3.7 million year to date compared to CAD 3.9 million last year.
Marie Cantin: Adjusted EBITDA was positive for both the quarter and the year at CAD 1.4 million for Q3 and year to date at CAD 5.9 million, which is similar or exactly the same as what we did last year. We are generating cash from operations. We had CAD 1.5 million in Q3 compared to CAD 3.2 million last year in Q3. When you look at year to date, it is a bit higher by CAD 100,000 at CAD 5.7 million compared to CAD 5.6 million year to date last year. When you include working capital, we had positive cash flow of CAD 4.6 million in Q3. That is a CAD 2.8 million increase compared to CAD 1.8 million last year and CAD 10.3 million year to date, which is a CAD 9.4 million increase compared to the CAD 0.9 million we did year to date last year. Randy already mentioned we have CAD 20.5 million in our coffers at the end of 30 September.
Marie Cantin: This slide puts the quarter in a long-term perspective. Randy touched base on a bit of the lumpiness, so you can see that in this graph, but the growth line is still trending in an upward position. In orange, this is year to date number, the rest in teal are full year. So you can see that year to date, it is the third highest revenue we have ever had, and we have not even finished the year yet. When you look at our backlog, it remains strong. We ended the quarter at CAD 65.6 million in backlog. At Q2, it was around CAD 61.5 million, so it went up. We announced CAD 43.2 million of awards year to date, and our book-to-bill ratio is 1.14, which indicates expanding our backlog. Our backlog supports our future revenues, and our largest project is in backlog is on the way.
Marie Cantin: When you look at our margins, I think 30% is a good target for you to keep in mind moving forward. If you are interested about the dip in the middle of the graph in 2022, that is because of the pandemic. We have supply chain issues and cement shortages. I am going to pass it to Randy to touch base on the key contract structure.
Randy Boomhour: Yeah. Thanks, MJ. This chart here is right out of our MD&A, but we think it is just important because it provides investors with a better reference point than our reported gross margins, because that contract structure really helped our gross margins in 2025. As a result, it might have created some unreasonable expectations in terms of what to expect going forward. We really do think 30% is the right number. We are obviously always working to get that better, but at a certain point, you cannot. There is no more improvement. We are obviously trending a little bit below that right now. We expect Q4 will raise it up. I do not know if we will get all the way to 30% on the year, but that remains our target, and we should be able to get pretty close.
Marie Cantin: Thanks, Randy. Since 1 January 2025, we have outperformed the S&P/TSX Composite Index. Our current share price, if you look at 21 October, it was CAD 0.485. That is 87% higher than our 31 December 2024, when it was at CAD 0.26. When you look at our low of 14 March 2025, when it was at CAD 0.16, it is 194% higher. We have no plans to raise capital or issue shares, and we repurchased 2 million common shares under our NCIB since the inception of the program in 2025. When you look at our debt and interest, it has dramatically decreased when you look at 2020, 2010, and it helps us to support and give us a solid foundation for our future. I am not going to go through the key ratios.
Marie Cantin: Again, it is just a good visual for you to see that they are all trending in the right direction, obviously, as we are becoming more profitable. That is a small, quick snapshot of our financials, and I am going to turn it back to Randy.
Randy Boomhour: Thank you, MJ. One more, please. Yeah. We always like to end on this. This is really just kind of the key messages we want people to walk away with is why invest? Well, we are an industry leader. We are really well-positioned to capitalize on the large opportunity in the growing infrastructure construction segment. There are lots of tailwinds in that segment that support our business, and it is really driving our growth. That really leads into the second point here is we are a growth company. We are growing revenue, we have positive adjusted EBITDA, positive cash flow from operations, and a really strong balance sheet. We do believe that we continue to be undervalued based on traditional valuation metrics, but the gap is closing.
Randy Boomhour: Whatever valuation metric you want to use, whether it is multiple of forward revenue, forward EBITDA, forward EPS, we believe there is still room there, and we are not properly valued. There are also no new capital raises that are required to fund a burn rate. MJ touched on that already. The only new capital should be in support of a large accretive acquisition. We have capital to deploy right now. We are actively looking for opportunities to grow organically by growing our sales or sales support team or via acquisition. If we do an acquisition, we are pretty sure the first one would be 100% accretive to shareholders, depending on the size. We are in a really good spot. We say it every quarter, but the three of us have never felt better about the company and the opportunities in front of us.
Randy Boomhour: Extremely optimistic about the future of our company, and couldn't be happier to be in the spot that we are in. Investor relations on the retail side, you can send it to CEMATRIX directly, and we will respond. On the institutional side, please go through Glen at Bristol. We still have our one analyst covering us is Russell Stanley from Beacon Securities, who we are very thankful for their support and to have Russell on the call with us today. With that, I think we will pause, turn it over to Glen, and we will go through some questions.
Randy Boomhour: Okay, super. Thank you very much, Randy. The first question we are going to pull in is Russell Stanley from Beacon Securities, and then we will take the rest of the questions through the question and answer portal. Russell, you are live in the call. Please go ahead.
Russell Stanley: Thanks for the questions. Maybe first, Randy, wondering if you can even roughly quantify the revenue impact of the projects that were delayed in Q3, and perhaps elaborate on the causes of those delays so people can better understand the dynamics of the business and how these things are quite normal.
Randy Boomhour: Yeah. What caused the delays is just what is happening on site in these various projects. What we do find sometimes in the summer is projects, especially if they have not started, can get delayed because of vacations and holidays. It is actually quite common in the construction industry for projects to experience a delay. Once a project starts, we have a much tighter idea when our scope of work is going to start. It can still shift a little bit, but once the contractor is on site, we have a much better idea. All that really happened that impacted the Q3 revenue, in particular, was that a bunch of these projects that we had on the schedule to start in the middle of August, they pushed and started in the middle of September.
Randy Boomhour: There is, as we said in the MD&A, no impact on our overall health of our business, no impact on the year at all, but had a pretty dramatic impact on our Q3 reporting results. If you are a private company, we would not have even batted an eyelash over this change. As a public company and with the scrutiny that happens comparing quarter over quarter, we knew that some of our investors would express some concern. Which is why we decided it would be a good idea to provide some information around what Q4 would look like to help give investors confidence.
Russell Stanley: Thanks for that. I guess further to that, given the Q4 guidance, it sounds like all the projects that were delayed have now started and are underway, so you have that visibility. Are there any projects for which you are still awaiting the start in order to hit that guidance? Or is everything occurring now as it needs to in order to hit that top-line range?
Randy Boomhour: I'd say all the large projects to hit that guidance have started, Russell. But there are always projects that are one or 2 days in duration that will start in November or start in December and finish in the same day or same week. There's still other work that has to go on to meet that number. But the largest items in it have started, and we expect them to be finished in Q4.
Russell Stanley: That's great. And maybe on SG&A, congrats, you continue to run a pretty lean ship there. I know there's a component in there, I believe that's insurance related, that varies up and down with the revenue level. But outside of that, is there still scope for additional improvement from here, additional cost savings, or do you envision having to expand this number in dollar terms going forward?
Randy Boomhour: In Q4, we expect the trend this year to continue where we would expect SG&A to be lower again. But heading into 2027, I would expect SG&A would go up kind of in line with inflation. Then we continue to look for opportunities to grow our sales and sales support team where that makes sense. Our preferred way to grow our business is via acquisition, but if we basically eliminate all the opportunities to do that in a market we really like, we might attempt a greenfield entry into a certain market, which would then increase the SG&A. But the expectation would be that that would deliver revenue at some point that year and in the future.
Russell Stanley: Great. And that dovetails into, I think, my last question just on acquisitions. Balance sheet obviously in great shape. Can you talk about what you're seeing and any progress that you've made since the last call in late July?
Randy Boomhour: Yeah. I continue to make progress on it. It is not like a one and done type of situation. I would call this like a courting process, right? It is not like the first time you meet a girl or a boy, you do not marry them that day, generally speaking, right? So it is a bit of a courting process. Some people have no interest in being acquired. Some people, it is a conversation starter, and we are just running down those opportunities. There is nothing imminent. As I said many times, if we cannot find a deal that makes sense at a price that is accretive, we just will not do it. I will continue to eat the egg every quarter as to why we have not done it. We will not do a deal just to do a deal. We will only do one that makes sense. I keep looking. I am optimistic.
Randy Boomhour: Our growing cash balance, our continued success, those just help me in terms of selling why it would be good for someone to join CEMATRIX. In the meantime, we will just continue growing our business organically and continue to run a business that runs properly, makes money.
Russell Stanley: That is great. Thank you for the color. I will hop back in the queue.
Randy Boomhour: Thanks, Russell.
Randy Boomhour: Super. Thank you, Russell. If you have any follow-up questions, just raise your hand once again. Next question will go to some online questions, Randy. The first question is, in Q3 results, you stated you remain on track for a record year of financial performance in 2026. Is the forecast record financial performance related to revenue, profit, or cash flow?
Randy Boomhour: It should be all three, Glen. Yeah.
Randy Boomhour: Okay. Thank you. Are project delays built into your bid pricing, or are there any penalties to the customer if the project is delayed beyond a certain point or canceled?
Randy Boomhour: Yeah. Unfortunately, it would be nice to punish our customers when they don't start things on time, but that's just not how the world works, right? That'd be like Costco punishing you because you don't shop on Saturday, instead you go on a Sunday. That's just not how business runs. There are no penalties like that. I've never seen penalties like that in any business, to be honest with you. That option just doesn't exist. It's just part of being in construction. We have to show up when our customers are ready, and we have to try to manage that. We try to be more conservative around our forecasting. I would say to all investors, we choose our words very carefully. When we give guidance or information around a quarter, you should take the understanding that we've chosen those words carefully.
Randy Boomhour: We didn't say Q3 would be the same as last year. We said it would be similar to last year. The words matter, I guess. We would also say there's going to be variability in our results. For people looking for a staircase, we're probably not the right place for you. People looking for businesses that are run really well, then we're a company that should interest you.
Randy Boomhour: Okay, super. Again, to our audience, if you have a question, please use the text box at the bottom of the webinar portal. We've got one question in the queue remaining unless other comes in. Randy, have you considered any stock consolidation, for example, a 3-for-1 reverse split?
Randy Boomhour: Yeah, I've had a number of investors chat with me about this concept, Glen. Some have suggested 3 for 1, some have suggested even a 10 for 1. Try to get the share price above certain thresholds that means something for either short trading or margin trading. The honest answer is we haven't really considered that. I would say, generally speaking, most people would say that if you see a share consolidation, that's usually a sign of a company struggling. I think there's been a couple share consolidations in the Canadian market, in the cannabis space in particular, where it wasn't about a company that's struggling. Both the companies that did it were in a good place, but they also had like 1 billion shares outstanding. So they're just trying to get their share count to something that was even remotely within reason.
Randy Boomhour: Long story short, we thought about it. The general advice we've gotten is to not do it. I don't really see at this point in time us doing that. It's something that as we think about our capital structure every year as part of our strategic planning, it's something that we talk about.
Randy Boomhour: Okay, super. Thank you. There are no further questions in the queue, so if you want to deliver some closing remarks, then we will end the call.
Randy Boomhour: Yeah. The only other thing I would like to add, Glen, is I think this year we have made a purposeful effort to try to report earlier, and I give credit to MJ and her team for allowing us to do that. So instead of reporting on the fifth week, we are reporting on the fourth week. And we are really doing that just to try to get information out to investors more quickly. But I think sometimes investors are misinterpreting that to, if it is good news, I am trying to get it out early, if it is bad news, I am going to wait. And that is just not how we operate. We have a business process, and good or bad, we deliver the news in the same timeframe. So our quarterly reporting, you should expect that it should come out roughly four weeks from when the quarter ends now and going forward.
Randy Boomhour: That is just our business process. In terms of closing remarks, again, as we stated in the presentation, we would love it if we owned 100% of this business. This business right now is doing better than it has ever done before. Our growth prospects look really good. Our sales teams look really good. We are generating cash. You can see that showing up on the balance sheet. You can see us winning contracts. You can see that in our win rate and our book-to-bill rate. Everything about our business right now is going really well. And if we were a private company, we would all be high-fiving each other. We understand that as a public company, there is a mandate to grow and to grow fast. And we are actively working to try to deliver that for our shareholders.
Randy Boomhour: I would just say, someone said to me, "You get the shareholders that you deserve." So we are really trying to find shareholders that are interested in traditional bricks-and-mortar businesses that are growing and cash flow positive and that understand the volatility that is inherent in our business. And if we have shareholders that do not like that volatility, we really would just recommend that you go somewhere else because there is going to be volatility. For those that can see the value in our business, we really hope that you stick with us, because we think you are going to get rewarded in the long term.
Randy Boomhour: Super. All right. Thank you, Randy. Thank you, MJ. And thank you, Jordan. This concludes the Q3 earnings call.
Randy Boomhour: Thank you, Glen.
Jordan Wolfe: Thanks, Glen.
Marie Cantin: Goodbye
