Financial Data and Key Metrics Changes - In Q4 2025, earnings per common share was $0.30, with an adjusted EPS of $0.37, reflecting a 9% year-over-year increase [16][20] - Average loans grew 14.4% year-over-year, with organic loan growth of $10.1 billion, exceeding the $9.5 billion added through the Veritex partnership [16][18] - Average deposits increased 5.1% quarter-over-quarter and 8.6% year-over-year, with core deposits growing $5.5 billion year-over-year [18][19] - Net interest income grew by $86 million, or 5.6% sequentially, representing over 14% growth year-over-year [20] - Adjusted return on tangible common equity (ROTCE) increased by 40 basis points, with tangible book value growing 19% year-over-year [25][26] Business Line Data and Key Metrics Changes - Consumer banking saw a 4% year-over-year increase in primary bank relationships, while business banking grew by 7% [6] - Fee income from payments grew 5%, with commercial payment revenues up 8% year-over-year [21] - Wealth management grew 10%, and capital markets delivered its second strongest revenue quarter, trailing only Q4 2024 [21][22] Market Data and Key Metrics Changes - The company expanded its consumer and regional banking presence to 21 states, focusing on fast-growing markets [4] - The partnerships with Veritex and Cadence are expected to enhance market growth and customer share in Texas and other new markets [14] Company Strategy and Development Direction - The company aims to become the leading people-first, customer-centered bank, leveraging a differentiated operating model [3][4] - Strategic investments in branch expansion, commercial verticals, and fintech solutions are designed to enhance long-term growth [7][8] - The focus remains on organic growth, customer relationship deepening, and maintaining a moderate to low-risk profile [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining strong growth driven by organic initiatives and recent partnerships [32] - The outlook for 2026 includes expectations for net interest income growth of 10% to 13% and fee revenue growth of 13% to 16% [27][29] - Management anticipates achieving cost synergies from Veritex by Q2 and from Cadence by Q4, contributing to overall profitability [31] Other Important Information - The company plans to initiate programmatic share repurchases and maintain a strong dividend yield [25] - Credit quality remains stable, with net charge-offs at 24 basis points and a criticized asset ratio of 4.2% [26] Q&A Session Summary Question: Clarification on expense trajectory and cost savings - Management indicated that underlying expense growth is expected in the mid-single digits, with positive operating leverage anticipated [40][41] Question: Partnership approach and revenue synergies - The partnership model has allowed for quicker decision-making and greater certainty for employees, enhancing the potential for cost and revenue synergies [42][45] Question: Guidance on first quarter expenses - Management refrained from providing specific quarterly guidance but emphasized the importance of positive operating leverage [48] Question: Revenue-producing initiatives and fee guidance - Very little of the revenue synergies are included in the current guidance, with more details expected in future updates [50][51] Question: Investment in technology and AI - Investments in technology, including AI, are expected to continue growing, supporting customer acquisition and operational efficiency [68]

Financial Data and Key Metrics Changes - The company raised its full year guidance on revenue, adjusted EBITDA, and adjusted EPS due to a strong start in the first half of the year, with organic order growth of low single digits and a book-to-bill ratio of 1.06 times [5][19] - Adjusted EBITDA for Q2 was $509 million, with an adjusted EBITDA margin of 27%, reflecting a year-over-year decline primarily due to organic volume declines and the dilutive impact from recently acquired businesses [14][20] - Adjusted earnings per share for Q2 was $0.80, which is up 18% on a two-year stack [15] Business Line Data and Key Metrics Changes - In the ITS segment, Q2 orders were up 7% year-over-year, with organic order growth in the low single digits and revenue finishing up low single digits [21] - The PSC segment saw Q2 orders increase by 13% year-over-year, with revenue up 17% driven largely by M&A [24] - The aftermarket revenue accounted for 37% of total revenue, up 100 basis points year-over-year [14] Market Data and Key Metrics Changes - Orders in the Americas were up high teens, EMEA up high single digits, and Asia Pacific up low double digits [22] - Organic order growth in China was noted, reflecting the resilience of the team and effective demand generation initiatives [22] Company Strategy and Development Direction - The company continues to focus on sustainability and innovation, achieving strong financial performance while supporting environmental and community initiatives [6] - A capital allocation strategy prioritizing M&A has been emphasized, with 11 transactions completed this year, adding over $200 million in annualized revenue [9][10] - The company is committed to leveraging its robust balance sheet to strategically deploy capital and drive shareholder value [29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the full year outlook, citing a stable macro environment and positive order growth in the first half of the year [28] - The company remains cautious about the impact of tariffs and macroeconomic factors on future demand, maintaining a precautionary view on volume growth [89][108] Other Important Information - The company recorded non-cash goodwill and asset impairments related to the High Pressure Solutions business and ILC Dover, but these adjustments did not affect adjusted earnings [15][18] - Total company liquidity is currently $3.9 billion, underscoring the strength of the balance sheet [20] Q&A Session Summary Question: Demand cadence and order cadence in the back half of the year - Management noted a stable continuation of orders through the quarter and into July, with a book-to-bill of 1.06 setting up well for the second half [32][34] Question: Margins in the back half of the year - Management indicated that margin improvement is expected due to seasonality and productivity initiatives, with Q4 anticipated to be the high watermark for the year [36][38] Question: Phasing within the second half of sales and EBITDA - Management confirmed that the phasing of revenue and EBITDA is consistent with prior guidance, expecting the second half to be better than the first half [42][43] Question: Legacy Gardner Denver Medical business performance - Management reported good momentum in the fluid handling side of the business, with organic revenue growth in life sciences [76] Question: Impact of tariffs on decision-making - Management indicated that tariff resolution is a significant factor affecting project timelines, with ongoing engagement from customers [67][70] Question: Long-term growth algorithm for compressors - Management reassured that the long-term growth outlook remains unchanged, with expectations for stable growth despite recent fluctuations [100][102]