Financial Data and Key Metrics Changes - For the first quarter of fiscal 2026, total consolidated net sales increased by 9.2% to a record $23.3 million compared to the same period last year [5] - Gross profit as a percentage of net sales was 36% for the first quarter, down from 38.3% in the prior fiscal year, primarily due to a temporary supplier lead time issue [12] - Net income for the first quarter was $238,000 or $0.03 per diluted share, compared to $561,000 or $0.06 per diluted share in the first quarter of fiscal 2025 [12] Business Line Data and Key Metrics Changes - Zerust Oil & Gas net sales increased by 58.1% to $2.4 million, marking a record for the first quarter [7] - Zerust Industrial net sales increased by 6.9% [5] - Natur-Tec product net sales increased by 2.2% to a record $6 million, driven primarily by higher sales in North America [9] Market Data and Key Metrics Changes - NTIC China reported a 23.5% year-over-year increase in net sales to $4.9 million, indicating strong demand in that market [6] - Joint venture sales increased by 2.9% year-over-year to $24.5 million, despite a mid-single-digit decline at the German joint venture [5] Company Strategy and Development Direction - The company is focused on improving profitability by flattening operating expenses and driving sales in higher-margin segments [4] - NTIC plans to enhance operations in China, viewing it as a significant market for industrial and bioplastic segments [6] - The company is investing in its Zerust Oil & Gas business to enhance its sales team and support anticipated future growth [8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the start of fiscal 2026, expecting higher year-over-year sales and profitability as the year progresses [4] - The company anticipates that economic recovery from government stimulus packages in Europe will positively impact joint venture operating income [6] - Management believes that the investments made over the past three years will begin to yield benefits in terms of improved profitability [4] Other Important Information - As of November 30, 2025, working capital was $19.4 million, with outstanding debt slightly reduced to $12 million [13] - The company declared a quarterly cash dividend of $0.01 per common share, payable on November 12, 2025 [14] Q&A Session Summary Question: What are some levers to improve profitability? - Management indicated that driving sales growth is key to increasing gross margin and operating profit, with expectations for significant growth in the latter half of the fiscal year [16][17] Question: Are there opportunities for cost-cutting? - Management noted that while there are some opportunities, the focus is on allowing revenues to catch up to previous expense increases rather than cutting expenses that could hinder long-term growth [19][20] Question: Are you pleased with the sales team's performance in oil and gas? - Management confirmed that the sales team is starting to secure business, particularly with a significant contract in Brazil and growing opportunities in India and the Middle East [21] Question: Are there other major opportunities in oil and gas? - Management acknowledged the ongoing discussions with other oil companies globally, expecting business growth across various regions [26]

Financial Data and Key Metrics Changes - For the fourth quarter ended August 31, 2025, total consolidated net sales decreased 4.4% to $22.3 million compared to the same period last year [5] - Fiscal 2025 consolidated net sales decreased 1.0% year-over-year [13] - NTIC reported a net loss of $1.1 million, or $0.11 per diluted share for Q4 2025, compared to net income of $1.8 million, or $0.19 per diluted share for Q4 2024 [17] - The effective tax rate for fiscal 2025 was 67.5%, significantly higher than 17.3% in the prior fiscal year [16] Business Line Data and Key Metrics Changes - Zerust oil and gas net sales decreased 29.4% in Q4 2025, totaling $3 million compared to $4.2 million in Q4 2024 [5][8] - NatureTech net sales declined 10% in Q4 2025, totaling $5.1 million [10] - Zerust industrial net sales increased by 5.8% [5] - NTIC China sales increased by 12% to $4 million in Q4 2025, and 14% to $16.2 million for the full fiscal year [7] Market Data and Key Metrics Changes - Joint venture sales increased by 4.7% in Q4 2025 to $24.4 million, but declined 4.9% for the full fiscal year [6] - The oil and gas group in North America was down close to 46% year-over-year, while NatureTech North America was down about 13% [39] Company Strategy and Development Direction - The company is focused on flattening operating expenses while expanding gross margins and driving sales in higher-margin areas [5] - NTIC is pursuing strategic initiatives to enhance long-term growth potential, including product innovation and emerging opportunities in the South American offshore oil and gas sector [4] - The company expects to start reaping benefits from strategic investments made over the past three years in fiscal 2026 [4] Management's Comments on Operating Environment and Future Outlook - Management anticipates macroeconomic headwinds to persist, especially in Europe, but believes NTIC is positioned for growth and improved profitability in key markets [5] - The company remains confident in its strategic growth plan despite challenges faced in fiscal 2025 [12] Other Important Information - NTIC's working capital as of August 31, 2025, was $20.4 million, down from $23.7 million a year earlier [18] - The company declared a quarterly cash dividend of $0.01 per common share payable on August 13, 2025 [19] Q&A Session Summary Question: Are the income taxes on international business higher than domestic taxes? - Management explained that the effective tax rate is influenced by profitability levels in North America, which were low in Q4 2025, leading to a high effective tax rate [22][23] Question: How much can the company cut expenses to improve profitability? - The goal is to maintain operating expenses close to fiscal 2025 levels, with expectations of revenue growth in 2026 from previous investments [25][26] Question: What is driving the oil and gas business? - The growth is attributed to general acceptance of the technology in the market and repeat business from existing customers [30] Question: What is the status of the compostable packaging business? - Trials are ongoing with several customers, and initial orders are expected to contribute to sales in 2026 [32] Question: Where is the weakness in North America coming from? - The main weaknesses were identified in the NatureTech and oil and gas groups, with significant declines reported [39] Question: Is the one-time customs charge a recurring issue? - Management confirmed it was a one-time event and does not expect it to impact future P&L [43][44]