Financial Data and Key Metrics Changes - Adjusted net income from continuing operations increased to $152.8 million or $0.81 per share, with an adjusted return on assets of 1.13% for the quarter [6][7] - Adjusted pretax pre-provision net revenue reached a record $224 million, up nearly 9% from the prior quarter [9] - Total adjusted revenue increased to $517 million, a rise of $41 million or 9% in the quarter [10] - Net interest revenue was up $46 million or 12%, driven by balance sheet growth and improved net interest margin [10][11] - Adjusted efficiency ratio improved to 56.5% [6] Business Line Data and Key Metrics Changes - Deposits increased by $3.4 billion, with core customer deposits up $3.1 billion due to the influx from the Industry acquisition [7] - Loans rose by $1.3 billion, with $1 billion attributed to the Industry acquisition and over $300 million in organic growth [7] - Adjusted non-interest revenue decreased by $4.7 million, primarily due to seasonal declines in mortgage banking revenue [12] Market Data and Key Metrics Changes - The net interest margin improved by six basis points to 3.46%, driven by improved securities yields and a decline in overall funding costs [11] - Loan yields were 6.37%, up three basis points due to added accretion, while securities yields improved by 32 basis points to 3.65% [11] Company Strategy and Development Direction - The company completed the acquisition of Industry Bank shares and integrated operations, aiming for growth in Central Texas and Georgia markets [5] - The focus remains on organic growth and potential inorganic opportunities, with a strong emphasis on maintaining a good capital level for future investments [41][96] - The company is confident in its performance and outlook for the markets, projecting continued growth through the end of the year [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth machine, noting that the shorter time frame for the year-end guidance reflects clarity in expectations [21] - The company anticipates continued modest improvement in net interest margin through the end of the next year [11] - Management highlighted strong market activity and a solid pipeline supporting growth expectations [99] Other Important Information - The company reported a decline in tangible book value per share by only $0.12 to $22.82, largely offset by strong operating earnings [6] - The acquisition of Industry Bank shares resulted in an additional $143 million in tangible common equity relative to initial estimates [14] Q&A Session Summary Question: Can you talk about the drivers of the slightly lower revenue and loan growth guide? - Management indicated that the shorter time frame for the year-end guidance provides better clarity, and they expect good growth in the fourth quarter [21][23] Question: What sort of beta do you expect in the broker and time deposits as rates go down? - Management expects interest-bearing betas to reach about 50%, with total deposits between 30% and 40% [26][27] Question: Is there anything impacting DDA specifically as we go through the rest of the year? - Management noted that non-interest bearing deposits finished at 20.6%, consistent with their historical trends [32][33] Question: What should we think of as a good capital level or base capital level moving forward? - Management aims to be good stewards of capital, looking for opportunities for organic growth and potential acquisitions [41] Question: Any thoughts on loan pricing and competition in recent weeks? - Management acknowledged competitive pressures but noted that yields have been holding steady [107][108]

Financial Data and Key Metrics Changes - The company achieved record net sales of $46.7 million, representing a 29% year-over-year increase, driven by a 100% increase in fire services products [4][15] - Consolidated gross margin decreased to 33.5% from 44.6% for the comparable period [15][19] - Net loss was $3.9 million or $0.41 per share, compared to net income of $1.7 million or $0.22 per share for the same period last year [16][21] - Adjusted EBITDA excluding FX was $600,000, a decrease of $3.2 million or 84% compared to the prior year [21][24] Business Line Data and Key Metrics Changes - Fire services segment grew by 100% year-over-year, contributing $10.5 million to the revenue increase [17][27] - Organic revenue increased by $600,000 or 2% to $36.9 million, with strong growth in the U.S. and Europe, partially offset by declines in Latin America and Canada [18][26] - U.S. net sales increased 42% year-over-year to $22.5 million, with organic growth of $2.1 million or 15% [5][27] - European net sales increased 102% year-over-year to $12.1 million [5][26] Market Data and Key Metrics Changes - Latin American operations saw a 12% decrease in sales year-over-year, primarily due to shipment timing and tariff impacts [26][64] - Sales in Asia increased by 15% year-over-year, indicating positive growth in that region [26] - The company experienced lower sales in Canada and delays in Latin America due to tariff uncertainties [7][12] Company Strategy and Development Direction - The company is focused on accelerating growth within the fragmented $2 billion fire protection sector and enhancing customer relationships [4][8] - A new company-wide SAP ERP system is being implemented to modernize and consolidate operations [6][7] - The company aims to navigate tariff uncertainties while pursuing strategic acquisitions to consolidate the fragmented fire market [13][32] - Long-term strategies include growing both fire services and industrial PPE verticals while maintaining operational efficiencies [32][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating tariff uncertainties and expects sequential growth in gross margins and adjusted EBITDA in the second quarter [9][13] - The company anticipates revenue between $210 million to $220 million for the fiscal year, trending towards the lower end of adjusted EBITDA guidance due to near-term order delays [30][33] - Management remains optimistic about the recovery of sales in higher-margin regions once tariff uncertainties subside [12][64] Other Important Information - Capital expenditures for the quarter were $1.2 million, primarily related to the new ERP system [6][29] - The company ended the quarter with cash and cash equivalents of approximately $18.6 million and long-term debt of $24.7 million [29] Q&A Session Summary Question: Can you elaborate on the impact of purchase variance and amortization on gross margins? - The total increase to manufacturing costs was close to $3 million, significantly impacting adjusted EBITDA, with about a 1% impact on gross margins from purchase accounting [36][38][41] Question: What are the expectations for operating expenses moving forward? - Travel expenses were notably high in Q1 due to various events, but are expected to decrease. Increased SG&A was also attributed to higher labor costs and freight related to inventory movements [43][46][47] Question: How is the head-to-toe strategy progressing? - The company is seeing greater engagement and opportunities in the market, particularly with the glove strategy from the Meridian acquisition, and is focused on bundling products for comprehensive offerings [50][52][56] Question: What are the expectations for organic growth for the full year? - The company expects organic growth to remain in the high single digits, with strong growth in the U.S. offset by declines in Latin America and Canada [63][64] Question: Will the Jolly order be crucial for achieving revenue goals? - The Jolly order is important but not the sole determinant for revenue goals, with ongoing positive engagement with the Italian government regarding procurement [66][67] Question: What is the expected cadence for EBITDA improvement throughout the year? - Improvement is expected in the second quarter, with a gradual increase in EBITDA as inventory issues and cost containment efforts normalize [68][69]