Core Insights - The company is experiencing a significant decline in net sales, with a 19.1% year-over-year decrease to $132.3 million in fiscal Q2 2025, attributed to soft customer demand and inventory destocking [3][4][33] - Adjusted EBITDA fell to $13.7 million, down from $19.6 million in the prior year, with a margin decline of 170 basis points to 10.3% [5][35] - The company has withdrawn its 2026 financial targets due to macroeconomic uncertainty and reduced demand projections [3][13] Financial Performance - Net sales for fiscal Q2 2025 were $132.3 million, a 19.1% decrease year-over-year [4][33] - Adjusted EBITDA was $13.7 million, with a margin of 10.3%, down from 12% in the prior year [5][35] - Free cash flow was $12.5 million, reflecting a 92% conversion of adjusted EBITDA [5][27] Acquisition Impact - The acquisition of AccuFab, completed in July, expands the serviceable addressable market by approximately 60% to about $8 billion [7][20] - The company expects $28 million to $32 million in incremental revenue from AccuFab in fiscal 2025, with adjusted EBITDA contributions of $6 million to $8 million [8][38] - Pro forma net leverage increased to approximately 3.1 times post-acquisition, with a target to reduce it below 2 times by the end of 2026 [9][28] Market Outlook - Commercial vehicle production is projected to decline by 24% in 2025 compared to 2024, with no anticipated recovery in the second half of the year [2][23][16] - The company is tracking ahead of its goal of $100 million in new business awards for 2025, with significant wins in critical power and data center segments [10][25] - The company plans to report revenues from critical power and data center segments starting in Q3 2025, expected to comprise about 10% of trailing twelve-month revenue [8][39] Cost Management and Efficiency - The company is implementing fixed cost reduction initiatives, including consolidating three warehouses and one manufacturing facility, expected to yield annual savings of about $2 million [11][41] - Adjusted EBITDA guidance for 2025 includes a $1 million to $2 million benefit from cost improvements, net of inflationary pressures [39][40] - The company is focused on debt repayment using free cash flow, with a target to reduce net leverage below 2 times by 2026 [9][28]