Financial Data and Key Metrics Changes - Revenue for Q4 2025 was $58.9 million, a 16% decrease year-over-year and a sequential decrease of 7% compared to Q3 2025, primarily due to challenges in the industrial end market and the divestiture of a mall-related business [14][15] - Gross profit for Q4 was $9.1 million, a decline of 15% year-over-year and a sequential decline of 21%, resulting in a gross margin of 15.5% [16] - SG&A expenses were $7.7 million, a 24% reduction year-over-year and a 17% reduction sequentially, attributed to headcount reductions and increased efficiencies [19] Business Line Data and Key Metrics Changes - The industrial end market faced significant volume declines, contributing to a $10.7 million reduction in quarterly revenue compared to the prior year [14][15] - Despite challenges in the industrial sector, the remaining two-thirds of the business saw modest growth of $7.4 million, or about 5% [15] - New business wins and wallet share initiatives launched in Q4 are expected to contribute positively in 2026 [15][18] Market Data and Key Metrics Changes - The overall pipeline remains healthy, but economic uncertainty has led to decision delays among potential clients [6] - The company has not lost any customers in the industrial end market, indicating strong relationships that may benefit from future recovery [5] Company Strategy and Development Direction - The company is focused on operational excellence initiatives to drive efficiencies and improve financial performance as market conditions normalize [8][13] - There is an emphasis on expanding wallet share with existing customers and onboarding new clients to enhance revenue streams [10][13] - The company aims to reduce debt and improve cash generation while continuing to invest in growth opportunities [23][24] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that 2025 was a challenging year due to volume declines from the industrial end market, but expressed confidence in the company's ability to recover as macroeconomic conditions improve [12][26] - The company is well-positioned to accelerate financial performance and drive shareholder value as conditions improve [26] Other Important Information - The company generated over $1 million in cash from operations and $1.7 million of free cash flow in Q4 [21] - The company reduced its debt by approximately $2 million in Q4, bringing the full-year debt reduction to $13.2 million, a 16.4% reduction [23] Q&A Session Summary Question: Update on KPIs and operational efficiency initiatives - Management stated that all KPIs and operational efficiency initiatives are on track, with positive trending despite the difficult volume environment [30][31] Question: Health of the vendor network - Management reported improved relationships with vendors, with vendors now accepting payment to term and experiencing the lowest service disruptions in history [32][33] Question: Cross-sell opportunities with industrial customers - Management indicated that if industrial clients expand operations, the company stands to benefit due to strong relationships and service satisfaction [34][36]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $63.3 million, a 13% decrease year-over-year but a sequential increase of 6.4% compared to Q2 2025 [18] - Gross profit dollars totaled $11.5 million, a decline of 2% year-over-year but a sequential increase of 3.9% [20] - Gross margin was 18.1%, which was 200 basis points better than the prior year but a sequential decline of 40 basis points [20] - SG&A expenses were $9.2 million, a 10% reduction year-over-year [23] Business Line Data and Key Metrics Changes - The decline in revenue was driven by the divested mall-related business and lower revenue from industrial clients due to challenging market conditions [18] - New clients added over $24 million in incremental revenue year-over-year, contributing to the sequential revenue growth [19] - Gross margins with new clients have shown consecutive gains for multiple quarters, indicating a successful land and expand strategy [19] Market Data and Key Metrics Changes - Volumes from industrial customers remain subdued, and the pace of adding new clients has slowed compared to last year [9] - The company is focusing on diversifying its customer base by expanding into non-industrial end markets such as retail and hospitality [12] Company Strategy and Development Direction - The company is committed to pursuing business efficiencies, reducing variability, generating growth, and driving business margins [5] - A focus on share of wallet opportunities is being emphasized, with efforts to broaden the number of waste streams handled for individual clients [10] - The company is enhancing vendor relationships to improve service levels and reduce service disruption rates [14] Management's Comments on Operating Environment and Future Outlook - The macro environment continues to present challenges, but management believes that all markets are stabilizing [32] - The company expects to continue experiencing margin pressure but anticipates offsetting these pressures through operational improvements and growing share of wallet with existing clients [17] - Management is confident in the value of the asset-light model and the ability to deliver improved financial results [26] Other Important Information - The company generated approximately $5.7 million in cash from operations, a sequential improvement of roughly 46% [24] - As of the end of Q3, the company had $1.1 million in cash and approximately $20 million of available borrowing capacity [24] Q&A Session Summary Question: How are the industrial end markets holding up? - Management indicated that the macroeconomic environment is uncertain, but all markets, including industrial, are stabilizing. Seasonality effects are expected in Q4 [32] Question: Has the strategy for expanding wallet share changed? - Yes, the company has implemented a more disciplined approach to the sales process and is collaborating more effectively between relationship managers and sales teams [34] Question: What are the opportunities for operational improvement moving into 2026? - The company is focused on continuous improvement and has defined major processes with KPIs to ensure optimal performance [38] Question: Can you provide details on the new food win? - The new food win was a competitive win, representing about 20% of the customer's total portfolio, with higher initial margins than typical [42] Question: What is the outlook for debt reduction? - The company plans to continue paying down debt aggressively, with a preference for reducing more expensive debt after Q1 [72]