Haitham Khouri: Thank you, Seth. Good morning, everyone. I will start on slide 3 with key observations from 2025. First, structural earnings power expansion. Our 2025 results demonstrate the sustainability of our higher earnings power. This higher baseline profitability, first exhibited in 2024, is the direct result of the rigorous application of our operational value drivers. Second, financial consistency. In addition to increasing our structural earnings power, we have transitioned Perimeter Solutions, S. ...

Perimeter Solutions (NYSE:PRM) Q4 2025 Earnings call February 26, 2026 08:30 AM ET Company ParticipantsHaitham Khouri - CEOJoshua Spector - Director of Equity ResearchKyle Sable - CFOSeth Barker - Head of Investor RelationsConference Call ParticipantsDan Jester - AnalystOperatorGreetings, and welcome to the Perimeter Solutions Q4 2025 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone requires operator assista ...

Perimeter Solutions (NYSE:PRM) Q4 2025 Earnings call February 26, 2026 08:30 AM ET Speaker4Greetings, and welcome to the Perimeter Solutions Q4 2025 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone requires operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Set ...

Acquisition Details - Perimeter Solutions, Inc. has completed the acquisition of Medical Manufacturing Technologies LLC for approximately $685 million in cash, including certain tax benefits [1] - The acquisition was financed using cash on hand and proceeds from a senior secured notes offering that closed on January 2, 2026 [1] Company Overview - Perimeter Solutions is a leading global solutions provider for the Fire Safety and Specialty Products industries, organized into two reporting segments: Fire Safety and Specialty Products [4] Fire Safety Segment - The Fire Safety segment formulates and manufactures fire management products to combat various types of fires, including wildland and structural fires [5] - This segment also offers specialized equipment and services to support firefighting operations, including mobile retardant bases and custom-designed equipment [5] - The service network can meet emergency resupply needs for approximately 150 air tanker bases in North America and other global locations [5] Specialty Products Segment - The Specialty Products segment develops and markets products for non-fire safety markets, including phosphorus derivatives and electronic components [6] - Phosphorus Pentasulfide produced by this segment is used in lubricant additives, pesticides, mining chemicals, and emerging electric battery technologies [6] - Intelligent Manufacturing Solutions within this segment focuses on a variety of product lines across communications, energy, defense, and industrial systems, with an emphasis on aftermarket repair and replacement [6] Medical Manufacturing Technologies (MMT) - MMT is a leading provider of highly engineered machinery and aftermarket consumables for minimally invasive medical devices, with nearly all revenue from proprietary products and about half from the aftermarket [2]

Core Insights - Perimeter Solutions will present at the Baird Global Industrial Conference on November 12, 2025, at 10:40 AM (ET) [1][2] - The company is a leading global provider in the Fire Safety and Specialty Products industries, with operations divided into two segments: Fire Safety and Specialty Products [2] Company Overview - Perimeter Solutions is headquartered in St. Louis, Missouri, and trades on the NYSE under the ticker PRM [2] - The Fire Safety segment offers fire retardants, firefighting foams, and related specialized equipment and services [2] - The Specialty Products segment focuses on non-fire safety markets, with a significant application in Phosphorus Pentasulfide (P2S5) based lubricant additives [2] - The Specialty Products segment also includes IMS, which manufactures electronic or electro-mechanical components for various end markets, emphasizing aftermarket repair and replacement [2]

Core Insights - The stock market is near all-time highs, driven by strong earnings, Fed rate cuts, and AI spending [1] - Investors are advised against timing the market but should seek strong stocks with solid fundamentals [1] Group 1: Investment Strategies - Utilizing a Zacks screen can help identify top Zacks Rank 1 (Strong Buy) stocks among over 200 highly-ranked companies [2] - Zacks Rank 1 stocks have historically outperformed the market, regardless of market conditions [2] Group 2: Screening Parameters - The screening process includes three key filters: Zacks Rank equal to 1, positive current quarter estimate revisions, and top broker rating changes [4][5][6] - Zacks Rank 1 stocks have an average annual return of approximately 24.4% since 1988 [5] Group 3: Company Spotlight - Perimeter Solutions, Inc. (PRM) - Perimeter Solutions, a leader in fire safety, reported a significant earnings beat in Q3, with a 9% growth in adjusted EPS, exceeding estimates by 21% [9] - The company’s Fire Safety segment focuses on fire management products, while its Specialty Products unit deals with phosphorus pentasulfide for various applications [9] - PRM stock has increased by 670% over the past two years but is currently trading 10% below its average Zacks price target and at an 18% discount to its median [10]

Core Insights - Investor interest in Perimeter Solutions has increased following the strong financial results for Q3 2025, with shares rising by 26.9% [1] Financial Performance - Perimeter Solutions reported Q3 2025 revenue of $315.4 million, reflecting a 9% increase year-over-year, driven by a 15% growth in the specialty products segment [3] - The company expanded its adjusted EBITDA margin to 59% from 56% in Q3 2024, with adjusted EBITDA growing to $186.3 million from $170.4 million during the same period last year [4] - Free cash flow for the first three quarters of 2025 reached $197 million, a 6.5% increase compared to $185 million in the same period of 2024 [5] Investment Considerations - Perimeter Solutions trades at 39.5 times trailing earnings, indicating it may not be a bargain opportunity, but it could appeal to conservative investors seeking a resilient stock [6] - The company has demonstrated year-over-year growth in revenue and adjusted EBITDA, along with an increase in free cash flow [7]

Core Insights - The Lazard US Systematic Small Cap Equity ETF (SYZ) has an annualized total return of 3.56% since its inception, outperforming the benchmark Russell 2000 Index, which has a return of -0.04% [1] - The ETF was converted from a mutual fund on September 12, 2023, and has been trading for 17 days as an ETF [1] - The ETF's portfolio consists of 427 small-cap stocks selected through a proprietary automated process, with market caps ranging from $54.5 million to $15.9 billion [6] Investment Opportunities - The ETF's valuation metrics show an average price-to-cash flow ratio of 9.93x, significantly lower than the Russell 2000's 15.07x, and a free cash flow yield of 6.57%, compared to the index's 1.98% [7] - Notable holdings in the ETF include Mueller Industries (MLI), which has nearly doubled its market cap from $5.5 billion to $10.9 billion in 22 months, and is trading at 14.6 times its 2025 earnings per share estimate of $6.75 [9] - Perimeter Solutions (PRM), the ETF's seventh-largest holding, has seen a 73% increase in its stock price in 2025, with sales growth of 26% to $234.7 million in the first half of 2025 [10][11] - Willdan Group (WLDN) has a market cap of $1.4 billion and reported a 27.5% increase in net revenues to $180.3 million in the first half of 2025, with a full-year revenue guidance of $345 million [17][19] Market Context - The ETF's recent performance is set against a backdrop where U.S. stocks experienced a decline for the first time in eight trading sessions, while gold prices reached a record high of over $4,000 [5] - The small-cap sector is gaining attention as large-cap stocks have become expensive, prompting a shift in focus towards smaller companies [4]

Group 1 - Perimeter has increased approximately 6% since the last recommendation three weeks ago, indicating positive market performance [1] - The quarterly results and management commentary provide further support for the initial investment thesis, highlighting operational leverage in Fire Safety and continued growth in Specialty Products [1] - The focus is on small and midcap companies with asymmetric upsides, suggesting a strategic investment approach in these sectors [1] Group 2 - The analyst has a diverse background, having worked in the Industrials and chemicals sector, as well as in finance and technology at a Canadian charity, which enriches the analysis [1] - The combination of execution experience and analytical skills is emphasized as a key factor in enhancing investment insights [1]

Core Insights - Perimeter Solutions reported a net loss of $32.2 million for the second quarter of 2025, with an adjusted net income of $57.1 million, indicating a significant shift from the previous year's net income of $21.7 million [1][4][27] - The company's adjusted EBITDA for the second quarter increased by 41% to $91.3 million, driven by strong performance in both Fire Safety and Specialty Products segments [1][4][22] Financial Performance - Net sales for the second quarter rose by 28% to $162.6 million compared to $127.3 million in the same quarter last year [4] - Fire Safety net sales increased by 22% to $120.3 million, while Specialty Products net sales surged by 47% to $42.4 million [4] - Year-to-date net sales increased by 26% to $234.7 million, with Fire Safety sales up 27% to $157.4 million and Specialty Products sales up 23% to $77.2 million [4] Earnings Metrics - Loss per diluted share for the second quarter was $0.22, compared to earnings per diluted share of $0.14 in the prior year [4][27] - Non-GAAP adjusted earnings per diluted share increased to $0.39 from $0.25 in the previous year [4][27] - Year-to-date adjusted earnings per share rose to $0.41 from $0.23 in the prior year [28] Segment Performance - Adjusted EBITDA for the Fire Safety segment increased by 40% to $77.7 million, while the Specialty Products segment saw a 48% increase to $13.7 million [4][24] - The Fire Safety segment's strong performance is attributed to its role as a manufacturer of fire management products and services [9] Capital Allocation - The company repurchased 2.9 million shares of common stock at an average price of $11.13 per share during the quarter [12] - In May 2025, the company settled trade secret litigation and acquired related assets for $20 million in cash [12]