Core Viewpoint - Cadre is experiencing strong demand for its mission-critical safety products, with significant growth in order backlog and recent contract wins, particularly in the defense and nuclear safety sectors, following strategic acquisitions. Group 1: Financial Performance and Growth - The fourth quarter of 2025 showed strong demand for Cadre's safety products, with a notable increase in order backlog, which grew nearly 50% year-over-year due to the addition of Carr's Engineering and other factors [2][5] - Full-year 2025 net sales, net income, and adjusted EBITDA rose significantly, with adjusted EBITDA reaching $111.7 million, marking a third consecutive annual record [12][13] - For 2026, Cadre is guiding net sales between $736 million to $758 million and adjusted EBITDA between $136 million to $141 million, implying an adjusted EBITDA margin of 18.5% [18] Group 2: Strategic Acquisitions - The acquisition of TYR Tactical, closed in February 2026, is expected to enhance Cadre's focus on high-margin, mission-critical products and provide access to international markets [3] - The acquisition of Carr's Engineering is aimed at strengthening Cadre's portfolio in the nuclear safety market, leveraging technical expertise and customer relationships [4] Group 3: Market Opportunities and Challenges - Cadre is seeing increased opportunities in the nuclear sector, driven by government and commercial programs, particularly in nuclear ventilation and containment systems [7] - However, there are near-term challenges in the environmental management segment due to a slowdown in downblending activities, which has reduced demand for certain products [8][9] Group 4: Major Contracts and Product Developments - A significant contract win was announced for $86 million from General Dynamics European Land Systems to supply blast attenuation seats, with production expected to begin in 2026 [10][11] - The company has a strong installed base of over 13,000 seats, demonstrating proven performance in protecting military vehicle occupants [11] Group 5: Capital Allocation and Future Guidance - Cadre has maintained a consistent dividend policy, paying 17 consecutive quarterly dividends and recently increasing its annualized dividend to $0.40 per share [14] - The company is modeling TYR to contribute approximately $100 million in revenue on a full-year basis, with EBITDA margins in the 20% range [17]

Financial Data and Key Metrics Changes - In Q4, net sales and net income were down compared to last year's record Q4, but full year net sales, net income, and adjusted EBITDA increased significantly year-over-year [22][23] - 2025 adjusted EBITDA reached $111.7 million, marking a record for the third consecutive year, with gross margins improving by 140 basis points [23] - The company anticipates 2026 revenue between $736 million and $758 million, with adjusted EBITDA guidance between $136 million and $141 million, implying adjusted EBITDA margins of 18.5% [26] Business Line Data and Key Metrics Changes - The duty gear and armor product lines saw revenue and margins in line with expectations, while nuclear businesses experienced revenue timing shifts and some distribution softness [23] - Order backlog increased nearly 50% year-over-year, driven by 2025 order growth and the addition of Carr's Engineering Division [9][10] - The consumer channel experienced a 7% growth for the full year and 15% growth in H2 2025, benefiting from the strength of the Safariland brand [15] Market Data and Key Metrics Changes - The law enforcement market is characterized by rising safety threats globally and increasing spending on protection equipment, supported by bipartisan commitment to public safety in the U.S. and Europe [13][14] - The nuclear safety market is seeing long-term demand driven by government and commercial programs, particularly in environmental management, national security, and nuclear energy [14][16] - The company noted a shift in priorities in the nuclear sector, with a focus on plutonium production programs impacting demand for certain products [17] Company Strategy and Development Direction - The company aims to build a cohesive platform by integrating acquired businesses and expanding capabilities, focusing on mission-critical technologies for demanding environments [4][6] - The acquisition of TYR Tactical is expected to enhance the company's product portfolio and open doors to international markets [5][11] - The company maintains an active M&A pipeline, focusing on opportunities that align with its strategic goals and return thresholds [8][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the current operating environment, citing strong demand across core markets and a robust backlog [7][30] - The company anticipates continued strong demand in 2026, despite short-term challenges in certain segments [29] - Management highlighted the importance of maintaining financial flexibility to pursue both organic and inorganic growth opportunities [26][30] Other Important Information - The company has paid 17 consecutive quarterly dividends since going public and recently raised its dividend to $0.40 per share on an annualized basis [12] - The integration process for TYR Tactical is underway, with initial projects already initiated to leverage synergies between the companies [11][21] Q&A Session Summary Question: Organic outlook and visibility on delayed orders - Management confirmed that large opportunities are delayed but not lost, with good visibility on these orders [48][49] Question: Impact of nuclear business shift on revenue - Management acknowledged a timing lag in revenue from nuclear projects but expressed confidence in future growth opportunities [40][42] Question: Revenue contribution from TYR Tactical - The company expects TYR to contribute approximately $100 million on a full-year basis, with guidance reflecting a conservative approach [53][55] Question: Details on the General Dynamics contracts - Management provided insights into the blast attenuation seats being supplied to General Dynamics, emphasizing the product's life-saving capabilities [64][65]

Financial Data and Key Metrics Changes - Fiscal 2025 showed significant growth in net sales, net income, and adjusted EBITDA, with adjusted EBITDA reaching a record of $111.7 million for the third consecutive year [23][24] - Gross margins improved by 140 basis points year-over-year, with public safety products' gross margins increasing by 188 basis points [23][24] - The company anticipates 2026 net sales between $736 million and $758 million, with adjusted EBITDA guidance of $136 million to $141 million, indicating year-over-year growth of 22% and 24% respectively at the midpoints [26] Business Line Data and Key Metrics Changes - The acquisition of Carr's Engineering and TYR Tactical contributed to a nearly 50% increase in order backlog compared to the previous year [9][10] - Duty gear and armor product lines performed in line with expectations, while nuclear businesses experienced revenue timing shifts [23] - The consumer channel saw a growth of 7% for the full year and 15% in the second half of 2025 [15] Market Data and Key Metrics Changes - The law enforcement market is characterized by rising safety threats and increased spending on protective equipment, supported by bipartisan commitment to public safety in the U.S. and Europe [13][14] - The nuclear safety market is driven by expanding government mandates for weapons modernization and production, with a positive outlook despite short-term impacts from shifts in plutonium production priorities [16][17] - The company is experiencing strong demand in international markets, particularly in South America, Europe, and parts of Asia [10][14] Company Strategy and Development Direction - The company focuses on building a portfolio of mission-critical technologies for demanding environments, with ongoing integration of acquired businesses to enhance operational cohesion [4][6] - An active M&A pipeline is maintained, with a focus on acquiring strategically aligned businesses that meet return thresholds [8][19] - The company aims to leverage the strengths of acquired companies to enhance product offerings and market reach, particularly in the armor and safety sectors [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate geopolitical uncertainties and maintain strong demand across core markets [30] - The outlook for 2026 reflects confidence in organic growth initiatives, with expectations of continued strong demand in public safety and nuclear safety sectors [30] - Management acknowledged temporary impacts on revenue from shifts in nuclear business priorities but remains optimistic about long-term growth opportunities [17][40] Other Important Information - The company has paid 17 consecutive quarterly dividends since going public, recently raising the dividend to $0.40 per share on an annualized basis [12] - The integration of TYR Tactical is underway, with initial projects aimed at leveraging its capabilities within existing business units [11][21] Q&A Session Summary Question: Organic outlook and visibility on delayed orders - Management confirmed that large opportunities are delayed but not lost, with good visibility on backlog and ongoing efforts to close additional orders [46][47] Question: Impact of nuclear business shifts on revenue - Management acknowledged a timing lag in revenue from nuclear projects but expressed confidence in future growth opportunities in commercial nuclear [39][40] Question: CapEx guidance for 2026 - The increase in CapEx is primarily for capacity expansion in the nuclear business, with typical investment levels for other areas [47] Question: Revenue contribution from TYR Tactical - TYR is expected to contribute approximately $100 million on a full-year basis, with a conservative approach to revenue integration [51] Question: Details on General Dynamics contracts - The contracts involve providing blast attenuation seats for military vehicles, with potential for follow-on orders based on established relationships [62]