Financial Performance and Key Metrics - In 2025, the company achieved record annual net sales of $526 million, an increase of 6.8% from 2024, marking the highest in its history [4] - Consolidated gross profit reached a record $103.6 million, up 8.6% year-over-year, resulting in a gross margin of 19.7%, compared to 19.4% in 2024 [5] - Consolidated net income for the fourth quarter was $8.9 million, or $0.91 per diluted share, compared to $10.1 million, or $1 per diluted share in the fourth quarter of 2024 [20] - For the full year 2025, consolidated net income was a record $35.4 million, or $3.56 per diluted share, compared to $34.2 million, or $3.40 per diluted share in 2024 [22] Business Segment Performance - Revenue from the Water Transmission Systems (WTS) segment totaled a record $350.9 million in 2025, up 3.8% year-over-year, with increased margins [5] - Precast revenue increased 13.3% year-over-year to a new annual record of $175.1 million, driven by an 8% improvement in sales volume [8] - WTS gross profit reached a record $67.1 million, up 7.2% from 2024, resulting in a gross margin of 19.1%, up from 18.5% in 2024 [7] - Precast gross profit increased 11.3% year-over-year to $36.5 million, resulting in a gross margin of 20.8%, down modestly from 21.2% in 2024 [9] Market Data and Trends - The commercial sector was up 45%, and the institutional sector was up 60%, indicating positive signals for non-residential construction activity in 2026 and into 2027 [8] - The Dodge Momentum Index increased by 50% in December 2025 compared to December 2024, reflecting strengthening leading indicators [8] - The company expects the 2026 bidding environment to be relatively consistent with 2025, supported by a robust WTS backlog and elevated bidding levels [15] Company Strategy and Industry Competition - The company is making targeted organic investments to expand capacity and enhance efficiency, including the acquisition of Boughton's Precast to establish a presence in the Colorado market [12][13] - The strategy includes expanding Precast capabilities across the network and pursuing disciplined M&A opportunities to accelerate growth [12] - The company aims to maintain a focus on margin over volume and return value to shareholders when M&A opportunities are limited [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in a strong 2026, with expectations for higher revenue and improved margins in both WTS and Precast segments despite potential weather-related impacts [14][15] - The leadership team highlighted the importance of safety and operational excellence as central to achieving record results in 2025 [20][31] - Management noted that the integration of Boughton's Precast is expected to be smoother than previous acquisitions, with a focus on cultural alignment and operational integration [70][72] Other Important Information - The company repaid $27.4 million of debt in 2025, ending the year with significant liquidity [13] - Free cash flow totaled $47.1 million in 2025, exceeding expectations and compared to $34.3 million in 2024 [29] - The company anticipates total capital expenditures for 2026 to be in the range of $20 million to $24 million, including investments to support Precast growth [29] Q&A Session Summary Question: Can you provide insights on margin expectations for 2026? - Management indicated a steady climb in margins for both WTS and Precast segments, with a strong backlog and healthy bidding environment expected to support this [38][40] Question: Will there be additional capital investments for the Boughton's acquisition? - Management confirmed that some capital will be needed, but they expect to double the size of the Boughton's business within 2-3 years with limited investment [42][43] Question: What are the growth opportunities in the Colorado market? - Management highlighted significant growth potential in Colorado, particularly in El Paso County, and indicated interest in further roll-up opportunities in the market [49][50] Question: Is there incremental demand from the private sector, particularly data centers? - Management noted increased demand from data centers on the Precast side, with several ongoing projects related to water management solutions for these facilities [51][53] Question: How will the acquisition impact the company's financial model? - Management stated that the acquisition will be financed through the line of credit, with plans to pay it down quickly [68][69]

Financial Performance - Sales volume reached S/ 499.2 million, a 4.8% increase compared to 1Q24[7] - Sales of goods amounted to S/ 134.7 million, showing a 1.4% increase compared to 1Q24[7] - EBITDA reached S/ 27.0 million[7] - EBITDA margin increased by 0.9 percentage points compared to 1Q24[7] Strategic Focus - The company is focused on building solutions[8] - Coprocessing is a key area of focus[10] Product Categories - Cement is a significant product category[21] - Concrete, pavement, and mortar are important product offerings[22] - Precast products are part of the company's portfolio[24]