Financial Data and Key Metrics Changes - For the fourth quarter ended August 31, 2025, total consolidated net sales decreased 4.4% to $22.3 million compared to the same period last year [5][14] - Fiscal 2025 consolidated net sales decreased 1.0% year-over-year [14] - NTIC reported a net loss of $1.1 million, or $0.11 per diluted share for Q4 2025, compared to net income of $1.8 million, or $0.19 per diluted share for Q4 2024 [17] - For the full fiscal year 2025, NTIC reported net income of $18,000, or $0.00 per diluted share, compared to $5.4 million, or $0.55 per diluted share for fiscal 2024 [17] - Operating expenses increased 2.2% to $9.7 million for Q4 2025, with operating expenses as a percentage of net sales rising to 43.5% from 40.7% in the prior year [14][15] Business Line Data and Key Metrics Changes - Zerust oil and gas net sales decreased by 29.4%, while Natur-Tec net sales decreased by 10%, partially offset by a 5.8% increase in Zerust industrial net sales [6][5] - Natur-Tec sales for Q4 were $5.1 million, representing a 10% year-over-year decline [11] - NTIC China sales increased by 12% to $4 million for Q4 2025, with full-year sales up 14% to $16.2 million [8] Market Data and Key Metrics Changes - Joint venture sales for Q4 2025 increased by 4.7% to $24.4 million, while full-year joint venture sales declined by 4.9% [7][14] - The oil and gas group in North America experienced a decline of nearly 46% year-over-year, while Natur-Tec North America was down about 13% [39] Company Strategy and Development Direction - The company is focused on flattening operating expenses while expanding gross margins and driving sales in higher-margin areas [5] - NTIC aims to leverage strategic investments made over the past three years to enhance global operations and support future growth [4] - The company is optimistic about growth in fiscal 2026, particularly in the oil and gas and Natur-Tec segments [57] Management's Comments on Operating Environment and Future Outlook - Management anticipates macroeconomic headwinds to persist, especially in Europe, but believes NTIC is positioned for growth and improved profitability [5] - The company expects to see significant improvement in Zerust oil and gas sales and profitability in fiscal 2026 [10] - Management remains confident in the strategic growth plan despite challenges faced in fiscal 2025 [13] Other Important Information - NTIC's effective tax rate for fiscal 2025 was unusually high at 67.5%, primarily due to increased income tax expense in foreign subsidiaries [17] - The company declared a quarterly cash dividend of $0.01 per common share payable on August 13, 2025 [20] Q&A Session Summary Question: Are the income taxes on international business higher than in the U.S.? - The effective tax rate is influenced by profitability levels in North America, which were low in Q4, leading to a high effective tax rate [23][24] Question: How much can the company cut expenses to improve profitability? - The goal is to maintain operating expenses at similar levels to fiscal 2025, with expectations of revenue growth from previous investments [26][27] Question: What is driving the oil and gas business? - The growth is attributed to general acceptance of the technology and repeat business from existing customers [31] Question: How close is the company to getting business from compostable packaging? - Trials are ongoing with several customers, and initial orders are expected to contribute to sales in fiscal 2026 [33][53] Question: Where is the weakness in North America coming from? - The main weaknesses are in the Natur-Tec and oil and gas groups, with significant declines noted [39] Question: Is the one-time customs charge a recurring issue? - It is expected to be a one-time event, with no ongoing impact on the P&L [44][45]