Financial Data and Key Metrics Changes - Revenue for Q1 2026 was $8.3 million, a decrease of 7% compared to $9.3 million in Q1 2025 [13] - Gross operating profit margins were negative 12.5% in Q1 2026, down from positive 18.3% in Q1 2025, primarily due to $2.2 million in additional inventory write-downs [15] - Net loss for Q1 2026 was $3.9 million, or negative $1.12 per share, compared to a net loss of $658,000, or negative $0.19 per share in Q1 2025 [17] Business Line Data and Key Metrics Changes - Sales in the core metal fence business increased slightly year-over-year, despite challenges from tariffs and negative consumer sentiment [14] - The Greenwood industrial wood business saw a 45% increase in sales, driven by demand from municipalities and the addition of a new non-transit industrial customer [14] - Sales of lumber and Pet products decreased, leading to initiatives to sell off excess inventory due to challenging market conditions [15] Market Data and Key Metrics Changes - The company faced ongoing headwinds from tariffs and weak consumer sentiment, impacting purchasing behavior across the market [11] - The company is actively working to monetize non-core assets and evaluate strategic partnerships to strengthen its market position [10] Company Strategy and Development Direction - The company aims to exit fiscal 2026 with a sustainable business model focused on its strongest product categories and operational efficiency [12] - There is a strong emphasis on the metal fencing business as a primary focus for operations, capital allocation, and innovation efforts [7] - The company is working to align costs with pricing to improve margins and has successfully renegotiated agreements with most customers [8] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges faced in Q1 but believes that positive developments will become evident in future quarters [6] - The company is committed to reducing annual operating expenses by $1 million to $3 million and aims to streamline operations [9] - Management expresses optimism about the long-term growth potential of the metal fencing business as global trade conditions stabilize [7] Other Important Information - The company has amended its lending agreement to increase borrowing capacity, providing additional flexibility for operational realignment [19] - Inventory balance as of November 30, 2025, was $13.5 million, down from $15.9 million at the end of August [17] Q&A Session Summary Question: Can you expand upon the renegotiated pricing agreements you've entered into? - Management reported successful negotiations for new pricing to minimize margin erosion from increased tariffs, with implementation beginning in Q1 of fiscal 2026 [24] Question: Can you provide a general breakdown of your inventory by product category? - Management indicated that metal fencing remains the highest velocity inventory, while some Pet inventory has been slow-moving [25]
Jewett-Cameron Trading Co Ltd(JCTC) - 2026 Q1 - Earnings Call Transcript