Financial Data and Key Metrics Changes - The company reported net revenue from continuing operations of $18.2 million for 2025, an 81% year-over-year increase compared to $10.1 million in 2024, exceeding previous guidance of $16.5 million [11] - Gross Merchandise Volume (GMV) grew 411% year-over-year, driven by the growth of the payments business [12] - General and administrative expenses were reduced by $9.9 million or 26% compared to the prior year, while R&D expenses increased by $1.9 million [14][15] - The operating loss for 2025 was narrowed to $32 million, with a notable improvement in the operating loss of $9.7 million for Q4 compared to the prior year [15][18] Business Line Data and Key Metrics Changes - Financial technology, including payment processing via PSQ Payments and credit offerings via Credova, earned $7.3 million in net revenue, a 109% increase from the prior year [12] - The credit business revenue in Q4 increased by $1.5 million or 47% year-over-year to $4.8 million [13] - Repeat customer rates for the Credova platform increased by 25% compared to 2024, indicating stronger customer engagement [13] Market Data and Key Metrics Changes - The firearms industry showed a decline of approximately 3.4% year-over-year in December 2025, but the company's business continued to grow, indicating a structural market shift rather than a contraction [5] - The company is focusing on underserved industries, particularly in the fintech space, which is expected to benefit from younger digital-first buyers [5][8] Company Strategy and Development Direction - The company is simplifying its operations and focusing on financial infrastructure, with four core themes: strategic focus, operational accountability, cash efficiency, and higher revenue per employee [4] - The strategy includes leveraging AI to improve productivity and underwriting performance, with plans to expand AI applications across various business areas [7][40] - The company aims to build a more integrated financial platform designed specifically for merchants and consumers, moving away from legacy payment systems [8][9] Management's Comments on Operating Environment and Future Outlook - Management emphasized the importance of executional discipline and strategic focus, with a commitment to reducing operating cash burn while efficiently growing the fintech platform [11] - The company expects significant disintermediation in the payments ecosystem, creating opportunities for new platforms that provide integrated financial services [8] - Management expressed confidence in the company's ability to deliver long-term shareholder value through market share growth and operational discipline [18] Other Important Information - The company incurred approximately $250,000 in cash severance expense in Q4, with expectations of lower cash burn in the coming quarters [6] - The company is evaluating divestitures, particularly in the Impact platform, and is in discussions regarding the EveryLife business [9] Q&A Session Summary Question: Why was now the appropriate time for the management change? - The management change was a deliberate decision made by the board to align with the strategic pivot into fintech, leveraging the new CEO's background in financial technology [23] Question: How will the go-to-market strategy change for the company's fintech efforts? - The strategy will focus on executing what is already working, tapping into market demand for financial infrastructure and credit products [26] Question: What are the capital priorities for the company? - The focus is on running a capital-efficient business, driving revenue per employee, and moving towards profitability before considering debt repayment or strategic M&A [29] Question: Where do you see the biggest opportunity in payments and credit? - The company sees opportunities in areas traditionally avoided by fintech, such as the 501(c)(3) and 501(c)(4) space, and the lending industry [35] Question: Is a digital asset strategy still part of the portfolio? - The focus is on stablecoins and new payment rails, aiming to improve transaction speed and reduce costs for merchants [38] Question: How will AI be integrated into the business? - AI will be used internally to enhance productivity and externally in consumer lending, with a comprehensive strategy being developed [40][42] Question: How will proceeds from the sale of the brand segment be used? - Proceeds will be used to execute on the product roadmap and improve unit economics, focusing on accretive revenue [46][47] Question: What KPIs should be followed to measure success? - Key metrics include top-line growth, adjusted EBITDA loss reduction, operating cash flow efficiency, and revenue per employee [48]

Financial Data and Key Metrics Changes - In Q4 2025, comparable store sales grew by 8.9%, with a two-year growth of 15.3%, marking the sixth consecutive quarter of positive comparable sales [4][19] - EBITDA for Q4 reached $11.9 million, a 67% increase year-over-year, while total sales increased by 9.1% to $230.4 million [4][19] - For the full year 2025, net sales totaled $820 million, with comparable store sales increasing by 9.7% and 13.1% on a two-year basis [10][21] - Gross margin improved by 210 basis points to 39.6% for the year, driven by fewer markdowns and lower shrink [22] Business Line Data and Key Metrics Changes - The Children's category posted high single-digit growth, becoming a cornerstone of the company [6] - Men's category also showed solid growth, with a balanced approach to product offerings [7] - Women's footwear began to show progress, indicating potential for future growth in the broader footwear category [7] Market Data and Key Metrics Changes - Customer traffic was a significant driver of growth, with transaction counts increasing in the mid- to upper-single digits [4] - The company reported a strong performance in the Family Basics and sleepwear categories, contributing to overall sales growth [8] Company Strategy and Development Direction - The company executed a three-phase strategy framework: repair, execute, and optimize, focusing on restoring business fundamentals and improving operational disciplines [9] - A clear focus on serving Black customers, leveraging neighborhood-based locations, and enhancing merchandising strategies are key differentiators [11][12] - The company plans to open approximately 25 new stores in 2026 and remodel 50 locations, with a disciplined approach to growth [27][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's long-term growth trajectory, supported by a clear strategic direction and operational improvements [3][29] - The outlook for fiscal 2026 includes total sales growth of 6%-8% and comparable same-store sales growth of 5%-7% [25][26] - Management emphasized the importance of consistent execution and the potential for significant profit growth in 2026 [30][34] Other Important Information - The company ended the year with a healthy balance sheet, including $66 million in cash and no debt [23] - A new loyalty program is currently in testing, with plans for a full rollout in the latter half of the year [59] Q&A Session Summary Question: Can you discuss the impact of weather on sales in January and February? - Management acknowledged that January weather negatively impacted sales but noted a recovery in February, aided by tax refunds [42][43] Question: What is the current status of closeouts as a percentage of sales? - Closeouts vary by category, with shoes having a high penetration, and management sees potential for growth in this area [44][45] Question: Can you provide more details on potential acquisitions? - Management is in early stages of exploring synergistic acquisition opportunities but emphasized a selective approach [46][47] Question: How do you anticipate comp trends for Q1? - Management expects high single-digit growth for Q1, considering various factors including tax refunds [52] Question: What is the expected cadence for new store openings? - The company plans to open stores in three strategic time periods throughout the year to align with peak shopping seasons [55][56] Question: What is the status of the loyalty program? - The loyalty program is in testing, with plans to refine messaging before a full rollout later in the year [58][60]

Financial Data and Key Metrics Changes - Total revenues excluding IFRIC 12 increased by 17%, nearly doubling the passenger traffic growth of 9% [11] - Adjusted EBITDA excluding IFRIC 12 rose nearly 40% to $211 million, reflecting strong performance in Argentina and Armenia [14] - The company closed the quarter with total liquidity of $750 million, a 36% increase from $526 million at year-end 2024 [17] - Total debt at year-end was $1.1 billion, with net debt decreasing to $502 million from $780 million in December 2024 [17] Business Line Data and Key Metrics Changes - Aeronautical revenues increased by 17%, driven by strong results in Argentina, with a 21% increase in aeronautical revenues [11][12] - Commercial revenues grew by 16%, supported by higher contributions from cargo, fuel revenues, and solid growth across VIP lounges and parking facilities [12] - Cargo revenues were up 22% year-over-year, with strong contributions from Argentina, Uruguay, and Brazil [10] Market Data and Key Metrics Changes - Passenger traffic in Argentina increased nearly 9%, with domestic traffic up 6% and international traffic up 15% [6] - International traffic across the portfolio grew by 12%, with Argentina contributing more than half of the total increase [5] - Traffic in Italy grew by 8%, driven mainly by the international segment, which increased by 11% [7] - Brazil's total traffic was up 12%, reflecting a better environment among airlines and stronger summer season activity [8] Company Strategy and Development Direction - The company secured a 35-year extension of the concession in Armenia and a 6-year extension in Galapagos, enhancing long-term visibility [4][19] - The company has been awarded concessions and is a preferred bidder for new airport concessions in Baghdad, Iraq, and Luanda, Angola, while evaluating additional opportunities [20] - The focus remains on disciplined capital allocation and expanding the portfolio through both organic and inorganic growth strategies [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued positive momentum in passenger traffic, particularly in Argentina, supported by strong international trends [21] - The geopolitical situation in the Middle East is being monitored closely for potential implications on international travel [21] - The company aims to prioritize commercial optimization and revenue per passenger growth across the portfolio [21] Other Important Information - The company achieved significant industry recognition, with various airports receiving awards for operational excellence and customer experience [20] Q&A Session Summary Question: Regarding traffic growth and profitability margins - Management indicated that margins are stable and expect continued growth in traffic and profitability, with approximately 10%-15% of traffic in Armenia affected by the war [24][25] Question: Update on Argentina concession rebalance and Italy investment opportunity - Management stated they are on the right track regarding Argentina's economic reequilibrium but could not provide a specific timeline due to political dynamics. Progress is being made in Italy, but further approvals are needed before construction can begin [30][31] Question: Capital allocation strategy and commercial revenue growth - Management highlighted ongoing opportunities in Iraq and Angola, with a focus on expanding the portfolio. Commercial revenues are expected to continue growing, although not as intensely as in 2025 [35][36]

Financial Data and Key Metrics Changes - In Q4 2025, comparable store sales grew by 8.9%, with a two-year growth of 15.3%, marking the sixth consecutive quarter of positive comparable sales [4][19] - EBITDA for Q4 reached $11.9 million, a 67% increase year-over-year, while total sales increased by 9.1% to $230.4 million [4][19] - For the full year 2025, net sales totaled $820 million, with comparable store sales increasing by 9.7% and a two-year growth of 13.1% [10][21] - Gross margin improved by 210 basis points to 39.6% for the year, driven by fewer markdowns and lower shrink [22] Business Line Data and Key Metrics Changes - The Children's category posted high single-digit growth, becoming a cornerstone of the company [6] - Men's category also showed solid growth, with a balanced approach to product offerings [7] - Women's footwear began to show progress, indicating potential for future growth in the broader footwear category [7] Market Data and Key Metrics Changes - Customer traffic was a significant driver of growth, with transaction counts increasing in the mid- to upper-single digits [4] - The company reported a strong performance in the Family Basics and sleepwear categories, contributing to overall growth [8] Company Strategy and Development Direction - The company executed a three-phase strategy framework: repair, execute, and optimize, focusing on restoring fundamental business disciplines [9] - A clear focus on serving Black customers is a strategic advantage, leveraging cultural relevance to curate appealing assortments [11] - The company plans to open approximately 25 new stores in 2026 and remodel 50 locations, with a disciplined approach to growth [27][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's long-term growth trajectory, emphasizing the importance of consistent execution and operational improvements [3][30] - The outlook for fiscal 2026 includes total sales growth of 6%-8% and comparable same-store sales growth of 5%-7% [25][26] - The company is exploring synergistic acquisition opportunities to complement its growth strategy [46] Other Important Information - The company ended the year with a healthy balance sheet, including $66 million in cash and no debt [23] - A new AI-based allocation system has been implemented to enhance inventory management and sales efficiency [15][34] Q&A Session Summary Question: Can you discuss the impact of weather on sales in January and February? - Management acknowledged that January weather negatively impacted sales but noted a recovery in February, aided by tax refunds [42][43] Question: What is the current status of closeouts as a percentage of sales? - Closeouts currently represent about 30% of the sales mix, with potential for growth, particularly in the shoe category [44][45] Question: Can you provide details on potential acquisitions? - Management is in early stages of exploring acquisition opportunities that would complement the company's growth strategy, emphasizing a selective approach [46][47] Question: How are comp trends shaping up for Q1? - Management anticipates high single-digit growth for Q1, with a focus on the impact of tax refunds and seasonal trends [52] Question: What is the status of the loyalty program? - The loyalty program is currently in testing, with plans for a full rollout later in the year after refining messaging and marketing strategies [58][60]

Financial Data and Key Metrics Changes - Adjusted net revenue for Q4 2025 reached BRL 5.7 billion, growing 2.1% year-over-year [4] - Adjusted EBITDA totaled BRL 3.4 billion, representing a 13% growth versus a year ago, with margins expanding to 60% [4] - Adjusted net income remained stable at around BRL 1.9 billion [4] - For the full year 2025, adjusted net revenue totaled BRL 22.2 billion, representing a 2.2% growth versus 2024 [5] - Adjusted EBITDA for the full year reached BRL 13.2 billion, growing 17% year-over-year, with margins expanding to 60% [5] - Reported net income for Q4 reached BRL 2.7 billion, representing 87% growth year-over-year [11] - Cash flow from operations reached BRL 3 billion, representing a 24% growth [5] Business Line Data and Key Metrics Changes - Water production totaled 789 million cubic meters in Q4, remaining stable [3] - Water connections increased by 0.4% year-over-year, reaching approximately 9.5 million, while sewage connections grew 0.8% to 8.3 million [3] - The number of units benefiting from subsidized rates reached nearly 2 million connections, approximately 6 million people, doubling the average from 2024 [10] Market Data and Key Metrics Changes - The price index, excluding mix effects, remained stable, with no rate reviews for 2025 [9] - Discounts for large clients contributed about 1.5 percentage points to revenue growth, with BRL 450 million worth of discounts removed in 2025 [8][47] Company Strategy and Development Direction - The company focuses on three strategic priorities: delivering new concession agreement obligations, achieving operational efficiency, and improving financial efficiency [17] - CapEx for 2025 reached BRL 15.2 billion, a 120% increase year-over-year, supporting universalization and infrastructure capacity expansion [17] - The company aims to enhance water safety and metering upgrades, with significant investments planned for the future [27][48] Management's Comments on Operating Environment and Future Outlook - Management highlighted strong cash generation and a fortress-like balance sheet, reinforcing the ability to fund investment programs [5][16] - The company is optimistic about achieving universal access targets ahead of schedule, with significant infrastructure projects planned for 2026 [12][13] - Management emphasized the importance of regulatory frameworks and bidding processes for potential acquisitions, particularly regarding Copasa [39][40] Other Important Information - The company concluded the acquisition of MIE's controlling shares, which is expected to increase reservoir capacity significantly [22][23] - The company has a strong liquidity position with BRL 12 billion in cash, covering more than three years of amortizations [16] Q&A Session All Questions and Answers Question: Potential upside to the BRL 70 billion CapEx number - Management indicated that inflation and evolving business needs could lead to an increase in the CapEx number, with investments in water safety and metering upgrades being prioritized [25][26][27] Question: Annualized level of CapEx in Q4 - Management stated that they aim to maintain or accelerate CapEx levels in 2026, depending on execution capabilities [29][30] Question: Payroll line and cost efficiency - Management confirmed that personnel expenses were low due to cost reductions and centralization efforts, with a focus on capitalizing more expenses through CapEx [33][35] Question: Strategic opportunities outside São Paulo - Management expressed interest in larger deals like Copasa, emphasizing the importance of regulatory frameworks and bidding processes in decision-making [39][40] Question: Evolution of discounts for larger customers - Management reported that BRL 450 million in discounts were removed in 2025, with plans to continue capturing remaining discounts [47][48]

Financial Data and Key Metrics Changes - The company reported net revenue from continuing operations of $18.2 million for 2025, an 81% year-over-year increase compared to $10.1 million in 2024, exceeding previous guidance of $16.5 million [11] - Gross merchandise volume (GMV) grew 411% year-over-year, driven by the growth of the payments business [12] - Operating loss improved to $9.7 million in Q4 2025, compared to a $32 million operating loss for the year, with $16.7 million of the loss related to non-cash stock-based compensation and depreciation [15] Business Line Data and Key Metrics Changes - Financial technology revenue, including payment processing and credit offerings, reached $7.3 million in Q4 2025, a 109% increase from the prior year [12] - Credit business revenue in Q4 increased by $1.5 million or 47% year-over-year to $4.8 million [12] - Repeat customer rates for the Credova platform increased by 25% compared to 2024, indicating stronger customer engagement [12] Market Data and Key Metrics Changes - The firearms industry showed growth despite broader market softness, with a 3.4% year-over-year decline in NSSF adjusted NICS checks in December 2025 [5] - The company is focusing on underserved industries, particularly in e-commerce, which benefits its payments and credit businesses [5] Company Strategy and Development Direction - The company is simplifying its operations and focusing on financial infrastructure, with four core themes: strategic focus, operational accountability, cash efficiency, and higher revenue per employee [4] - The strategy includes leveraging AI to improve underwriting performance and operational efficiency, with a goal of increasing revenue per employee significantly throughout 2026 [6][7] - The company is evaluating divestitures of non-core assets and focusing on building an integrated financial platform for merchants and consumers [9][10] Management's Comments on Operating Environment and Future Outlook - Management emphasized the importance of executional discipline and strategic focus, with a commitment to reducing operating cash burn while growing the financial technology platform [11] - The company expects to see significant disintermediation in the payments ecosystem, creating opportunities for new platforms that provide integrated financial services [8] - Management expressed confidence in the company's ability to deliver long-term shareholder value through operational discipline and market share growth [18] Other Important Information - The company reduced SG&A expenses by $9.9 million year-over-year, reflecting strong expense discipline [14] - Cash and restricted cash as of December 31, 2025, totaled $16.1 million, with net cash for operating activities decreasing by $14.2 million during 2025 [17] Q&A Session Summary Question: Why was now the appropriate time for the management change? - The management change was a deliberate decision made by the board to align with the strategic pivot into Fintech, leveraging the new CEO's background in financial technology [22] Question: How will the go-to-market strategy change for the company's fintech efforts? - The strategy will focus on executing what is working, particularly in credit and payment products for underserved industries [25][26] Question: What are the capital priorities moving forward? - The focus will be on running a capital-efficient business, driving revenue per employee, and moving towards profitability before considering debt repayment or strategic M&A [27][28] Question: Where do you see the biggest opportunity in payments and credit? - The company sees opportunities in the 501(c)(3) and 501(c)(4) space, as well as in the lending industry, where traditional fintech has shied away [34][35] Question: What is the focus regarding digital assets? - The focus is on stablecoins and new payment rails that can improve transaction speed and reduce costs for merchants [37] Question: How will AI be integrated into the business? - AI will be used internally to increase cognitive capacity and improve efficiency, with a comprehensive strategy being developed [39][40] Question: How will proceeds from the sale of the brand segment be used? - Proceeds will be used to execute the product roadmap and focus on revenue that has good unit economics [45][46] Question: What KPIs should be followed to measure success? - Key metrics include top-line growth, adjusted EBITDA loss reduction, operating cash flow, and revenue per employee [47][48]

Financial Data and Key Metrics Changes - Total revenues excluding IFRIC 12 increased by 17%, nearly doubling the passenger traffic growth of 9% [12] - Adjusted EBITDA excluding IFRIC 12 rose nearly 40% to $211 million, reflecting strong performance in Argentina and Armenia [14] - The company closed the quarter with total liquidity of $750 million, a 36% increase from $526 million at year-end 2024 [18] - Total debt at year-end was $1.1 billion, with net debt decreasing to $502 million from $780 million in December 2024 [18] Business Line Data and Key Metrics Changes - Aeronautical revenues increased by 17%, driven by strong results in Argentina, with a 21% increase in aeronautical revenues [12] - Commercial revenues grew by 16%, supported by higher contributions from cargo and fuel revenues [12] - Cargo revenues were up 22% year-over-year, with solid contributions from Argentina, Uruguay, and Brazil [11] Market Data and Key Metrics Changes - Total passenger traffic reached a record 22.3 million, with international traffic growing by 12% [5] - In Argentina, passenger traffic increased nearly 9%, with domestic traffic up 6% and international traffic up 15% [6] - Italy's traffic grew by 8%, driven mainly by the international segment, which increased by 11% [7] - Brazil's total traffic was up 12%, reflecting a better environment among airlines and stronger summer season activity [8] Company Strategy and Development Direction - The company secured a 35-year extension of the concession in Armenia and a 6-year extension in Galapagos, enhancing long-term visibility [5][20] - The company is pursuing inorganic growth opportunities, having received concession awards in Iraq and Angola, while evaluating additional bidding processes [21] - The focus remains on disciplined capital allocation and expanding the portfolio through both organic initiatives and acquisitions [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued positive momentum in passenger traffic, particularly in Argentina, supported by strong international trends [22] - The geopolitical situation in the Middle East is being monitored closely for potential implications on international travel [22] - The company expects margins to remain stable, with traffic growth anticipated to continue [26] Other Important Information - The company received several industry recognitions, including Best Airport Operator in South America and Best Airport in Latin America and the Caribbean [21] - The strong performance in 2025 reflects the resilience and quality of the company's portfolio and disciplined execution by the management team [20] Q&A Session Summary Question: Will the current margins and profitability be the new base for CAAP going forward, and has the war affected operations in Armenia? - Management indicated that margins are stable, with traffic growth expected to continue, but noted that 10%-15% of traffic in Armenia has been affected by the war [25][26] Question: Any updates on the Argentina concession rebalance and the Italy investment opportunity? - Management stated they are on the right track with Argentina but could not provide a specific timeline due to political dynamics; progress is being made in Italy, but further approvals are needed [33][34] Question: Can you elaborate on the capital allocation strategy and expected commercial revenue growth? - Management confirmed they are pursuing opportunities in Iraq and Angola and looking at other regions; commercial revenues are expected to continue growing, particularly in VIP lounges and parking [37][39]

Financial Data and Key Metrics Changes - In Q4 2025, comparable store sales grew by 8.9%, with a two-year growth of 15.3%, marking the sixth consecutive quarter of positive comparable sales [4][19] - EBITDA for Q4 reached $11.9 million, a 67% increase year-over-year, while total sales increased by 9.1% to $230.4 million [4][19] - For the full year 2025, total sales increased by 8.9% to $820 million, with comparable store sales up 9.7% and a two-year growth of 13.1% [10][21] Business Line Data and Key Metrics Changes - The Children's category posted high single-digit growth, becoming a cornerstone of the company, while Men's also showed solid growth [5][6] - Women's footwear began to show early signs of progress, with improved customer response in the off-price and extreme value strategy [7] - Family Basics and sleepwear were among the top growth areas in Q4, driven by better styling and trend relevance [8] Market Data and Key Metrics Changes - Customer traffic was the primary driver of growth, with transaction counts increasing mid- to upper-single digits during the quarter [4][12] - The company reported a significant focus on serving Black customers, which is a strategic advantage due to their trendsetting nature [11][12] Company Strategy and Development Direction - The company executed a three-phase strategy framework: repair, execute, and optimize, focusing on restoring fundamental business disciplines [9][10] - Plans for 2026 include consistent execution, sales flow-through to profit, and disciplined growth, with an emphasis on improving the women's business and expanding off-price buying strategies [30][32][34] - The company aims to open approximately 25 new stores in 2026 and remodel 50 locations, with a disciplined approach to site selection [28][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's long-term growth trajectory, citing a clear strategic direction and momentum entering 2026 [3][4] - The outlook for fiscal 2026 includes total sales growth of 6%-8% and comparable same-store sales growth of 5%-7% [25][27] - The company is exploring synergistic acquisition opportunities to complement its growth strategy, although details are still in early stages [46][48] Other Important Information - The company ended the year with a healthy balance sheet, $66 million in cash, no debt, and a focus on improving inventory efficiency [24] - A new AI-based allocation system has been implemented to enhance product allocation and reduce markdowns [15][34] Q&A Session Summary Question: Impact of weather on sales in January and February - Management acknowledged that January weather impacted sales but noted a recovery in February, aided by tax refunds [41][42] Question: Closeouts as a percentage of sales - Closeouts vary by category, with shoes having a high penetration, and management sees potential for growth in this area [44][45] Question: Details on synergistic acquisitions - Management is in early stages of exploring acquisitions that complement the company's growth, emphasizing a selective approach [46][47] Question: Q1 comparable store sales trends - Management anticipates high single-digit growth for Q1, considering the impact of tax refunds and calendar shifts [51][52] Question: Store openings and pipeline visibility - The company has opened 2 stores in February and plans to open 25 stores in 2026, with a structured approach to timing [53][54] Question: Update on the loyalty program - The loyalty program is currently in testing, with plans for a full rollout later in the year after refining messaging and marketing [57][60]

Financial Data and Key Metrics Changes - Total revenue for the year ending December 31, 2025, was $5.8 million, which includes $3.4 million in license and other revenues and $2.4 million in net product revenue [13][14] - Net income for the year was $71.2 million, or $0.34 per basic and $1.01 per diluted common share, compared to a net loss of $63.7 million in 2024 [17] - Cash equivalents and short-term investments totaled $191.4 million as of December 31, 2025 [17] Business Line Data and Key Metrics Changes - The company treated one patient with ZEVASKYN in December 2025, marking the first commercial treatment [4][13] - The average net revenues are expected to normalize as the payer mix expands to include commercially insured patients [14] Market Data and Key Metrics Changes - Demand for ZEVASKYN has grown, with over 100 potentially eligible patients identified across initial treatment centers and community-based physicians [8] - Major commercial payers, including UnitedHealthcare and Cigna, have published coverage policies for ZEVASKYN, representing roughly 80% of commercially covered lives [11] Company Strategy and Development Direction - The company aims to have at least 7 qualified treatment centers (QTCs) active by the end of 2026 to ensure a geographically expansive footprint [11][60] - The focus is on building a consistent cadence of patient treatments and biopsies to demonstrate operational scalability [5][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving profitability, stating that anything north of 3 patients a month would lead to profitability [52] - The company is focused on ensuring a seamless experience for patients and is committed to delivering a high-quality treatment journey [6][18] Other Important Information - The company recorded a $152.4 million gain from the sale of a rare pediatric disease priority review voucher [16] - R&D spending decreased to $26.8 million in 2025, down from $34.4 million in 2024, primarily due to the FDA approval of ZEVASKYN [15] Q&A Session Summary Question: Cadence of Qualified Treatment Centers - Management expects to have 7 QTCs active by the end of the year, with various factors influencing the speed of onboarding [23][24] Question: Drivers of R&D Spending - R&D spending will be driven by registry study costs and pipeline development costs, with a shift from R&D to SG&A as the company transitions to a commercial entity [28] Question: Patient Concentration Around Treatment Centers - Management anticipates that new treatment centers will have a decent pool of patients similar to the initial centers, with a strategy to ensure geographic distribution [40] Question: Manufacturing and Sterility Testing - The company is confident that the sterility testing issues are resolved and is ramping up production capacity to meet demand [88][89] Question: Feedback from Patients and Physicians - Feedback from treated patients is still limited due to the small number of patients, but initial reports indicate positive outcomes [93][94]

Financial Data and Key Metrics Changes - Discretionary assets under management (AUM) decreased by 1.2% in Q4 2025 from $24.3 billion to $24 billion, while total discretionary AUM increased by 3% for the year from $23.3 billion to $24 billion [3] - Total AUM decreased by 1.6% in Q4 to $37 billion but increased by 2% year-over-year from $36.5 billion [4] - Revenue for Q4 was $32 million, with a reported consolidated net loss of $0.1 million [11] - For the full year, revenue increased by 1.3% year-over-year to $19.6 million, while total expenses increased by 9.4% [14][15] Business Line Data and Key Metrics Changes - Organic new client accounts added in Q4 amounted to $124.5 million, bringing the total for 2025 to $688.3 million, indicating strong client acquisition [3] - Compensation and benefits expenses for Q4 increased by 12.1% year-over-year, primarily due to merit-based increases and new hires [11] Market Data and Key Metrics Changes - The firm ranked 6th in Nasdaq eVestment's Q4 2025 brand awareness rankings among mid-sized firms, reflecting growing recognition of its institutional capabilities [6] - The firm is expanding its international business development efforts with professionals in London and Australia, and is nearing completion of an Australian investment trust and a UCITS vehicle in Europe [6][7] Company Strategy and Development Direction - Silvercrest is making significant strategic investments to promote growth across multiple fronts, focusing on intellectual capital and headcount [5] - The firm is adjusting its interim compensation ratio to match investments in business growth, with an elevated compensation ratio expected to continue for the foreseeable future [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term vision and investment plans, anticipating that these will bear fruit with patience [43] - The firm expects to see significant flows from its global and international strategies in 2026, with a potential for multiple billions of dollars in AUM growth [26] Other Important Information - Total compensation and benefits expense for 2025 was $83.9 million, representing 67% of revenue, compared to 62% in 2024 [8] - The firm repurchased approximately $50.4 million worth of shares, with a new share repurchase program of $25 million announced in May 2025 [9][16] Q&A Session Summary Question: Current AUM in global and international strategies - The firm currently has over $2 billion across global and international strategies, with strong performance and a robust pipeline expected to yield significant flows in 2026 [22][26] Question: Future compensation ratio outlook - The compensation ratio will depend on future flows, with expectations that it will remain elevated due to ongoing hiring and investments [31][32] Question: Thoughts on further buybacks - The firm is open to considering additional buybacks, emphasizing the importance of returning capital to investors while also managing equity awards [37][38]