Financial Data and Key Metrics Changes - The fourth quarter results showed organic growth of 5%, the highest level of the year, with revenue performance driven by strong trends in secular growth markets and improving retail conditions [3] - Adjusted EPS for the quarter was $9.61, up 14%, and 16% for the full year, indicating solid operational results [4] - Free cash flow in the fourth quarter was $487 million, or 23% of revenue, with full-year free cash flow at 14% of revenue, an increase of nearly $200 million over the prior year [10] Business Line Data and Key Metrics Changes - Engineered Products revenue declined due to lower volumes in vehicle services, but margins improved over 200 basis points due to cost management and product mix [5] - Clean Energy & Fueling saw a 4% organic growth driven by strong shipments and new orders, although margins were slightly down due to lower vehicle wash solutions [6] - Climate and Sustainability Technologies posted a 9% organic growth, with margins up 250 basis points, indicating strong demand for CO2 refrigeration systems [8] Market Data and Key Metrics Changes - Bookings were up 10% in the fourth quarter, with all five segments showing growth, indicating broad-based demand strength for 2026 [11] - The North American retail fueling market is expected to enter a new CapEx cycle, with strong demand for clean energy components [14] - Demand for brazed plate heat exchangers in North America is robust, particularly for liquid cooling applications in data centers [16] Company Strategy and Development Direction - The company is focused on organic investment as the highest priority for capital spending, with a significant increase in capital spending in 2025 [12] - The acquisition strategy remains strong, with $700 million deployed across four strategic acquisitions in high-growth markets [12] - The company aims for double-digit EPS growth in 2026, supported by solid demand trends and a strong order book [5][18] Management's Comments on Operating Environment and Future Outlook - Management expressed a constructive outlook for 2026, with no individual end market presenting a material headwind based on current visibility [4] - The company anticipates solid volume leverage on incremental revenue and carryover benefits from prior restructuring efforts [18] - Management remains optimistic about the overall economic environment, with strong bookings momentum and good production performance expected [25] Other Important Information - The company initiated a $500 million accelerated share repurchase program, highlighting its disciplined approach to capital deployment [4] - The balance sheet remains flexible, allowing the company to respond dynamically to market conditions [5] Q&A Session Summary Question: What are the expectations for price cost management this year? - Management expects to manage raw material costs with a price increase embedded in the guidance of 1.5-2% [22][24] Question: Has anything changed in the economic outlook recently? - Management has not seen any changes that would alter their positive view on the economy and business [25] Question: What is the expected operating leverage for DCEF and DCST segments? - Management indicated that DCEF will benefit from prior restructuring, while DCST saw a margin jump in Q4 and expects further improvements [30] Question: What is the growth outlook for 2026? - Management is guiding for 4% growth, which is considered conservative based on current visibility and backlog [36] Question: How is the retail fueling CapEx cycle developing? - The retail fueling market is experiencing a resurgence in North America, with expectations for accelerating demand [54] Question: What is the outlook for the natural gas power generation side? - The company supplies components for both large and small turbines, with significant follow-on CapEx expected in the back half of 2026 [87] Question: Are there any plans for divestitures? - Currently, the company is comfortable with its portfolio but remains open to considering divestitures if they align with shareholder interests [113]

Financial Data and Key Metrics Changes - Landmark Bancorp reported a net income of $4.7 million for Q4 2025, an increase from $3.3 million in Q4 2024, with diluted earnings per share of $0.77 [5][9] - For the full year 2025, net income reached $18.8 million, or $3.07 per share, representing a 43% increase over 2024 earnings per share [6] - Tangible book value increased to $20.79 per share, up $0.83 from the prior quarter and $4.09 or 24% over year-end 2024 [5][6] Business Line Data and Key Metrics Changes - Net interest income for Q4 2025 totaled $14.8 million, an increase of $695,000 from Q3 2025, and grew by $2.4 million compared to Q4 2024 [9] - Average total loan growth was 11.5% for the year, with loans ending at $1.1 billion [7] - Non-interest income for Q4 2025 was $3.9 million, a decrease of $169,000 from the prior quarter, primarily due to a loss on the sale of investment securities [12] Market Data and Key Metrics Changes - Deposits totaled $1.4 billion at December 31, 2025, increasing by $63.4 million in Q4 2025 [16] - Non-interest-bearing deposits accounted for 26.3% of total deposits at year-end [16] - The Kansas economy remains healthy, with an unemployment rate of 3.8% as of November 30 [21] Company Strategy and Development Direction - The company plans to continue investing in associates and making strategic investments to enhance customer service and capitalize on growth opportunities [23] - Management emphasized the importance of maintaining a strong and resilient balance sheet while proactively monitoring credit quality [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in building on the foundation set in 2025 and highlighted the importance of employee dedication and community connections [23] - The company is focused on addressing non-performing loans and improving overall loan portfolio quality [20] Other Important Information - The board declared a cash dividend of $0.21 per share, marking the 98th consecutive quarterly cash dividend since the company's formation [8] - The efficiency ratio improved to 62.7% in 2025 from 69.1% in 2024, reflecting controlled expense growth [7] Q&A Session Summary Question: What are the expectations for loan growth in 2026? - Management indicated a focus on maintaining loan growth while addressing credit quality and non-performing loans [19][20] Question: How is the company managing its investment portfolio? - The company is repositioning its investment securities portfolio to improve future income, which included a loss on the sale of lower-yielding securities [12]

Financial Data and Key Metrics Changes - The company's Fourth Quarter GAAP net income was $9.1 million, or $1.15 per share, which includes a $1.5 million one-time adjustment related to tax provisions [3][9] - Excluding the one-time adjustment, operating income for the quarter was $10.7 million, or $1.36 per share [3][13] - Pre-provision net revenue return on average assets was 180 basis points, an increase of 10 basis points from the prior quarter and 75 basis points from Q4 of 2024 [4][9] - Net interest margin expanded to 340 basis points, up 6 basis points from the prior quarter [9][10] - The efficiency ratio improved to 50.8% from 51.4% in the prior quarter [8] Business Line Data and Key Metrics Changes - The SBA division contributed significantly to non-interest income, with $2.2 million in gains on sale for the quarter, leading to a total of $5.1 million for the year [7][11] - Loan production remained strong, with $240 million of new loans funded in the Fourth Quarter, totaling $758 million for the year [6][9] - Net loan growth for the quarter was $122 million, with a total of $134 million for the year, representing 5% annual growth [7][9] Market Data and Key Metrics Changes - Floating-rate loans comprised 38% of the total loan portfolio at year-end 2025, up from 23% at the end of 2024 [5] - Average low-cost deposit balances increased by $22 million, or 5%, over the prior quarter and by $86 million, or 21%, compared to Q4 of 2024 [5][11] Company Strategy and Development Direction - The company aims to strengthen credit, improve the funding mix, build non-interest income, and generate high-quality growth while investing in people and technology [14][15] - The focus on diversified recurring revenue sources is yielding positive results, particularly with the growth of the SBA division [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in entering 2026 with a strong position and anticipates loan growth of 4%-5% and net interest income in the range of $111 million-$112 million [15] - The company expects non-interest income to increase to approximately $11 million-$12 million and total non-interest expense to be between $64 million-$65 million [15] Other Important Information - The allowance for credit losses stands at 108 basis points of total loans, with coverage of non-performing loans increasing to 188% [12] - The effective tax rate for the full year 2025 was 27.4%, influenced by a one-time tax expense, with an expected future rate of approximately 25% [13] Q&A Session Summary Question: Loan growth expectations for 2026 - Management indicated that loan growth is expected to pick up in 2026, driven by a balance of payoffs and new originations [18][19] Question: Composition of the loan pipeline - The loan pipeline is currently 60% C&I and 40% Investor CRE, with expectations to continue strong C&I real estate originations in 2026 [24] Question: Low-cost deposit growth expectations - While no specific guidance was provided, management expects steady improvement in low-cost deposits, which grew 5% from the previous quarter and 21% year-over-year [28][30] Question: SBA originations outlook for 2026 - The company anticipates achieving significant SBA originations in 2026, building on the first full year of the SBA division's operations [42] Question: Expense growth drivers for 2026 - Expense growth is expected to be driven by investments in people and processes, with a headcount increase of over 10% in the previous year [48][51]

Financial Data and Key Metrics Changes - Brunswick finished 2025 with net sales of $5.4 billion, up 2% year-over-year, marking the first full-year net sales growth in three years [4][15] - Adjusted earnings per share (EPS) for the year was $3.27, impacted by tariff headwinds, with free cash flow generation reaching $442 million, up 56% year-over-year [4][17] - The company reported a 41% increase in Q4 earnings compared to the prior year, driven by higher sales and operational improvements [15] Business Line Data and Key Metrics Changes - The propulsion segment saw a 23% increase in sales, with double-digit growth across all product categories, driven by strong OEM orders [17][19] - The aftermarket parts and accessories (P&A) business grew sales by 15% in Q4, marking the third consecutive quarter of growth [19] - The boat segment reported an 11% sales increase, with growth across premium, core, and value categories [22] Market Data and Key Metrics Changes - The U.S. retail boat market finished 2025 down approximately 9% in units, while Brunswick's global retail unit sales were down only 5% [3][10] - Dealer inventories remained low, with a high percentage of recent model year products, supporting a favorable retail environment [4][10] - Brunswick's market share in the U.S. outboard segment remained stable at approximately 47%, with gains in higher horsepower engines [11] Company Strategy and Development Direction - Brunswick plans to continue driving operational efficiencies and is encouraged by the strong reception of new products, with a focus on ultra-high horsepower engines [23][89] - The company aims for revenue growth in 2026, projecting net sales between $5.6 billion and $5.8 billion, with adjusted operating margins between 7.5% and 8% [24] - Brunswick's strategy includes significant investments in new product development and technology, alongside returning capital to shareholders [30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in improved market conditions for 2026, supported by falling interest rates and strong retail demand [5][8] - The company anticipates a flat to slightly up U.S. retail boat market, with expectations for wholesale sales to closely match retail [23][24] - Management noted that tariff mitigation actions successfully offset over half of the gross dollar exposure, with expectations of further incremental tariff costs in 2026 [9][28] Other Important Information - Brunswick's liquidity at year-end was $1.3 billion, including access to an undrawn revolving credit facility [13] - The company plans to retire approximately $160 million of debt in 2026, contributing to a net debt leverage target of 2.5x or lower [29] - Brunswick received multiple awards for its products and innovations at recent trade shows, highlighting its commitment to quality and technology [31][35] Q&A Session Summary Question: What was the retail performance in the fourth quarter? - Management indicated that retail performance was flat, with continued strength in premium and core brands, which represent a significant portion of their portfolio [41] Question: What gives confidence for flat to up retail in 2026? - Management cited expected interest rate cuts and improving retail financing conditions as key factors supporting their outlook for 2026 [43][44] Question: How should we think about inventory levels for 2026? - Management expects pipeline units to be flat to slightly reduced, aiming to match wholesale and retail [46][48] Question: How is the company addressing competitive inventory levels? - Management noted solid ordering and a healthy pipeline, indicating no evidence of dealers holding back on orders [49] Question: What are the dynamics affecting retail sales and replacement rates? - Management highlighted a significant gap between new boat sales and replacement rates, suggesting a natural pull for retail sales [53] Question: How is the propulsion business performing with OEM customers? - Management reported strong performance and share gains in the propulsion segment, with new multi-year agreements with OEMs [61][62]

Financial Data and Key Metrics Changes - The company achieved record Q2 sales of $5.2 billion, with organic growth of 6.6% and a 150 basis points margin expansion, resulting in a 27.1% adjusted segment operating margin [4][10] - Adjusted earnings per share (EPS) grew 17% to $7.65, with cash flow from operations at $1.6 billion [4][11] - Net income reached $980 million, reflecting an 18.9% return on sales [10] Business Line Data and Key Metrics Changes - North America sales were approximately $2 billion, with organic growth of 2.5% driven by strength in off-highway and aerospace and defense verticals [14] - International sales increased to a record $1.5 billion, up 12% year-over-year, with organic growth of 4.6% [15] - Aerospace sales reached a record $1.7 billion, up 14.5% year-over-year, with an adjusted segment operating margin of 30.2% [16] Market Data and Key Metrics Changes - Orders increased by 9% year-over-year, with a backlog reaching a record $11.7 billion [12][14] - In Asia-Pacific, organic growth was the strongest at +9%, while Europe turned positive at +2% [15] - Latin America saw a slight decline of 3% year-over-year [15] Company Strategy and Development Direction - The company announced the acquisition of Filtration Group Corporation, which is expected to create one of the largest global industrial filtration businesses and achieve approximately $220 million in cost synergies [8][9] - The company is focused on interconnected technologies that provide efficient solutions across market verticals, with two-thirds of revenue coming from customers who buy four or more technologies [6][7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering another record fiscal year in 2026, with strong orders and positive growth across all reported businesses [12][19] - The company is increasing its full-year guidance for organic sales growth to 4%-6% and adjusted EPS to $30.70 at the midpoint, reflecting a 12.3% increase [22][24] Other Important Information - The company achieved top quartile safety performance with an 8% reduction in recordable incident rate [4] - The company remains committed to free cash flow conversion of greater than 100% for the year [17] Q&A Session Summary Question: Positive organic growth across technology platforms - Management noted that positive organic growth was seen across all three technology platforms, attributing it to both specific company performance and broader market cycles [28][30] Question: Filtration Group acquisition timing - Management believes the acquisition timing is favorable, as Filtration Group has seen positive growth, indicating potential for increased sales post-acquisition [32][33] Question: Regional performance outlook - Management provided insights on regional performance, indicating strong growth in North America and Asia-Pacific, while Europe showed signs of recovery [39][41] Question: Pricing and cost management - Management emphasized strong pricing strategies and cost management practices to mitigate inflation impacts on margins [72][74] Question: Fourth quarter performance expectations - Management reassured that the fourth quarter is expected to be the strongest of the year, with no specific concerns noted [96][97]

Financial Data and Key Metrics Changes - The company reported a full-year growth in NOI of 4.8% and a 5% increase in normalized FFO per share for 2025 [3][15] - Fourth quarter normalized FFO was $0.79 per share, with full-year normalized FFO at $3.06 per share, reflecting 4.2% and 5% growth respectively compared to the prior year [15][16] - The annual dividend rate was set at $2.17 per share, marking a 5.3% increase and the 22nd consecutive year of annual dividend growth [7] Business Line Data and Key Metrics Changes - The MH business generated over $1 billion in revenue in 2025, with a combined revenue CAGR of 5.9% over the last five years [9] - Core community-based rental income increased by 5.5% for the full year 2025 compared to 2024, driven by rate increases for renewing residents and market rent for new residents [16] - Core RV and marina annual base rental income increased by 4.1% compared to the prior year, while core seasonal and transient rent combined decreased by 9.1% [16][17] Market Data and Key Metrics Changes - Approximately half of the MH revenue comes from Florida, with 20% from California and Arizona, and the rest from North Central and Northeast US [9] - The average occupancy in California properties is 96%, reflecting strong demand in high-cost markets [11] - The company noted that demographic trends, including the aging of baby boomers and Gen X, support demand for its MH and RV offerings [11][12] Company Strategy and Development Direction - The company focuses on internal growth and operational expansions, particularly in the Sunbelt markets, while maintaining a strong balance sheet for potential acquisition opportunities [52][53] - The management emphasized the importance of community engagement and the value proposition of affordable housing in addressing broader housing issues [42][52] - The company plans to continue investing in its communities to support long-term resident retention and growth [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operating environment, anticipating normalized FFO growth of 3.7% for 2026 [6][18] - The company expects core property operating income growth of 5.6% at the midpoint of its guidance range for 2026 [18] - Management highlighted the positive early booking pace for RV and seasonal customers, driven by favorable weather conditions and marketing efforts [93] Other Important Information - The company has no secured debt maturing before 2028, with a debt to EBITDARE ratio of 4.5 times and interest coverage of 5.7 times [21] - The company anticipates approximately $100 million of discretionary capital after meeting obligations for dividend payments and capital expenditures [7][20] Q&A Session Summary Question: What gives confidence that seasonal and transient can accelerate through the balance of the year? - Management indicated that early booking pace is favorable compared to last year, with positive trends observed for major holidays [28][30] Question: What is the expected impact of insurance renewal on expenses? - Management noted that while they expect some increase in expenses, they are pleased with the lack of adverse claims experience in 2025 and anticipate a softening market for insurance [34] Question: What is the outlook for Canadian customers? - Management reported that Canadian customers represent 10% of total RV revenue, with no significant increase in home sales observed, maintaining a strong demand profile [48][50] Question: What is the strategy for the rental home business moving forward? - The company plans to prioritize selling homes but may accept rentals to expose more prospects to future home buying [99] Question: What is causing the decline in campground membership counts? - Management explained that attrition of legacy members paying lower dues is offset by new members paying higher dues, leading to a net decline in counts [117]

Financial Data and Key Metrics Changes - Brunswick finished 2025 with net sales of $5.4 billion, up 2% year-over-year, marking the first full-year sales growth in three years [4][15] - Adjusted earnings per share (EPS) for the year was $3.27, impacted by tariff headwinds, with free cash flow generation reaching $442 million, a 56% increase year-over-year [4][17] - The company reported a 41% increase in Q4 earnings compared to the prior year, driven by higher sales and operational improvements [15] Business Line Data and Key Metrics Changes - The propulsion segment saw a 23% increase in sales, with double-digit growth across all product categories [17][21] - The aftermarket parts and accessories (P&A) business grew sales by 15% in Q4, marking the third consecutive quarter of growth [19] - The boat segment reported an 11% sales increase, with growth across premium, core, and value categories [22] Market Data and Key Metrics Changes - The U.S. retail boat market finished the year down approximately 9% in units, while Brunswick's global retail unit sales were down only 5% [3][10] - Dealer inventories remained low, with a high percentage of recent model year products, supporting a favorable retail environment [4][10] - Brunswick's market share in the U.S. outboard segment remained stable at approximately 47%, with gains in higher horsepower engines [11] Company Strategy and Development Direction - Brunswick plans to continue driving operational efficiencies and investing in new products, with a focus on maintaining a competitive edge in the market [23][31] - The company anticipates a flat to slightly up U.S. retail boat market in 2026, with expectations for improved wholesale sales to match retail [24][28] - Strategic actions include a focus on new product launches and maintaining strong relationships with OEMs, particularly in Europe [62] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in improved market conditions for 2026, supported by early season retail strength and falling interest rates [5][8] - The company noted that tariff mitigation actions successfully offset over half of the gross dollar exposure, with expectations for further incremental tariff costs in 2026 [9][28] - Management highlighted the importance of maintaining a strong balance sheet and financial flexibility to support growth initiatives [12][13] Other Important Information - Brunswick's liquidity at year-end was $1.3 billion, including access to an undrawn revolving credit facility [13] - The company plans to return capital to shareholders through dividends and share repurchases, with a slight dividend increase anticipated [30] - Brunswick received multiple awards for its products and innovations at recent trade shows, enhancing its brand reputation [35] Q&A Session Summary Question: Retail performance in Q4 and outlook for 2026 - Management indicated that retail performance was flat in Q4, with continued strength in premium and core brands, and expressed confidence in a flat to up retail market for 2026 due to anticipated interest rate cuts [39][41][43] Question: Inventory levels and wholesale vs retail dynamics - Management expects pipeline units to be flat to slightly reduced in 2026, aiming to match wholesale and retail [46][48] Question: Market share opportunities and competitive dynamics - Management believes Brunswick has a long-term structural advantage due to tariffs impacting competitors, with expectations for steady market share gains [88][90] Question: Tariff impacts and financial guidance - Management provided insights on the expected incremental tariff costs for 2026, estimating a $35-$45 million impact, primarily in Q1 [73][79]

Financial Data and Key Metrics Changes - The company reported net revenue of $987 million for the first quarter, an increase of 8% from the prior year [5] - Operating income rose to $131 million, up 12% year-over-year [5] - Adjusted earnings per share (EPS) increased by 17% to $0.34, while GAAP EPS was reported at $0.40 [5][6] Business Segment Performance - The Government Services segment generated $382 million in revenue, growing 5% despite a U.S. government shutdown [6] - The Commercial and International Group segment's revenue increased by 10% to $605 million, driven by growth in the UK and Ireland [6][7] - Margins for both segments improved by 40 basis points, with Government Services at 18% and Commercial International at 13% [6][7] Market Data and Key Metrics Changes - Federal work increased by 7%, primarily due to projects with the U.S. Army Corps of Engineers [8] - State and local markets in the U.S. grew by 10%, driven by municipal water treatment initiatives [8] - International revenue accounted for 48% of total revenue, growing at a rate of 13%, with significant contributions from the UK and Ireland [9] Company Strategy and Industry Competition - The company focuses on water supply, treatment, flood control, and environmental stewardship, which are in high demand [3] - Strategic growth areas include technology and automation, with plans for acquisitions to enhance capabilities in defense and environmental services [18][25] - The company aims to leverage its strong balance sheet for future acquisitions, targeting firms that can enhance its market position [70] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in revenue growth despite challenges like the government shutdown, anticipating increased federal orders as budget clarity improves [10][11] - The company expects international growth to continue at a rate of 5%-10%, supported by water programs and defense spending [27] - Guidance for the second quarter is set at $975 million to $1.025 billion in net revenue, with adjusted EPS of $0.30 to $0.33 [29] Other Important Information - The company announced a 12% increase in its quarterly cash dividend, marking the 47th consecutive dividend payment [18] - A stock buyback program was initiated, with $50 million repurchased in the first quarter [19] - The company divested its Norway operation, which was deemed non-core, prior to Christmas [82] Q&A Session Summary Question: Strength in Federal Business - Management highlighted that the federal business grew 7% due to advanced planning and strong relationships with clients, particularly the U.S. Army Corps of Engineers [37][40] Question: International Business Performance - The UK and Ireland have shown strong double-digit growth, while Canada is recovering and Australia is stabilizing after previous declines [41][46][48] Question: Guidance and Market Conditions - Management discussed the potential impact of a government shutdown on guidance, noting that while it could affect the lower end, essential services would likely continue [59][61] Question: Focus on M&A - The company is looking to leverage its strong balance sheet for strategic acquisitions, with a focus on larger, transformative opportunities [67][70] Question: Details on Recent Acquisitions - Recent acquisitions include Halvik and Providence, which are expected to enhance the company's capabilities in defense and consulting [79][81]

Financial Data and Key Metrics Changes - The company reported a full-year growth in NOI of 4.8% and a 5% increase in normalized FFO per share for 2025 [3][15] - Fourth quarter normalized FFO was $0.79 per share, and full-year normalized FFO was $3.06 per share, representing 4.2% and 5% growth respectively compared to the prior year [15][16] - The annual dividend rate was set at $2.17 per share, marking a 5.3% increase and the 22nd consecutive year of annual dividend growth [7] Business Line Data and Key Metrics Changes - The MH business generated over $1 billion in revenue in 2025, with a combined revenue CAGR of 5.9% over the last five years [9] - Core community-based rental income increased by 5.5% for the full year 2025 compared to 2024, driven by rent increases for renewing residents and new residents [16] - Core RV and marina annual base rental income increased by 4.1% compared to the prior year, while core seasonal and transient rent combined decreased by 9.1% [16] Market Data and Key Metrics Changes - Approximately half of the MH revenue comes from Florida, with 20% from California and Arizona, and the rest from the North Central and Northeast US [9] - The average occupancy in California properties is 96%, reflecting strong demand in high-cost markets [11] - The company noted strong demand for MH communities, particularly in Florida and Arizona, supported by favorable economic conditions and demographic trends [10][11] Company Strategy and Development Direction - The company focuses on internal growth and operational expansions, particularly in the Sunbelt markets, while maintaining a strong balance sheet for potential acquisition opportunities [52] - The management emphasized the importance of community engagement and the value proposition of manufactured housing in addressing housing affordability issues [42] - The company plans to continue investing in its communities to support long-term growth and resident retention [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operating environment, anticipating normalized FFO growth of 3.7% for 2026 and core property operating income growth of 5.6% [7][18] - The company highlighted the positive demographic trends, with a significant portion of the population aging into their target market [11] - Management acknowledged challenges in the investment market due to fragmented ownership and limited transaction activity, focusing on internal growth instead [52][53] Other Important Information - The company reported a utility recovery rate of 48.7%, a 220 basis point increase from 2024 [17] - The balance sheet is well-positioned with no secured debt maturing before 2028 and access to $1.2 billion in capital [21][22] Q&A Session Summary Question: Seasonal and transient business expectations for the year - Management provided insights on the seasonal and transient revenue streams, indicating a positive outlook based on early booking trends and favorable holiday timing [24][30] Question: Progress on marina repairs - Management confirmed that repairs on three marinas affected by storm damage are expected to be completed by the latter half of 2026 [40] Question: Canadian customer demand - Management noted that Canadian customers represent 10% of total RV revenue, with no significant increase in home sales from this group, maintaining a strong demand profile [48] Question: Impact of cold weather on RV demand - Management indicated that cold weather has historically driven demand for RVs, with marketing efforts focused on encouraging customers to escape to warmer locations [93] Question: Non-core income decline - Management explained that the decline in non-core income is attributed to timing differences in insurance proceeds and recovery from storm-affected properties [121] Question: Strategy for rental home business - Management stated that the rental home business will continue to grow based on demand, with a focus on selling homes to current renters [99]

Financial Data and Key Metrics Changes - The company achieved record Q2 sales of $5.2 billion, with organic growth of 6.6% and a 150 basis points margin expansion, resulting in a 27.1% adjusted segment operating margin [4][10] - Adjusted earnings per share (EPS) grew 17% to $7.65, with cash flow from operations at $1.6 billion [5][12] - Net income reached $980 million, reflecting an 18.9% return on sales [10] Business Line Data and Key Metrics Changes - North America sales were approximately $2 billion, with organic growth of 2.5% driven by strength in off-highway and aerospace and defense verticals [14] - International sales increased to a record $1.5 billion, up 12% year-over-year, with organic growth of 4.6% [15] - Aerospace sales reached a record $1.7 billion, up 14.5% year-over-year, with an adjusted segment operating margin of 30.2% [16] Market Data and Key Metrics Changes - Orders increased by 9% year-over-year, with a backlog reaching a record $11.7 billion [12][14] - In Asia-Pacific, organic growth was the strongest at +9%, while Europe turned positive at +2% [15] - Latin America saw a slight decline of 3% year-over-year [15] Company Strategy and Development Direction - The company is focused on interconnected technologies that provide efficient solutions across market verticals, with a strong emphasis on the off-highway market [6][7] - The acquisition of Filtration Group Corporation is expected to enhance the company's presence in life sciences, HVAC, and industrial markets, with anticipated cost synergies of approximately $220 million [8][9] - The company aims to continue its investment in high-quality businesses to transform its portfolio and drive shareholder value [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering another record fiscal year in 2026, citing strong orders and positive growth across various segments [12][20] - The company is increasing its organic sales growth guidance from 4%-5% to 5% at the midpoint, reflecting positive trends in aerospace and off-highway markets [20][22] - Management noted that while some markets are recovering, challenges remain in transportation and upstream oil and gas sectors [20][41] Other Important Information - The company reported a favorable currency impact of 2% and a 1.5% contribution from acquisitions [10] - Corporate G&A expenses are expected to remain unchanged at $200 million, with interest expense slightly adjusted down to $415 million [23] Q&A Session Summary Question: Insights on technology platforms within Diversified Industrial - Management noted positive organic growth across all three technology platforms, attributing it to both company-specific factors and broader market cycles [29][31] Question: Regional performance outlook - Management highlighted strong growth in North America, particularly in industrial and aerospace sectors, while noting challenges in transportation [40][41] Question: Pricing and cost management amid inflation - Management confirmed strong pricing power and ongoing efforts to mitigate inflation impacts on EPS [73][75] Question: Filtration Group acquisition timing and hurdles - Management indicated that standard regulatory filings are the primary hurdles for the acquisition process [76] Question: Long-term growth outlook for in-plant equipment in the U.S. - Management emphasized gradual recovery driven by productivity and automation projects, with no single catalyst identified for a rapid turnaround [65][66] Question: Aerospace business margin expectations - Management clarified that while margins are expected to step down in H2, they remain confident in robust activity and overall margin improvement [68]