Financial Data and Key Metrics Changes - Sales for Q3 2025 were $1.03 billion, reflecting an 8% increase on a reported basis and a 6% increase in local currency, with a 5% increase excluding recent acquisitions [6][10] - Adjusted EPS for the quarter was $11.15, a 9% increase over the prior year, while reported EPS was $10.57 compared to $9.96 in the prior year [9][10] - Gross margin decreased to 59.2%, down 80 basis points primarily due to tariff costs [7][9] - Adjusted operating profit was $309.9 million, up 5% year-over-year, with an adjusted operating margin of 30.1%, a decrease of 100 basis points [8][9] Business Line Data and Key Metrics Changes - Laboratory sales increased by 4%, while industrial sales grew by 9%, with core industrial growing 10% excluding acquisitions [6][8] - Product inspection sales grew by 7%, and food retail sales increased by 5% [6][8] - Service revenue grew by 8%, including a 1% benefit from acquisitions [6][8] Market Data and Key Metrics Changes - Local currency sales growth by region showed a 10% increase in the Americas, 6% in Europe, and 1% in Asia [6][10] - Local currency sales in China increased by 2% during the quarter [6][10] Company Strategy and Development Direction - The company is focused on capturing growth opportunities in automation, digitalization, and onshoring, while remaining agile amid global trade uncertainties [4][12] - Strategic initiatives include investments in innovation and operational excellence to navigate challenging market conditions [4][21] - The company plans to continue using free cash flow primarily for share repurchases and small acquisitions, with an additional $2.75 billion authorized for the share repurchase program [16][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to capture growth despite uncertainties in global trade and governmental policies [4][12] - The outlook for 2026 anticipates local currency sales growth of approximately 4%, with adjusted EPS forecasted to be in the range of $45.35-$46, representing an 8%-9% growth rate [14][15] - Management noted that while market conditions remain challenging, there is potential for gradual improvement and increased replacement demand [23][24] Other Important Information - The company completed several small acquisitions totaling approximately $75 million, which are expected to contribute modestly to sales growth [11][16] - Free cash flow for the first nine months was $689.5 million, a 6% increase on a per-share basis [11] Q&A Session Summary Question: Can you provide a breakdown of the 2026 guidance by segment, particularly around the industrial side? - Management expects low to mid-single digit growth in the laboratory business, with core industrial and product inspection also projected to grow low to mid-single digits [28] Question: How is the consumer market affecting the more consumer-facing segments? - Management noted that while the end market remains challenging, recent product innovations have been well received, particularly in food manufacturing [30] Question: What are the expectations for onshoring demand in 2026 versus 2027? - Management believes the company is well positioned to benefit from onshoring activities, but expects a gradual impact over the coming years [42] Question: What is the outlook for the lab and biopharma side in China? - Management anticipates low single-digit growth in both lab and industrial businesses in China, with some upside potential from recent updates in the Pharmacopia [46] Question: Can you elaborate on the recent acquisitions and their impact? - Management explained that the acquisitions were aimed at expanding distribution and service capabilities, with a focus on enhancing the life science equipment portfolio [52]

Financial Data and Key Metrics Changes - The company reported a consolidated net revenue decline of 6% year-over-year to $562 million, with a consolidated AOI decline of 28% to $94 million and an adjusted EPS of $0.18 per share [15][20]. - Free cash flow totaled $42 million in the third quarter, with an increased guidance of approximately $250 million for the full year [4][15]. Business Line Data and Key Metrics Changes - Domestic operations revenue decreased 8% to $486 million, with subscription revenue flat year-over-year and streaming revenue growth of 14%, partially offset by a 13% decline in affiliate revenue [15][16]. - The company ended the third quarter with 10.4 million streaming subscribers, reflecting a year-over-year growth of 2% [16]. Market Data and Key Metrics Changes - International revenues for the third quarter were $77 million, with subscription revenue, excluding foreign exchange, decreasing 6% due to the non-renewal with Movistar in Spain [18]. - Advertising revenue, excluding foreign exchange, increased 10% due to strong performance in the U.K. and Ireland [18]. Company Strategy and Development Direction - The company is transitioning from a cable networks business to a global streaming and technology-focused content company, with streaming expected to be the largest source of revenue in the domestic segment this year [4][5]. - The company has renewed and expanded its licensing agreement with Netflix, which is beneficial for both parties, and has also renewed a long-term distribution agreement with DirecTV [6][7]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the full-year outlook of approximately $250 million in free cash flow, emphasizing the importance of free cash flow generation [15][20]. - The company remains focused on reducing gross debt and extending maturities, with a net debt of approximately $1.2 billion and a consolidated net leverage ratio of 2.8 times [19]. Other Important Information - The company has launched new programming initiatives, including a new series called "The Audacity" and a franchise focused on John Steinbeck's "The Grapes of Wrath" [11][12]. - The company has implemented a voluntary buyout program resulting in a less than 5% reduction in the total employee base to strengthen its talent base [12][13]. Q&A Session Summary Question: Discussion on partnership with Sphere and AOI margins - Management highlighted the attractiveness of integrating with Sphere for advertisers and mentioned ongoing discussions for future promotions [24][25][26]. - Regarding AOI margins, management indicated a focus on free cash flow generation while investing in premium programming, with a current conversion rate over 60% [27][28]. Question: Impact of becoming less linear and more streaming on cost structure - Management stated that the company has an efficient model where programming dollars work across multiple platforms, and emphasized the cost advantages of targeted streaming services like Acorn [30][31][32]. Question: Advertising growth potential with increased streaming presence - Management pointed to a 40% growth in digital advertising and the expansion of inventory through AMC+ as key factors for future advertising growth [36][37]. Question: Advertising revenue from FAST channels and overall advertising landscape - Management confirmed that streaming revenue does not include digital advertising, which is captured separately, and emphasized the promotional opportunities provided by FAST channels [40][41][42].

Financial Data and Key Metrics Changes - The company reported a gross margin decrease of 190 basis points and an EBITDA margin decrease of 160 basis points, despite lower ingredient costs as a percentage of sales [37][39] - The company is experiencing margin pressure primarily due to increased promotional activity and the higher cost structure associated with new product innovations [39] Business Line Data and Key Metrics Changes - The food service business has been under pressure due to economic conditions and consumer sentiment, but profitability improvements from past efforts are still evident [25] - The private label segment has shown weakness, attributed to narrowed price gaps between private label and lower-priced branded products [26] Market Data and Key Metrics Changes - Consumer sentiment reached a low point in Q3, but there are expectations for category demand to normalize as the economy strengthens [7][8] - The company noted that the bread category is experiencing a bifurcation into premium differentiated products and value-oriented brands, impacting traditional loaf sales [46][47] Company Strategy and Development Direction - The company is focusing on redefining traditional loaf products to align with evolving consumer preferences for value and better-for-you attributes [4][47] - There is a commitment to continue investing in consumer engagement and innovation, despite short-term margin pressures [11][48] Management's Comments on Operating Environment and Future Outlook - Management anticipates that the category will stabilize over time, although some weakness is expected to persist into 2026 [8][15] - The company is optimistic about long-term growth due to its strong brand portfolio and ongoing innovation efforts [47] Other Important Information - This earnings call marked the final appearance of the CFO, Steve Kinsey, after 18 years with the company [5] - The company is reassessing capital expenditures to focus on projects that deliver the best returns while managing leverage ratios [34][36] Q&A Session Summary Question: Insights on consumer sentiment and category demand normalization - Management believes that while it is difficult to pinpoint a timeline, the category will stabilize over time, with current economic pressures affecting consumer behavior [8] Question: Offsets to margin pressures from new investments - Management acknowledged that new product innovations typically pressure margins initially, but expects improvements as scale and efficiency increase [11] Question: Performance of Simple Mills post-acquisition - Integration efforts are going well, with strong performance and new innovations expected in the coming year [20] Question: Food service and private label business performance - The food service segment is under pressure, but profitability improvements are still being realized, while private label has been weak due to competitive pricing dynamics [25][26] Question: Expectations for 2026 gross margins amid inflation - Management expects inflationary pressures on input costs, including volatile commodity prices, to impact gross margins in 2026 [30] Question: Balancing CapEx and dividends - The company is focused on capital allocation to deliver shareholder value, with a reassessment of projects to ensure optimal returns [34][36] Question: Navigating margin pressures in the competitive environment - Management indicated that promotional activities and the integration of higher-cost products are contributing to margin pressures, but improvements are expected as consumer sentiment stabilizes [39] Question: Generational shift and economic weakness impact - The company noted that economic uncertainty leads to a trade-down effect, but there is a long-term shift towards premium and differentiated products [46][47] Question: Complexity of managing regional brands - Management acknowledged the complexity of managing smaller regional brands but emphasized the importance of focusing on efficiency and consumer demand [50][52]

Financial Data and Key Metrics Changes - Revenue for Q3 was $3.4 billion, including a $653 million revenue reversal in energy solutions due to litigation [4] - Consolidated new awards for Q3 totaled $3.3 billion, with 99% being reimbursable [4] - Adjusted EBITDA for Q3 was $161 million, compared to $124 million a year ago, and adjusted EPS was $0.68 compared to $0.51 in 2024 [17][24] - The company ended the quarter with $2.8 billion in cash and marketable securities, up $500 million from June 30 [19] Business Segment Data and Key Metrics Changes - Urban Solutions reported a profit of $61 million in Q3, with new awards totaling $1.8 billion, a significant increase from $828 million in the same period last year [5] - Energy Solutions reported a segment loss of $533 million compared to a profit of $50 million a year ago, primarily due to the $653 million court ruling [7] - Mission Solutions reported a segment profit of $34 million for Q3, down from $45 million a year ago, with new awards totaling $1.3 billion compared to $274 million a year ago [10] Market Data and Key Metrics Changes - The total backlog remains around $28 billion, with 82% being reimbursable [4] - The company anticipates significant contributions from Urban Solutions, particularly in metals and mining, and expects a Q4 award for a pharmaceutical facility [7][11] - Energy transition projects have slowed down due to market conditions, while traditional oil and gas activities are picking up [15][58] Company Strategy and Development Direction - The company is transitioning to an asset-light model with a majority reimbursable backlog, aiming for long-term growth [4] - The monetization of the NuScale investment is expected to enhance financial discipline and capital allocation [13][24] - The company is focusing on strategic relationships rather than competitive bidding for new projects, particularly in power generation and data centers [34][46] Management's Comments on Operating Environment and Future Outlook - Management noted that external factors have caused delays in new awards, impacting EBITDA growth rates [14][15] - The company expects to approach $90 billion in new awards over the four-year planning cycle ending in 2028, with most awards concentrated in 2026-2028 [14][59] - The outlook for 2026 suggests EBITDA generation may be marginally better than the guidance for 2025, with a potential shift in growth targets to 2029 [26][59] Other Important Information - The company plans to deploy an additional $800 million in share repurchases through February [23] - The anticipated payment to Santos for the court ruling will be funded from cash generated from core operations [30][54] - The company is actively pursuing opportunities in various sectors, including mining, power generation, and data centers [33][35] Q&A Session Summary Question: Insights on 2026 EBITDA expectations - Management indicated that 2026 EBITDA is expected to be marginally better than 2025, driven by growth in Urban Solutions and the resumption of work in Mexico [27][29] Question: Clarification on Energy Solutions margins - The margins in Energy Solutions, excluding Santos, showed strong performance due to the nearing completion of LNG Canada and resumption of work in Mexico [29] Question: Funding for Santos payment - The Santos payment is expected to be funded from cash on the balance sheet generated from core operations, not from NuScale proceeds [30] Question: Opportunities in power generation and data centers - The company is focusing on strategic relationships for power generation projects and is well-positioned for larger data center projects despite challenging terms in the U.S. [34][35] Question: Competitive landscape for $90 billion potential awards - The competitive set is favorable, with many projects already in progress, particularly in mining and metals, and a focus on negotiated contracts rather than competitive bidding [45][46]

Financial Data and Key Metrics Changes - Total third quarter revenue was $7.8 million, a 3% increase compared to $7.6 million in Q3 2024, marking the 12th consecutive quarter of meeting or beating revenue guidance [6][14] - Consumables revenue increased by 40% year-over-year, reaching a quarterly record, while service revenue grew by 12% compared to Q3 2024 [6][14] - Gross margins improved to 9%, reflecting a 70 basis point increase from the prior year, with service margins at 40% [7][15] - Net loss for Q3 was $11.5 million, consistent with the net loss of $11.3 million in Q3 2024, with net loss per share remaining at $0.26 [16] Business Line Data and Key Metrics Changes - Product revenue was flat at $5.2 million, with consumables offsetting the impact of fewer system placements [14] - Recurring revenue, which includes consumables and service contracts, increased by 32% to $4.8 million [14] - Non-recurring revenue, mainly from systems and validation, was $3 million [14] Market Data and Key Metrics Changes - The company secured a record multi-system order from a top 20 global biopharma customer, with contributions expected to begin in Q4 and extend into 2026 [7][8] - The customer is deploying GrowthRx systems across multiple sites in North America, Europe, and Asia-Pacific, indicating broad-based demand [8][24] Company Strategy and Development Direction - The company is raising its full-year 2025 revenue guidance to at least $33 million, driven by the recent multi-system order and a strong sales pipeline [11][17] - The collaboration with MilliporeSigma is expected to enhance sales and drive margin improvement, with initial benefits anticipated in the second half of 2026 [10][11] - The company aims to capitalize on industry trends towards automation and increased investments in U.S. pharmaceutical manufacturing [13] Management's Comments on Operating Environment and Future Outlook - Management noted that while there is no demonstrable change in demand, the company continues to benefit from high ROI projects in the pharmaceutical sector [37] - The company expects to see meaningful gross margin improvement in 2026, driven by product cost reductions and manufacturing efficiency initiatives [19][20] Other Important Information - The company ended the quarter with approximately $42 million in cash and investments [16] - Operating expenses decreased by 5% year-over-year to $12.1 million, attributed to operational efficiency programs [16] Q&A Session Summary Question: Clarification on revenue guidance increase - Management explained that the increase in guidance is due to the large multi-system order not previously included in forecasts, with some offsetting factors in Q4 [22][23] Question: Geographical demand distribution - Management indicated that demand is consistent across North America, Europe, and Asia, with broad-based customer interest in global deployments [24] Question: Details on the multi-system order - Management did not disclose the total order size but confirmed it is a double-digit order [30] Question: Cost efficiency journey with MilliporeSigma - Management stated that benefits from the collaboration with MilliporeSigma are expected to materialize in the second half of 2026 [32] Question: Momentum against current market backdrop - Management noted steady demand and high ROI projects continue to be prioritized, with expectations for gradual improvement in 2026 [37][39] Question: Timeline for consumable ramp-up from new systems - Management expects installations and validations to occur in Q4 and the first half of next year, with consumable revenue ramping up in the second half of 2026 [46][48] Question: Progress in adjacent markets like personal care - Management confirmed that while the focus remains on pharmaceuticals, efforts to penetrate adjacent markets are ongoing through the collaboration with MilliporeSigma [50]

Financial Data and Key Metrics Changes - Revenue for Q3 was $35 million, a decline of 17.8% compared to the prior year quarter, with same-store revenue down approximately 22% [13] - Cases declined 15.2% to 2,780, with same-store cases down approximately 20% [13] - Average revenue per case was $12,587, a decline of approximately 3% from the prior year quarter [14] - Adjusted EBITDA was $3 million, down from $4.7 million in the prior year [15] - Net loss for the quarter was $9.5 million, with an adjusted net loss of $2.4 million, or $0.04 per diluted share [15] Business Line Data and Key Metrics Changes - The introduction of skin tightening services has seen a lift in demand, although many clients require additional procedures for loose skin [8][26] - The company is expanding its service offerings to include skin excisions to address the needs of patients with loose skin post-weight loss [26] Market Data and Key Metrics Changes - Global GLP-1 prescriptions have grown at roughly 38% annually between 2022 and 2024, with total sales expected to reach $100 billion by 2030 [5] - 63% of GLP-1 patients are seeking aesthetic treatments post-use, indicating a new consumer base for the company [6] Company Strategy and Development Direction - The company is focusing on three key areas: introducing new services to capture the GLP-1 opportunity, enhancing sales and marketing strategies, and maintaining financial discipline [4][12] - The strategy includes adapting marketing spend to align with revenue trends and prioritizing initiatives that drive higher conversion rates [8] Management's Comments on Operating Environment and Future Outlook - Management noted that while Q3 revenue was lower than expected, it reflects timing rather than a change in business trajectory [4] - The company updated its annual outlook, expecting 2025 revenue of approximately $153 million, down from previous guidance of $160 million to $170 million [10][19] Other Important Information - The company announced the appointment of Michael Arthur as the new Chief Financial Officer starting January 2026 [11] - The closure of the London center was confirmed as part of a strategic review, as it was the only unprofitable center [10][17] Q&A Session Summary Question: Can you elaborate on the cost-cutting measures taken and their sustainability? - Management indicated that cost controls have primarily focused on SG&A expenses, with ongoing efforts to identify additional savings [22][23] Question: What is the uptake of the standalone skin tightening service and future service additions? - Management noted that while demand for skin tightening is evident, many clients require additional procedures, leading to the introduction of skin excisions [25][26] Question: What were the timing issues affecting Q3 performance? - Management explained that despite strong leads and consultations, consumer hesitance in making purchases impacted revenue, but Q4 trends are improving [29][31]

Financial Data and Key Metrics Changes - Company revenues grew by 54% year over year, reaching $227.8 million in Q3 2025, with adjusted EBITDA growth of 70% year over year [4][20] - Adjusted non-GAAP diluted earnings per share increased to $2.04 from $1.34 in the prior year period [24] - The company raised its 2025 financial guidance, expecting net revenues of $854 million to $873 million, up from previous guidance of $818 million to $843 million [26][28] Business Line Data and Key Metrics Changes - Rare disease revenues were $118.5 million, up 109.9% from the prior year, with Cortrophin Gel revenues at $101.9 million, up 93.8% [20][21] - Revenues from the generics segment increased by 19.3% to $98.7 million, driven by a successful partner generic product launch [22][24] - Iluvien net revenues were $16.6 million, with expectations for modestly lower demand in the fourth quarter due to normalization trends [21][27] Market Data and Key Metrics Changes - The ACTH market is expected to grow approximately 40% to $957 million in 2025, with Cortrophin projected to grow by 75%-78% [8] - The addressable patient population for acute gouty arthritis is estimated at 285,000 patients, indicating significant growth potential for Cortrophin Gel [8][35] Company Strategy and Development Direction - The company aims to grow its rare disease business, with Cortrophin Gel as a top strategic priority, focusing on clinical evidence generation and enhancing patient convenience [5][11] - The company is exploring inorganic opportunities to expand its rare disease business while continuing to support its genetics and brands business [11][47] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong multi-year growth trajectory of Cortrophin Gel, driven by increased demand and a growing prescriber base [7][35] - The company anticipates continued strong momentum in Cortrophin and positive impacts from initiatives to grow Iluvien in 2026 [11][72] Other Important Information - The company ended Q3 2025 with $262.6 million in unrestricted cash, up from $217.8 million at the end of Q2 [25] - Non-GAAP gross margin was 59.2%, a slight decrease from the prior year, primarily due to product mix [24] Q&A Session Summary Question: Impact of Medicare Part D redesign on Cortrophin growth - Management noted a modest tailwind from the redesign, improving affordability and access for patients, but tempered by mandatory Medicare manufacturer payments [34] Question: Details on the new partner generic product - The company did not specify the name of the partner generic but indicated it was launched successfully, with expectations of competition entering the market [38] Question: Growth trajectory in pulmonology for Cortrophin - Management acknowledged pulmonology as an important area with significant growth potential, although it currently represents a smaller portion of the overall mix [44] Question: Durability of Cortrophin Gel against potential generic competition - Management expressed confidence in the long-term durability of Cortrophin Gel, citing the complexity of developing a generic version [62] Question: Challenges of label expansion in the ACTH category - Management indicated that any label expansion would require a phase three clinical trial, and they are focused on generating evidence to support treatment guidelines [66]

Financial Data and Key Metrics Changes - Q3 2025 was an all-time record revenue quarter for the company, with revenue reaching $11.5 million, up 22% year-over-year and 13% sequentially from Q2 [4][12] - Year-to-date revenue growth for the first nine months of 2025 was 39% compared to the same period last year [4] - Gross margins were 77.9%, slightly down from 78.2% in Q2 but up from 75.5% a year ago [5][13] - Net income for Q3 2025 was $10.3 million, compared to a net loss of $20.7 million for the same period in 2024, representing a $31 million increase [15] Business Line Data and Key Metrics Changes - The company sold 155 Ultimate Systems in Q3, an increase from 124 units sold in the same quarter last year [4] - Applicator revenue reached $6.8 million, up 26% year-over-year and 6% sequentially from Q2 [4] Market Data and Key Metrics Changes - The wound care market experienced uncertainty in Q3 due to changes in reimbursement policies, leading to a cautious approach from practitioners [8][9] - Despite the uncertainty, the company’s reimbursement for the 97610 code remains largely unchanged, potentially slightly increasing for 2026 [8] Company Strategy and Development Direction - The company is focused on driving sustainable, profitable growth and is optimistic about future opportunities as market concerns around reimbursement are alleviating [18] - The company is exploring a rental model for hospitals to navigate capital approval processes, which could enhance market penetration [55] Management's Comments on Operating Environment and Future Outlook - Management noted that the recent changes in reimbursement rules have created a more favorable environment for the company, leading to increased inbound interest from distributors and partners [10][66] - The company is engaged with a promising sales funnel and anticipates significant opportunities in the coming months [11] Other Important Information - The company received a $5 million payment for the exercise of IP licensing related to its intravascular shockwave patent portfolio [7] - The company refinanced its debt, reducing it from $27.5 million to $24 million, which has improved its financial footing [7] Q&A Session Summary Question: Is there inbound interest from resellers due to disruption in skin substitutes? - Yes, there is substantial inbound interest as resellers are looking to realign their offerings in light of significant changes in the market [21][22] Question: How does the company blend distributor channels with direct sales? - The company employs a deconflicting structure to ensure that direct sales and distributor efforts do not overlap [25] Question: What is the current rep headcount and future plans? - The rep headcount remains at 13, with plans to grow based on market conditions and internal assessments [30][34] Question: How does the company handle inventory management with distributors? - The company is cautious about inventory levels in the channel and aims to maintain healthy inventory turns [26] Question: What is the company's approach to international opportunities? - While there is interest in international distribution, the current focus remains on domestic opportunities due to the significant potential in the U.S. market [38] Question: How does the CMS fixed rate affect Ultramist's attractiveness? - The attractiveness of Ultramist has increased as physicians seek to maximize revenue while providing patient care [42] Question: What is the company's strategy regarding capital approval processes in hospitals? - The company is considering a rental model to facilitate easier access to its products in hospitals with strict capital budgets [55]

Financial Data and Key Metrics Changes - The company reported a total cash balance of $67 million, which is expected to provide runway into Q1 2027, allowing the company to achieve upcoming value-enhancing data milestones for both ALX-2004 and evorpacept [6][44]. Business Line Data and Key Metrics Changes - Significant advances were made in both evorpacept and ALX-2004 clinical programs during Q3 2025, with a focus on evorpacept's potential as a targeted oncology therapy [4][12]. - The phase two clinical trial in breast cancer is on track to dose its first patient in Q4 2025, based on strong data supporting a CD47 and HER2 biomarker-driven strategy [5][12]. Market Data and Key Metrics Changes - The addressable patient population for HER2-positive breast cancer in the second-plus-line setting is approximately 48,000, with an estimated 20,000 patients being both HER2 positive and CD47 high, representing a market opportunity of $2 billion to $4 billion [38]. Company Strategy and Development Direction - The company is pursuing a focused development strategy for evorpacept in combination with anticancer antibodies, leveraging the consistent proof of concept seen in various clinical studies [13][44]. - ALX-2004 is positioned to redefine standard care across a range of EGFR-expressing cancers, with a strong emphasis on optimizing safety and efficacy [39][44]. Management's Comments on Operating Environment and Future Outlook - Management expressed excitement about the potential of evorpacept to drive substantial benefits for patients with high CD47 expression, emphasizing the importance of this biomarker in future trials [11][44]. - The company remains focused on delivering solutions for patients with unmet needs in both HER2-positive breast cancer and EGFR-expressing cancers [44][45]. Other Important Information - The company highlighted the unique mechanism of action of evorpacept, which is designed to block the CD47 signal that cancer cells use to evade immune detection, thus enhancing the effectiveness of anticancer therapies [15][44]. - ALX-2004 has shown promising preclinical data, indicating a differentiated safety profile and potential efficacy across various cancer types [40][41]. Q&A Session Summary Question: How to correlate CD47 positivity with expression cutoffs in gastric data? - Management noted strong scientific concordance across different indications, with approximately 50% of patients expected to be CD47 high based on multiple studies [46][47]. Question: Companion diagnostic development plans? - The company is working with partners for companion diagnostics, utilizing a research-use assay for both gastric and breast cancer studies [48]. Question: Efficacy data in breast cancer trials? - Management highlighted a 56% overall response rate in patients post-Enhertu, which is significantly higher than expected benchmarks [51][52]. Question: Expectations for interim data and patient numbers? - The company anticipates good outcome data in the evorpacept trial, aiming for a response rate of 35%-40% in the breast cancer setting [56].

Financial Data and Key Metrics Changes - The company reported adjusted earnings per share (EPS) of $0.82 for Q3 2025, and $4.06 year-to-date, representing an 8% increase compared to the same period last year [7] - Year-to-date, the company achieved double-digit growth in adjusted gross margin, operating income, and adjusted net income relative to the same period in 2024 [8] - Adjusted gross margin for Q3 2025 was approximately $137 million, up 12%, while adjusted net income was approximately $20 million, up 8% from Q3 2024 [25][28] Business Line Data and Key Metrics Changes - The regulated segment's adjusted gross margin was approximately $115 million in Q3 2025, up 12% from the same quarter last year, driven by organic natural gas transmission expansions and increased rates [27] - The unregulated energy segment saw adjusted gross margin increase by 13% to approximately $22.5 million, supported by growth in the Marlin Gas Services business [28] Market Data and Key Metrics Changes - Both core service areas experienced above-average residential customer growth: 4.3% in Delmarva, 3.9% for Florida Public Utilities, and 2.1% for Florida City Gas [10] - The company is expanding natural gas distribution in southern Delaware, targeting 2,000 new homes, and has become the natural gas provider for a new community development in Port St. Lucie, Florida [10][11] Company Strategy and Development Direction - The company is focused on three pillars of growth: prudently deploying capital, proactively managing regulatory agendas, and transforming business operations to enhance safety and customer service [12] - The capital investment program is on track, with over 400 gas distribution projects placed in service in the first nine months of the year, generating significant gross margin [12][13] Management's Comments on Operating Environment and Future Outlook - Management reaffirmed full-year 2025 EPS guidance of $6.15-$6.35 per share, contingent on a successful outcome from the Florida City Gas depreciation study [9] - The company is committed to increasing shareholder value and maintaining top quartile growth and total shareholder return [12][33] Other Important Information - The company has increased its 2025 full-year capital expenditure guidance to $425-$450 million, reflecting a $25 million increase over the previous range [10][13] - The company has received several recognitions, including being named a champion of board diversity and employer champion of the year for Kent County [22][23] Q&A Session Summary Question: Clarification on the outcome of the depreciation study - Management indicated that achieving the guidance range assumes a successful outcome from the depreciation study, with the timing of the decision impacting the final results [35][36] Question: Inquiry about the number of distribution projects - Management confirmed that 400 new distribution projects were completed in the last nine months, reflecting significant growth in both residential and transmission projects [46][47] Question: Discussion on Ohio data center growth - Management elaborated on a project with American Electric Power to build a pipeline for a data center, highlighting the favorable regulatory climate and in-state gas supplies [50][51] Question: Clarification on retroactive treatment of depreciation reserve - Management confirmed that an order received by early February could allow for retroactive treatment of the depreciation reserve, impacting 2025 earnings [54][55] Question: Future capital expenditure plans - Management stated that the long-term capital expenditure target of $1.5 billion-$1.8 billion through 2028 is expected to be maintained, with updates provided in February [58][59] Question: Growth trajectory in Delmarva vs. Florida - Management expressed optimism about continued strong growth in Delmarva, noting it is currently outpacing Florida, while also acknowledging robust growth in Florida [60][62]