William Crossland : Good morning, everyone. I'm William Crossland, CEO of Thermal Energy International. Thank you for joining us this morning for our fiscal 2026 fourth quarter and year-end earnings call. Our news release, financial statements, and MD&A are available on our website and have been filed on SEDAR. After my prepared remarks, we'll have a question and answer session, at which time qualified equity research analysts and institutional investors joining us on MS Teams will be able to ask questions. If you're joining us online, you should be able to see our slide presentation on your screen now. Next slide, please. Before we go any further, of course, I have to point out that today's call may contain forward-looking statements within the meaning of applicable securities laws. Forward-looking statements are, of course, subject to risks and uncertainties, and undue reliance should not be placed on such statements. Certain material facts or assumptions are applied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such statements. For additional information, please refer to our financial statements and MD&A for the quarter and other filings with Canadian securities regulators. Next slide, please. Over the course of fiscal 2024 and 2025, we invested in scaling our business, particularly across our sales, marketing, and engineering functions. We were transparent that these investments would create short-term pressure on our profitability, but we also said that we expected those investments to begin benefiting our top line and our profitability in fiscal 2026. Today, I'm pleased to share that our solid fourth quarter capped out a record year for Thermal Energy International. Our revenue in the fourth quarter was up about 4%, while our profitability was more or less on par with a year ago. But when comparing it to on an apples-to-apples basis, which I'll explain later. For the fiscal year, we reached new all-time highs for order intake, revenue, and profitability, and we ended the year with a very strong balance sheet. As we move through our fiscal 2027 year, we look forward to continuing executing the strategy we announced at this time last year. Next slide, please. Looking at our top-line performance, in the fourth quarter, we had revenue of CAD 7.1 million, representing about a 4% increase over the fourth quarter last year. The increase was primarily driven by higher GEM sales in the quarter. For the full year, we had revenue of almost CAD 34 million, which was a new record for us and represented a 13% increase compared to last year. Our revenue in fiscal 2026 was fueled by double-digit increases from both turnkey heat recovery and GEM sales. As you can see on the graph on the right, over the longer term, we have grown our annual revenues by almost 60% over the last three years. Next slide, please. Gross profit. I wanted to spend a moment discussing our gross profit for the quarter compared to the fourth quarter the year before, 2025. While our fourth quarter revenue was up slightly, our gross profit in Q4 was down 6% compared to last year. This is because the fourth quarter of last year benefited from a couple of one-time adjustments on large corporate sales. Without the adjustments, gross profit in Q4 2025 would have been very similar to what we achieved in Q4 this year. Additionally, I wanted to highlight that our gross margin for the fourth quarter of fiscal 2026 was higher than any other quarter of fiscal 2026 and up significantly from the second and third quarters. For the full year, gross margin was up year-over-year, and we had record gross profit of CAD 14.2 million, which represents an increase of 48% over the last three years. Next slide, please. We had adjusted EBITDA of CAD 247,000 for the quarter, which was down 38% from the prior year. Most of the decrease was due to the year-over-year difference in gross profit. Our operating expenses were up only CAD 17,000, and therefore decreased as a percentage of revenue. For the fiscal year, adjusted EBITDA increased by about CAD 800,000 to CAD 1.9 million. Next slide, please. I thought it would be interesting to take a look at our adjusted EBITDA when also excluding the one-time employer obligation adjustment that we had to make in the quarter. As you can see on slide seven, if it were not for the one-time adjustment of about CAD 149,000 in the quarter, our adjusted EBITDA would have been essentially flat to Q4 over the last year. Adjusted EBITDA would have been even higher, and it would have been our highest yet at CAD 2.1 million. Next slide, please. Our net income for the fourth quarter was essentially flat compared to the prior year. The real story here is that our net income for the year was a new record at CAD 1.34 million. As you can see on the graph, on the right side, slide eight, our annual net income has increased 86% since fiscal 2023. Next slide, please. In addition to our record net income, we continue to generate very robust operating cash flow. On slide nine, we show how operating cash flow, excluding changes in working capital items, which tends to vary pretty significantly quarter-over-quarter, has increased much more and is much higher than our net income. Looking back over the last four years, we had combined net income of CAD 3.2 million, but over that time we generated a total of CAD 7.3 million in operating cash flow. Next slide, please. Over the last few years, we've used that strong operating cash flow to materially strengthen our balance sheet by paying off more than CAD 3 million in bank loans, including repaying over CAD 300,000 in the last fiscal year to bring our bank debt down to under CAD 2,000 at year-end. We also returned about CAD 500,000 to shareholders through the repurchasing of about 3.6 million shares. Next slide, please. Another highlight for the year was our order intake, which rose to approximately CAD 30 million, our highest ever in a fiscal year. We ended the year with an order backlog of CAD 11.8 million, and since then have received an additional CAD 7 million in orders, bringing the current order backlog up to about CAD 19 million as of yesterday. Next slide, please. The vast majority of orders we received in fiscal 2026, as in every year, were from repeat business with our large multinational customers. In fiscal 2026, we received CAD 5.1 million in orders from a global pharmaceutical leader following an initial CAD 500,000 engineering project in 2025. Next slide. Our business model largely centers on developing long-term relationships with large multinationals who often adopt Thermal Energy solutions across multiple facilities as they pursue ongoing energy efficiency and decarbonization objectives globally. A great example of this is our relationship with a global nutrition company. In fiscal 2026, they ordered their seventh, eighth, and ninth turnkey heat recovery projects from us, generating about CAD 2.5 million in order intake and highlighting the scalability of our customer relationships. So far in fiscal 2027, we have received three more orders from this customer, totaling CAD 2.1 million. Those orders, which were announced in August, were for another two turnkey heat recovery projects, plus an order for a major equipment package, which is one of our new offerings stemming from the strategic review we did last year and announced last year. The thinking behind the major equipment packages is that we deliver the engineering and equipment while the customer manages the installation. This results in a faster sales cycle and greater flexibility for the customer. This is also a useful approach when it is in a distant market where we have less of a presence. As you can see, sometimes the same customer at one site will order a turnkey, at another site, will do a major equipment package, and that is all part of our strategy going forward to scale the business. Including these latest orders, our business with this customer since 2019 has grown to more than CAD 16.8 million with solutions deployed at 28 manufacturing sites across nine countries. We are continuing to work with them to uncover additional opportunities to support facilities throughout their global manufacturing network. Next slide, please. The streamlined HeatSponge turnkey offering we launched last year has been an early success. In fiscal 2026, we had announced roughly CAD 5 million in simplified HeatSponge turnkey orders, including two projects with the multinational building materials company and three with the global nutrition company I just discussed. Next slide, please. What is next? Looking ahead, we are continuing to execute the initiatives that make our solutions easier to deploy and more scalable, such as developing and promoting standardized equipment packages. At the same time, we are developing indirect sales channels. We recently hired two indirect sales channel managers, one for North America, one for Europe, who will be responsible for driving the strategy in their respective markets. Finally, we see Europe as a significant and largely untapped growth opportunity for HeatSponge. We will initially support the market from our U.S. facility before transitioning to European contract manufacturing as demand builds, lowering costs and shortening lead times. Next slide, please. To sum up, just a quick summary before we open the call for questions. We had solid fourth quarter to cap a banner year. We achieved fiscal year all-time highs for order intake, revenue, and profitability, with revenue up 59% over three years and profit up 86% over three years. We further strengthen our balance sheet, and we are continuing to execute our strategy announced last year, which is positioning us well for sustained long-term growth. That is it for my prepared remarks. I would now like to open the call for questions, and I will turn it over to Trevor Heisler at MBC Capital Markets Advisors, who will moderate our Q and A. Please go ahead, Trevor.

Trevor Heisler : Thank you, Bill. If you are a qualified equity analyst or institutional investor joining us on MS Teams this morning and would like to ask a question, please notify me by using the Raise Your Hand feature. The first question comes from the desk of Russ Stanley at Beacon Securities. Please go ahead, Russ.

Russ Stanley : Good morning, and thank you for the questions. Appreciate the time. Maybe first on the backlog. As you noted, Bill, CAD 19 million as of yesterday. I am wondering if you can talk about what the pipeline for new orders looks like and perhaps compare that to where you were about a year ago.

William Crossland : Yeah. The pipeline continues to grow, but I am always very hesitant, Russ, as you know, to disclose pipeline because pipeline are not orders, and sometimes the pipeline turns into orders and sometimes it does not. But we are continuing to execute our strategy. So we think the future looks pretty bright. We are feeling pretty positive about what we have achieved so far and where we are going to take it. So our strategic plan that we have discussed over the last year or so, we have got some good early positive results, so we think that is a positive sign for continuing our growth.

Russ Stanley : Maybe if I could, around the geographic revenue mix. It looks like the U.S. sales to U.S.-based customers grew meaningfully year-over-year in both absolute dollars and as a share of revenue, while I think several of the European markets saw a bit of a year-over-year decline. I am wondering if you can elaborate, I guess, on what is behind those year-over-year trends, and is that just a reflection of where last year's opportunities were, or is that more indicative of where you are seeing the strongest demand right now?

William Crossland : That varies year over year, depending on the year. Sometimes North America is growing more and has more sales. Sometimes it's Europe. Over the longer term, it seems to be about 50%, but the particular growth in North America more recently has to do with pharmaceuticals. We've mentioned a number of pharmaceutical orders, and we developed our pharmaceutical relationships. They started in North America. We're now trying expanding them to Europe and globally. North America has grown pretty significantly, partially because of its pharmaceutical, and also because a lot of the simplified HeatSponge happen to be in Europe. The simplified turnkey HeatSponge projects are in North America as well. That's partly because those are quick and easy projects with strong paybacks, and natural gas prices are lower in North America, so there's a better payback for that. Whereas in Europe, they might be more interested in the bigger projects. We don't expect that to be a continuing trend. We think both markets are going to continue to be strong for us, and it just happens to be a couple of years ago it was Europe, and more recently it's been North America, but they both ebb and flow, and that's why we've got a good diversified revenue base. On a consolidated basis, we continue growing.

Russ Stanley : That's helpful color. Thank you for that. I think you led off the call by talking to the decision to ramp up or expand the sales and engineering capabilities a few years ago and starting to see the benefits of that with the fiscal 2026 results. I'm wondering on sales in particular, you'd always mentioned that it would take time for people to ramp up, new additions to hit their stride, so to speak. Are you happy now with the pace of that ramp up, and are you perhaps contemplating any more expansion of the internal team? I mean that as distinct from the IMR initiative.

William Crossland : No, we're not anticipating any expansion of the current team. It's ramping up as we expected. Like always, there's some things outperform and some underperform, but generally, we're delivering the results we expected. The growth is what we expected. We're not planning to add more people at this point, significantly. The strategic growth happened a couple of years ago, and now we hope to sort of leverage those investments, continue leveraging those investments.

Russ Stanley : On the major equipment packages, you talked about this earlier, where the customer handles the installation. I am wondering, relative to a typical contract, I understand you forego some revenue, but can you remind us how the blended gross margins end up comparing relative to a typical contract? Any thoughts on the extent to which we should expect to see more of the major equipment package contracts going forward? Is that something that you are seeing a particular strength in demand from customers on?

William Crossland : Well, again, as I mentioned, it depends on the customer. It even depends on the site. Some sites are happy to do it on their own, and it depends on where the project is. If it is in a far-flung market where we do not particularly want to do the installation, we will try and emphasize the major equipment package. We do see it as a growth and that it is going to continue to grow. It was part of our strategic plan to be able to leverage the business by not doing the full installation if the customer did not want it or need it. The margin is generally a bit better, and that makes sense because the proprietary part of the project is the equipment and the engineering. The installation, we sub that out, so the customer can always sub it out and manage that if they wanted to. The actual installation tends to have a lower margin. The equipment and the engineering has a higher margin. While those projects will be smaller in terms of total revenue number, the margin should be higher.

Russ Stanley : That is great. That is all from me for now. Thank you very much. I will pop back in the queue.

William Crossland : Thank you, Russ.

Trevor Heisler : Great. Thanks, Russ. Your next question comes from the line of Jesus Sánchez at Castañar Investment Fund. Please go ahead, Jesus.

Jesus Sánchez : Thank you very much, Trevor. Thank you, and congrats all the team for these amazing results. Just a couple of questions on my side. The book-to-bill ratio has been going down consecutively during the last years. At what book-to-bill ratio does our fiscal revenue hold flat, and what is the intake run rate in the first quarter, which closed on August 31st?

William Crossland : Sorry, Jesus. Thank you for joining us, and thank you for your continued interest and support. What did you say was going down? I sort of missed right at the start where you said something's going down.

Jesus Sánchez : The book-to-bill ratio.

William Crossland : Which ratio?

Jesus Sánchez : Book-to-bill.

William Crossland : Oh, book-to-bill. Help me out. How do you calculate that ratio?

Jesus Sánchez : With former PR from the last annual reports in the last years.

William Crossland : I am really sorry, Jesus. The former what?

Jesus Sánchez : All PRs from other annual reports of 2023, 2024, 2025.

William Crossland : I am sorry, I still do not book-to-bill. You mean how quickly we get an order and it turns it into revenue? Is that what you are talking about?

Jesus Sánchez : No. How many orders-

William Crossland : I really apologize.

Jesus Sánchez : How much does the intake compares to how much revenue we get from revenues?

William Crossland : To order intake compared to revenue?

Jesus Sánchez : Yeah.

William Crossland : I don't see anything changing other than the major equipment packages and the simplified HeatSponge turnkey projects will be quicker order intake to revenue. The big turnkey projects take a longer time to revenue. We get an order, and we revenue it usually over 12-18 months or 9-18 months, whereas the major equipment package will turn into revenue much faster, as will the simplified turnkey projects, because they're much simpler. We'd expect to be able to turn orders into revenue quicker, and that's partly been shown this past year.

Jesus Sánchez : Do you have the intake for the first quarter that ended in August?

William Crossland : We haven't disclosed that yet.

Jesus Sánchez : Okay. My second question.

William Crossland : We did disclose, I think earlier in my presentation, I said the orders received from now, since the year-end, is CAD 7 million, I believe. Somebody correct me if I'm wrong. But some of that might have been after the first quarter, so I'm not sure what the breakdown is between first quarter and September because the first quarter ended in August.

Jesus Sánchez : Also the breakdown between Ottawa and Bristol. We have seen Ottawa growing revenue 60%, but gross margin falling, while Bristol revenue is falling and the gross margin raising. So where does Ottawa project margin settle at the scale, and what has to happen in Bristol to recover our volume? We just signed a 10-year U.K. property lease, so.

William Crossland : Yeah. So it all has to do with the normal ebb and flow we have with large. It all has to do with heat recovery projects for the most part. So Bristol had a bunch of heat recovery projects, and the last year or so, they've had fewer. That's why the revenue is down, and that's why the margin is going up, because a larger portion of the European revenue has been GEM. Just the opposite has happened in North America. There's been a number of large heat recovery projects, pharma as an example, as well as the simplified HeatSponge turnkey projects that have been large in North America. Therefore, the revenue is growing, but the margin's going down because it's a higher proportion of the North American revenue is large projects and less equipment. So again, it's the normal ebb and flow. The actual product margins haven't changed. It's just the timing of some heat recovery projects in both markets.

Jesus Sánchez : Thank you very much for the call.

Trevor Heisler : Okay, Bill, we also have two questions submitted to us by email from retail investors. The first one: Can you break down your revenue into turnkey system sales and shorter duration GEM sales?

William Crossland : What we disclose, which is in the notes to the financial, we break it down by equipment sales and turnkey project sales as well as services. Again, it changes year-over-year. It ebbs and flows, but roughly equipment's, when you go back historically over the last number of years, sometimes it's more, sometimes it's less, but equipment's somewhere around 50%, and turnkey projects are somewhere around 50%. Turnkey is slightly higher. Maybe it's 45/55, but generally that's about the ratio, and like I said, it's in the notes to the financials.

Trevor Heisler : Thank you. The last question we have is: What is the plant utilization of the plant in Bristol?

William Crossland : In terms of percentage, I am not sure, but we have lots of room left. Most of what we do in Bristol, in the Bristol plant, is the GEM traps. We just moved a couple of years ago, and the current facility, off the top of my head, is probably 4x or 5x the size of the previous facility. There is lots of opportunity for growth there. That is why we just signed a long-term lease, so it is going to serve our purposes for a long time.

Trevor Heisler : Excellent. It looks like there are no further questions at this time. Please go ahead, Bill.

William Crossland : Okay. Thank you so much for joining, everybody, and your continued interest and support of Thermal Energy International. Look forward to speaking to you again next quarter. Have a great day.