Thank you, John. Good afternoon, everyone, and welcome to Evertz Technologies conference call for our 2026 fourth quarter and year ended April 30th, with Doug Moore, Evertz Chief Financial Officer, and myself, Brian Campbell.

Please note that our financial press release and MD&A will be available on SEDAR and on the company's investor website. Doug and I will comment on the financial results and then open the call to your questions.

Turning now to Evertz results, I'll begin by providing a few highlights, and then Doug will provide additional details. First off, we had record annual sales in excess of a half a billion dollars, coming in at $515.8 million for the year.

This includes revenue in the international region of $148 million, up 16% from the prior year. Recurring software, services, and other software revenue increased % year-over-year, totaling $240.7 million in the year.

Margin rates remained consistently strong, coming in at 59.3% versus 59.5% prior year and 58.8% two years ago. Total margin dollars were $306 million.

Net earnings were $64.4 million, resulting in a fully diluted earnings per share of 83 cents. Our sales base is well diversified, with the top 10 customers accounting for approximately 44% of sales, with no single customer accounting for more than 10% on a full-year basis.

In fact, we had 87 customer orders of over $200,000. Turning to the fourth quarter, sales were up 3% year-over-year to $131.6 million.

Recurring software, services, and other software was $55.8 million, an increase of 17% from the prior year. Gross margin in the quarter was $78.1 million versus $78.9 million in the fourth quarter previous year.

Net earnings in the quarter were $15.2 million as compared to $13 million in the corresponding period last year. Fully diluted earnings per share were 20 cents, up from 17 cents in the previous fourth quarter.

Operational highlights for the quarter include Evertz stellar presence at the National Association of Broadcasters NAB Show in Las Vegas, where Evertz won prestigious Future Best of Show awards distributed across the primary industry publications presented by TV Tech: the Bravo best of blade recognized for expanding multi-program live production capabilities for single-band; our ENX, an innovative media core specifically for hybrid IP and SDI facilities; the Excalibur, a high-density encoding platform engineered for scalable media transport; the MMA and Nucleus product won in the AV technology area for IPMX certified IP gateway solution built to bridge Pro AV and broadcast environments with seamless IPMX and ST 2110 integration. At the end of May, Evertz purchase order backlog was more than $237 million, and shipments during the month of May were $33 million.

We attribute the strong financial performance and robust combined shipments of purchase order backlog to channel and video services proliferation, increased global demand for high quality video anywhere and anytime, the ongoing technical transition to AV, IT, and cloud-based architectures in the industry, and specifically to the growing adoption of Evertz IP-based software-defined video networking solutions, Evertz IT and cloud solutions, our immersive 4K, 8K ultra-high-definition solutions, our state-of-the-art DreamCatcher IP replay and live production with Bravo Studio, featuring the iconic Studer Audio. Today, Evertz Board of Directors declared a regular quarterly dividend of 20.5 cents per share payable on or about July 13th.

I'll now hand over to Doug Moore, Evertz Chief Financial Officer, to cover our results in greater detail.

Thanks, Brian, and good afternoon. Looking at revenues, despite a relatively slow start to the quarter, sales were $131.6 million in the fourth quarter of fiscal 2026, a 3% increase compared to the $127.8 million in the fourth quarter of fiscal 2025.

While for the year ending April 30th, 2026, sales were $515 million, up $14.2 million, or 2.8%, from the prior year. Quarterly hardware revenue was $65.7 million.

That's a decrease from $71.7 million the prior year. While software and services revenue increased to $65.8 million from $56.1 million in the prior year.

For the year, oh sorry, actually revenue from software and services represented approximately 50% of the total revenue in the quarter. For the year, hardware revenue declined 1% to $275.1 million, while revenues from software and services increased 8% to $240.7 million, from $222.6 million in the prior year.

Annually, software and services revenue represented 47% of total revenue versus 44% in the prior year. Looking at regional revenues, quarterly revenues in the US/Canadian region were $94.2 million.

That's a decline compared to $106.5 million in the prior year. However, this is more than offset by a $16 million increase in quarterly revenues in the international region, which were $37.4 million compared to $21.3 million in the prior-year fourth quarter.

The international segment represented 28% of total sales in the quarter, as compared to 17% in the same period last year. For the year ended April 30th, 2026, revenues in the Canadian/US region were down 2% to $367.8 million, while international revenues increased $20.8 million, or 16%, to $148 million.

The increase in the year is was driven by increased project deliveries in Western Europe, in particular. For the year ending April 30th, international sales represented 29% of total sales compared to 25% in the same period last year.

Gross margin for the quarter was 59.3% compared to 61.7% in the prior year. It's worth noting the prior-year comparative quarter was higher than typical, and the current quarter is more in line with our target range of 56% to 60%.

For the year, the gross margin was 59.3%, which was also within the company's 56% to 60% target range. Turning to selling and administrative expenses, S&A was $20.7 million in the fourth quarter.

That's relatively consistent with the same period last year. S&A expenses as a percentage of revenue were approximately 15.7%, as compared to 16.2% for the same period last year.

Sequentially, selling and admin expenses were up approximately $2 million from Q3. That increase was driven by increased trade show and travel costs, which in turn was driven by our participation at the NAB trade show in the fourth quarter.

For the year ending April 30th, selling and admin expenses were $77 million, or 14.9% of sales. That's compared to $75.9 million, or 15.1% of sales, in the prior year.

Research and development expenses were $37.7 million for the fourth quarter. That represents an increase of $1.2 million the prior year.

As a percentage of revenue, R&D expenses were 28.7% compared to 28.6% in the prior year. For the year ending April 30th, R&D expenses were $148.1 million, or 28.7% of sales.

That's compared to $146.8 million for the same period last year, an increase of approximately 1% year-over-year. Foreign exchange for the fourth quarter resulted in a gain of $400,000 as compared to a loss for the fourth quarter last year of $4.5 million.

The fourth quarter of the current year, sorry, during the fourth quarter of the current year, US dollar versus Canadian dollar declined modestly from 1.38 to 1.37 to 1, as opposed to the fourth fourth quarter last year where the US dollar declined more significantly from 1.44 to 1.40 to 1. For the year ending April 30th, foreign exchange resulted in a loss of $0.4 million compared to a gain of $0.2 million last year.

Turning to the discussion of liquidity of the company, cash as of April 30th was $19.1 million $19.1 million, a decline compared to cash of $111.7 million as of April 30th, 2025. The decline was primarily driven by the $136 million in dividends we distributed during the year, including the $75.5 million in special dividends that we paid during the third quarter.

Working capital was $131.7 million as of April 30th, 2026, compared to $206.9 million at the end of April 30th, 2025. Looking now at cash flows for the quarter, for the three months ended April 30th, cash from operations were $18.4 million.

That's compared to $33.3 million generated during the three months last year. If you exclude the changes in non-cash working capital and current taxes, cash from operations were $19.1 million for the fourth quarter this year compared to $17.7 million for the same period last year.

In the quarter, the company used $3.9 million from for investing activities. That's particularly for the acquisition of property, plant, and equipment.

For the quarter, the company used $17.1 million for financing activities, $15.4 million of which was for the payment of dividends during the quarter. For the year, the company generated cash from operations of $76.2 million, which is net of a $10.2 million change in non-cash working capital and current taxes.

If the effects of that change were excluded from the calculation, the company generated $86.4 million in cash from operations during the year. The company used cash of $17.8 million for investing activities, which is principally driven by the acquisition of property, plant, and equipment of $18.7 million, including the land and building we purchased outside Pennsylvania.

The company used cash and financing activities of $147.1 million, which, as previously noted, was principally driven by dividends paid. Finally, looking at our share capital position as of April 30th, 2026, shares outstanding were approximately 75.6 million, and options and share-based RSUs outstanding were approximately 4.2 million.

Weighted average shares outstanding were 75.5 million, and weighted average fully diluted shares were 76.8 million. This concludes the review of our financial results and position for the fourth quarter and year-end.

Finally, I would like to remind you that some of the statements presented today are forward-looking, subject to a number of risks and uncertainties, and refer you to the risk factors described in the annual information form in the official reports filed with the Canadian Securities Commission. Brian, back to yourself.

Thank you, Doug. John, we're now ready to open the call to questions.

Hi, good afternoon. It was a nice acceleration in the growth rate for your software revenues this quarter.

Is there anything in particular that you would call out in that regard, or just sort of the ongoing trends and drivers that we've talked about in prior quarters?

I could call out there was a couple larger project milestones that we met in the quarter that would have caused to go $7 million, $8 million additional software and services revenue that was released from deferred revenue. There's ongoing releases and deferrals throughout the year, but that's a bit more substantial than typical.

If I had to call it something, there's two projects that made up between $7 million and $8 million worth of software and service revenue releases.

Okay. Would that be one-time revenue, or is that recurring revenue that's now been coming online?

It would be more of a project-based, one-time milestone.

That's helpful. With respect to the hardware side of the business, obviously a lot of price inflation happening with components.

We've seen consistent margins this quarter, but going forward, how should we think about that dynamic? Would you expect to be able to pass through those costs and maintain margins, or what are you seeing on the component side?

We are seeing some challenges, of course, in bringing in parts, and increased costs, especially with memory, in particular, and a few other aspects. The target range remains the same at the 56% to 60%.

We manage pricing when we need to, but I can't directly say everything would be passed along, but our target range remains the same, and doing our best to mitigate those cost increases.

Sure. Lastly for me, Brian, any update of note with respect to your government and defense opportunities on the US side of the border?

Yes, we are very encouraged by the US, international, and domestic opportunities that we see for Evertz. Much of it dual-purpose technologies, where we have decades of domain knowledge and expertise demonstrated in the live news, sports at the highest level.

Then those technologies are Common Criteria certified, NIAP listed for installation in secure facilities. We have routing platforms that can handle the Top Secret, Secret, and other levels as well, too.

We're very well positioned to be able to grow with that area. It's something that we do have significant experience in some high-profile locations that we can't necessarily speak to.

What we have done is increase our emphasis and awareness domestically and also internationally. We've opened up Evertz office in Colorado Springs and we have one in Ottawa as well, too.

You may have seen that we participated with a Canadian delegation that included the Canadian Secretary of State for Defense Procurement and CEO of DIA to the SAHA Defense & Aerospace Exhibition in Istanbul. That was quite a large event and contingent, and we were front and center there.

Those initiatives were continuing to work very strongly, and I'll pass over to Doug to add a little bit more financial color.

From a quantitative perspective, we don't separately disclose sales to government and military in our financial statements. However, I could comment that over the past year, sales to government, military, aerospace customers combined to be over $50 million in the year, and also over 10% of revenue.

Just to give you some kind of context of the scope.

That's very helpful color for both of you. I'll pass the line.

Thank you.

Hi. Great to hear the context around the defense sector.

I was wondering if we could go a little bit deeper there just to talk about how you're going to market. Are you doing that with a partner, or are you building out any partner relationships specific to defense, or are you pursuing any specific opportunities in defense currently with partners?

You'd talk about the go-to-market.

The answer is yes to all of the above. We have in the past done so.

Many of the large installations that we have in the US or NATO areas have been through US or international large prime contractors. Evertz providing very meaningful subsystems and solutions in secure environments.

There's more public context around that, you may have seen recently that Evertz joined Astra as a foundational partner advancing sovereign Canadian defense interoperability. This is led by Calian, and Evertz brings real-time operational infrastructure, secure networking, data transport, and video transport expertise to this next-generation defense modernization opportunities that we're seeing domestically in Canada.

Similarly, Evertz has joined Babcock's Team Fisher to provide next-generation strategic communications for the Canadian Armed Forces. Babcock is a UK-based prime contractor that we have experience with as well, too.

Those are a couple of the recent public domain relationships that we're very much leaning into and are significantly contributing to these opportunities.

Great to hear about all those efforts. That $50 million revenue number you shared, how would that compare with the last five years, for example?

Are you seeing a meaningful increase in opportunities or any increase in deal size? Or anything to put context around how much of that defense spend or defense opportunity is new, and how much has already been a part of Evertz business?

That would be roughly a 12% increase over the prior year. It's been lumpy because of big projects in the past, and we would foresee it to be like that in the future.

We are looking at large programs. Those don't happen instantaneously, as you can often go through RFI stage, RFP, and then contracting.

Definitely takes time, but we're really encouraged by the opportunities we see in front of us.

Maybe a last question from me would be around the CUSMA renegotiations. You still manufacture the bulk of your products in Canada, and I'm curious about what you might have done to prepare for any change in that.

I know the North American revenue base has declined the last two quarters, and I'm curious if that's a function of upcoming CUSMA, or if there's some other factor. Then I'll pass the line.

I can comment that we continue to ramp up capacity outside Pittsburgh there. During the year we spent between $7 million and $8 million, and I think four $3 million or $4 million was associated with the land and building, but also additional equipment, leasehold improvements to ramp up our ability to manufacture in just outside Pittsburgh there in Indiana.

Currently the vast majority of what we're selling is USMCA compliant and not being subjected to tariffs. It's something we'll have to monitor and address, but as of this time, it's not a huge at least a clear impact.

I guess the question I'm trying to ask is if the negotiations were to yield an end to that agreement, how should investors be thinking about how well Evertz is prepared?

We will have to additional capacity to our United States facility, but we will have six months to fully address those plans properly.

Thanks.

Good afternoon. Thanks for the detail on the defense business.

Just another one, if I may, on defense is, the defense revenue, is it skewed more towards hardware or recurring software, or is it match the mix of the entire company?

It would be more skewed towards hardware. Software is a large component of the modernization issues and it is part of those sales to that sector.

We do not have the analysis to tell you currently what the product mix is. We're not disclosing that at this time.

That's helpful. The second question is just on the international revenue growth.

You mentioned there's a degree of lumpiness due to project timing. Was it related to those two projects milestones that you hit?

Were those in Europe?

No, actually they were in North America. They're not correlated in this case.

This is just project deliveries that happened to be in Q4 in international region. They're not related in this case.

Okay. When you look forward to international, do you see that momentum and growth in international sustained, and is that segment going through a period of stronger growth here?

Oh yeah, we had improvements in Western Europe for sure, there's still a fair amount of political unrest in certain jurisdictions. Year-over-year, there was definitely improvement in UK and in Western Europe.

Then

just lastly, during the quarter, obviously there's the conflict in the Middle East, there's also the World Cup in North America. With all those large events going on, did the conflict have any impact on procurement discussions?

What you've seen through the quarter? Then conversely, was there a benefit from the World Cup in the quarter?

Benefits for the World Cup would happen in prior quarters as infrastructures updated their facilities well in advance of the actual events. Similar to the way the Olympics and other events happen.

Not directly to Q4.

There's no late catch-up of those deployments.

No, there's not there.

Okay. Thanks for taking the questions.

Thank you, John. I'd like to thank the participants for their questions, and to add that we are pleased with the company's performance during fiscal 2026, which saw record sales of $515.8 million, including $240.7 million in software and services revenue, solid gross margins of 59.3% for the year, which, together with Evertz disciplined expense management, yielded earnings per share of 85 cents.

We are entering into fiscal 2027 with significant momentum fueled by over $33 million of shipments in May, with a combined purchase order backlog plus shipments totaling in excess of $270 million, by the continued adoption of and successful large-scale deployments of Evertz IP-based software-defined video networking and cloud solutions by the largest broadcast, new media, service providers, and enterprises in the industry, by the continuing success of DreamCatcher, Bravo, and our state-of-the-art IP replay suite, and we're very encouraged by the opportunities in the government, defense, and aerospace sector. With Evertz significant investments in software-defined IP, IT, and cloud technologies, the over 600 industry-leading SDN deployments, and our capabilities of the staff, Evertz is poised to build upon our leadership position in the sector.

Thank you, and good night.