Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Dorel Industries' Second Quarter 2025 Results Conference Call. At this time, all participants are in listen-only mode. Following the presentation, we will conduct a question-and-answer session. To join the question queue, you may press star, then one on your telephone keypad. Should you need assistance during this conference call, you may signal an operator by pressing star, then zero. Before turning the meeting over to the management, please be advised that this conference call will contain statements that are forward-looking and subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. I would like to remind everyone that this conference call is being recorded today, August 11th, 2025. I would now like to turn the call over to Martin Schwartz, President and CEO. Please go ahead. Okay, thank you. Good morning and thank you for joining us for Dorel's second quarter earnings call for the period ended June 30th, 2025. With me today are Jeffrey Schwartz, CFO, and Jayson Kwasnik, Vice President of Finance. We'll take your questions following our comments. Please note that all figures mentioned during this call are in US dollars. Dorel Juvenile delivered a strong second quarter in 2025, building on the momentum from the start of the year and overcoming the challenges posed by U.S. tariffs. Our performance was driven by strong growth in Europe and key international markets, disciplined cost control, and favorable foreign exchange movements. Dorel Home experienced a difficult second quarter with tariff uncertainties and liquidity constraints impeding sales. On June 30th, we announced our expanded restructuring plan and are actively implementing changes to reduce costs and further streamline operations. We remain confident that the benefits of our Home segment's transformation will begin to emerge in the fourth quarter of this year, with full impact expected in 2026. As always, Jeffrey will elaborate further on our results. First, I want to update you on some very positive momentum in Juvenile. Our Juvenile revenue growth for the quarter was less than 1%, which is less than the pace we have been setting over the past several quarters. The only reason for that was reduced sales in the U.S., as our customers took a wait-and-see approach on tariffs and scaled back considerably on their order levels. Given our worldwide footprint, we were able to more than offset the impact in sales and earnings. In fact, revenue growth, excluding our U.S. market, was just over 12% in the quarter. Europe was the driver of that, given their relative size, but our smaller markets like Canada, Australia, Chile, and Peru, and our export markets were also up at least high single digits. This is a tribute to our business model of combining our powerful global brands like Maxi-Cosi with local brands like Mother's Choice in Australia and Infanti in Chile and Peru. Of course, our local management teams are key to our success, and led by our Juvenile President and CEO, Rafael Caminaro, the teams we have in place right now are as strong as they have ever been. Let me now turn to some of the exciting developments across our brands and markets in the quarter. We officially launched our Maxi-Cosi nursery and youth furniture collection of cribs and dressers, marking a strategic expansion into this category. The Juvenile team has taken the legacy of our home segment and expanded it into premium collections, which previewed at both the High Point Furniture Market and the ABC Kids Expo in Las Vegas. Retailer and consumer interest was very strong, and we expect meaningful shipments to begin the latter part of the second half. This will coincide with a near-similar launch at the Juvenile Products Trade Show in Cologne this September. One of the most exciting developments this quarter was the global rollout of the Maxi-Cosi Fame stroller. Following its successful debut in Europe earlier this year, we launched Fame in Canada, Brazil, and Chile, reinforcing our commitment to premium innovation and regional brand alignment. These strategic launches were coupled with tailored activations designed to maximize impact. These efforts in Chile led to a 35% increase in brand purchases and 82% sales growth versus last year, and a three-point increase in Maxi-Cosi's share of Dorel Chile's sales. Last quarter, I mentioned the management team in Chile turning that business around, and that continued into the second quarter. Safety 1st made headlines in Brazil by launching the first safety-certified hotel by Safety 1st, integrating child safety into the hospitality experience. This initiative opens new avenues for brand engagement and long-term loyalty. In Europe, beyond the ongoing success of Maxi-Cosi, we have a new Baby Comfort Disney car seat line, which was launched in France with vibrant in-store displays and strong consumer interest. We see an opportunity to grow in lower to mid-price point categories under Baby Comfort, and this Disney line is part of that ongoing strategy. Now on to Dorel Home. We made a significant announcement on June 30th that we were ceasing manufacturing in North America. This was not a decision made easily, given our legacy as an RTA manufacturer since our beginning. It is also contrary to what we discussed in our first quarter conference call at the beginning of May, when we discussed changes being made to improve what has been a money-losing operation for several years. However, after extensive analysis aided by third-party consultants from EY Parthenon, we recognized that the time required for a turnaround was not something we could afford. This led to the decision, and we are winding down operations in the third quarter with a stoppage planned for the end of September. Our first thoughts are with our employees who will need to seek new opportunities. Many of them have been with us for decades, and this made the decision that much harder. I want to thank everyone who has helped build Dorel over the years, and we wish them the best in the future. We are doing our best for our employees to transition out of manufacturing, but also for our suppliers and customers. We are committed to fulfilling our obligations as we transition to a pure import business in the future. The decision to exit manufacturing not only removes a part of our business that was not profitable, but allows us to fully leverage synergies with our juvenile segment. We will be integrating all of Dorel Home's North American back-office functions into the juvenile ecosystem, including combined warehousing in some locations. This will be done in the current year, and if we hit the milestones we have set for the integration, the benefits will accrue as soon as the start of 2026. These decisions are part of a broader transition to a leaner organization with a reduced product line focused on profitable categories. The home segment is actively working on exiting product categories that are now considered non-core, including a plan to significantly reduce inventories by the end of the year, thereby allowing for a much smaller distribution footprint. Our home segment teams have been informed of our plans, and of course, with synergies come job losses, and we are working with our employees to help them manage this transition. What we have seen through all of this is that we have some of the best employees, and this is why we have been successful in the past. I want to personally thank them for their support and their commitment to Dorel, even with all these changes. I'll now ask Jeffrey to review the financials. Thank you, Martin. Before we do that, I just want to add a little more color to a couple of recent events, the restructuring. Dorel Home's new round of restructuring, as Martin's been discussing in the second quarter, is founded upon the reduction of the size of the organization and its ability to merge the sales, marketing, and product development organizations into our successful Costco division. We call it the Costco Plus model. A limited number of high-performing Dorel Home import SKUs will be transferred to the Costco portfolio, focused on categories and customers driving the highest contribution with the least added complexity. An additional contributor to improved earnings is the consolidation of certain Dorel Home back-office functions with the juvenile North America operation based in Columbus, Indiana, which will provide further synergies for Dorel overall. The decision will result in substantial savings based on a much smaller footprint and workforce and eliminate the losses from the domestic operation. This will allow the reduction of the current distribution footprint, which now is much too large for the new streamlined home operation. The company will be exiting from existing warehouses based on their scheduled lease termination dates this year. For the facilities with longer termination dates, the company is exploring subleasing opportunities for which we believe we can realize sometime next year. For Q2, we took a restructuring charge of $22.4 million, of which $13.2 million was non-cash, with the balance, mostly severance, spread over time in the future. The other event signed last week was the company amended its ABL facility and term loan facility, whereby the lenders agreed to continue to forbear. They're enforcing their rights and exercising their remedies under both the ABL facility and the term loan facility. In addition, the company received access to $20 million more of additional liquidity in three tranches under the ABL facility in order to finance new inventory. The company is continuing to work with two leading capital market advisors to assist in recapitalizing the company's balance sheet to allow for growth in the juvenile segment and support the reorganization of the home segment. The new structure will replace the current debt structure, which no longer matches the company's needs. Dorel will update stakeholders on developments when we can. Now, if we move over to the numbers, from a consolidated standpoint, the second quarter, Dorel's revenue decreased by $55.7 million, or 16%. Organic revenue declined by about 16.8%. The revenue decline was all in Dorel Home as the juvenile business was essentially flat. In juvenile, the revenue improvement was in all markets across most brands except for the U.S. and the Brazilian market. Gross margin for the second quarter decreased by 210 basis points as a percentage of revenue to 16.9% from 19%. The decrease in gross profit and gross margin in the quarter was in Dorel Home, offset in part by increases in gross profit and gross margin in Dorel Juvenile. For the second quarter, Dorel reported an operating loss of $37.2 million compared to $49.3 million last year, excluding impairment loss on goodwill and restructuring. Adjusted operating loss increased by $10 million- $13.5 million. Finance expenses decreased by $1.2 million in the quarter to $8.3 million, and the decrease is mainly explained by the lower average long-term debt balances compared to last year. If we move over to juvenile, which we're pretty proud of, say for the U.S., the revenue was, you know, increased by less than 1% compared to last year, with organic revenue being essentially flat. The improvement in revenue, as I stated before, was just about everywhere except the U.S. and Brazil. Despite the uncertainty in the macroeconomic environment and changes in consumer spending, Europe experienced double-digit organic revenue growth in several of its key markets and categories, building upon the momentum from the first quarter. In addition, Latin America, Australia, Canada, our export markets all continued to grow, driven by growth in the Maxi-Cosi brand, channel optimization, and the launch of new products. The revenue improvements were offset by a revenue decline in the U.S., which was due to the tariffs. The tariffs hit in April, and the effect was practically an embargo on all Chinese goods as the tariffs shot up to 145%. Everybody, ourselves, our competitors, retailers, everybody pretty much stopped importing goods from China during that period. Since then, with the tariffs dropping to 30%, business has restarted again in May and in June. However, the uncertainty is certainly causing what I would call paralysis on decision-making by our customers, even in a sense by ourselves, as changes around the world continue almost on a weekly basis as far as where tariffs are from other parts other than China. That impact in itself had a significant negative impact on our sales numbers in the quarter. On the other side, our factory in Columbus, Indiana, has been picking up, as that is an area that allows us a little more certainty and allows our customers more certainty in both pricing and availability. We are seeing momentum gathered in that factory as volume is increasing on American production. We expect that to continue throughout the year. The only other area of decline was in Brazil, where we declined less than 1% as a key customer delayed their orders to the third quarter. That seems to be back on track again. That's a non-issue. From gross margin, profit for the quarter increased by 2.6% compared to last year. The gross margin in the second quarter was 29%, an increase of 50 basis points from last year. The increase in gross profit and gross margin was primarily driven by positive foreign exchange rates, as well as a better product mix. That was partially offset by lower volumes in the U.S. The operating profit, $6.5 million during the second quarter compared to $6.3 million. Excluding restructuring costs, the profit was up by about $1 million- $7.8 million. The increase in operating profit, again, was explained by an increase in gross profit dollars from higher gross margins, and then partially offset by some higher expenses. If we move over to home, this is obviously a very difficult quarter for the home. The second quarter revenue declined by $57 million, or 43%. As we announced, we will be taking a substantial reduction in the size and sales of our business, primarily on the e-commerce channel, which will not represent a large portion of our sales moving forward. The rest of the numbers in the quarter for home has a lot of noise in those numbers because of things like restructuring, the factory wind-down, tariffs, SKU reductions. We are determining that those numbers are somewhat kind of meaningless as we look forward because of all those factors. The one thing I do want to point out, which I think is very valid, is the Costco division of home, which is the surviving entity. They were profitable despite significant tariff headwinds in the quarter. We are feeling good that as we look forward in our home business, we are looking forward to taking a profitable division and adding SKUs and a limited number of people to it. As we look forward to that, we have a fairly large level of confidence that we will have a profitable business going forward, even in this environment of home furnishings. With that, I'll pass it back to Martin. Okay. Thank you, Jeffrey. In our outlook, despite the challenges of the U.S. tariffs, the juvenile segment is well positioned relative to competitors based on its worldwide footprint and its domestic manufacturing capabilities in the U.S. This was evidenced in the second quarter as reduced earnings in the U.S. were more than offset by improved earnings in other markets. With our facilities in the U.S., which could present further opportunity going forward, and our strong international business, we expect to continue to improve earnings and remain on track for a better 2025 than 2024. Dorel Home is entering a pivotal phase in its transformation journey, with the second half of 2025 focused on executing the structural changes initiated this year. We are confident that the actions taken, streamlining operations, integrating with Dorel Juvenile, and transitioning to a more agile distribution model will position us for a return to profitability in 2026. The company continues to work with key customers and suppliers to maintain strong relationships during this period of transition, and we are appreciative of that support. We are on track to secure additional financing, and when we do, this added liquidity will mean a much healthier Dorel on day one. This will coincide with our reduced cost structure in Dorel Home and with our ongoing growth in Dorel Juvenile. We will have the ability to better serve our customers and work even more closely with our key suppliers. With that, I'll ask the operators to open the lines for questions, and please limit your questions to two in the first round. Operator? Certainly. Thank you. We will now begin the question-and-answer session. To join the question queue, you may press star, then one on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star, then two. We will pause for a moment as callers join the queue. The first question comes from Derek Lessard with TD Cowen. Please go ahead. Good morning, everyone. This is Cheryl calling in for Derek. Thanks for taking our questions. Firstly, on juvenile, I'm curious how your customers started reordering again and what have they said about their reordering plans at this point? Yeah, I mean, they never stopped ordering. The problem is, we've had to raise some prices because of tariffs. That's caused some uncertainty. We obviously have sales in the U.S., so they are ordering. It's just they're not sure where they're going with all of this. What are their alternatives? It's just a lot of paralysis. I think this is not a juvenile issue. I think this is much more of a consumer product issue. There's just a lot of uncertainty there, and that's not leading them to make long-term decisions yet. I think that's the issue. Okay. Got it. One more before I re-queue. Is there any color you can offer on the delay in the refinancing and any timing of when we could expect an update on that? What we've done now is we're looking to do a complete refinancing of the whole credit agreements. Before, we were looking at adding a new piece to our current lending agreements, and now we're looking at a completely new lending agreement. We're focused on trying to get something done before the end of the quarter. We're halfway through the quarter, so we're working on it. Can't give you any more details on that. Okay. Got it. I'll re-queue. Thanks, Jeffrey. Thank you. Again, if you have a question, please press star, then one. Our next question comes from Stephen MacLeod with BMO Capital Markets. Please go ahead. Thank you. Good morning, guys. Just a couple of questions. With respect to the home restructuring, that's obviously quite significant, and you've indicated a return to profitability in 2026. Just a couple of questions there. Wondering if you can give any sort of expected magnitude of the benefits you expect to receive. When you talk about return to profitability in 2026, is that a, you know, do you expect to be profitable in every quarter in 2026, or is it a run rate where you achieve profitability somewhere in the later parts of the year? The benefits, let's start with that. We are reducing, you know, the way to look at it is we're trying to cut all of the parts of the business that didn't make money, leaving only the parts that were profitable, which is really the Costco Plus business and our European business. Everything else is going to be cut. We're looking at, you know, fairly significant footprint of warehousing and factories and people associated with that. It's in the tens of millions of dollars that we're going to be cutting and have been, you know, a lot of it's already been in the works. We are fortunate in that a number of the larger warehouses or buildings that we've been leasing, they are up for renewal this year, so we won't be renewing those. There's not a cost there. I can't give you the exact number. We're working it through. As far as profitability, we're hoping we start the year really close to profitable. Again, it's all about getting rid of stuff as opposed to the difference between this turnaround and the last one. The last one, there was some hope in there. The last one involved increasing sales. It involved increasing efficiencies in the factory. It involved turning around this, turning around that. This one doesn't. This one's a lot simpler in its effect. It's literally about cutting away the parts that don't work and just leaving the parts that do work and adding some pieces to that. We have a lot more confidence that this time we're going to get to the profitability area. As we're working now, there's been a lot of severance and there's been a lot of layoffs. There'll be a lot more. I think it's Q4 is when it kicks in. Therefore, we do expect to, you know, I wouldn't say it's January, but certainly Q1 is an area where we'd like to get to break even to small profitability and then go from there. Okay. That's helpful. Thank you. Maybe I'm just wondering, you know, lots of noise in Q2 in both segments. I'm just curious if you can give a little bit of color as to what Q3 to date has looked like in both juvenile and the home business on the top line. Yeah, I mean, again, we're continuing, all the area except the U.S. is continuing to grow. We're very excited about, you know, some areas that we were struggling with, like Chile, has turned, and other areas are doing really well. Everywhere, you know, the U.S. is picking up. It's going to be challenging to beat last year in the U.S., I would say. That's very questionable given the tariff circumstance. The rest of the world is doing very well. In our juvenile business, I think more than 50% of our business is outside the U.S. today. It's a very significant portion. Therefore, I think we're on track to do what our internal budgeting is supposed to do for juvenile. Optimistic there. I mean, even though the top line is down, we're trying to make up earnings in other areas. We're very optimistic on the juvenile. On the home, it's really where focus is on that Costco Plus business. We are getting into a busier time of the year. Keep in mind, the Costco business is a lot of folding chairs, tables, ladders, climbing, we call them climbing products, stuff like that. This is more of the season normally for that. We are seeing orders picking up. We've had liquidity issues, which haven't allowed us to fulfill all those orders. We're hoping now with the increased liquidity that that allows us to fulfill the orders we need for the second half of the year. Okay. Maybe just to sort of dig in on home a little bit, with the sales weakness that you saw in Q2, do you expect to be kind of improved from that on a quarter-over-quarter basis, or is that reflective of just the exiting of the e-commerce business? If you think about sales down 40%. Yeah. The two big factors, well, it's more than two. As I mentioned, you've got the exiting of most of the e-commerce. You've got a factory wind-down. We are no longer bringing in orders other than what we currently have for the factory, so you're seeing that taper off. The tariffs really hit Costco hard in April. A lot of product was made in China. That is coming back now, and we are getting that. That part of the business is improving over the second quarter. You're seeing the rest of the business kind of dropping off, which, again, is the planned part. We are just focused on keeping the Costco part. The longer-term plan, Steve, is really to stabilize the business, make some money, make it no longer a losing business. I'd say take a breath, have a coffee, and then start building again, but build in an asset-light mode. No warehouses all over the country. We have other options for that. A limited amount of people, just keeping it asset-light and grow the sales. That's kind of the way Costco has always been, or has been for 10 years—a significant amount of sales with not a lot of people and not a lot of overhead. That's the model we're going with, and we're going to try and grow the business through that model instead of the heavy model that we had coming out of COVID, in which we had locations and warehousing and factories. That's what really killed us here. Okay. Okay. That's great color. Thanks, Jeffrey. Appreciate it. Okay. Thank you. We have a follow-up question from the line of Derek Lissard with TD Cowen. Please go ahead. Hi. Thank you. Just a couple more clarifying questions. First on home sales, I'm just curious if you have any idea on the rough run-rate of sales and margin profile after you fully right-sized the business. What's the run rate? Run rate will be, I'm just trying to think now because, again, we're cutting that down to about, you know, it'll be between $250 million and $300 million, I think, is the run rate that we're looking at. Initially, it will be a profitable business. Single-digit type of returns right now, but we hope to build that back up again over time once we, like I said, caught our breath, got rid of all the pieces that don't fit, and then give ourselves the opportunity to grow again. I think that'll give you an idea about how big the company is. Got it. That's very helpful. Thank you. On your comment on return to profitability in 2026, just to clarify, are you looking at operating profit, and is that referring to just the home segment or on a consolidated basis? If we get the home segment done, we're going to be consolidated. We'll be done for sure. I mean, the juvenile business is going very well. It's going to plan, and you know, it's hit our plans for a couple of years. You know, it's even doing well this year despite the tariffs and despite the liquidity issues. It's not allowing us to do everything we want to do. We're pretty confident once we can get a new lending structure in place that that business will continue. We will also have a profitability from the home business. You put, you know, they will be profitable. The juvenile will be profitable. You know, we do have some corporate expenses in there. Overall, we're looking to certainly be profitable across the board next year. Got it. Thank you. I think in the press release, you noted that the gross margin of Juvenile benefited from favorable effects. I was just curious if you might be able to quantify how much of that improvement came from effects. It depends on how you do it. With a new rate, it allows margins to go up, and it allows different decisions to be made. I don't have a hard number for you. If you want to also zoom in on where that's occurring, it's occurring significantly in Europe, where we have a growing business that is also having a positive exchange rate. It's a meaningful number. Again, it's hard to actually calculate. It's not a hard number. It becomes a soft number because it allows different things to happen within the business. It's a material number, and it's going to continue because we're buying goods at a better rate now than we were earlier in the year. Okay. That's fair. In juvenile, you noted that the 12% organic growth in Europe and other markets is driven by channel optimization. Just curious if you could elaborate on that. We continue to grow the higher-end business. We've had a lot of success in the last couple of years with introducing new products to the higher-end business. The Maxi-Cosi Fame stroller is an example. Other strollers. The Flytech car seat is now probably the single most important car seat in Europe today. Those are allowing us to grow higher-end product and make more use of that high-end channel. Got it. Maybe just last one from me. I think you noted higher legal expense in Juvenile in the quarter. Just curious what that is related to. I believe that's the case. We have a case in which we're actually the plaintiff on this point. I believe that's the case, what it is. It's not anything I think that would affect us going forward, put it that way. Okay. Got it. Thanks so much, Jeffrey, for taking all our questions. Yeah. Our next question is a follow-up from Stephen MacLeod with BMO Capital Markets. Please go ahead. Thank you. I just wanted to follow up on the home business sort of right-sizing to that kind of $250 million- $300 million on the top line. Is that, you know, would you expect to be at that run rate by this time next year? You'll have achieved four quarters of this plan? Yeah, for sure. You know, what's interesting there is, you know, that includes the sales reduction that we're estimating we're having on the Costco business because of tariffs. We would have had a higher number if tariffs didn't happen. Tariffs have pulled down some of that imports business. We're estimating a reduced Costco business and then adding what we call the Plus to that. I would think at some point next year that we should be there. Yeah. Okay. You mentioned a single-digit returns. Were you specifically referring to margins with that comment? Net overall margin, no, not gross margins, but like operating margins. Operating margin. Okay. That's great. Thank you. You know, again, what we're not doing here is we're not expecting growth. We're not, we're not at, how do I put it? Internally, we're obviously working on growth. From an external standpoint, we don't want to forecast a turnaround, a growth in our sales, any type. What we did in the first time we did a restructuring in home, which clearly didn't work. There were a lot of that what didn't work. We did cut the expenses we said we were going to cut, but we didn't get the growth in sales. We didn't get the turnaround in the factory. This time, we're saying, "No, let's take what we have today and forecast that forward." Once that is profitable, and that's the, that's what we the exercise we went through with the restructuring when we had, you know, even EY helping us to get to where we're going. That gives us the confidence. From there, we'll try and grow it. What we're talking about isn't a turnaround in sales. It's just what we have. I just want to make sure that's clear. It's a very different concept than last time. Yeah, that's understood. Okay, that's great. Thanks, Jeffrey. Thank you. This concludes the question-and-answer session. I would like to turn the conference back over to Martin Schwartz for any closing remarks. Okay. I just want to thank everyone for joining us today. I wish you all a great week ahead. Thank you. This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.