Good morning and welcome to Dentalcorp's Second Quarter 2025 Results Conference Call. Please note that all lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question- and- answer session. If you would like to ask a question during this time, simply press the star key, then the number one on your telephone keypad. If you would like to withdraw your question, please press Star, one again. At this time, I'd like to turn the call over to Mr. Nate Tchaplia, President and Chief Financial Officer of Dentalcorp. Please go ahead, sir. Good morning and welcome to Dentalcorp's Second Quarter 2025 Results Conference Call. Please note that all lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question- and- answer session. If you would like to ask a question during this time, simply press the Star key, followed by the number one on your telephone keypad. If you would like to withdraw your question, please press Star, one again. At this time, I'd like to turn the call over to Mr. Nate Tchaplia, President and Chief Financial Officer of Dentalcorp. Please go ahead, sir. Thank you, operator, and good morning, everyone. Welcome to Dentalcorp's Second Quarter 2025 Results Conference Call. I'm joined today by our Chief Executive Officer, Graham Rosenberg. Before we begin, please note that all amounts discussed on this call are denominated in Canadian dollars unless otherwise indicated. Also, I'd like to remind everyone that certain statements made on this call may include forward-looking statements, information, and future-oriented financial information regarding Dentalcorp and its business. These include disclosure regarding possible events, conditions, or results that are based on information currently available to management and reflect management's expectations regarding future growth, results of operations, business performance, prospects, and opportunities. Such statements are made as of the date hereof, and Dentalcorp assumes no obligation to update or revise them to reflect the required by applicable securities law. These forward-looking statements involve significant risks and uncertainties and are not guarantees of future performance or results. A number of these risks and uncertainties could cause results to differ materially from results discussed today. Given these risks and uncertainties, one should not place undue reliance on these statements and information. Please refer to the forward-looking statements and information and future-oriented financial information section of our public filings without limitations or MD&A in our earnings press release issued today for additional information. For those of you who have dialed into the call, the company has prepared a survey that is available on the investor relations section of our website in the events and presentations section. With that, I'll turn the call over to our Chief Executive Officer, Graham Rosenberg, for opening remarks. Graham? Thanks, Nate, and good morning, everyone. We're pleased to be with you today to review Dentalcorp's recent developments, as well as our financial and operating results for the three months ended June 30th, 2025. For today's call, I'm going to share a number of those developments with you, and I will then hand the call over to Nate, who will discuss our financial results in detail, after which I will provide forward-looking remarks about how our business is trending. As highlighted on slide three, you'll see that Dentalcorp operates in a $22 billion fragmented market that's only 7% consolidated. Dentistry is a highly recurring essential cash pay healthcare service, and it is resilient to economic cycles and insulated from disintermediation by technologies. Our business is particularly recurring, with over 90% of our revenue coming from routine dental services such as cleanings, fillings, and basic restorative work, creating predictable and recurring revenue streams that aren't dependent on discretionary spending or specialized procedures. Dentalcorp expects to continue outpacing the broad Canadian dental services market by delivering 4%+ same practice revenue growth. We also have multi-year Canadian dollar supply contracts with our key suppliers, resulting in minimal direct tariff or foreign exchange exposure. When combined with our proven and repeatable M&A engine, we have delivered predictable double-digit growth across all key financial metrics since our IPO in 2021 and expect to continue to do so moving forward. Our confidence in the business is supported by our second quarter results, which demonstrate effective execution of our strategy and reinforce our confidence in the full-year outlook. As you'll see on slide four, we completed our second quarter ended June 30th with approximately $1.7 billion of last 12 months' pro forma revenue and approximately $314 million of pro forma adjusted EBITDA. Last 12 months' adjusted free cash flow also came in strong at $165 million. Our teams continue to deliver the highest ends of care to more than 2.4 million active patients, 92% of which are recurring, and visit our practices over 5.6x million annually. As you can see on the next slide, we continue to convert a high percentage of our EBITDA to free cash flow in any given period and expect this conversion to increase as we continue to deliver and realize network-wide operating leverage. Our business continues to operate with robust and expanding margins, low CapEx requirements, and capped interest rate exposure on 100% of our existing outstanding debt. Our last 12 months' free cash flow conversion increased to 65% in the quarter, up from 60% in Q2 2024, resulting in approximately a 10% year-over-year adjusted free cash flow per share growth. On slide four, we increased our EBITDA by 2.5x from the same period last year to 3.65x at the end of Q2. This marks the seventh consecutive quarter of deleveraging, and we continue to work towards our medium-term target band of 3x-3.5x leverage. On the next slide, you will see a comparison of valuation and free cash flow yields versus our peers. At the end of the quarter, we were trading at a level that implied a 5.8x multiple on EBITDA vis-à-vis enterprise value discounts for our peer group. At the same time, we are currently trading at a 9.5% free cash flow yield compared to our peer group of 3.9%. On slide eight, I'm pleased to report that our business delivered revenue of $435.2 million in the second quarter of 2025, up approximately 9% year-over-year with adjusted EBITDA of $81 million, up 10% year-over-year. As we continue to realize operating leverage with 20 basis points of margin improvement relative to our adjusted EBITDA at 18.7%. During the quarter, we experienced some deferrals related to the CD C P, and when combined with M&A timing, had minor impacts to our same practice revenue growth and financial performance. Despite these near-term impacts, which were very modest, our underlying business fundamentals remained strong, as evidenced by our 92% recurring patient visit rate, reflecting strong predictability and continued demand for routine care across the network. Increased operating efficiency resulted in an adjusted free cash flow of $45.6 million or $0.23 on a per share basis, representing growth of 12% and approximately 10% respectively over the same quarter last year. This enabled us to fund the entirety of our acquisition program with free cash flow for the ninth consecutive quarter. With respect to M&A, we acquired eight practices in a quarter for a total consideration of $24 million. These practices are expected to generate $3.8 million in pro forma adjusted EBITDA after rent. We remain as the best positioned and capitalized partner for independent dentists and will continue to be disciplined about the practices we acquire. Looking ahead, we anticipate third quarter 2025 revenues to increase by 10%- 12% dependent on acquisition timing over Q3 of 2024, while delivering 3%- 5% same practice revenue growth. We expect adjusted EBITDA margin to increase by 20 basis points over the third quarter of 2024. Subsequent to the quarter, we completed the acquisition of seven practices representing $5.5 million of pro forma adjusted EBITDA after rent, and when combined with signed letters of intent and acquisitions completed as of June 30th, 2025, is greater than our 2025 full-year acquisition target of $25 million of pro forma adjusted EBITDA after rent. I will now pass the call over to Nate, who will walk us through the details of our financial results. Thank you, Graham. Starting with the CDCP update, in March of 2025, the Canadian government expanded eligibility under the program to patients aged 18- 64 to begin receiving care in July. This led to some appointment deferrals in Q2 from eligible patients, creating a modest headwind to same practice revenue growth. However, we do not anticipate any further deferral impacts in the second half of the year. Importantly, 95% of our practices are now enrolled in the CDCP, up materially from the initial participation levels in 2024. Turning to the numbers, our quarterly results reflect strong operational fundamentals and continue to demonstrate the durability and predictability of our business. Turning to slide nine, revenue for the three-month period ended June 30th, 2025, as Graham mentioned, was $435 million compared to $400 million for the corresponding period last year, representing an increase of approximately 9%. This increase is attributable to our continued acquisitive and organic growth. As you can see, we reported second quarter adjusted EBITDA of approximately $81 million compared to $74 million in the same period last year, and reported second quarter adjusted EBITDA margins of 18.7%, representing a 20 basis point expansion of margins year over year as we continue to realize operating leverage and our fully built-out corporate infrastructure. Looking forward, we continue to be confident about our ability to grow the business through acquisitions and organically. Turning to the next slide, you can see our net leverage and liquidity as of June 30th, 2025. On a net debt basis, we were approximately 3.65x levered at the end of the second quarter, deleveraging by approximately 6%. Second quarter adjusted free cash flow came in at $46 million, representing growth of 12%, further bolstering our already robust balance sheet. We ended the second quarter 2025 with liquidity of $428 million, comprised of $78 million of cash and $350 million in undrawn capacity under our senior debt facilities. This quarter marks a seventh consecutive quarter over quarter increase in our interest coverage, as defined by our LTM pro forma adjusted EBITDA after rent divided by net interest expense, which currently sits up at four times, up from 3.9x in Q1 2025. Overall, our second quarter 2025 performance demonstrates the strength and resilience of our business model. We delivered positive organic growth while successfully expanding margins through operating efficiencies. We continue to strengthen our financial position by deleveraging the balance sheet, completing accretive acquisitions, and realizing operating leverage as we continue to expand margins. I'll now pass the call back to Graham for closing remarks before we open it up for Q&A. Graham? Thank you, Nate. As seen on slide 11, our second quarter performance reinforces our confidence, enabling us to reaffirm our full-year 2025 guidance of 3%- 5% same practice revenue growth, a 20 basis point improvement in adjusted EBITDA margins, acquisitions representing pro forma adjusted EBITDA after rent of $25 million+ and 15%+. I want to thank you all for joining the call today. This concludes the formal part of our presentation, and we would now like to open the call to questions. Operator? Thank you. We will now begin the question- and- answer session. If you have dialed in and would like to ask a question, please press Star, one on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press Star, one again. We ask that you please limit yourself to one question and, when following up, allow everyone an opportunity to ask a question. We'll take our first question from Brian Tanquilut at Jefferies. Hey, good morning, guys. Maybe Nate or Graham, as I think about same practice performance in the quarter coming in below, you know, below out of the range, what percentage of that do you attribute to the CDCP? How are you thinking about same practice, you know, volume performance for the back half of the year? Hey, Brian, and thanks for the question. I think if we look to breaking down kind of what percent of our business or what percent of our patients today, prior to the secondary rollout of the CDCP, were represented by CDCP patients, I'd say roughly call it 4% were CDCP patients in that kind of 65+ cohort and then 18 and under. Our expectation is that 19- 64 cohort, that new cohort that began in earnest on July 1 here, will probably be in that 4%- 5% range. Call it roughly total CDCP penetration in and around the high single digits, low double digits here, which ultimately would have that impact as it relates to deferrals in the quarter above and beyond that 3.3% that we printed. One additional note around the pacing of acquisitions. Our acquisitions that we expected to close in the quarter ended up closing in the first couple of weeks in July, and ultimately that would have also had some impact on the overall revenue performance of the business. As we sit here today and look at the back half of the year, very confident in that 3%- 5% range on same practice revenue growth and really returning to call it the midpoint and the high end of the range as we get through Q3 and into Q4. Okay, that makes sense. Nate, just maybe to that point you made on the M&A side, it looks like you've got at least $25 million under letters of intent. You just had a deal closed in July. How do we think about this timing of closings for the rest of that letters of intent to get to complete a deal within your guidance range? I would say the pacing of our acquisitions as far as our overall pipeline and where we're sitting both signed and closed is ahead of our expectations. As we get through the second half of the year, our expectation is that we'll close $25 million, if not more than $25 million. There are great opportunities here at great valuations, and the market continues to be very robust. From a timing perspective, I would expect Q3 to be a very strong quarter as far as M&A closings go, just given some of the rollover from Q2 into Q3, and ultimately Q4 will continue at that same pace. Awesome, thank you. We'll go next to Gary Ho at Desjardins. Thanks, good morning. Maybe start off with that M&A question. The eight locations added in the quarter, 6.3x multiple, that's slightly below your historical range. Should we read anything into that? Maybe just talk about the general M&A environment and good to see that you've executed on your kind of $25 million acquired EBITDA signed or closed for the year already. Thanks for the question, Gary. As far as evaluations for the deal this quarter, it's a small sample. Ultimately, as we look through to the balance of the year and really looking at our full-year valuation metrics, we expect to be in the mid-seven range as initially guided through the piece. As far as the overall M&A environment goes, it continues to be incredibly robust. Our team is continuing to foster relationships and bring people along through the process and the deal. As mentioned, we're now signed and closed above and beyond our $25 million of expected closed deals in 2025. We expect that momentum to continue. Okay, great. While I have you, Nate, just good to see the nice step down in leverage, 3.65x.. You probably have line of sight in hitting that 3-3.5 over the medium term. Do you see any pivots to your capital allocation strategy once you're kind of within that range, whether that's speeding up M&A or maybe more buybacks? Just want to hear your thoughts on that. Yeah, it's a great question, Gary. We've done a tremendous job in deleveraging the business and continuing to take a really balanced approach to growth. Given the great opportunities that are before us on the M&A front, as we continue to make our way into our targeted leverage range, any excess capacity ultimately will be put forward to an accelerated growth lens. Okay, makes sense. Those are my two. Thank you. We'll go next to Daryl Young at Stifel. Hey, good morning, everyone. First question is just around the clear aligner space. We've continued to see some challenges there on a global basis and slowing of case starts. Could you just speak to what you're seeing in terms of your case starts, your clinical outcomes, and then I guess ability to keep driving growth from this ortho avenue and Ortho Acceleration Program going forward? I guess said differently, is the Invisalign adoption meeting your expectations for the program? Thanks for the question, Daryl. Just before diving directly into the Invisalign and orthodontic insourcing, I think what's important to highlight around our business is the significant recurring nature of our business. Over 92% of our patients are recurring year in and year out, and 90% of our services, ultimately 90%+ of our services, are really those non-discretionary hygiene, fillings, and other routine type restorative work. Our overall exposure as it relates to the higher value, call it discretionary specialty services, is limited. They continue to be an opportunity for us. You might have seen that we've continued to roll out and expand the number of clinics we have in our network that are participating in our Ortho Acceleration Program. Over the last number of quarters, we worked with Align to rebuild and revamp that program for ease of implementation and ultimately enhancement around education. We continue to be bullish in the long term in that program's rollout through our network and in practices that are currently not offering that service. From a year-over-year perspective, if we look at Invisalign and we look at orthodontic services in general, there's absolutely a bit of a slowdown there across really all discretionary services. As we continue to roll it out into practices as well as clinicians that previously have not been providing this type of service, our overall network has an opportunity to continue to increase the penetration, albeit ultimately our focus continues to be on our highly repetitive and highly recurring services. Okay, that's helpful. Thanks. The second question is just around your VideaHealth and AI relationship. Can you just speak to the rollout of those capabilities and what you're seeing in terms of the dentist workflow and maybe any financial benefits you're seeing to date from it, or is it more about quality of doctor service? It's a great question, Daryl. It's still very early days on the rollout. We're just around 250 of our practice locations that have had the VideaHealth rolled out into its workflow. We are seeing tremendous positive response from clinicians as well as patients as it relates to the clinical environment, as well as the ability now to have a more fulsome patient education as well as treatment acceptance around the care that they're getting. It's still very early days to describe really what are the metrics around it, but that's something as we continue the rollout and have a few periods now where we're going to be able to see the performance, we're going to develop that view by the end of the year, and ultimately we'll share that with you guys. That's great. Thanks. I'll get back in the queue. Congrats on the good result. Thanks, Daryl. Next, we'll move to Doug Miehm at RBC Capital Markets. Good morning. The question I have just has to do with a letter that was sent by the Canadian Dental Association, it was posted on July 28. They're raising escalating concerns about persistent gaps in the CDCP, with pre-authorization, enhancing public communication about coverage services. I thought this was important that existing employer-sponsored dental benefits are protected. Could you expand on this letter and what implications it may have for your business, particularly around the private side concerns they seem to have? Thank you. Absolutely. Thanks for the question, Doug. I think since the beginning of the rollout, if we get back into our time machine to December of 2023, there was a lot of misinformation and misunderstanding as to how the plan is going to be administered with patients' expectations being called full coverage. Ultimately, as 2024 ran through, more and more information came out. There was more and more patient education that was provided, which, of course, as the rollout was happening, created increased frictions from a patient communication perspective as well as a patient behavior side. I think the plan is still in its infancy as both practices' patients as well as the plan administrators are trying to keep up with demand as well as keep up with process. Our expectation is as more time passes, there should be greater efficiency, greater understanding, and clear expectation around the plan. Over the last 18 months since the inception of the plan, there absolutely have been speed bumps in the road, which ultimately have affected patients, clinicians, and ultimately performance. Our expectation is as we go and look forward into the second half of the year and into 2026, given now the cycle, we've almost gone through a couple of cycles now of patient visits, it'll become much more smooth and much more efficient on both sides of things. As it relates to employer-sponsored insurance and the implications that would be had there on employers making decisions to cut coverage, it's not something that we've seen take place at all. Ultimately, if we take a step back and think about employer decision-making here, it's a very difficult thing to cut somebody's insurance because you don't know their household income. It's not something that is readily available, nor is it something that can be asked of an individual to share, nor do you know if their spouse or partner has any other type of coverage. Albeit it's a risk that has been raised, it's not something that we have seen come to fruition, nor do we expect it to for the reasons just mentioned. Okay, perfect. That's good for me. Thank you. We'll go next to David Kwan at TD Cowen. Hey guys. Nate, just on the M&A in the quarter, you talked about, I guess, a small sample set as to why you got a better deal, looks like, relative to what you've seen historically. The practices also look to be, on average, smaller than what you typically bought. Is that one of the reasons? You're a great detective. Absolutely. It's a small sample, and the average practice size is smaller. Okay. It looks like for the Q3 acquisitions that you noted, it looks like you were also kind of paying below that range. Was it also because they were typically smaller too? Some of the ones in Q3 were actually some larger groups. Really, it's just coming down to the mix. As you continue to forecast through the year and you look at the full year of $25 million+, again, valuations will be in that mid-seven range. At any point in time, it might be a little bit higher, it might be a little bit lower. The way that we look at it, because again, it's very difficult to predict on a deal-by-deal basis, on a full basket in the mid-sevens is where our expectations are. Okay, perfect. Just one more, just on the cash taxes, are you still expecting to accrue them in the second half of this year and then start paying them out next year? Yeah, I think if you look on our Q2, we have a tax payable amount of, I think, roughly $17.9 million that's on our financials today. Our expectations are to kind of accrue in the back half of this year. Those cash taxes, that'll be called in the low to mid-$20 million for the year. That's an estimate here, and the cash will flow out in 2026. Great, thank you. We'll go next to Allen Lutz at Bank of America. Taking the questions, I want to ask a question on gross margins. They've been shooting up for a couple of quarters now, and the sequential from 1Q to 2Q was really, really strong given the seasonality you've seen historically. Can you talk about what's driving the gross margin? I guess especially the incremental gross margins and how we should think about that into the second half of the year. Thanks. You know, it's the gross margin. It really is a truly variable figure. If we look at the components of what comprises our COGS, it really is the largest portion is dental revenue, where dentists are earning a 40% on average commission rate for what they bill. It's hourly hygiene rates, again, highly variable based on what they put through. It's the lab costs that are inputs into the dental work, as well as the consumables which are going into the delivery of the care. I'd say from a dental draw perspective, hygiene as well as lab, obviously those are quite consistent. One of the areas where we continue to get leverage, just given overall our size and scale, as well as our very strong partnerships with some of the industry's largest and best suppliers, we're able to continue to draw and expand our efficiencies on that front. That's helpful. For my follow-up on SPRG into the second half of the year, what gets you to the low and the high end of that guide? Is there anything that's driving that other than the relative C DC P patient flow? Thanks, guys. I think the only difference that we saw in Q2 that brought us to the lower end was the headwind that we experienced from the CDCP. I think now that's been fully digested. Now work forward with normally scheduled programming. We expect to be at the midpoint or above. However, there really isn't anything else that drove that Q2 decline, right? If we look at Q3 of 2024, which was in the mid-fours, if we look at Q1 of 2025 again in the mid-fours, those were operating, I'd say, in more normal environments, and that's really our expectations for Q3 and Q4. We'll move next to Zachary Evershed at National Bank Financial. Good morning, guys. Thanks for taking my question. Just a follow-up on the capital allocation question. You stated that as you move down into your three to 3.5x leverage target, excess capacity will go to accelerated growth. Do you consider you're in excess territory right below 3.5x, or would you expect a bigger acceleration to prevent you from dipping below 3x? Like, when do you kick it into gear? Great question, Zach. I think given the opportunities before us and the pace of our growth here, right now, even at 3.65x, we continue to be the lowest levered aggregator in the healthcare space. Should there be opportunities that we view as highly accretive and consistent with our growth objectives, we would continue even at the rate and at the rate of leverage that we're at today. We do have a continued focus to bring it down into that three to three and a half range, but it's not going to be at the expense of growth. Understood. Thanks. Is there any wood left to chop on specialty practice disposals? We divested our last standalone orthodontic practice in the quarter. We no longer have any standalone orthodontic practices in the network. I'd say from that perspective, no, and I wouldn't expect any more dispositions in the near term. Thanks very much. I'll turn it over. We'll go next to Tania Armstrong, Canaccord Genuity. Hi guys. Most of my questions have been asked. Now it's just a couple for me. I guess to start, it's great that you reaffirmed your 2025 guidance. Could you remind me, did you provide an actual revenue number apart from just the same practice revenue growth and the M&A? I don't know if there was a range given for the revenue number for the full year. It was 10%- 11%, Tania. Thank you. On the practices, you mentioned divesting one standalone orthodontic. Just doing some like that calculation here based on your 575 number, up from 571 in Q1, and you acquired eight. Were there some closures as well? No, no closures. The difference is all related to consolidations or planned consolidations. Even certain practice acquisitions that we acquired in this quarter are going to be tucked in or consolidated with other practices that we currently have in the network. We have not closed any practices. Got it. Perfect. Kind of following on from the last question, seeing as you've already hit your M&A targets based on signed letters of intent, I guess how comfortable would you be, like where is a good number for us to settle out at? You're not going to obviously do nothing in Q4. How far would you feel comfortable taking that M&A target? Just to be clear, the 25 signed and closed, the expectation is not all $25 million will be closed by the end of Q3. The signed and closed, the signed deals will ultimately close through the back half of the year. I would say confidently, our acquisitive pacing will be in the $25 million- $30 million range for the balance of 2025. Perfect. All right. Thanks, guys. Thanks, Tania. We'll go next to Stephen MacLeod at BMO Capital Markets. Thank you. Good morning, guys. It's a color so far, so thank you, but I just had two follow-up questions. The first one relates to just the margin growth that you've seen, you know, another quarter of nice operating leverage in Q2. I'm just wondering if there's any reason to expect that to not continue as we turn the page into 2026. I appreciate the questions. I think as we go through the back half of the year, our expectation is we'll continue at that same pacing of 20 basis points of margin expansion over the same period last year. Ultimately, if we take a step back and really unpack the components of the margin expansion, it's really driven predominantly by operating leverage on our invested corporate infrastructure. As we continue to grow, as we continue to execute on our M&A program, and the velocity of our acquisition pacing continues to increase, ultimately that margin expansion, given there's a greater installed base of practices operating and being supported by the same size of corporate infrastructure, we're going to have an increase in our overall margins and ultimately the pacing of our margin expansion. Nothing today would detract from that in that 20 basis points through 2025 and ultimately into 2026 at a 20 basis point plus velocity. Okay. No, that's great. I was curious about the 20 basis points plus. That's good to hear. Maybe just my final question is just on the CDCP. Is there any discernible difference in the patient behavior for a CDCP patient versus a non-CDCP patient in terms of revenue per visit or the number of services that they might have? I think in the early days here, really our sample is related to predominantly the 65+ cohort. We only really have one month of data. If we look at the 65+ cohort, their behaviors and ultimately the services that they're consuming are really consistent with their non-CDCP peers. That's great. Thanks, Nate. Appreciate it. That completes the question and answer session. This will conclude today's conference call. Thank you for your participation. You may now disconnect.