Good day, and welcome to the Acme United Corporation's fourth quarter 2024 earnings call. At this time, I'd like to turn the call over to Walter Johnsen, Chairman and CEO. Please go ahead, sir. Good morning. Welcome to the fourth quarter and Year 2024 earnings conference call for Acme United Corporation. I'm Walter C. Johnsen, Chairman and CEO. With me is Paul Driscoll, our Chief Financial Officer, who will first read a safe harbor statement. Paul? Forward-looking statements in this conference call, including without limitations, statements related to the company's plans, strategies, objectives, expectations, intentions, and adequacy of capital and other resources are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, including, among others, those arising as a result of the challenging global macroeconomic environment characterized by continued high inflation, high interest rates, and the imposition of new tariffs or changes in existing tariff rates. In addition, we have experienced supply chain disruptions, and we may experience these disruptions in the future. We are also subject to additional risks and uncertainties, as described in our periodic filings with the Securities and Exchange Commission and in our current earnings release. Thank you, Paul. Acme United had a strong year in 2024. We had record net sales of $194.4 million and record EBITDA of $20 million. As you may recall, we sold our Cuda and Camillus hunting and fishing business in November 2023 for $19.8 million. We used the after-tax proceeds of approximately $15 million to reduce debt and position the company for growth. The sale of Cuda and Camillus represented a return of over 100 x our annual investment. During 2024, we reported net sales growth of 2%, despite the reduction of approximately $9 million in revenues from the businesses we sold. Net revenues adjusted for the sale of Cuda and Camillus increased 6% during 2024. Our net income in 2024 was $10 million, compared to $8.1 million in 2023, an increase of 23%. We adjusted our expenses to compensate for the lost contribution of the businesses we sold and generated productivity savings. This performance was better than we planned. Earnings per share were $2.45 in 2024, compared to $2.23 in 2023, an increase of 10%. Our first-aid business had strong performance. Its revenues were approximately $120 million. Refills of components for first-aid kits were approximately $30 million and growing. We introduced Smart Compliance first-aid cabinets with RFID technology in 2024, which permit automatic replenishment of refills. This is the annuity segment of our business that builds on our growing installed base of industrial first-aid kits. Automatic replenishment provides substantial savings to our customers and captures a high percentage of items needed to keep the kits compliant with OSHA and ANSI standards. Our Westcott cutting and DMT sharpening business had excellent performance in 2024. Net revenues in this segment were approximately $75 million, an increase of 10% compared to 2023. We gained share in the craft market, expanded our distribution of high-leverage and proprietary adjustable blade scissors, and broadened the family of cutters to open boxes in industrial settings and in homes. We are excited about our new sharpening tools that we successfully introduced in the kitchen and culinary markets and the outstanding growth that we experienced in this category in 2024. Our productivity initiatives resulted in over $2 million in annual savings. We attacked expenses on many fronts, including reducing the cost of first-aid boxes, automating the placement of items into unitized packages, bidding out freight and carrier charges, and installing new software tools to optimize placement of items in our warehouses. We installed new warehouse racking in our largest distribution center. This facility in Rocky Mount, North Carolina, has over 340,000 sq ft on 33 acres of land and has been the backbone of our expansion during the past eight years. The new racking increases our capacity by 30% and positions us to handle additional growth. Our businesses in Canada and Europe also had a good year. We moved into a new facility in Laval, Canada, to handle growth in First Aid Central. Our European business made investments to expand in the first-aid and medical segment and generated another profitable year. We anticipate that there will be challenges with tariffs in 2025, and we feel we are ready. During the past eight years, we have purchased 10 companies with production facilities in the United States and Canada and worked to diversify our sourcing to many global locations, including Thailand, Egypt, India, and the Philippines. We would like to acknowledge Stevenson Ward, who will be retiring from our Board of Directors in April. Steve has been chair of our audit committee and a valued confidant, colleague, and friend. He leaves us a much stronger company than when he arrived more than 20 years ago. I would like to personally say thank you to Steve Ward. As we look into 2025, we are optimistic and confident. We have a strong customer base, excellent financial strength, and a solid book of new business. I will now turn the call to Paul. Paul? Acme's net sales for the fourth quarter were $45.9 million, compared to $41.9 million in 2023, an increase of 10%. Sales for the year ended December 31, 2024, were $194.5 million, compared to $191.5 million in 2023, an increase of 2%. Excluding the impact of the Cuda and Camillus hunting and fishing product line sold on November 1, 2023, sales for 2024 increased 6%. Net sales in the U.S. segment increased 12% in the fourth quarter. Excluding Cuda and Camillus, sales increased 8% for the year ended December 31, 2024, due to market share gains with first aid, Westcott craft products, and DMT sharpeners. Net sales in Europe declined 1% in local currency for the quarter. Sales for the year ended December 31, 2024, excluding Cuda and Camillus, increased 8% compared to 2023. The sales increase for the year was mainly due to market share gains in the office channel. Net sales in Canada were constant in local currency for the quarter. Sales for the year ended December 31, 2024, excluding Cuda and Camillus, increased 1% compared to 2023. Sales of first-aid products were strong. However, there was a decline in sales of school and office products. The gross margin was 38.7% in the fourth quarter of 2024, compared to 39.1% in 2023. The gross margin for the year was 39.3% compared to 37.7% in 2023. The higher gross margin for the year was mainly due to productivity improvement initiatives in our manufacturing and distribution facilities. SG&A expenses for the fourth quarter of 2024 were $15.5 million, or 34% of sales, compared with $14.3 million, or 34% of sales, for the same period of 2023. SG&A expenses for the 12 months of 2024 were $62 million, or 32% of sales, compared with $59 million, or 31% of sales, in 2023. Interest expense for the year went from $3 million in 2023 to $1.9 million in 2024, due to a decline in the average debt of approximately $16 million. Net income for the fourth quarter 2024 was $1.7 million, or $0.41 per diluted share. After excluding the $9.6 million gain on the sale of the Cuda and Camillus product lines in the fourth quarter of 2023, this compares to $1.6 million, or $0.40 per diluted share in Q4 2023, an increase of 9% in net income and 3% in diluted earnings per share. Net income for the year ended December 31, 2024, was $10 million, or $2.45 per diluted share. After excluding the gain on the sale of Cuda and Camillus, this compares to $8.1 million, or $2.23 per diluted share in 2023, an increase of 23% in net income and 10% in diluted earnings per share. The company's bank debt less cash on December 31, 2024, was $21.5 million, compared to $19 million on December 31, 2023. During the 12-month period, we purchased the assets of Elite First Aid for $6.1 million, paid $2.2 million in dividends, and generated approximately $5 million in free cash flow. Thank you, Paul. I will now open the call to questions. Great, thank you. At this time, we will be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the Star keys. One moment, please, while we pull up for questions. Our first question is from Jim Marrone from Singular Research. Please go ahead. Good afternoon, gentlemen. I have two questions. Both of them are related to the tariffs. With my first question, in your prepared remarks, you said that your company is ready for the upcoming tariffs, and you kind of alluded to the fact that you're ready based on expansion with respect to acquisitions over the few years. I just was hoping that maybe you can just put a little bit more clarity to those prepared comments. Related to that, how do you plan on attacking or being prepared for tariffs, both the tariffs that the U.S. is going to impose as well as the retaliatory tariffs? Do you plan on your operations in Canada, like selling from within and avoiding cross-border shipments as well as within the U.S., or do you plan to continue cross-border trade? I'm just curious. I'm looking forward to hearing your comments on that. That's really a very helpful question, Jim. The first part is the preparation. Over the past eight years, we've purchased manufacturing sites, Vancouver, Washington. That was First Aid Only. That's one of our major first-aid production sites where we make first-aid products. We also make first-aid products in Rocky Mount, North Carolina. We bought Spill Magic, which makes spill cleanup powder. In the medical area, we use that powder for bloodborne pathogen kits and bodily fluid cleanup kits. That production is in Santa Ana, California, and Nashville, Tennessee. We bought Med-Nap, which makes alcohol prep pads, BZK wipes, calamine lotion, hand sanitizers, and other items, triple antibiotic wipes. That's in Brooksville, Florida, and we're working on an expansion there, all domestic production. What we did in our Asian business is a dual sourcing strategy in places like Egypt, which has a broad cotton industry. You may think of Egyptian cotton or Egyptian linen, as an example. So gauze, tape, and it's very competitive with China. We've moved quite a bit of production into Egypt as well as into China. In the case of some of our production that's currently in China, we're moving pieces of it from the previous Trump tariffs into Thailand and the Philippines. The first production of Thai paper cutters, as an example, with a certificate of origin made in Thailand, was in December 2024. That's going to be followed by many, many other items. We do a lot of production today in India, and that's been as part of the diversification out of China. As you look at first the preparation, it's been something we've been responding to over the past eight years, and we are very broadly diversified compared to where we had been. Now, specifically, the retaliatory tariffs and the question of how we address those. Our subsidiaries are set up so that, for example, in Canada, our First Aid Central business produces first-aid kits in Canada. There's very little cross-border shipping. There is some. For example, we make BZK wipes in Brooksville, Florida, and Med-Nap. We ship them into Canada because there's a drastic shortage of those items in Canada. Even if there was a retaliatory tariff, the availability of BZK wipes is something that we have that most of our competitors do not. That would continue to be a plus. The actual production, the sourcing in China, it's all in our Toronto location or Montreal location and our warehouse in Mount Forest. It is really separate. In the case of Europe, it's similar. Our European business is a subsidiary that deals directly with China, and they have these tariffs there. It's different than in the U.S. We don't ship from the U.S. to Europe. It goes directly from the sources in China. Our first-aid production is done there as well, as well as the other locations. I'm not really too concerned about retaliatory tariffs. I think we're positioned to be able to respond to those very easily because we're whole within those locations. Now, when tariffs happen, we do a couple of things. First, we work with our suppliers to figure out ways to reduce cost, and they tend to respond to that. Second, we have an ongoing productivity program. I mentioned $2 million last year. Every year, you expect productivity in your factories, and your suppliers have similar goals. Third, we do regular price increases for inflation, and that covers part of the cost of tariffs. Frankly, if there's a tariff that's so big, like two or three, well, we're the largest scissor maker globally. There's no one that can replace the volumes that we have. There's pricing power, and we're a leading brand. In the case of our first aid, we're the leading brand in North America, and again, with a very diversified sourcing base. Finally, if the tariffs were to be very, very high globally, we have the capability in our first-aid business to bring it back gradually into pieces of the U.S. and vertically integrate further. It's not perfect, but we're prepared. Yeah, that's great. Great insight. Thank you for that clarity. However, here's my follow-up. Right, it's not perfect, but you're prepared. Can you perhaps just comment, like if the tariffs were to be imposed, where exactly will your business get hit the most? Will it be based on the input prices becoming higher and you're going to have to pay higher input prices, or will it be based on the sales where you're going to be having to sell at higher price points as a result of the tariff? Can you give us a sense of where the biggest hit's going to be and how that's going to play out things? It's a dynamic situation right now because tariffs, there's an extra 10% that was just announced for implementation next week for China. With that, as an example, first, it's on your cost, not your selling price, right, because you're importing. We pay the tariff. We will be working with our suppliers to adjust their costs. We will adjust maybe the mix of some products. We will be getting productivity. There is a price increase that will go with inflation, and we've already announced those, and they're happening. It's a mix. Generally, when we're done, we try to be pretty close to margin break-even, being sensitive to that we're giving real value to our customers. Right. What about on the other end, on the sales side? How much of an impact can you imagine having to sell with regards to the goods that are shipped cross-border as far as the price points of your selling prices being higher as a result of the tariffs? Can you get a sense of how much impact that could possibly be? It just depends on the rest of the supply chain, but we've already put a price increase. Remember, there is inflation, so you've got that covering on your selling price. There may be a pickup in a little bit of that, but then maybe the customer trades to a different item, and we work with them to keep the utility of what they're buying comparable, and they do not actually get a price increase. They have a substitution. It is not quite so simple. I know the press says, "You got a 10% increase and 10% selling price increase." It does not work that way. Okay, great. Thank you for the insight, gentlemen. Thanks, Jim. As a reminder, if you'd like to ask a question, it is star one. Our next question here is from Jeffrey Matthews from RAM Partners. Please go ahead. Thank you. That was a great answer, Walter, and leads into my question, which is also about tariffs. More broadly, we have an economic policy that's kind of run out of the White House now, and it sort of depends on what side of the bed the president got up on. An advantage that you do not have is that if you are a very large company like Apple or Amazon, and you can pay a million dollars for his president's inauguration committee, you now have a seat at the table, and he is going to be your friend. My question is, does the small manufacturer who could get run over, depending on where the tariffs are applied, does the small manufacturer have a voice at the table here? We really do not have a voice at the table. You're absolutely right. We're not Apple. On the other hand, within our market segments, we're very big. Whether that's in the cutting area where we have the largest share in the world or in the scissors, or in the first aid where we're major in North America, we do have pricing power. We do have negotiating power with our suppliers, but we are clearly not influencing policy. We are responding. We also, as you can imagine, have purchased inventory in advance of these tariffs so that we have time to adjust our pricing mix and product mix to meet what might come forward. You're absolutely right. We do not have a seat at the table. Okay. You are flexible and you are responsive, and you have got your eyes wide open, and I would have expected no less, but I appreciate that answer. My follow-up is. Thank you. Yeah. My follow-up is the Canadian acquisition you made of the Red Cross out of bankruptcy. I forget how long ago that was, but could you give an update on kind of how that is playing out and how it's developing relative to your expectations at the time? Yeah. For those who may not remember, we bought a company called Hawk tree Solutions out of bankruptcy last September. This was September 2023. They had been supplying first-aid kits to the Canadian Red Cross and to other customers in Canada. When COVID happened, they started to supply gloves and other PPE items to the Canadian government, and they ballooned in sales, which was terrific. They financed themselves with quite a bit of debt for continued growth. COVID ended, the debt was called, and the company went bankrupt. We bought that business for about CAD 1 million, and it had inventory of about CAD 1.3 million. We bought it below its cost of inventory. We have built that to about a CAD 2.5 million-CAD 3 million business right now, profitably. We have renewed the contract with the Canadian Red Cross. We're introducing the Elite First Aid, first responder bags to the Canadian market through—it's all First Aid Central today, but it's through the customer base that Elite had. We have used the inventory very effectively. It is a part of the business, and it has been a good acquisition. Terrific. Thanks, Walter. Good luck. Thank you. Once again, as a reminder, if you'd like to ask a question, it is star one. Next question here is from Richard Dearnley from Longport Partners. Please go ahead. Good morning. Paul, why did you stop releasing the European sales numbers? I didn't know I did stop releasing European sales numbers. Oh. Yeah, yeah. In the U.S. and Canada, but no Europe. No, I did mention Europe. I know I did. You mean in this call or on the? In the press release. I'm pretty sure they're in the press release. Yeah, they're in the press. I read it. Okay. It's in front of me. It's in there. Oh, gosh. Okay. Sorry about that. That's all right. Walter and Paul, if Westcott was $75 million for the year and up 10%, that would suggest a $7 million increase in sales. Sales, the $194 million, was up $3 million. Are you telling me that first aid was down for the year? No, first aid was up approximately 5%. Included in the $191.5 million last year was $9 million of Camillus and Cuda. Westcott was up 10%, and first aid was up 5%. We do not have the $9 million of Camillus and Cuda. Right. Okay. When I say Westcott and DMT. Right. The $30 million of refills, I thought refills were around $40 million. I think in net sales, I believe it's $30 million. When we look at what's going out the door, we're looking at gross sales, and that has rebates in it and things. That's what we measure. I may have said 40 at one point because that's what I see. When they net it out for reporting, it might be down to 30, but it's something like that. Okay. Okay. Thank you. Thanks so much. Thanks, Dick. Next question here is from Jake Patterson from Talanta Investment Group. Please go ahead. Hey, just one question on the SG&A. I think second quarter, you guys mentioned you expected it to decline. The percent of sales a little below 31% picked up a good bit here in the fourth quarter. I was kind of just curious if that is still a fair assumption going forward. The assumption being it's somewhere between 31% and 32%. That's probably right. Yeah, yeah. That's right. Okay. I think you said a little below 31%, so that was kind of—that was what I was interested in. It's somewhere in that range. Okay. I guess the uptick this year, is there anything you could call out specifically, like growth investments or anything? It was up by one percentage point on net sales, and it's mostly inflationary reasons and typical wage increases. Other than that, there's not much there. Okay. Cool. Appreciate it. There are no further questions at this time. I'd like to turn the floor back over to Mr. Johnsen for any closing comments. If there are no further questions, this call is complete. Thank you for joining us. We look forward to discussing our first quarter of 2025 with you in April. Goodbye. This concludes today's teleconference. You may disconnect your lines at this time. Thank you again for your participation.