Core Molding Technologies, Inc. (CMT) Earnings Call Transcript & Summary

Okay. Welcome today to our 2026 first ever Investor Day and plant tour at our Matamoros facility in Mexico. We've got a lot of great products, as you can see around the room that depict what we do. We've got a lot of great materials to go over today. I want to give you a quick run of the show. When I step away, we're going to play a quick video that will give you some nice background on some of the stuff that we're doing. And then I'm going to turn it over to Eric Palomaki to run through a presentation. Our presentation today will be broken into two parts. We'll have a break in the middle. At the end, we'll have a long Q&A session, followed by dinner and networking in the back of this room. Right outside the room is restrooms, if you need those. On the far left over here, there are snacks drinks and anything you need. If you got to get up and go out for the room for anything, help yourself, no worries. Also on the table in front of you is the Internet information. If anybody needs the Internet, welcome to do that. We don't have plugs on the tables. But if you need to charge something, we can make some room outside for you as well. With that, let's get started. First and foremost, everybody has seen a safe harbor statement, which you see up on the screen in front of me. Everybody's read one of these, so I don't plan to read that, but please note that we will make forward-looking statements in today's presentation. Now to the best part, our speakers. Most of you in this room and most of you on the webcast have had plenty of opportunities to speak with our President and CEO, Eric Palomaki; and our Chief Financial Officer, Alex Panda. And while you're going to get a chance to speak with them more and hear from them more today, you're also going to get a chance to hear from some of the other leaders in our organization. You're going to get to hear from people like Alex Bantz, who's our Chief Commercial Officer; Stephanie Pulliam, who's our Executive Vice President of Human Resources; Mike Gayford, who has just announced Monday as our Chief Operating Officer; and Arnold Alanis, I'm sorry, who's our Executive Vice President and Operations of our Mexico facility. With that, I'm going to get our video started, and then I'm going to turn things over to Eric. Thank you. [Presentation]

All right. Welcome to Investor Day 2026. Pleased to have all of you joining us in person as well as on the webcast, and thanks to some of our suppliers and banking partners also for being here today. We're glad to have everybody. Today is an important milestone for us. This is our 30-year anniversary as Core Molding Technologies, and the journey we want to talk to you about is the next chapter of Core. We're not here to tell you the turnaround story, but we're here to demonstrate how the turnaround that we've had over prior years is turning into a platform for growth. Over the last several years, we've rebuilt our operating foundation, strengthened leadership and improved execution and invested in our capacity. Our objective today is simple: to show investors why Core is positioned to create substantial long-term shareholder value. Each member of our leadership team today will help you connect our strategy, our operations and our people associated with our capital allocation and how we work together to drive profitable revenue. The message today is why Core and why now. We'll have some time at the end for questions. So please feel free to jot those down. We've got a lot of material to cover. I know you're going to want to ask questions, but we'll have plenty of time to do that at the end today. So why now? Investors, if you remember anything today, let it be these five things. Growth is visible and it's tangible, not just through a promise, but through actual customers with actual products that we've won and they're in the process of launching. Our operating transformation has already produced measurable results. You can see it in the P&L and the gross margin. Scale matters. As revenue grows, our quality of earnings will benefit from those economies of scale. And the capital decisions here at Core are made through a rigorous and disciplined process associated with a return on capital employed calculation. Our goal is to build trust. Do what we said we're going to do, which we think we've done in the last few years, and continue to do that over the next few years as we say what we're going to do and then we execute and do what we said we were going to do. So why invest in Core? We combine a lot of characteristics that are difficult to find. Core Molding Technologies ranges from thermoplastic to thermoset. We do have 45 years of award-winning manufacturing experience, and we operate in attractive markets with high barriers of entry. Many of our products end up being sole-sourced with Core Molding. There's only one set of tools, and we make and manufacture those parts for our customers. And those customers, we have decade-long relationships, they're large successful blue-chip companies, and we work with them well over many decades and will continue to for many decades to come. Our large and ultra-large molding capabilities are difficult and expensive to replicate. When you all get the chance to tour our facility in Matamoros and see the size and scale of a 5-story tall press and what it takes to make that installation, you'll really appreciate the barrier of entry that it takes to build some of these parts that you see behind me on the stage. We've proven that we have a disciplined process for capital allocation. And most importantly, I'll remind you again, we've seen the growth. We've already seen wins, and you can see it in that gross margin line as well. As we think about the transformation journey, it's important to reflect back on the past a few years, and what we call our Must Win battles. You'll hear all of the leaders today tell you about a particular Must Win Battle as they go through. But from the highlights, back in 2019 and 2020, we called that the turnaround. We focused on stabilization, leadership, our customers, fixing equipment and liquidity challenges. We built foundational systems, things like leadership development, diversification and operating discipline systems, our manufacturing processes. All of those combined together today applied to Must Win Battle of Invest for Growth and our 2026 Must Win Battle, which is our investments in our Mexico facilities. That's the expansion of our Monterrey facility from a 50,000 square foot operation to a 200,000 square foot operation as well as an added square footage and 4,500 ton presses at our Matamoros facility to support sleeper roofs. When we think about performance, we always try to measure it on what are those key performance metrics that we want to measure. One of my favorite coats from Dr. Deming and God we trust, all others bring data. A few of those data points that I'd like to share from the last 5 years. Internal promotion rate in 2020 was 10%, last year 48%. So almost every other person that we promoted inside of the company came from inside. For you guys in person, you're looking at an entire group of them standing in front of you. This entire group was part of an internal succession over many years of development executive coaching internal training classes and so on. That exists down through our organization as well. It's not just what you see here today. In purchasing savings, we weren't tracking in 2020. Last year, we tracked $3 million of savings on annualized direct material purchases or, in some cases, onetime capital purchases, but we track all of them and we support teams when they win in those negotiations. Our training hours were relatively not tracked in 2020. Last year, we tracked over 20,000 development hours through salaried, hourly positions on our shop floors with our leaders at various levels, we're investing back in our people, and you should see that from our team today. Our variable margins sometimes range wildly quarter-to-quarter, for those that remember, our variable margin or our margin would vary based on mix, based on what certain markets were doing. -- and those were in the 20% to 24% range. Last year, we averaged about 30%. And it was consistent quarter-over-quarter in that 30% range, and that's continued into the first 2 quarters of 2026. Our scrap varied widely from 3% to 6% back in 2020. Last year, we averaged under 2% for the entire year. Sometimes in some of our plants, which we'll show you a picture, have even gotten under 1%. And finally, and certainly not least, our safety performance score. We were at a 4.01 serious injury incident rate. So those are recordable rates in 2020. Last year, about a 75% reduction down to 1.7. That is one of the reasons why our employees stay with Core because they're part of the solution to drive safety improvements and all of these other improvements. There's one thing I've learned in 25 years of manufacturing, there's always another problem coming around the corner, whether it's a new launch, a new project, A new tariff doesn't matter what it is. There's always going to be a challenge. It's the ability to understand the data, solve that problem and then measure the effectiveness of our solution. Did we get it fixed or not and sort of reiterate and solve those problems. That is what it means to be good in manufacturing. And when we're good and when we solve those problems or have those successes, we believe in celebrating them because we believe winning is contagious. Whether it's in the upper left-hand corner, you see Mr. Panda and his Corporate Controller, Andrew Laskowitz; getting a cake or when they did the refinancing. They're refinancing this year, so will save us over $900,000 over the next 5 years, a significant accomplishment that those two helped us lead. And you can even see on teams, Mr. Gafford and Mr. Annaly's holding their cupcakes because we planned in advance, so they could have Cake 2 on that day. Thank you, Tammy. In the upper right-hand corner, the first time Matamoros, it under 1% scrap. Arnold and I cooked, helped cook, we didn't cook them all, helped cook 750 states. We put a hurt on the stake industry here in the Brownsville Matamoros region that week. Or in the lower right-hand corner that was a recutting earlier this year in Monterrey. Instead of standing on a stage and cutting the ribbon, we stood with the people on the shop floor with our entire team and made them part of the celebration of the opening of the plant, as we believe winning is important and it's contagious throughout the organization. This is certainly a key slide to make sure you understand. Diversification is part of our strategy, for sure. This presentation, it does admit and show the decline in revenue through a difficult truck cycle over the last few years. Despite that reduction, you can see that margins have improved from the 8% range to 11% range despite decreasing revenue. We improved pricing, productivity, cost structure and our execution through this time period. As that volume returns, we expect those benefits and operating leverage to further improve the quality of our earnings. We've become a stronger company because of this cycle. And as the cycle recovers, you'll be able to see it. When we think about our future, we think about diversification. It's been part of our history and our legacy already. Diversification from 15 years ago was heavily dependent on the truck and transportation industry, 91% truck. In 2025, that percentage dropped to 44 with Powersports making up an additional 27%. So 75% of Core is in truck and power sports. When you hear us talk today about diversified sales that means -- win outside of truck or power sports. We're still happy to win truck and power sports programs, but we're focused on winning things outside of truck and power sports. This will reduce our diversification risk, reduce the cyclicality. And so far, over the last 2 years, 65% of our new wins have been in those diversified categories. Ultimately, it lowers our concentration risk, both by any single one customer or any single one market, which we believe will enhance the quality of our earnings, making Core Molding Technologies a more resilient and engineered solutions business. What are we uniquely good at? Every great company wants to understand and be clear at what it does best. We borrowed this concept from one of my favorite books, Jim Collins, in 2001, wrote a book called, Good to Great. Some of you may have read it, and this is called the hedgehog concept. What can you be the best in the world at, what are you passionate about and what drives your economic engine? Here at core, we know the answers to all three of those things. We're passionate about culture as a competitive advantage, taking care of our people and making Core a great place to work. We know what we can do the best in the world at. It's large and ultra-large molding and its manufacturing processes that are uniquely challenging in some way. And we know what drives our economic engine. All of you that are going to visit Matamoros, we'll get to see it tomorrow. It's Mexico truck production, it's power sports, and it's unique solutions like SMC compounds, battery boxes like you see in the back corner, our lattice production various small components. That is what makes up Core. And if we apply those decisions to our everyday making processes, it will allow us to continue to move from good to great. And that brings us to the strategy house. What is our long-term strategy and how we align it to the entire company? We share this with everybody in the entire company. It's posted in every plant. Everybody understands it. And at the top is our vision to be the most reliable, innovative and responsive partner in engineered materials and manufacturing solutions. At the bottom is the foundation, our Core values, to be a learning organization with a currency challenge to mutual respect and transparency. And through the middle are the five pillars. In priority order, culture is a competitive advantage. We want to be accountable to results, never to be a victim, but to deliver on results. That is what makes a culture and makes it a competitive advantage. The second pillar is operational excellence. We're still a manufacturing company. We're not working on AI large language models. We're a manufacturing company. We've got to be good at scrap. We've got to be good at problematic and take a data-driven approach that is absolutely core to our competence. And the last three are all related to growth. Grow wallet share and is being first in our customers' minds. It's working with customers that we already have today to help solve problems and expand those. It's to solve problems for our customers. We've got to listen so that we can provide the how for the what of our customers. And the final pillar, industry diversification, where -- when we're focused on organic growth and new wins, we'd love those to be diversified new customers. Also, when we take an inorganic approach, and Mr. Panda will give you more details we're also looking for industry diversification when we look at an acquisition. And anybody can have a strategy, but the strategy is only good if you can execute it. That's the most important part of any strategy. And so this is how we bring our strategy to life. We start with the strategy house. We convert it into a 5-year plan with detailed walk of exactly the things that we think we can do, have already done or are planning to do make sure that it meets our objectives and goals, and then we convert it into a policy deployment matrix. That policy deployment matrix has all the annual initiatives for the entire business and is reviewed with every employee at every location. This keeps everybody on the same page and engages them on an annual process, which they can take through the red, what we call the red thread understand the challenge in the project, make sure that's part of their annual goals and objectives that each person understands how it relates to them. And then we go through a process of reiterating that through weekly reviews, monthly operations process to make sure that we are successful in accomplishing all of the annual objectives that we set out every year. And then we repeat this process year after year continuing to iterate to achieve those 5-year objectives. And addressable market is a question I often get from the investment communities and investor conversations. It's very difficult for us to talk about that with Core because the opportunities that are in any market. It is a huge opportunity. It could be the chairs and tables you guys are sitting at today. It could be any one of these large parts that you see behind me from the power sports and truck, but it could be in almost any market. The size of that market could be in the billions. But the composite industry is where we live and grow every day. 7% to 8% CAGR, if you were to search the Internet and look at why we're composites growing. The reason composites have continued to grow over many years globally is because of the conversion of Ludd concrete and metals into a composite when you're changing the technology and moving to a composite. Our traditional truck and power sports, we continue to win. We've worked with many of these customers for decades. We understand where our investments are and why those are strategic and valuable to our customers, like the ones that we're doing in Mexico today, and those will help us continue to win in the truck and power sports business. And some of the new areas we're focused is utilities and building products. We've been successful on BerryVault and flush covers like the ones you see in the back corner over there. Those are the kind of flush covers that we make. We've been working with electrical and closure boxes as well as grid hardening batteries like the large white battery box you see against the wall. That's a battery for on a bus, but a very similar size that goes on in industrial that does grid hardening, where there installing batteries to help support peak loads of grid demand for electrical usage. It doesn't matter the industry, but if we can associate a composite part, large effectively molded part, in the composites industry where we can solve problems for our customer. Those are the best projects for Core Molding. And why composites? These are some of the reasons why the world changes those traditional materials over to composites. We don't want people to come to core to buy composites. We want them to come buy solutions, solutions to a problem that they have, whether it's helping them reduce weight, improve durability or lower a total life cycle cost, we want to help solve that problem. And will create opportunities through part consolidation, sometimes metal parts, there are rivets, wells, additional features, we can mold that all into 1 part we can offer material savings or labor savings to our customer. The more complex those problems become, the more attractive they are to us, and this is a benefit for core. When you apply them to core and some of the products that we have today in that large and ultra large format solution, this is what they look like. In the truck market, it could be hoods, school bus hoods, sleeper roofs or air deflectors, like the one you see behind me. Can take a bird hit at 75 miles an hour. No problem. If it's power sports, it could be the skin plates that we have an underbody protection that we launched last year, a great new product or the cargo boxes that we have for UTVs like you see in the back, imagine the people that takes and the assets, it takes to make a part that big in a one-piece molding. That's what makes core unique -- and that's why we own a large percentage of the cargo box UTV market because they are very difficult large quest to make. Or if it's a power sport for water, like the personal watercraft haul and mid deck, you see to my right. Those are great products, and we're in 85% to 87% of the personal watercraft in the world because of our ability to make those in single pieces. In Building Products, you've surely seen them around a deck or patio either at your house or somebody else's or you walked on a dock this summer that was made out of a composite or I promise you, every one of you has opened an SMC door and never even realized that it was a composite door that you opened in or out of a house residence or condo. In the utility space, you've been on a rail line and seen a trough beside it. We're making composite troughs. If you've seen anybody installing a parking lot in a commercial space, they can't run water off and so they have to collect the storm water under the parking lot, so it doesn't run off in the creeks and streams. That's what those green chambers are for underneath the parking lot to store water. Again, won't corrode, won't rest. It's not wood, it won't rot, and it's significantly lighter and cheaper than concrete. And in the last process, everybody that's coming to Matamoros, you'll get to see one of my favorite processes, building a 12-foot industrial fan blade, hollow composite fan blade 12 feet long and one piece. No bond joints, no assembly, a single part, a truly awesome engineering process. And how do those apply to some of the recent new wins? The automotive part, you see in the upper left is the inner bedsides, tailgate and panels. A great process for us in the electric vehicle space in a heavily utilized cargo facility takes quite a beating with throwing things in and out of the back of a truck. Our construction vehicles, like the lift you see there, where the customer wants a composite side pod, painted in color, and we've added top co paint capability to both our Matamoros and Monterrey facilities to be able to serve the construction and agricultural market. The medical bed application on the upper right replaces stamped steel and powder-coated panels. You get a molded part with hinges, with handles with guides -- excuse me, everything you want on the part already molded in saving that customer a significant total assembly cost. They've already awarded two programs to us because of the success of the first one. And the battery enclosure, shown on the lower left is a battery that can be hot swapped on the top of a bus. So you never have downtime for charging. And that's similar to the part we have here in the room today. We solve problems to be able to drop that battery from the top of the bus onto the ground without failure. Our TopCo paint that I mentioned as well as our SMC compounding that we have in Columbus, Ohio, is another key area that we've been able to win and grow new additional business. And in the lower right-hand corner. For those of you that were on the tour today or got here early enough Monday to see the starship launch out of Star base here at Brownsville, Texas, carrying a few satellites into orbit this week in the last 24 hours. Those satellites need to talk to a base station. Shown there is the base stations that communicate with satellites. And it really looks small on the page, but that part in the lower right-hand corner is 2 meters across. It's over 6 feet across and provides the chassis for all the hardware and all the assembly for that unit, and they'll be launching in December this year in Matamoros. So let me summarize. Why Core? Because we have proven our operating transformation. Why now? Because growth is becoming visible. And we have strengthened the foundation, diversified the business and built an execution culture. Most importantly, we've positioned ourselves to capitalize on large market opportunities. Next, Alex Bantz will show you how we're converting these capabilities into measurable commercial growth. Thank you. Alex?

Thank you. All right. Thanks Eric. Good afternoon, everyone. My name is Alex Bantz. I'm the Chief Commercial Officer for Core Molding. I've been with the company not quite 2 years now. I joined in November of '24. So coming up on my 2-year anniversary. Because I'm the newest member of the group up here, I'll spend just a few minutes talking about my background, just so you get a flavor of who I am. My background is actually in engineering. So my degree and my education is engineering. And I started as an engineer and as fast as I could, I went over to the commercial side. So it's apparently in my blood. I started in procurement that I went to sales and then I did product management, marketing and then into sales leadership and management. Most of my career has been in that commercial space, but all of my career has been in manufacturing. That's what I know. That's what I love. I still get a kick almost on a daily basis when I get to see parts that I've been intimately involved with out in the world. So it's -- I've had the pleasure of working with some great customers and great companies, and I get to see myself my parts out there almost every day. So that's still a rush to me. I know it's kind of silly. And ultimately, my engineering background really does help me to understand our customers and deal with the highly technical products that we sell at my previous customer or previous employers -- employees and here at Core Molding. So I was hired here to accelerate growth. So that's what we're going to talk about today. So in that growth conversation, we'll talk about where we've been and how we've significantly transformed our commercial organization, both the structure and the processes. We'll talk about the successes that we've achieved along that path over the first 18 months. Record level of incremental platform awards. And then also we'll talk about where we're going and how we are excited about how much tremendous runway of growth we have in the markets that we're focused on. So starting with people. When I first came in, again, November of '24, the first thing -- one of the first things I noticed when I started thinking about how we can accelerate growth. I noticed that the structure of our group was really hindering our ability to grow. And what I mean was the structure we had key account managers. And account managers were completely responsible for the entire process of customer relationships. So they were getting pulled into quality issues, payment issues, pricing, delivery, everything and then also growth at the end of it. And it was that growth at the end of it was really the issue. They weren't able to focus as much as we wanted them to on pure growth. They're getting pulled in multiple directions and really detracting from our ability to grow. So what we did is we created a dedicated growth team. So all day, every day, they wake up, they think about growing the business, and hopefully, they think about that until they go to bid. And whether that's with our current customers or new customers. At the same time, we also created a team dedicated to maximizing the customer experience. So what they do is focus on those day-to-day issues so that the other team can really focus on that growth, and the customer experience team really enables growth two ways. They allow that focus to happen in the growth team, but also they increase the customer satisfaction to facilitate growth with our current customers, which is vital to our growth path. And through specialization and adding resources, we've tripled our bandwidth for growth activities, and we doubled our bandwidth for increasing that customer experience. And both groups are really benefiting from that efficiency of focus. Another thing I noticed when I started and really just observing the team in general. A couple of things. I noticed that we were really just turning quotes. So we really focus on quantity and speed of quotes coming in and getting them out, which is fine. But we weren't really focusing enough on the strategy of how to win those opportunities. We were treating a $5 million opportunity the same way we would treat a $0.5 million opportunity. And also, our key account managers on our team, we're taking more of a passive approach to finding new opportunities. So in conjunction with the structure changes, we implemented some new processes to further increase the effectivity of both teams. And here's a highlight of some of those. For the growth team, which we call our business development team, we created a ranking system to help us identify and prioritize the best opportunities where we have the best chance to win. We trained on and implemented value-selling methodologies into our sales process to identify and solve the root issues of each opportunity, what the customer really needs when they're asking us to quote on something. We're driving a how-to-win approach through the mentality through the entire sales process and asking those questions immediately when we find out what is the competition, how can we beat them, how can we outmaneuver them? What are their strengths, what are their weaknesses? What are our strengths? How do we win this business? We want to treat every opportunity as a battle against our competitors. And then more so this year, we're focusing on proactively identifying new opportunities in our focus markets that I'll get into here in a little bit, and Eric already touched on. So instead of taking that passive approach, now we're getting proactive and really taking it to the market. On the customer experience side, really, the initial focus was on maximizing our scorecard. So we have blue chip really sophisticated customers that have pretty intense scorecards that's how they evaluate how we operate on a daily basis. So this team is now going to be able to make sure that their judgment of us is an alignment of how we think of ourselves. And then once we get that alignment, how do we maximize those scores, so that when a new opportunity comes around, we are in the best position possible to win it. And in addition to that, we're also aligning with the plants and the operations team with our customers to make sure that throughout the entire order process, we're in alignment on minimum order quantities, lead times, everything to make their job easier and our job easier. And advocating for our customers when it's appropriate, but more importantly, advocating for our facilities and our plants to our customers when appropriate. And ultimately protecting our current business and enabling that growth team to go out and grow with our current customers. So that all sounds great, but does it really actually mean growth, right? So is it working? And I might be a little biased, but I would say, yes, I think it is working. So 2025, $63 million in annual incremental revenue. That's a record. So we asked all our long-term surveying employees and some of our Board members. No one can remember a year of more growth than we experienced last year. And we're following that up with this year, $26 million in the first half and great momentum going into the second half. So that's nearly $90 million of growth annually in the first 18 months of the new system. But it's not just the numbers that are exciting. It's also the diversity that you see within the numbers when you really dig down. And those numbers are -- that diversity is by market. You can see here different markets we're serving, where we're winning by customer, it's not like we're going out and winning 1 or 2 huge opportunities. We've got 30 different opportunities, discrete projects that we're working on. And that's really helping us diversify our customer base, our process and our markets. And Eric already mentioned 65% of those wins are in diversified markets beyond truck and power sports. So that's going towards our goal of diversifying the business. We want to grow truck. We want to grow power sports, but we want to grow everything faster and we're doing that. And then when you look at the minimum amount of revenue over the lifespan of these projects, and we took a pretty conservative look at this. When you add all that together, we estimate $400 million of total revenue that we've won in these 18 months. So very exciting stuff. So where are we at today? So what you're seeing is a snapshot of our current pipeline. This is a snapshot in time. This is probably done in late July after we closed second quarter. And you can see a lot of numbers here, but I'll just -- I'll focus on a few. And the one that really jumps out and I should probably put it in bold, $1.4 billion of total revenue over the life stand on these projects that we have in our funnel currently today. Transformational growth opportunity for us. We've got $15 nearly $150 million of opportunities annually that is prospecting. So that's what we call Stage 0. This is the initiative that we've really implemented this year, where our guys are going out and finding opportunities, not waiting for them to come to us. And then we've got $210 million annual incremental revenue that we're actually quoting right now, whether it's quoting, negotiating or waiting for an award. And that $210 million over the lifespan. That's where we're getting that $1.4 billion, and we're not even taking into account the $150 million because we don't -- we're not sure what those lifespans are. And then more exciting is when you look at our previous win rate over the last 18 months that we've experienced and you apply it to these numbers, that gets you $83 million of annual incremental revenue. I'm not saying we're going to get that, but that's -- if history were to hold, that's where we would be. So that's very exciting. So all these numbers point to me that we have a very robust pipeline. But how do we keep it that way? And how do we actually make it even more robust, even bigger? So that's how we're going to focus on these 5 markets that we kind of tease in the video. Eric kind of mentioned them a little bit already, but we'll dig a little bit deeper into each one of these. Truck market is always going to be our -- I won't say always, but it's traditionally been our biggest market and will be for the foreseeable future. This is the market that we were born out of. This is our heritage. When we were spun off from international truck 30 years ago We were -- like Eric said, even 20 years ago, we were 90% truck. That's our heritage and will continue to be our heritage. But we still have significant room for growth. That's the exciting part. We are a very known player in this space, and we have a lot of room to grow. So the traditional applications are super roofs. So at some point, hopefully, we'll go outside, and we'll see some trucks that we parked outside. Those are the sleeper roofs that we have a pretty dominant position within North America. We've got hoods like the part over to my right. And then we've got wind factors, like Eric already mentioned can survive a 70-mile -- I didn't know that. So I learned something to... So -- and we are -- the exciting thing is that there's a handful of major players in North America. We are engaged in selling to every one of them, and we have really good relationships, and we're winning with most of them. So being that truck is our largest market and sends the reason that it is the biggest portion of the awards that we won last year, over the last 18 months and also our current pipeline. So that's to be expected. But in this space, again, we are a very established market leader. There's only a handful of companies in the world that can do what we do. And we have over 30 years of experience, very, very well established. And hopefully, you're getting a sense for looking at the part behind us, looking at the video and those of you that are going to go to the plant tomorrow, these are complex parts and assemblies. Very few people can do this in the world, and we are one of them. Our customers always are also recognizing and awarding us for the operational excellence improvements that we've done in the previous years. That is a big part of why I'm here is because we earned the right to grow through those initiatives of operational excellence. So going forward, how are we going to attack this market? Our inside sales team working alongside with the operations team will ensure that we are keeping our customers happy. And so that we will continue to be on that short list of every opportunity that comes for hoods and roofs in the foreseeable future. And we also will ride the wave. So we're in a trough right now, but we are forecasting -- everyone is forecasting a significant growth in the market in the coming years, just the market cycle, Alex Panda will talk a little bit about that here in a little bit. And then also, we are working very diligently and hard to go beyond the hoods and roofs that everyone knows us for. There's lots of opportunities beyond those, whether it's inside the cab for more traditional thermoplastic parts but also outside the cab. A great example is the traction plates, whether it's on the steps or in the back near the fifth wheel. Those are traditionally aluminum. And aluminum is getting very expensive right now. So it's a great opportunity for us to go in there with a great solution for plastics and displace that. Our next biggest market currently is powersports. So this would include side-by-side vehicles, personal watercraft, golf carts. It's not on here, but ATVs would also fall into that category. We -- Eric already mentioned, we have very dominant positions with the cargo boxes and the boat holes that you see here today, not only thermoplastic but also thermoset. We're not showing that today, but that's another one that we have a good position with. But we do have additional opportunities in the golf cart space. We've talked to those guys. We've had good conversations, and we're going to keep at it. We think there's tremendous opportunity for us in the golf cart space, which continues to be a very booming industry with the -- the wave of retirements going on. In addition to our market-leading positions in the cargo boxes and halls, we bring some pretty unique technologies to this market. Eric already mentioned the patent-pending skid plate technology that we already have placed in one customer, and we are working very hard to get that to be the standard across the entire industry in the coming years. But also, in addition to protecting those positions, we're really targeting growth in golf carts and winning with other customers that we don't -- we have some connection with, but don't really serve too much in that like Honda and Kawasaki. So beyond our core markets of Truck and Power sports, the utilities and infrastructure market is probably the most exciting space for us to grow, in my opinion. When we think of this space, we think of really three main categories, maybe a fourth I'll mention, but water filtration and drainage, power generation, data centers, obviously, very hot topic right now, but also some HVAC applications as well. And one of the reasons that this is such an exciting market for us is huge. It doesn't take long to build up to that $1 billion, just looking out very quickly. So I don't know how many billions it is, but it is in the billions. So a huge runway for us, but it's a very diverse market. So all of our processes are applicable. And what we're showing here is just a snapshot of some of the exciting opportunities for applications as well as customers. So when you look at recent awards and current pipeline amongst our core markets, this is the second one. Again, that's why we're so excited about it. Lots of great opportunities that we already won and that we're currently working on. And again, with our diversity of applications and processes that fits very well for this market, and we're very excited about that. A great example of that is opportunity working on right now where a customer came to us for a thermoset part, and we found out that it was being made to a thermoplastic part. And we said, "Hey, we can do both." And they were quoting each one separately, and they were going to assemble it themselves. And we said, "Well, we'll quote both. And while we're at it, we'll go ahead and assemble it for you and give you one complete part. No one else was doing that." So that's been a very good -- good ongoing conversation and absolutely separated us from our competition. So very exciting. That's just one example of what we can do. And another advantage is our experience in being a molder, and a producer of SMC. So there's a lot of SMC used in this space. So for customers that want a molded product, the fact that we make our own SMC gives us an advantage for numerous reasons. Cost is one, of course, but also the technology experience and technical know-how that comes along with that. And for a customer that might be molding their own parts and once are material, the fact that we mold SMC, we can have really good conversations with them on design. And really, we understand their possible pain points and really help them avoid some fit falls. So our customers -- our experiences, our customers are very much valuing that, and it's allowing us to win. So in this space going forward, we're going to proactively pursue opportunities in the electrical submarket specifically power generation and data centers. We've invested in market data, and we've gotten a good head start on identifying customers and applications. And both of those spaces are going to grow no matter what. I know that there's -- we talk about maybe there's too much data center going on, but when you're talking trillions of dollars, obviously, a huge amount of growth, even if it slows down a little bit. So very exciting for us. Building Products. So this is -- when we think of building products, we think about home exteriors, where a lot of wood parts are being displaced by composite plastics, whether that's a door, like Eric mentioned, shudder's siting as well. You can see one of the examples there of composite siding. And then when you think of patios index, we do decorative Lattice that you might see in some of the big box stores. But also decking is a very interesting market right now. We're not really looking at the decking itself. But because that's such a trend right now, all the ancillary parts that go along with it is very exciting for us. So we're looking at ways to tag on to that and potentially grow with that market. So that could be the railings, the structure, anything that goes along with the actual decking itself. So a very interesting and very exciting market. And then finally, kitchen and bath ware, there's a lot of applications for SMC, including shower bases. Our value proposition in this market is -- has a lot of similarities to what we just talked about the utility market. Diversified portfolio of processes and products, our experience in molding large-format parts and producing our own SMC certainly helps us in this space. And our experience, again, of collaborating with customers to solve problems and delivering elegant solutions is a huge advantage for us. So going forward in this space, some of the utilities, we are proactively pursuing OEMs of the products we've identified as good fits for our processes, and we're evaluating other paths to the markets like direct-to box potentially or direct-to-consumer. Right now, what we've discovered is there's a lot of steps between our facility and the end-use application. So we don't know what the answer is, but we're asking the question, is there a better way to do that? Do we go direct to the actual consumer? Or do we go direct to those big-box stores? Then finally, construction and ag market. Amongst the five markets, this is the one that we're probably earliest in the development phase. We have a small foothold. We do some parts for John Deere. We have some applications with fans for Barnes. But this is not -- while not as large as some of the other markets that we're dealing with, it doesn't -- we don't think the opportunity is over $1 billion. But certainly, it's in the hundreds of millions. And again, starting from where we are with single-digit millions a long path for growth for us. And more excitingly, and one of the reasons that we are really focused on this is because of the parallels between this space and the truck space, you can see hoods and you can see roofs. Those are things that we know. Those are the things that we've been doing for 30 years. And our ability to talk to our customers in this space, whether it's John Deere, Caterpillar, Case New Holland, what have you. Our experience with those truck manufacturers and power sports OEMs gives us a lot of credibility in the space. And some of the conversations that I've been a part of, they really value that we have that experience, and are asking us a lot of great questions of how we can grow with them. -- so our value proposition, again, you're going to see some similarities again with the previous two. Our portfolio of products, again, is a strength. And our experience in SMC production as well as molding A.nd large format parts when you think about construction vehicles, ag vehicles. These are big parts. These are big vehicles, and they need big parts. So that falls right into our value it. So going forward, we're going to leverage that credibility with our truck customers to win more quotes. We're doing that right now. We're going to proactively and persistently educate customers -- customer engineering teams on the advantages of our thermoplastic technologies. So DLFT and low pressure are a little unique in the space, and it's not something that engineers learn in school. So we have to educate them. We've already done that with powersports to great success to do that again in the ag and construction space. It's going to take time. We know that. We have to be consistent and persistent with it. But those seeds will come to fruition, and we will be a decent player in this market eventually. And then finally, we are looking to add a dedicated resource to this market and really, again, get that efficiency of focus where they all day, every day, they're looking at how to grow in this space. So in summary, circling back to where we started. We've made significant transformation of the commercial team through improved processes, focused teams and investments and additional resources. The team is executing at higher levels and poised for growth, and that growth is accelerating. A record year in 2025, great momentum so far this year and in the first half that we've proven and second half that we're working on right now and more to come. And finally, tremendous opportunity ahead of us. We have billions of dollars of available opportunities in these spaces, these 5 markets that we're focused on, and that's what we wake up every day figuring out how to do that. And while I would say 2025 and so far 2026, like I tell my team, it's a great start, but it's only that it's a start. We have to keep pushing and keep going. And this is -- we'll be much, much further along when we look back in 5 years, when we're $1 billion company. And with that, I will hand it over to Mr. Gayford.

So shortly after Alex started, I've shared the story with John earlier at lunch. I told him, "You sell it, we'll make it." And you can obviously see they're having a lot of success for the pressure is quickly turning it back to Arnold and I to make sure we keep up with the sales team. But -- good afternoon. So Arnold and I are excited to -- they let us out of the manufacturing plants, and we're going to present to you guys the operating platform at Core. With this week's announcement, I thought it would be appropriate to give a little background on myself. I have almost 30 years of manufacturing experience and quickly approaching 19 years specifically in composites. I joined Core nearly 4 years ago. And one of my first assignments was the Must Win Battle for getting the basics right in Gaffney and Columbus. We stabilized equipment, strengthened accountability, and put the right people in the right roles and then also rebuild the operating discipline. The success in that Must Win Battle that Eric talked about was built on in subsequent years for invest for growth and now for the Mexico expansion. So today, I'm honored to stand before you as the COO -- in the COO role. I see this as a continuity. It's not a change in the direction. My focus is converting the opportunities that Alex talked about into stable production and profitable growth. So back to the operations platform. Most investor presentations focus on markets, products, financial results. We want to show you today the operating system that makes those results possible. Because we can't physically take you through all the plants, even though we will take you through Matamoros tomorrow, we're going to show you how the network works, how each operation plays a specific role and why we believe the operating system and the people are a competitive advantage. The important story is not that we own manufacturing plants, a lot of companies own manufacturing plants. What differentiates Core is how we combine the people, the process and the specialized assets across one integrated network. We develop people internally, we move leaders and knowledge between facilities. So expertise is not trapped in one plan. Many of our products, as you can see, are large complex parts. We'd like to say at Core, we build big better. So let's look at the framework. We describe Core's operating platform through three reinforcing elements: execution, specialized manufacturing footprint and differentiated composite solutions. Execution earns customer trust. Our footprint creates scale and options. Our capabilities allow us to solve difficult customer problems using the right material, the right process and the right cost structure. The value is not one plant, process or piece of equipment. The value comes from combining experienced people, material knowledge, engineering capability and large-scale assets into one system. The starting point for that is execution. Our commitment is straightforward, safely ship good parts on time every time. The three measures on the page represent the basics of manufacturing, safety, quality and delivery. So as Eric said, Dr. Damien said and God we trust, all others bring the data. So there's the data the last 5 years of how we've been performing on those metrics. Additionally, the other proof is how our customers recognize our performance. In 2025, Core received a supplier quality excellent role from General Motors. In '24, we received the BRP Gold Supplier award. And in 2023, we received PACCAR's 10 ppm supplier award for quality and execution performance. Those awards are results of consistent performance, not isolated events. It comes from experienced people, disciplined processes and consistent operating standards, which are deployed across every facility in our network. So now we're going to dive into the footprint. Core operates over 1 million square feet of manufacturing space. We have 83 presses in North America. Our presses range up to 5,500 tonnes, allowing us to manufacture some of the largest composite structures in our markets. These large assets are important. Not every competitor has the facilities, equipment or capital required to produce parts of this size. Again, at Core, we build big better. Just as important, not every competitor has a technical expertise to run them successfully. The key takeaway from this slide is specialization. We are not trying to make every facility do everything. At Columbus, that is our center of excellence for SMC compounding. Gaffney focuses on hood and battery enclosure systems. Winona anchors our proprietary DLFT technology, which is direct long fiber thermoplastic. Coburg specializes in engineering solutions and specialty products using the structural foam and structural web processes. Matamoros provides scale manufacturing and is our truck roof center of excellence. Monterrey is the growth platform that combines structural foam and structural web with DCPD and top co pain technologies into one location. Each facility has a clear role in specific strength. Now we're going to look at each plant in more detail, starting with Columbus. Columbus is much more than a manufacturing plant and our SMC compounding center of excellence. It is our SMC compounding center excellence with over 100 million pounds of annual capacity. Our recent investments in equipment, controls and automation have improved material consistency, reduce scrap and provide a more reliable input into our SMC network. This consistency has helped some of our plants reach the 1% scrap goal. As Eric pointed out, we created a stake shortage in Matamoros when we achieve that goal at the Matamoros plant. Columbus also supports external material customers. We mold parts ourselves, so we understand what the material must do when it reaches the press. That combination of compounding, molding, engineering and application knowledge differentiates core when working with external customers. Another example of how we leverage this capability is with transfer programs. We had a customer transfer of mold on a Friday afternoon and said they needed parts. By Wednesday, we had compounded -- we have made a new compound, made parts and sent them with the business development team to be tested at the customer. That highlights the power of internal compounding. It creates speed. So with that, we're going to take a video tour of the Columbus plant. [Presentation]

So that's a quick overview of the Columbus. I know some of you have been to the plant, but it's really impressive. the mixing system, which is the heart of our compounding operation. Those vessels that you saw in there would stand floor to ceiling in this room to give you kind of an idea of the size of those mixing vessels that we use. And then that line is making compounded over 40 feet per minute is what the speed of that. So it's very impressive to see in person. So that's what gives us control at the beginning of the value chain where product consistency and finished part performance start. We are able to leverage this internally to achieve the low scrap percentage that we talked about, and we're also able to leverage it to sell compound to external customers. Now Gaffney tells a different story. If you want to see how culture moves from one plant to another, Gaffney is a great example. Gaffney is our hood and battery and closure and center of excellence. But when I think about the plant, I think about having the right people in the right seats. We have three leaders, Marshalltar, Doherty Ortega and Andrea Garcia that have each worked in three different core facilities and bring broader experience into this operation. They transferred not only technical knowledge, they brought operating standards, relationships, lessons learned and leadership expectations. Culture is not a slogan. It's not a poster on the wall. It's how the operators respond to problems, reinforce standards and develop people and deliver the customer commitments. The equipment matters, but the people make the operation successful. Gaffney demonstrates how internal development, leadership mobility, great consistency, strengthen the business and prepare the plant to pursue adjacent opportunities like the battery systems, the battery enclosures in the back of the room. So with that, let's take a look at this Gaffney plant. [Presentation]

So Marshall is great. You saw there giving a presentation. Marshall came up, he was originally started as a stealth aircraft technician has worked his way up and worked at Coca-Cola for a period of time and leads our maintenance excellence program. So we brought the maintenance excellence from Coca-Cola to our plant leads that. One of the things I'd highlight in the Gaffney plant is, we call -- we talk about tracking green oil because all our presses use thousands of gallons of oil. And even a speck of dust will ruin the servo valves in them. So we have a green oil program that the Gaffney team has really helped us develop to filter that oil to a very low concentration so that we maintain our presses and keep that oil impecably clean. So Gaffney shows how putting the right people in the right roles, turns culture into a competitive advantage. Now we'll move into Winona. Winona is built around our proprietary DLFT process. Chris Jansen, Mike Bergman and Melissa Wagon, are three plant leaders that have more than 20 years of experience with this technology. Chris even started as an intern. Was then an engineer, engineering manager and then now the plant Director. Additionally, our proximity to win on a state helps us add engineering talent and develop the next generation of technical capability. One of the most valuable things in Winona is it produces is knowledge. The talent can then move beyond the plant. Julian Rodriguez is one example. He started as an intern, moved into product engineering and now works in our corporate account management department with Alex. The technical and manufacturing experience enables a deeper customer conversation because the account manager understands what the process can do, where the risks are and how the operation can create value. Winona also demonstrates cross-plant integration of our specialized manufacturing footprint. In the current program, we are creating a DLFT part in Winona and an SMC part in Matamoros. The SMC part ships from Matamoros to Winona where we combine it for final assembly and core manages both technologies and delivers one integrated solution to our customer, rather than our customer having to manage multiple suppliers. So with that, we'll take a look at the Winona plant. [Presentation]

So Winona, in Winona, I take you right to -- if we were there, I take you right to the Tailgate manufacturing cell where we make the Tailgate inter panels for General Motors. It's such a fine dance of automation and manual operations all in one cell. There's about 7 people dancing through that cell, and they produce 60 vehicle sets per hour between loading the press, doing some manual operations, then loading it into a robotic cell and then delivering it every day for General Motors. It's quite a sight to see. I hope you guys get to see it one day in Winona. So Winona combines experience, emerging talent, proprietary technology and cross-plan integration into solutions that are difficult for a single process competitor to match. Next, we'll look at Cobourg. Cobourg provides another example of technical capability, this time through manufacturing efficiency and direct customer collaboration. So Cobourg does two things particularly well. It makes today's products more efficiently, and it works with customers to engineer tomorrow's products. The Lattice product demonstrates the first capability. The team improved the process so multiple pieces could be molded at one time, increasing our output from the same existing piece of equipment. The skid plate application is another. A skid plate being the shield underneath the side by side that demonstrates the second capability. The business development team heard about the problem during a supplier summit. We challenged the Cobourg team to solve the problem. Cobourg worked directly with the customer and performance impact testing, developed a thermoplastic alternative for a side-by-side vehicle application. And the team did not simply receive a print and mold apart. The team helped to engineer the solution and around the application. The results demonstrate why customers choose composites. Lower weight, corrosion resistance, durability and greater design flexibility. Let's take a look at Cobourg. [Presentation]

So you saw the skid plate application there. We make about 24 of those every hour. Also was there was the generator pads, and you saw us in putting inserts. The Cobourg plant does a great job of of engineering error proofing into the process. We use cameras and vision systems to make sure we get all those inserts into those -- the basis to make sure we protect our customers. So Cobourg demonstrates how continuous improvement creates capacity in today's business while we -- while customer collaboration creates tomorrow's growth. Across the four plants, the stories are different, but the operating model is the same. The same operating model continues in Mexico where we combine scale and growth capacity. Arnold is going to take us through the Matamoros and Monterrey facilities.

Thank you, Mike. Appreciate that. Good afternoon, everyone. My name is Arnold Alanis, and I'm the Executive Vice President of Operations for Mexico. Been with the company for 14 years now, and I bring about 32 years of experience in manufacturing. Today, I'll walk you through the two Mexico plants, Matamoros and Monterrey. And our 2026 Must Win Battle. Let's start with Matamoros, our largest facility. Matamoros is a 600,000 square foot facility with 672 employees and with capacity up to 5,500 tonnes. The plant is designed for large-scale cost competitive manufacturing, SMC, DLFT and sprayer processes. It also supports some of the most complex programs and is the largest heavy truck roof manufacturing facility in North America. Those of you who are going to sign up for the plant tour tomorrow will be able to see that firsthand. Let's take a few minutes to see the Matamoros operation in action. [Presentation]

Now let's move over to Monterrey. Monterrey has gone through a significant transformation, expanding from 50,000 square feet to 217,000 square feet and 226 employees. The facility currently operates 9 presses with capacity up to 1,000 tonnes. But this transformation was not -- was about much more than just square footage. We consolidated two plants into one facility and brought an external warehouse operation in-house. This created a more efficient operation and more importantly, positioned Monterrey for the future. Today, Monterrey is being established as our DCPD center of excellence when integrated topical paint capabilities, and a strong platform for future growth. The goal is clear: build the capabilities in Monterrey today that will allow us to grow the business tomorrow. [Presentation]

Next, there's three reasons why Core wins: execution, capability and solution. Number one, every day at 9:00 a.m., we're standing on the production floor, reviewing safety, people, quality and delivery. Number two, we have a unique capability to offer two processes under one company, thermal set and thermoplastic. Thermal set being multi-heavy truck parts like SMC, thermoplastic mainly in power sports and personal watercrafts. And number three, we work closely with our customers to find solutions to their problems or needs. This concludes the overview of our 17 plants. Thank you. I'll now hand it over to Steven.

Awesome. Thank you, guys. Thank you, everybody, so far. That concludes the first session of our presentation. We made it through that a little bit quicker. So during this break, we've got some extended time, we've got two trucks sitting out in the parking lot. If anybody wants to go to the restroom, get something to snack on or anything like that and then meet us outside, we'll head outside and do a little show and tell. Thank you. [Break]

Okay. Part number two, here we go. Let's finish this thing out. Next up, we're going to have Stephanie Pulliam come up, and she's going to spend some time on culture as a competitive advantage for us. But first, I want to play another quick video, and then welcome Stephanie to the stage. [Presentation]

All right. Good afternoon, everybody. I'm Stephanie Pulliam, I'm the Executive Vice President of Human Resources. I joined Core about 5.5 years ago. I started as the Director of Total Rewards. I am one of the lucky beneficiaries of our succession planning process. I will talk you through a little bit about that. But I took this role on just under 2 years ago. So I spent time with my predecessor, Rene, going through our succession planning to make sure that I was set up and prepared for this role as I took it on. So it's just a tiny bit about me. So you've clearly heard from our leaders why culture and people are important to us. I think you've heard that woven through all of the presentations so far today. You've seen culture talked about in the various plant videos. So I want to take a minute to kind of ground us back to the strategy house that Eric shared earlier. Culture is a -- competitive advantage is our first pillar. It's our most important pillar. We truly believe that having that culture and people in place are really what help us execute that long-term business strategy. And then we put in place various leadership development programs because our leaders are the ones that help create that alignment for our employees back to that business strategy. The culture is where we bring in the behavioral components, and I will talk about the programs that we have in place to support all of these. And then ultimately, at the end, I will talk about some of the execution of the strategy from the culture and people standpoint. Okay. So let me talk a little bit about some of the systems. We've spent a significant amount of time and energy into developing systems and processes to support our leadership and talent development. Eric mentioned our Must Win Battle back in 2021, had some components of organizational development. So some of these programs were developed as a result of that Must Win Battle, and we've continued to build and improve upon those in the several years after that. Now these systems that I have shown here, lots of organizations have these, right? So what I want to do is take a minute to explain what is maybe unique or at least special for us at Core, what makes it important to us. So starting on the left, our internship program. So our interns are brought in. They get assigned projects. They have the opportunity to present back to us to the leaders, the conclusion of their internship, the results of their projects. Mike mentioned our plant Director, Chris Jansen and Winona, started with an intern with us. Another intern that I would like to highlight is here with us in the room today, Telia in the back, started with us in corporate HR as an intern. And today, she actually helps manage our internship program. Moving into our career paths. So we want to make sure that our employees know what those potential advancement opportunities are matched with the business need. So we've developed those career path plans that show people how they can move forward in individual contributor roles ultimately into people leader and potentially up to executive positions. Now the tools that we have in this career path are also critical for the leaders. So built into these career paths, we're giving the leaders, the tools to help facilitate those career path conversations with their employees to help understand where their interests are, where their skill sets are to potentially continue those career path conversations. Now moving into skills assessments being a manufacturing organization, you can imagine that it's very critical for us to understand the technical needs that we have, the technical abilities and ultimately, where our workforce stands in relation to those. So we have a big matrix where we are able to evaluate those skills, and that really helps us identify where we have subject matter expertise and where we maybe have some areas where we need to prioritize those development or training efforts. All of these things then translate into targeted actions that we put into our individual development plans. Now these are not performance improvement plans. This is different. This is focused on true professional development. So we have put together these tools. It's a formal individual development plan. It could be for somebody who is working on that succession path and giving them targeted actions to work towards those potential future opportunities. It could be for somebody newly promoted into a manager position to make sure that we're giving them the opportunity to achieve success in that role and what are the things that they need. We partner mentors with them through this. We utilize what their natural strengths are to help them be successful. Moving into performance management. Every organization has performance reviews, right? We give performance reviews to all of our employees. Internally, we say that we use this to measure both the what and the how. So of course, everybody has goals. We want to make sure that we are executing on those goals. That's the what. But equally important are those behavioral competencies. So we're building those competencies into our performance management system. One of the things that we also do that is maybe a little bit unique is all of our salaried employees are given a professional development goal. So even if they don't have a formal individual development plan, everybody has something tied to their own professional development through that annual process. Leadership Essentials is our foundational leadership training program. So oftentimes, you hear that people are promoted into their first people leader position, but they don't necessarily have the skills or the knowledge to be successful in that people leader role. So we recognized that gap, and we developed this Leadership Essentials program as the true foundation of that. This is where I have a little bit of my show and tell I think I felt like maybe I needed to contribute something to the very cool parts here. So I want to highlight this work book. You can see it's over 200 pages. This is something that our organizational development team led by Christina Farr, developed entirely in-house. So we wrote our own book on those foundational leadership skills and how that translates specifically at Core. All of our leaders have been trained in this Leadership Essentials program, and some individual contributors as well as part of their succession planning opportunities, they get trained in this. And we do this ongoing for people who are new to the organization or newly promoted into a leadership role. The second step after that is our leadership development program. We call that LV2. This is a more select group. So these are for our high-potential employees. They are nominated and selected for participation in this program. The picture that you see on the bottom right is our current cohort. It's our fourth group. I am one of the lucky graduates of this program as well and some of the names that you've heard mentioned throughout the day. We do this year-long program with this group and they get lots of trainings. They are assigned projects as a part of this program. But one of the things that has been truly successful for us is a weeklong conference that we do where this group gets to come together in person. So a lot of times, these individuals are in different roles. They're in different plants, so they don't have the opportunity to come together in person. And this gets them the opportunity to see each other to interact with the leaders and get that face-to-face interaction. And then finally, I'll wrap this section with the succession planning. So all of this comes together with our succession planning. We evaluate this at least 4 levels deep into the organization, in some cases, more. So what that means is that we have succession planning evaluated for the vast majority of our salaried workforce. One of the things that we do is we hold cross-functional workshops. So after we do our succession planning evaluations, we get together with the leaders to have conversations with each other and share our succession planning evaluations as a leadership group. And this really has helped us see where we have different people that have interest maybe in other areas or maybe they have skill sets suited to a different area. For those of you going on the tour in Matamoros tomorrow, you'll get to meet our Plant Director, Camero Castro. He's a perfect example of this. So through these workshops and discussions, we identified that -- so his background -- let me back up his background is in finance. He was our country controller, but we learned that he had an interest in a plant director role. So that got us talking about, okay, well, if he's interested, we think he might have some skills for that. What can we do to help work him towards that position. So part of that included getting him into an operations role, and he's now the plant Director in Matamoros. So all of these programs combined, right, help us make sure that we're attracting new talent that we can develop the talent within and that we can retain people, and all of these tie back to our foundational value of being a learning organization. So shifting a little bit, those systems, those processes, they are all great. They give us a foundation, but they're really only part of the equation. We need to make sure that we have that culture and we have the behaviors around it to make those systems and processes successful. One of the things that we did, taking that first pillar in our strategy house is defining these culture standards. And this started with our leadership team. We did a workshop, and then we started to have workshops with the management teams at all of the plants to talk about what our culture is, who we are, how we want to operate. We then continue those discussions, getting feedback from employees because at the end of the day, we really wanted to make sure that these culture standards, they give us a common language. It gives us consistency, and we wanted that to come from the people, not just from us, but we really wanted everybody to see their input into developing these culture standards. Another thing to highlight how critically important these culture standards are to us. As we went and rolled these out through training, Eric and I partnered with Mike and Arnold. We went out to every facility. We help all hands meetings so that we could get in front of every employee to show just how important we feel Culture is. And express, right, that everybody in our workforce, they are the ones that are going to help us actually bring these culture standards to life. We need everybody to display those behaviors every day. And then our leaders are the ones that help us reinforce that. And they do that through a variety of ways through one-on-one conversations, and we have a toolkit that we've developed to help our leaders have those one-on-one conversations. We do that through feedback and coaching. We've recently implemented a real-time feedback tool. So that gives the leaders weekly pulse survey information so they can interact with the teams and get that feedback live and have the ability to interact back with the employees. Of course, accountability, recognition. We have a platform. We've built these culture standards into our recognition platform, and that helps us make sure that we're promoting those behaviors that we want to see repeated. All of that ties back together with development, again, to our learning organization value. So all of those programs are tied back into our culture standards as well. You've gathered that we like data here at core. So I want to show you some data of how all of these programs translate into measurable progress for us. So our salary voluntary turnover is our first metric that I would like to highlight. We are incredibly proud of this statistic. So in 2021, we had a voluntary turnover of just over 19%. Today, we are tracking below 7%, and that is an annualized number. So for 2026, that is not year-to-date, that is if we continued on the rest of the year, this is where we would sit. So we are incredibly proud. Having that stable workforce is truly what allows us to execute that long-term strategy. Looking into our leadership pipeline. So we want to make sure that we are understanding our bench strength and building that bench strength. Our senior leaders, which we define as our director level and above. 74% of those individuals were promoted internally into their current positions, which is a true testament to all of the programs that we've developed and also all of their active involvement in participating in those programs. Of that same group of people, 65% of them have an identified successor listed today. So that helps us understand where we do have that bench strength, but also where we know we may need to target maybe some interns to build that talent pipeline or look at workforce planning for strategic external hiring. Next one I'll talk about is our promotion rate. So Eric mentioned this in the very beginning of where we were last year. We're continuing that same trend this year. We're hovering right around 50% of all of our open positions being filled through internal promotions, which again is just a tremendous testament to all of the things that we have in place. Now as we look to grow, right, we do expect that, that will come back down a little bit, but we will still continue to do all of those programs and maintain a strong internal promotion. I mentioned the weekly feedback tool that we have. We also, for several years, have been doing an annual employee engagement survey, that touches all of our employees. We do that on a scale of 1 to 5. And so our score on that has improved from 3.6% in 2021 to a 4.0 in our most recent survey. And that's with 80% participation of the entire workforce. I talked about our individual development plan. So the last statistic I have to share with you is that we, today, have 142 people with an active individual development plan. With that, I'd like to close by, of course, bringing it back to our people. We're celebrating our 30-year anniversary today -- or this year. All these pictures are the internal celebrations that all of our people have had. You can see how proud they are. You can see these trucks outside and some of the pictures. We bring those out to our employee celebrations. But really, all of the success that we've been able to achieve, we would not have been able to do it without the people. These are the people that are going to help us with the next 30 years. So really, for us, we think the connection is pretty simple, right? You have those strong -- that strong culture, which gives you better leaders, gives you stronger teams, leads to that execution. Ultimately, that can translate into the customers having confidence in our team and leading to that long-term sustainable growth. And with that, I will transition over to Alex to talk about our financial overview. Thank you, everybody.

Thanks, Stephanie. So as Stephanie said, Alex Panda, Chief Financial Officer. pretty sure everyone in this room knows who I am. But for those that are on the webcast that don't know, that's my introduction. So you've heard from Eric, who led us off with the vision of the future of the company, right, going from good to great. And then you had Mr. Bance over here talk about our must-win battle from 2 years ago, invest for growth and the success that we've had over the last 18 months. And then you had our operational leaders, Mike and Arnold talk about our must-win battle from 3 to 4 years ago of operational transformation, which has been extremely successful, and you've seen that in the margins over the last couple of years. And then all of this couldn't have been possible without the HR systems that we've had in place that has led us to a culture as a competitive advantage, right? We believe in that. And so my job today is to tell you all, well, how does that turn into long-term shareholder value, right? And we're going to get into that. So before we do, we're going to talk about our capital allocation policies. And many of you in this room have seen this data. So first of all, maintaining a strong balance sheet. As of 6/30, we had 0 debt and our cash balance was $12 million. For working capital, we really strive to have payment terms with our customers of 30 days and with our suppliers 60 days. Those payment terms really allow us to take our AP and have it offset our inventory, which is always a goal of ours. But the real main reason to have a strong balance sheet is to be able to take advantage of those organic and inorganic growth opportunities that come up, right? We can't control the timing of when those come up. But what we can control is that we're ready for them, and we have the capital available to take advantage of those. And you've heard us talk a lot about organic growth, right? It's our #1 priority at the end of the day. We require a return metric of 14% and you've heard us talk about the investment in Mexico, right? And that's why a lot of you guys are down here to see that investment in Mexico. $25 million over the last year and will be wrapped up by the end of the year. Our sustaining CapEx is roughly 3% to 3.5%. I would say, over the last 2 to 3 years, our floor has been $10 million. So we've been a little bit above that. But as we continue to grow, we will target 3% and 3.5%. And then lastly, total CapEx for 2026 will be $30 million. Now inorganic M&A opportunities. Our main priority here is to diversify our end markets, right? It's a lot easier to get into new markets and expand into those new markets through inorganic growth rather than organic growth, right? You go buy those customer relationships. The financial criteria for an M&A opportunity for us is to hit that 14% return metric by the end of year 2 and then also be below 2.5x leverage by the end of that year. And then lastly, returning shareholder -- returning capital to shareholders, right? We have a stock buyback program in place. We just renewed it in Q1 of this year. We have $7.5 million of availability left to be spent over the next 3 years. So what have we done to make sure that we have that availability? Well, in July, we just refinanced our debt, right? And so we extended our debt and now matures in 2031. We've increased our availability from $75 million to $100 million, and we've simplified the structure. We've gone to a $50 million revolver and a $50 million delayed draw term loan. Now that term loan will be used for large organic or inorganic opportunities. And we also were able to make the debt cheaper. Now in order to do this, we've -- we did a very disciplined multi-bank bid process. So we had 4 banks come in and bid on the business, and we worked with them. And I'm proud to say that we have 2 of our banking partners here today, Huntington and U.S. Bank. Thank you guys for being here. We really appreciate it and value the relationship we've been able to build over the last couple of years. So you heard Mr. Bantz talk about the organic growth opportunities that we've won over the past 18 months, and we're going to take a little bit of a deeper dive into those -- into that data. So over the last 30 months, we've won $142 million of annual sales of awards, right? $115 million of that revenue is incremental. Now we categorize our wins in 2 different categories. The first one being replacement business, which would be if we're currently making a truck program, truckload program and it's up for rebid and we rewin that business, that's a replacement program, normally not incremental business, right? We might get a little bit better margins, a little bit more revenue. But at the end of the day, it probably won't move the needle a ton. The other category is incremental. And this is a program that we currently don't make and it's brand new to us. So every dollar of sales of that award will increase our sales overall. So of that $115 million, $85 million has not yet launched. And 90% of that $85 million will launch in the next 12 months. So I'll give you a little sneak peek of what our must-win battle in 2027 is. It's the launch of all of these programs, right? It's imperative to the success and the growth of our company that we launch these programs flawlessly. And like Mike said earlier, if you'll win it, we'll build it. We're going to put Mike and Arnold's team to the test on that one. So you can see the diversification of those new wins, right? So of the new wins, 28% has been in building products. Utilities was 22% and then other was 11%. So we've really won a lot of business outside our main 2 industries for truck and powersports. Now like everyone else has said, we don't want to decrease truck and powersports. We love our truck and powersports customers. We want to continue to grow those customers and into those markets, but we want to grow everything else at a faster rate. You've also heard us talk about sales to $300 million, right, and the confidence we have us getting there. This is why. This chart on the -- up here is why. Right now, we have launch programs of roughly $225 million and that $85 million walk to $300 million, it's not a matter of if it's going to happen, it's a matter of when. We know we have launched -- or we know we've already won those programs. It's just a matter of launching them. We've also talked a lot this year about our investment in Mexico, right? And I'd like to break it down in 2 different categories, Monterrey and Matamoros. So it's a $25 million investment, $20 million of that is in Matamoros. What do you get with that $20 million? Well, 2 brand-new state-of-the-art 45-ton presses, which those of you that are here today and are going to see the Matamoros facility, we will see tomorrow. It's going to be extremely impressive. We also get 50,000 square foot building expansion. And then we're also able to move our DCPD process from our Matamoros facility into our Monterrey facility. And we really did that for 2 reasons, the move of DCPD. So the first reason is our main DCPD customer is in Monterrey. So we have about $1 million of logistical savings that we've already negotiated splitting with the customer 50-50. And then the second reason was to lower our capital expenditure into the Matamoros facility because now we don't have to do an additional building expansion to be able to do all of the Volvo assembly, which really was the launch pin, right, of why we did -- gave us the capital to do the investment. And then switching gears to Monterrey. So like Arnold said, quadrupled the footprint size to 210,000 square feet. And we were also able to consolidate a 30,000 square foot external warehouse into the facility. So we had some lease cost savings there. We also were able to add Topco paint, which, like Alex said, the COA industry will not let you win a program if you don't -- if you're not able to build or paint those products. But at the end of the day, doing these kind of investments require the discipline of hitting your return metrics, right? The team went over and over and over again going through the costs, understanding where our savings were to ensure that we hit a 14% return to protect our shareholders. So what does all this organic growth mean for our margins? I actually get that question a lot from many of you in this room. So you guys are very familiar with our company. Baseline gross margins are 17% to 19%. We've given that guidance now for 2 to 3 years. As we get into $300 million and $350 million of sales, we expect an additional 200 basis point improvement for improved leverage. And then all of those programs that we've won, all of the work that has been done on the operational transformation will be another 200 basis points. So our target gross margins in the near future will be 21% to 23%. Those additional gross margins give us more availability to go do an acquisition. And like I said earlier, the #1 priority is diversify our end markets when we do an acquisition. And we've been pretty successful at that. So I've been with the company 12 years on Thursday is my work anniversary. And the first acquisition we did when I was at Core was the Winota facility. We purchased it from CPI Binani. And we got 2 main things from that acquisition. The first one we got was the DLFT process that you've heard Mike talk about. The second thing we got was a great relationship with BRP and grew us further into powersports, primarily in the marine market, right? And then the second acquisition we did was in 2018. We purchased Horizon Plastics, which gave us the Coburg, Ontario plant and then also a Monterrey facility, which at that time was just a startup. There's really nothing in there. And we got a couple of things out of that acquisition. The first one being structural foam structural Web, which is a low-pressure injection molding process. we're also able to get our building products market going when we're selling Lattice to UFP. And then the last thing we are able to have is our ATV business, right? So growing powersports. We're able to grow powersports with both BRP and a brand-new customer, Polaris. So what's the financial criteria of an acquisition that we're looking for? $50 million to $100 million in revenue, 14% return, like I said earlier, by the end of year 2. And again, we want to be below that 2.5x leverage by the end of year 2. Eric and I have had the pleasure of meeting with a bunch of different companies over the last 18 months. We pretty much have gone and visited a company every other month essentially. And what they're looking for is about 6 to 8x EBITDA for a multiple. And I will tell you, it's normally closer to 8% than 6%. When we're talking about $100 million of acquisition sales, what -- how does that change the business? What does the business look like after we do that, right? So our largest customer would go from 19% to 13%. And then our largest market, truck would go from 44% to 30%. And just to give you an idea, I just walked you through the 2 acquisitions we've done in my time. When I first started, we were a 90% truck company. We're able to diversify down to 45%. This would get us down to doing to 30%. So our long-term financial goals, they haven't changed. I guess they changed a little bit. Instead of saying $505, 1 year went by, so we now have to say $500 million in 2030. So $500 million by 2030. We added gross margin on here. When I started 12 years ago, my predecessor, John Zimmer, he told me the story once. He said, Alex, if we could just hit 30% variable margin and hit 10% fixed costs, we'll hit gross margin of 20%. And if we just control our SG&A costs of 10%, we hit that long-term goal of operating income of 10%. And then just magically, the math works, we're going to hit that return on capital target of 16%. That's all we got to do. He made it sound so easy in like 3 sentences, right? But those are our long-term financial goals. And $500 million is easy to stand up here and say, "Hey, that's a number on a page, right? Anyone can make an Excel sheet say anything. But why do we have belief in that number, right? Why do you hear us stand up here and have confidence in hitting that $500 million number by 2030? Well, we've already talked about a couple of reasons why. So we already have known wins of $85 million. We know we're in a truck trough, right? And for those of you who don't know the truck cycle, truck cycle is about 2 years of downturn and about 3 to 5 years of uptick. Right now, we're in the second year of a trough. And so ACT, which is the industry expert forecasts an increase over the next 3 to 5 years. We're projecting that to be roughly $30 million. So that gets you into the mid-$300 million range, right? While $100 million of acquisitions, whether that's 1 for $100 million or 2 for $50 million, that gets you a little bit closer, $450 million. And the last piece is Mr. Bantz's job over here to continue working on organic growth and winning programs after programs. And we really see growth in 2 different areas, right, that we're really focusing on. SMC sales. We've won 4 major programs in the last 12 months on SMC sales. We've launched 3 of the 4, and that last program will be launched by the end of the year. CONAG, we're just getting started on CONAG, right? We've invested in Topcoat paint in Monterrey. We're reaching out to customers. We're being active. So that will take a little bit of time to get. But if you think back to the slide I had a couple of minutes ago, $142 million of awards that have won over the last 30 months. That's basically a $55 million annual run rate. So whether it's $100 million of acquisitions or $150 million of organic growth over the next 3 years, it is doable. It's achievable. We believe it. So you guys should too. So what does core look like with $500 million in sales? Well, we're going to hit those long-term goals. So $500 million in sales, 21% to 23% gross margin, operating income of 10%. John Zimmer, hopefully calls me and say, "Hey, guys, great job. You did what I said a handful of years ago. And then we'll hit that ROCE target of 14% to 16%. A couple of other financial metrics that are interesting when we're at $500 million is our EBITDA margins should be between 16% and 18%, just a math equation based on our depreciation and amortization. And then operating cash flows will be $60 million to $70 million, which is a big cycle, right? Then we have more cash, more capital to go do more organic growth and more inorganic growth. And so really, at $500 million in sales, CORE will be positioned at a higher-margin cash-generative company that really creates long-term shareholder value. And for my last slide, we'll go through 2026 as guidance, an update. So for 2026, we're keeping our sales guidance the same, 0 to up 5%, probably going to come in right around the midpoint of that. There is a shift, though, in our truck. So over the last 4 quarters, we have seen increases in truck quarter in and quarter out, but we have seen and have heard and worked with our customers, there will be a shift from Q4 into Q1 of about $5 million to $7 million of sales. That's mainly due to 2 reasons. The first, we're hearing that a lot of other suppliers to truck companies are shutting them down. And so they're not able to keep up with the demand increases. And then the second piece is because of the conflict on Iran and the diesel fuel costs being at an all-time high, some OEM truck buyers are pushing orders out into Q1. So it's twofold. The other thing that will impact sales is our tooling sales. You guys heard us talk a lot about tooling sales and the timing of tooling sales. Earlier this year, we announced that in Q4, the Volvo tooling program will close in Q4. Where we've worked over the last couple of months and basically negotiated with Volvo a contract change, which will allow us to recognize tooling on a percentage of completion basis, which will allow us to pull in tooling sales into Q3 is about 75% of that $35 million. And then in Q4, we'll recognize about 15% and then the last 10% will be recognized in 2027. Full year gross margins will be 16% to 17%, so just slightly under that 17% to 19%, again, mainly due to 2 reasons. First one being higher oil costs, which have increased our resin costs. We're working with our customers to pass through those price -- or those cost increases and increasing our sales. We've been able to work with them on most of those, but there has been a delay in some of the larger OEMs. As you can imagine, it's been difficult to get those price increases done. But as of today, all of them are effective and will be effective for Q4. And then the other thing is with those -- the rise in diesel fuel costs, the extra freight that we've incurred between Monterrey and Matamoros, which starting up a new facility, there are some impacts there. Those higher fuel costs were not in our plan at the beginning of the year. And so we've incurred a couple of some additional costs there. And then lastly, we're announcing a new footprint optimization project. This really gets back to what Mike talked about with our focus on our Daphne plant being the hood and battery enclosure Center for Excellence and our Columbus facility being our center for excellence for SMC compounding. So this is going to cost us about $2 million. About 50% of that will be incurred in Q3, 50% of it will be incurred in Q4, and we'll have about $1 million in annual savings moving forward. Those costs will be in SG&A and there'll be an add-back to adjusted EBITDA. And with that, I'll hand it over to Eric for the wrap-up.

All right. Thanks, Alex. Thanks for converting everything we talked about today into how it affects the P&L and what it will look like for you guys in the future. I want to thank you for taking your time and investing your time with us today and listening to us. We appreciate the opportunity to share our story and our vision for the future. If there are 3 things I want you to take away. First, Core's transformation is real and it's proven. Second, organic growth is accelerating. You've seen the new business wins and our market diversification approach. Third, we have a disciplined capital allocation framework, and we focus on returns and shareholder value. What you guys should believe is that we've demonstrated improved margins through a difficult cycle. We've built a stronger operating platform. We have meaningful opportunities to scale revenue and earnings, and we have a management team aligned around execution and accountability. I'm incredibly proud of all of them that you guys got to see today and the skills they have. Our path forward is clear: grow organically, increase diversification, improve returns on capital employed, expand our margins and deliver sustainable long-term shareholder growth. Thank you guys for listening today. We're going to take a brief intermission, and then we're going to set up for a panel up here and take questions for the next 45 minutes and look forward to answering all the questions you guys have for us. There is coffee here on the side, so we could get a refreshment, take a little break and lease set up, and we'll do questions. Thanks. [Break]

Okay. Moving on to our question-and-answer session. We've got plenty of time. So if you've got a question, please raise your hand. Let me find you. Remember, I know a lot of you are probably loud and you think I don't need a mic, but we need the mic for your question so it can be live on the webcast. So if you have a question, raise your hand, please wait for me to come to you with the mic, and then we'll get things started. You're more than welcome to ask one person in particular or the whole team. So let's get rolling. Tyler?

One of the areas that's kind of a hot topic, but it's not necessarily on your road map is kind of the aerospace and defense area. And with so many new companies like Arel, Palantir, Cerironic, they're kind of changing the paradigm a bit and bringing a lot more commercial focused speed to market. Curious if any of that's kind of in the road map or if there's any potential to kind of tap into any of those areas with so much going on in that space. And again, just being a little bit different from the old defense prime paradigm in the past. Again, there's a lot -- it seems like a lot more commercial focused kind of opportunities. So yes, curious if you've thought about it or have new road maps for anything in that space.

Yes, I'll start, Tyler, and then I'll let Alex give you some feedback. But we've had the opportunity to quote a couple of programs and I would say, that defense contract world. And the challenge, I think the U.S. government is making is how do you take cost out of this? The historical materials used are what I would call carbon fibers and titaniums for race cars and airplanes, which makes a missile or a one-way aerial defense vehicle very expensive. And so they're looking for ways to make that cheaper. We've had the chance to quote a couple of things, converting it from carbon fibers into a glass fiber-based resin matrix, which is you're talking about 1/10 the cost, right? Very, very big difference. Today, we don't have any of those programs in our new wins, but we've had the opportunity to look at a few of them. I think our large format presses in the U.S., not only for those guys, but also just think about the drone technology and our government is looking for anti-drone and drone technology to bring to, unfortunately, the future of potential wars.

Yes. I would just add, we have had some exposure to some of these one-way vehicle applications. And they're very interesting. That -- the whole space is a little bit of an unknown for us. So I think we need to do our homework and really understand the lay of the land and how do we differentiate ourselves and do it in a strategic way and not just kind of stumble into it.

Do you -- you guys have pretty much indicated that there's a lot of new business that's ramping next year. Are there any other plant optimizations that need to be done? Or are you set once this Matamoros spend is done for this year? Is there a CapEx thing that you're going to need to do to ramp these projects? Or are you already ahead of the game?

Yes. Thanks for the question, Tom. I'm going to have Mike tell you a little bit about the project Alex sort of announced there at the end relative to our U.S. footprint.

Yes. So we've been -- we've already been -- have the CapEx programs built into that. The footprint optimization plant in Daphne, we're optimizing what we're doing as far as the battery closure systems, one of them you see in the back of the room there. So we have that built into the system. Next year, as far as CapEx, we're looking at our standard CapEx spend. We're not -- we don't have any other optimization program planned at this time. We have invested in presses and some rebuilds as part of that optimization as well. We've seen that in Daphne this year as well. So to answer your question, it would just be looking at standard CapEx spend going into next year.

Yes. I would add, I didn't talk about it in detail, but on that organic growth slide in my section of the slide deck, of the $85 million of revenue launching next year, about $14 million of capital remains. Now $8 million to $9 million of that is what's left to be spent as of 6/30 on the Mexico investment. And so if you take that out of the equation, you're really looking at $5 million of additional CapEx to do the majority of that $85 million of annual revenue because the Volvo program in that $85 million is roughly $12 million to $15 million. So CapEx for that -- the launch of those programs is minimal.

Energy costs are front and center of everybody these days and your raw material costs must be forefront of your concern. So question is, how is that impacting your costs? And do you hedge any of your diesel purchases? And if so, like how far out?

So the only hedging we do is foreign currency. It's funny you asked that question because we've done a lot of investigation over the last 6 months on oil hedging. We've actually asked some of our major suppliers, do they hedge? And all of them, which are bigger than us, said absolutely not. So I don't think we're going to try to do something that those guys don't do. So right now, we don't have any intention on doing that, but we have investigated it. But as of today, we don't have any plans for it.

[indiscernible]

Correct. Yes.

Yes. We don't, but we have raw material adjustment either clauses that are very specific a calculation. If polypropylene does this, then this is the calculation. So in some cases, it's as easy as that. In others, it requires a lot of discussion about how oil price affects our resin price because especially our highly engineered resins, there's just not a good defined global standard.

And so the raw material clauses we've historically done have been very -- it's been based on raw materials, not freight itself, right? And so one of the things we've done more recently is start to try to build in a freight adjuster clause with some of our customers. And we've been successful with one customer recently.

I wanted to ask about SMC and why it's catching on like it is. And I guess, what differentiates you competitively with your SMC product and process compared to what others are doing?

I'll start, Mr. Bantz can continue for me. But one of the biggest is that we make our own SMC and mold SMC. So when you think of the marketplace, there are many that make a compound, and that's what they do. They specialize in making compound, not molding it. So the fact that we can have good engineering and molding conversations with a customer buying that compound, we have seen lots of positive feedback from customers and potential customers in that regard. It's something we spent a lot of years perfecting. Think about all of the molding engineers inside of our company and Daphne, Matamoros that have given feedback to the compounding team and the chemists and the many, many years of evolution of that, something we really focused on internally, which made our scrap better. That's how we really -- that's one of the key factors how we achieved sub -2% scrap as a company over the last 4 years, bringing that to a potential external customer is a real value.

And I would just add to that. It's not that we just make SMC. We make SMC for some pretty intense applications like trucks. So as we've gone into the space and talked to some customers in the building products, the quality of our SMC is from a scrap percent on their presses is a pretty substantial benefit to them. And then also, we -- as we have gone into the space, we understand that customer service is pretty critical and dealing with the customers that we do, we're used to that. We just need to make sure that we keep that top of mind as we grow into the space.

Are you marketing it differently? I mean is there something with the sales process today that was different that you just really weren't doing in the past that's allowed it to the customers be more aware of it?

We haven't really done any active marketing per se. We've done some just research and cold calling. We're trying to ease into it, learn the industry. And then when we feel we have a good footing, then we're going to go pretty hard into it. We're not quite there yet.

This one is for Stephanie. Curious how long it took -- when you introduced the feedback program from the employees and so forth, how that was received initially? How long did that take to them to buy into it? Was there a little bit of a pushback whether they really believed you were for real about it? And I'm just kind of curious how that all played out because that's really important, what you've all done.

Yes. Thank you for the question. So it's relatively new. So first, we started with a pilot. So we -- that was just over a year ago that we started the pilot of that. Now I will say our annual employee engagement survey has been in place for many years. So I think that has helped give that level of comfort with people giving feedback and that we are putting action plans in place, so they know the feedback is being listened to. But I think when we rolled it out, the new tool, we did training sessions leading into it and showed people the tool. So the biggest thing that we hear concerns about is the confidentiality. So we were showing them the tool to address that concern upfront saying, here is what we see to give that level of comfort to people. And then what we -- so once we launched it, then another thing that we did is, I mentioned Christina. She's our org development leader. She and I held meetings after a couple of months of the program being in place. to check in with those leaders, go through the feedback with them, give them tips on how to share that feedback back to the employees and how we are listening to them and what we're doing about it. So I think that's helped give that continuous momentum of we are continuing to look at this and listen to it.

Good. Another related question, the internship program, is that an internal one? Or when I think of an internship, I thinking of you're bringing somebody like students in or whatever. Could you kind of expand on that?

Yes. So it's an internal program. We partner with different universities and colleges depending on the different locations. Winona came up a lot. That has -- there's a local university there, Winona State that specializes in composites. So that has been our most successful with getting student interns. And then we have various partnerships with like technical colleges. I have someone in my team who sits on the board in Columbus of one of the technical colleges with the HR groups to leverage that and get some more insights.

I touch a little bit on the feedback. One thing I do want to mention, Stephanie, least of Mexico is something new for them, obviously, going into it, understanding the system, and they got a large group out there in Mexico. So when they started to do the exercise, really -- it was really positive. It was really welcoming and they started to get engaged and start providing feedback to us, which is really pretty necessary for us to hear that from them.

Sort of a follow-up question to the CapEx question from earlier. When you did that bridge to get to the $500 million of revenue, some of that was organic growth. Obviously, there's the acquisition that you had in there for about $100 million. So presumably, that's its own things that would probably come with its own plan. Do you have enough capacity currently in the existing facilities that you have to do that organic -- the remaining organic growth to get you to the $500 million? And I understand there might be some tooling. But other than that, the facilities need to be expanded? Or do you need other major CapEx to get there?

Yes. Great question. The short answer is no. So we have enough capacity in place to do roughly $450 million to in sales. Where it gets a little tricky is do you have the rightsized press in the right process in the right location, right? Everything has to line up in order to not have a capital expenditure. And so that's where it would come. So if we could wave a magic wand and fill every single press with the right sales, then yes, we could get to $500 million organically. We wouldn't even have to do an acquisition with 0 CapEx. Now is all of that going to happen? I think the odds would tell you no. We'll probably have to do some CapEx. But in theory, we do have capacity to do roughly $450 million to $475 million.

Eric, I think what will be interesting to you is that we also -- Mr. Bantz has added a process to rank opportunities. And so when we get a new opportunity to quote, we consider what is the market? Is it diversified? What is the size of it? But another thing is do we have the capacity or capability already to serve that customer because those are much more interesting to us if it's filling empty capacity than, oh, it's an interesting opportunity, but I'm going to have to make a large capital investment to be able to do it. And on some of those, we're going to add $150,000 overhead crane or lift. You see the size of our parts, right? Depending on the part, there's going to be some CapEx, but it's can we leverage a majority of an existing capital installation. And that's something we do in that ranking when we decide, is this a good project for us? Is this what Alex calls an A or a B item? I don't know if you want to add anything, Alex, to how you rank projects. That's something new in the last 18 months that Alex has brought to the organization.

Yes. So any new opportunity that comes in, there's about 12 questions we ask. And again, we try to hit the financials, the fit from a customer standpoint, logistic advantages, what we think about the customer, what we think the customer thinks about us. And certainly, one of those is capacity utilization. And that's something that we're probably -- we have the ability to tweak the importance of each of those rankings, we'll probably start kicking that a little bit more as we roll in this next $85 million of new capacity or new business into the organization over the next 12 months, so we can dial that up in importance.

I'll ask a question on the other side of that. On the acquisition stuff, I guess, Alex, I wouldn't mind hearing your thoughts on -- you were around during the Horizon deal. And I guess, walk me through what you thought was good about that, what was not great about that and how you want this time to be different or something to that extent.

Yes, good question. So the timing of the Horizon deal was not great at the end of the day. We have started to have operational inefficiencies in our other plants and the focus of the management team was on those other plants at the time. It's really more of a coincidence that when we did the last acquisition, we started to see the decline in profitability. But the acquisition itself really had nothing to do with the decline in profitability. It was really the core stand-alone business that we had the issues in and that we were trying to fix. But it's a common question we get because of the timing of it. But -- so I would say the only thing I would change looking back would be the timing. Could it have been 12 months later, which we can't control. But what I will say is that acquisition has paid for itself probably 2 times since we've bought them. The Lattice business throughout COVID boomed the ATV business we've won and been able to leverage with BRP and the Polaris business we've won over the years has been phenomenal for us. So yes, if I can delay it 12 months, maybe I would say that. But overall, it still was the right move and created long-term shareholder value at the end of the day.

Just a little stress in between there and now. Then my follow-up is, it seems -- maybe I'm wrong on this, but it seems like we've changed the acquisition target a little bit over the last 3 years or so and kind of increasing it from like $30 million to now it sounds like $100 million. I guess I was curious about the thought process and what went into that and why the change?

Yes. So I'll maybe answer quick, and Eric, you could probably give a little bit more color. So we have visited, like I said, a handful of companies over the last 12 to 18 months. Some of those -- one of them was in Monterrey, and it was about $10 million in sales. So we've gone from one end of the spectrum all the way up to a company that was $100 million in sales and quite a few in between. And what ultimately where we got to was when we do an acquisition, the amount of work that is required, whether that's $10 million or $100 million acquisition, the work is the same. And so if we -- if our goal is to diversify our sales and we do a bunch of $10 million acquisitions, it's going to take a lot to do, right? And we're a smaller company. And we, at the end of the day, need to be almost perfect, right? We need to back 10 for 10 when it comes to acquisitions. And so it's really important that we get it right. So we have broadened from a size standpoint, but I think the most important thing is to stay disciplined to the financial criteria and the metrics on the return and our leverage ratios by year 2.

That's pretty well said, wasn't it? Yes, good job, Alex. And I think the only thing I can add to it is that we have gotten to see different-sized businesses. And sometimes those $10 million businesses just aren't that exciting. We won $10 million of skid plates last year just on a single part, single tool and a process, that's a much more exciting thing than a $10 million acquisition with all the headaches that come along with it with the integration and everything that goes. So at some point, you got to have some size to make it worth all the effort and the energy that goes into it. And the other thing I would add is that Mr. Pan has done an outstanding job the last 12 months starting to model our future 5 years. Now we can't give you that Excel sheet, but he's taking the information on the wins that Mr. Brant comes up with, the hypotheticals and saying, "Hey, if we win 25% of the stuff in that pipeline that Mr. Brant presented to you, what would that look like?" And it gives us confidence to be able to model what could we do, right, and still stay in a conservative leverage ratio. What could that scale look like? And so I think because of all those new wins, $85 million of launches, we're going to be at a point where you guys are going to look at us and go, what are you doing with the cash to redeploy it. And so we've got to make sure we're ready for that. We're anticipating that question a year from now.

Yes. The only other thing that I would add is as we were visiting smaller companies, management team is critical to the success of the acquisition, right? And when you go visit those smaller companies, the bench strength of companies is not nearly as strong when you start getting into that $50 million to $60 million, $70 million range. So those smaller companies, we would have to be -- us around this table would have to be extremely hands on. And so that also has played a factor in us visiting companies.

I wanted to ask about quote win rate. What has it been over, say, the last 12 months or so versus historic? And I do have another sales question after that.