Dorel Industries Inc. ($DIIB)

Good morning, everyone. I'm Norm Steinberg. I'm Co-Chair of the Board of Directors of Dorel Industries, Inc. Welcome to Dorel's 2026 Annual Meeting [Foreign Language] Again, this year, we thought it was prudent and cost-effective to hold this meeting online and have therefore asked all shareholders to vote by proxy prior to the meeting, which many of you have done and to participate in this meeting by audio webcast. [Foreign Language] We will first conduct the official business of the meeting, after which our President, Martin Schwartz, we'll discuss recent developments at Dorel. We ask shareholders to submit their questions prior to the meeting. After the official business of the meeting, we will respond to your questions. [Foreign Language] Based on proxy forms and voting information form submitted prior to the meeting, I can report that all matters to be considered today will be adopted. The election of directors will be by ballot. All other votes will be conducted by voice vote unless a ballot is requested by a registered shareholder or proxy holder. [ Foreign Language ] Leslie Anne, could you please present your report?

Yes. Mr. Chairman, with under sciences scrutineers from Computershare Investor Services Inc., hereby report that there are at least 3 shareholders and/or proxy holders present at this meeting representing in person or by proxy, 15,077,069 subordinate voting shares and 4,900,531 multiple voting shares for a combined vote of 55,172,199 being 76.8% and of the total votes attached to all outstanding shares of Dorel Industries, Inc.

Thank you. It's Leslie Anne. [Operator Instructions] Next, the notice calling this meeting together with the proxy form, Management Proxy Circular and related documents have been made available to drill shareholders and mailed to Dorel's auditors. With the consent of the meeting, we will dispense with the reading of the notice and of the minutes of the last meeting of shareholders, which was held last year, May 28, 2025, and I direct that the minutes be taken as read and approved and they be signed as being correct. The next item is financial statements. The first item of business is the presentation of the annual report, the financial statements and the auditor's report thereon. I now present to the meeting the annual report, the consolidated financial statements of the company for the fiscal year ended December 30, '25 and the auditor's report. A copy of these documents have been made available to all our shareholders. Next is the election of Directors. [Foreign Language] John?

Thank you, Norman. Mr. Chairman. I am John Paikopoulos, Vice President and Corporate Controller of Dorel Industries Inc. and a proxy holder. I nominate [ Martin Schwartz, Jeff Segel, Jeffrey Schwartz, Brad A. Johnson; Sean Lederman, Norman Steinberg and Maurice Dusan, ] as directors of the company to hold office until the next Annual Meeting of Shareholders or until their successors are elected or appointed.

Are there any further nominations? Hearing none, I declare the nominations closed. As Dorel has a majority voting policy for the election of directors, we will vote by ballot in order for the votes to be accurately compiled. Mr. Martin Schwartz has already signed and submitted a ballot in his capacity as proxy holder as did other proxy holders. As all ballots have now been submitted and tabulated, I'll again can upon this scrutineer to present the results of the vote on the election of the directors. Leslie Anne?

Mr. Chairman, I report that each of the 7 nominees have received a vote of at least 81.94% of all votes attached to shares voted or withheld from voting .

Thank you, Leslie Anne. Based on these results, I declare that the 7 nominees have been elected as directors of Dorel is to hold office until the next Annual Meeting of Shareholders or until their successors are elected or appointed Dorel will issue a press release announcing the results and file a detailed report of voting results on SEDAR after the meeting. [Foreign Language] John?

It is resolved that KPMG LLP chartered professional accountants, being hereby appointed auditors of the company to hold office until the next Annual Meeting of Shareholders at such remuneration as may be fixed by the directors and the directors be and they are hereby authorized to fix such remuneration.

Thank you, John. May I ask Claudie Lauzon to second the motion.

Chairman, I'm Claudie Lauzon, Senior Director of Finance of Dorel Industries Inc. and a proxy holder. I second the motion.

Thank you, Claudie. All those in favor, please say I. All those against, please say no. I therefore declare the [Foreign Language] I will now turn it to Martin Schwartz, President and CEO, to say a few words about recent developments at Dorel. Martin?

Thank you, Norman, and good morning, everyone. I appreciate you taking the time to join us today for Dorel's 2025 Annual General Meeting. On behalf of our Board and leadership team, I want to thank our shareholders for your continued trust and support. I'd also like to recognize our employees around the world for their dedication and resilience. I thank our suppliers and customers for their ongoing support and confidence in our business. I'll briefly touch on our 2025 results, but I'll spend most of my time on where we are today and what we're expecting as we move through 2026. Overall, 2025 was a year of solid progress. It wasn't without challenges, particularly tariff uncertainty in the U.S. and shifting consumer demand, but we made important moves to strengthen the business for the long term. There were really 3 key themes this year first, the recapitalization of our balance sheet; second, strong momentum in Dorel Juvenile and third, a major transformation in Dorel Home to simplify the business and get it back to profitability. Starting with the balance sheet. Back in September, we completed new credit facilities and issued preferred shares. That was an important step for us. It gave us financial flexibility to move forward with our strategic priorities, especially accelerating growth in Juvenile and repositioning the Home segment. We're very appreciative of the support from TCW, our lending partners on the Alberta Investment Management Corporation. Let me now turn to our segments, starting with Dorel Juvenile. Juvenile had a very strong year with significant improvement in earnings. Adjusted operating profit was up 24.7% driven by disciplined cost control, better margins and the strength of our global footprint. This is also our third consecutive year of earnings improvement in this segment. That said, the environment was still challenging. Higher volatility and higher retail prices impacted consumer demand especially in the U.S., although foreign exchange did provide some support at times. We also strengthened our financial position through new partnerships, which is helping us move faster on product development and continue improving our supply chain. One of our biggest strengths continues to be our global footprint when demand in the U.S. was under pressure, strong performance in Europe and other international markets helped offset that and support overall growth. We continue to invest in innovations across all price points, from entry-level products to premium Maxi-Cosi offerings. We expanded the global rollout of the Maxi-Cosi fame stroller and continue to build a strong pipeline of new products tailored to regional needs and safety standards. We also took steps in adjacent categories, launching Maxi-Cosi nurseries and new furniture collections, which allowed us to leverage capabilities across the company. At the same time, our focus on safety innovation especially in retaining car seats continue to set us apart. Other key package is our domestic manufacturing capability. Our facility in Columbus, Indiana is one of the largest car seat manufacturing plants in the world. It produces about 3 million car seats annually and serves close to 30% of the U.S. market. That gives us real flexibility as trade policies and supply chains continue to evolve. Beyond North America, we also saw strong performance in Europe and several international markets, including Australia, Canada, Chile and Peru, where our teams continue to strengthen execution and omnichannel capabilities. As we've moved into 2026, we're encouraged by what we're seeing so far. Performance in several key markets has remained solid supported by new product launches and improved product availability. In March, we hosted our global customer conference in Portugal with more than 240 customers from around the world. It was a great opportunity to showcase our parent focused design approach and introduce new innovations, including the Maxi-Cosi Coral Go, new product collections and our [indiscernible] technology. The hands-on product experiences were especially valuable. They gave us direct feedback from customers and helped build strong momentum, particularly in our newly launched nursery furniture portfolio. It's still early and the market remains tough. These are encouraging signs and reinforce our confidence in both our innovation pipeline and our global operating model. Let me now turn to Dorel Home. 2025 was a year where we had to take decisive action. Sales were down as we work through product constraints, reduced our SKU count and completed the many stages of our restructuring. We made some difficult but necessary decisions to simplify the business, lower our overhead cost base and set it up for better performance going forward. This included exiting domestic manufacturing, narrowing our product range to focus on the most profitable categories, streamlining our distribution network and integrating back office functions into the Juvenile organizations. Over the course of the year, we closed our manufacturing facilities in Cornwall, Ontario, and transition to a pure import model -- we also consolidated our warehousing and distribution network, exiting large facilities in California and Montreal and moved into smaller spaces within Juvenile operation. At the same time, we significantly reduced overhead, including headcount and operating expenses down meaningfully in the third quarter. We also completed the integration of systems and back-office functions into the Juvenile platform in just 9 months, which was an important milestone. We're starting to see the benefits of these actions. Our operating loss narrowed in the fourth quarter, reflecting the impact of a lower cost structure. I do want to acknowledge that these changes had a real impact on many employees, including long-serving team members. I want to sincerely thank everyone who contributed to the business and recognize the professionalism shown throughout this transition. In the first quarter of 2016, results improved compared to both the prior year and the fourth quarter. That improvement, however, was driven mainly by lower costs. Sales were still disappointing, particularly in some traditional furniture categories. And as we've seen with several recent closures of Canadian-based and USA pennies, the industry remains very challenging. So as we move ahead to 26, our priorities are clear. We will continue to build on momentum in Juvenile while staying disciplined in managing through ongoing uncertainties. That means focusing on efficiencies, strengthening supplier relationships and continuing to invest in innovations. While volatility, especially in the U.S. may continue, our global footprint and domestic manufacturing capabilities give us a level of stability and flexibility. In Dorel Home, we're becoming even more focused, exiting categories and channels where we don't have competitive advantage and maintaining a streamlined product line that supports a lower cost structure. That's what will allow us to return to profitability and build a stronger foundation going forward. To wrap up, 2025 really highlighted 2 things: the strength in our Juvenile business and the determination behind the transformation of Dorel Home. We're taking the right steps to simplify the company. Thank you again to our shareholders, employees and partners for your continuing support and confidence. With that, I will now move back to Norman. .

Thank you very much, Martin, for a comprehensive review of our business. We now come to the question period. As I think you all know, Dorel invited shareholders to submit questions prior to this meeting, I will read the 1 series of questions we received and respond to them. [Foreign Language] There is one question -- or series of questions from shareholder, Georgios Cole Ketos, and it relates to our normal course issuer bid, I'll refer to as the NCIB. Mr. Cole thanks ask questions about it, starting with. On November 7, 2025, you announced an NCIB representing a total of 10% of the outstanding Class B shares. So far, no purchases have been made despite the depressed valuation. Given Dorel's depressed share price, when do you plan to start purchasing under the NCIB? And why have you not purchased any shares as yet. If I may answer the question. During the year ended December 30, 2025, Dorel did indeed purchase a total of 992,000 Class B subordinate voting shares for a total cash consideration of approximately $1,094,000. This information was actually disclosed in Note 21 of Dorel's 2025 consolidated financial statements. In addition, during the 3 months ended March 31, 2026, Dorel purchased a total of 47,220 Class B subordinate voting shares for a cash consideration of approximately $55,000. This information was disclosed in Note 9 of Dorel's 2026 1st quarter condensed consolidated interim financial statements. I hope that responds appropriately to the question. Thank you for raising it. And that actually concludes the question period as there were no other questions. Moving on to the next part of our meeting. As there is no further business, I will ask John Paikopoulos to present his motion to terminate the meeting. John?

Thanks, Norman. I move that the meeting be terminated.

Thank you, John. May I ask Claudie Lauzon to second the motion.

I second the motion.

Thank you, Claudie. All those in favor, please say I, against, please say no. Not hearing any. I declare the motion carried and that this meeting is terminated. Thank you, everyone, for participating in Dorel's Annual Meeting. [Foreign Language]