5N Plus Inc

TSX:VNP

Q2-2025 Earnings Call

[Operator]

[Foreign Language] Good morning, ladies and gentlemen. Thank you for standing by, and welcome to the 5N Plus Inc. Second Quarter 2025 Conference Call. [Operator Instructions] I would like to turn the conference over to your speaker today, Richard Perron, Chief Financial Officer. Please go ahead, sir.

[Richard Perron, executive]

Good morning, everyone, and thank you for joining us for our Q2 2025 results conference call and webcast. We will begin with a short presentation, followed by a question period with financial analysts. Joining me this morning is Gervais Jacques, our President and CEO. We issued our financial results yesterday and posted today's short presentation on the Investors section of our website.

I would like to draw your attention to Slide 2 of this presentation. Information in this presentation and remarks made by speakers today will contain statements about expected future events and financial results that are forward-looking and therefore, subject to risks and uncertainties.

A detailed description of the risk factors that may affect future results is contained in our management's discussion and analysis of 2024 dated February 25, 2025, available on our website in our public filings. In the analysis of our quarterly results, you will note that we use and discuss certain non-IFRS measures, which definitions may differ from those used by other companies. For further information, please refer to our management's discussion and analysis. I would now turn the conference over to Gervais.

[Gervais Jacques, executive]

Thank you, Richard, and thank you all for joining us this morning. Yesterday evening, we announced record results for the second quarter of 2025 and year-to-date across several indicators. Our performance marks several new all-time highs for 5N Plus and positions us well for the remainder of the year. This includes record quarterly and first half adjusted EBITDA, record quarterly adjusted gross margin and our strongest first half revenues in a decade. In a volatile business environment, where customers are seeking out dependable partners, 5N Plus continues to stand out. We are a deep partner of choice outside of China for high-purity, high-quality advanced materials.

Customers appreciate the value and depth of our diversified global sourcing and manufacturing capabilities. Today, our reliability and supply chain are not just competitive advantage for us. They are of strategic importance for our customers. This morning, we also announced a milestone supply agreement with First Solar, which I will discuss in more detail in a moment. As we head into the second half of the year, we're not only well placed to deliver on our new increased adjusted EBITDA guidance for 2025. We will also be able to build on this momentum going into 2026.

Let's start with our activities and strategic sectors under Specialty Semiconductors. In terrestrial renewable energy, volumes were significantly up for the second quarter compared to last year and up compared to the first quarter. We are on pace to continue shipping more products than originally planned to our key strategic customer in this sector as reflected in the terms of our new and expanded supply agreement. Under our new terms, we are increasing semiconductor compound supply volumes by 33% for the '25, '26 period underway. This is compared to initial contract levels.

As we are increasing volumes by an additional -- over 25% over this period for the subsequent '27 and '28 terms. This will also include the delivery of additional next-generation semiconductor compound as we continue to work with First Solar on product development. With the investment recently completed in our Germany and Montreal plant operation, we will be able to meet this increased demand with minimum -- minimal additional investments. Our team is incredibly proud to solidify its standing as a critical enabler to the U.S. solar energy sector and to further strengthen our long-standing partnership with First Solar.

Amidst shifting U.S. energy policy First Solar is uniquely positioned to capitalize on new wet economic growth, digital infrastructure expansion and accelerating electrification as the leading American solar technology company. Make no mistake, America needs solar energy in the mix as it seeks to diversify its energy sources, enhance its energy security and to meet significant power demand over the next decade. They need access to domestically produce reliable, scalable, cost-effective and quick-to-market solution. First Solar provides all those things. and they are currently actively expanding their U.S. nameplate capacity to meet the moment.

With the U.S. administration's Big Beautiful Bill Act and despite the phaseout of the Inflation Reduction Act anticipated in 2026, domestic solar energy will remain a part of the U.S. energy equation. The why and how may have evolved, but the fundamentals remain. In this context, 5N Plus is also benefiting as a key strategic North American supplier embedded in First Solar's value chain and as reinforced by our extended supply agreement. Turning now to Space Power and our activities at AZUR in Germany. Demand for our solar cell technology remains very strong. further driving our performance in the second quarter, including pricing margins.

Customers are planning ahead and securing products early to support future satellite programs and space missions. To illustrate, we recently submitted a quote for deliveries extending into 2029, 2030 and 2031. This highlights both the long-term visibility the sector provides and customer confidence in the reliability of our technology. After increasing capacity in Heilbronn by 35% last year, we continue to boost solar cell production by an additional 30% this year. All equipment, including 2 new reactors has been installed and commissioned. We are currently ramping up production while optimizing the full value chain.

We remain on schedule to reach our full production target by Q4, 2025. Looking now at energy storage. A few weeks back, our customer Australia-based RayGen announced the acquisition of its Yadnarie project by AGL, a project which has been granted development approval. This acquisition marks a major step towards the industrialization and commercial development of long-duration storage technology. As the supplier who supplies the solar cells that form the foundation of RayGen's core module technology, this announcement bodes well for us as a commercial opportunity in the medium term. When that time comes, we will be ready and able to deliver on RayGen's global pipeline of projects, including Yadnarie which will have a total of 150 megawatts of solar energy capacity once operational.

Finally, on the performance materials side, we are benefiting from exceptional margins, and this is no accident. In Q2, this segment was positively impacted by a favorable sales mix despite slightly lower volumes over last year. This, once again, reflects our unique positioning in the context of high business volatility with a strategic and diversified global supply chain. In conclusion, we have many tools in our toolbox to continue capturing market share and the growing demand in key sectors for our advanced materials. We have the capacity to grow organically, thanks to our flexible manufacturing footprint, while we also continue to actively pursue external opportunities from a strong financial position. Thanks to our market leadership and competitive advantages, we will continue to solidify our status as the strategic partner of choice. Richard, over to you for a review of our financial results in more detail.

[Richard Perron, executive]

Thank you, Gervais, and good morning, everyone. Strong financial results across the board in Q2 2025 and year-to-date reflects significant volume increases in specialty semiconductors on the back of accelerating demand in strategic sectors and exceptional margin expansion on the performance materials. In an environment of ongoing global trade and economic volatility, our customers are acting decisively to secure the advanced materials they require, and we are delivering. We have the right expertise to supply it, high-quality products as well as diverse sourcing and manufacturing capabilities, customers can depend on.

And this is translating into sustained outperformance since the beginning of the year. To illustrate, consolidated revenue in Q2 increased by 28%, reaching $95.3 million, while revenue year-to-date reached $184.2 million, representing a 37% growth year-over-year and a 10-year high in terms of first half revenue generation for 5N Plus. Adjusted EBITDA increased by 79% to a record $24.1 million in Q2 and grew to a record $44.9 million year-to-date and a 78% increase compared to year-to-date 2024. For Q2, we also delivered a record adjusted gross margin, both in terms of dollars and as a percentage of sales. In dollars, adjusted gross margin increased by 41% to $33 million and came in at 34.6% of sales.

Adjusted gross margin through the first half of 2025 came in at $63.4 million and $34.4 million of sales. Turning now to our segments and the drivers beyond the outstanding KPI performance, starting with Specialty Semiconductor, Q2 volumes in terrestrial renewable energy were up 50% year-over-year and 15% compared to Q1. Our new agreement with First Solar announced this morning only further confirms that this acceleration in demand is not a question of timing or pull forward, but really a step up in demand that is sustained and that will continue to grow over the next few years.

Q2 segment performance was further supported by high demand for solar sales, which is also positively impacting pricing margins as we progressively benefit from our capacity expansion at AZUR. Meanwhile, Imaging and sensing performance was on plan and as expected. Specialty Semiconductors revenue was $71.2 million compared to $52.3 million in Q2 last year. Year-to-date, revenue was $134 million compared to $97.5 million in 2024, supported by this higher demand. Adjusted gross margin as a percentage of sales was 32.7% in Q2 compared to 33% in Q2 of last year. Year-to-date, it was 32.8% compared to 31.2% year-to-date, favorably impacted by economies of scale due to higher production and higher prices net of inflation.

Adjusted EBITDA increased by $5.9 million or 45% to reach $19 million for Q2, and adjusted EBITDA year-to-date increased by $14 million to $36.7 million. The increase is primarily attributable to higher demand, higher prices than inflation and favorable unit costs from economies of scale. For its part, our performance materials segment performance was positively impacted by favorable sales mix. This is despite slightly lower volumes over last year and the absence of the pull forward in purchasing experienced in Q1. Our ability to supply bismuth-based products for industrial applications at our margins in the context of business volatility speaks to our unique strategic and diversified global supply chain.

performance materials revenue reached $24.1 million in Q2 compared to $22 million in Q2 of last year. Year-to-date, revenue was $50.2 million compared to $42.1 million last year. Adjusted gross margin as a percentage of sales was a record 41.1% in Q2 this year compared to 28.4% in Q2 last year and 36.8% for year-to-date compared to 31.7% last year. We had a favorable inventory position going into the quarter from which we benefited on top of a favorable product mix and higher prices net of inflation. Adjusted EBITDA in Q2 increased by $4.2 million or 108% and reached $8 million. Adjusted EBITDA year-to-date increased by $5.3 million to $14.1 million. positively impacted by the same factors.

Turning now to backlog. Backlog for Specialty Semiconductors was 364 days of annualized revenue, 17 days higher than on March 31, [ 2025 ]. While the estimated number of days based on annualized revenue cannot exceed 365 days per hour backlog definition, the effective backlog for the terrestrial renewable energy and space solar power sector, specifically continues to surpass the next 12 months. Backlog for performance materials was 127 days, 25 days higher than on March. Combined backlog at Q2 was 297 days of annualized revenue, 29 days higher than March. We also ended the quarter in a strong financial position with net debt at the low level of $74.3 million. This is compared to $100.1 million as of the end of December 2024, representing a decrease of $25.7 million.

That brings our net debt-to-EBITDA ratio to 1.07x as at June 30, 2025. Our strong balance sheet, coupled with our borrowing capacity continues to provide us with financial flexibility to execute on internal or external growth opportunities. We continue to actively assess opportunities, and the team is very motivated to enter 2026 with an acquisition. However, we will take the time required to find the right opportunity that meet our criteria. We are pursuing these opportunities while remaining highly focused on our increased capacity targets and production optimization to meet anticipated demand.

Turning now to outlook and the adjusted EBITDA guidance. Through the second half of 2025, we anticipate demand under Specialty Semiconductors from the terrestrial renewable energy and space solar power markets to increase further, as customers look to secure high-quality advanced materials from trusted partners. Under performance Materials, consistent with historical trends, volumes through the second half are expected to be slightly lower than in the first half. but with margins continuing to benefit from a strategic global supply chain. Based on our financial performance year-to-date and our expectations for the second half of 2025, we have increased our adjusted EBITDA guidance from a range of $55 million to $60 million to a new range of $65 million to $70 million.

This revised guidance takes into account the increased volumes anticipated through the end of this year as a result of our new contract with First Solar. Looking ahead, we are excited about the growth opportunities ahead, but also remain very prudent and mindful of the evolving geopolitical and trade environment. We're keeping a close eye on any impact on operating costs and focus on supporting our clients. All in all, given our unique and global standing as a preferred partner, we are well positioned for the rest of the year, but we will also capitalize on our strong momentum to enter 2026 at higher levels. We will continue to raise the bar as we have done consistently over the last few years and keep the momentum going. So that concludes our formal remarks. I will now turn the call back over to the operator for the Q&A with financial analysts.

[Operator]

[Operator Instructions] And your first question will be from Michael Doumet of National Bank Financial.

[Michael Doumet, analyst]

Good morning. Congratulations on the quarter and obviously, the First Solar contract expansion and extension. So maybe I'll start on the latter piece. So on the contract, would you be able to provide some details around just pricing in general. And I know Gervais, you said minimal CapEx, but if you can get a little bit more specific on that, that would be great. And then also, I guess, separately, any way you can comment on whether or not you expect the deliveries there to extend much beyond the first solar U.S. production, as well just to get a general view.

[Richard Perron, executive]

Okay. As a starting point, spike default, the vast majority of the volume secured contract will be adding to the U.S. to the United States. So there are various plants that they have in the U.S. as a starting point. Then to answer the CapEx part, we have already in this year's budget, capital allocated to meet the current year's demand, and we have launched another program in order to meet next year and the following 2 years demand. And all of that is on its way, and those capital investments will be done for the most part, but not exclusively, for the most part in Montreal. So that's all undergoing. And from -- and the other part of your question was pricing.

So pricing, it's on favorable terms. But at the same time, remember, in our last remarks, we're extremely mindful of inflation and operating costs that will most likely not stay at the current level, but all have to be to see.

[Gervais Jacques, executive]

And maybe just to add, it will all happen within our own installation both in Heilbronn and Montreal. No need to build a new building. It will be happening within the same installation, and we keep the same strategy, securing contract first and then adding capacity in an incremental manner.

[Richard Perron, executive]

We're extremely disciplined when it comes to capital investments.

[Michael Doumet, analyst]

Perfect. So maybe turning to the results, like, obviously, a very strong first half. If I tell you to go back to the beginning of the year and compare your early year expectations, the results so far, I wonder in your view, what really exceeded the expectations? And I guess, separately, has the expanded agreement with First Solar already provided to boost to the first half? Or is that really just expected to start going into the second half and into '26?

[Richard Perron, executive]

The last part of your question with this morning's announcements, what we need to say is that in the first half, part of that is already realized. Okay. It's what we referred to in the past as our spot business now being confirmed or contracted that's essentially what's behind today's announcement. And more, as you can see, it goes 4 years ahead of us, okay? And the other part of your question was on?

[Michael Doumet, analyst]

Where the performance...

[Gervais Jacques, executive]

Compared to the beginning .

[Richard Perron, executive]

Yes, the expectation. So I guess, our biggest single positive impact in the year would be under Performance Materials. It does perform better than anticipated. Okay, from a margin perspective and obviously, we did not at the beginning of the year, anticipated the pull forward in Q1. But as we just mentioned, it did not occur in Q2. But the margins that we're currently realizing on the performance in those, that's a nice, let's say, surprise or a factor that we did not anticipate at the beginning of the year. We always anticipate good results from that segment, but the results are better than anticipated, we have to be honest.

[Michael Doumet, analyst]

Right. And maybe if I can end with the third, but I noticed you didn't characterize the strength in your Q2 sales is benefiting from any pull forward like you did for Q1. So if I take your comments on the accelerating demand in Special Semiconductors, obviously, including First Solar, the expansion at AZUR in my mind, how is it not possible that the Q2 -- sorry, the second half sales don't exceed the first half sales. Just trying to really square away the guide with some of the commentary.

[Gervais Jacques, executive]

Well, in the case of renewable energy, we -- what was the spot sales in Q1 will be under contract and will increase gradually over the year to be ready to be at the level of 2026 and so on after then what we see is an improvement on renewable terrestrial energy. On space solar, you will see an increase going forward as we completed the commissioning and now we're doing all the qualification and ramping up the production, then AZUR, production would gradually increase over the year as well. And on performance materials, well, we -- as you know, we have enough capacity to meet all the demand. But the volume is slightly down, but margin up, then we'll see how the market will react over the next 2 quarters.

[Operator]

Next question will be from Nicholas Boychuk at Cormark Securities.

[Nicholas Boychuk, analyst]

On the First Solar contract, can you just kind of qualify Richard, you mentioned that a lot of the new material you're producing is going to be going to the U.S., but does this incremental capacity account for all of the new facilities they have coming online there? Or might there be additional demand that they have as these other facilities like Louisiana and Alabama fully ramped to production?

[Richard Perron, executive]

Well, our understanding from discussion with them and also their own public filings. Their strategy forward is to increase further the capacity in the U.S. When I say further, further from what they have announced a couple of years back when they officially announced the Alabama and the Louisiana plant. Now they want to bring to a higher level that capacity they have in the U.S.

[Nicholas Boychuk, analyst]

Okay. But to confirm, do you guys know if what you are producing represents all of the CdTe and all of the advanced materials that are going into those facilities? Or?

[Richard Perron, executive]

That's our understanding. Yes, it's not all of it. It's by far the vast majority of all this -- the Semiconductor Compounds, they're going to be using their thin film technology.

Sorry, just to quickly add on this morning's announcement. As you've read, we're also adding another infant materials referred to as CdSe.

[Nicholas Boychuk, analyst]

Exactly. I was just going to ask the CdSe, can you comment at all on where that's going to be produced? And the expected volumes, the type of product that's going to be going into? Any color there?

[Gervais Jacques, executive]

It's going to be produced in Montreal then we're currently -- we will be investing in Montreal to put in place a new production line, producing CdSe. And this will -- it is part of the different semiconductor compound layers when you're producing a panel at a thin-film solar panel at First Solar, you do have 1 layer of CdSe then this will be produced in Montreal.

[Nicholas Boychuk, analyst]

Okay. Understood. And then switching gears to AZUR and the capacity demand you have there, it's remarkable that your booking business as far as you are. How are you guys thinking about capacity there? What would you have to see, I guess, to increase further production run rate? And yes, what would capitalize that?

[Gervais Jacques, executive]

Well as you know, '25 is fully sold. '26 is fully sold. Now we are booking '27 and onwards. And the way it works for us, the same strategy will apply as soon as the booking will be when we have super good visibility and we know that we will be lacking capacity we will be looking at projects to add capacity again. But again, it will be 1 step at a time in an incremental manner. Always the same strategy, securing contracts and then investing.

[Richard Perron, executive]

So we essentially have a whole list of options prepared. And as we're filling up those years, we'll come a point in time, we'll make the call.

[Operator]

Next question will be from Frederic Tremblay at Desjardins.

[Frederic Tremblay, analyst]

Thank you and congrats on the quarter and the new agreement with First Solar.

[Richard Perron, executive]

Thanks, Fred.

[Frederic Tremblay, analyst]

Just on the First Solar agreement, can you help us maybe understand how the incremental volume that the increase that you announced at 33%, how that's going to be distributed roughly over 2025 and 2026. Is that -- should we think about it as an increase in both years? Or is it mainly weighted to 2026?

[Richard Perron, executive]

So the way we have made our announcement, we've compared the '25, '26 versus that previous contract that we had announced a year ago. So you got a first increase whereby default 2026 as higher volume than '25. Then when you get into '27 and '28, the increase we have announced is against '25, '26. In this case, at this point in time, the 3 years should be pretty much at the same level. But for the first 2 years, the second year being 2026 would be on a higher level than this year.

[Frederic Tremblay, analyst]

Okay. That's helpful. And then maybe just switching to performance materials and trying to better understand the elevated margins there. Is it -- I mean you're talking about Bismuth base pricing -- is it mainly just a pass-through of the higher bismuth prices that we're seeing in the market right now that's sort of helping the operating leverage and the margin there? Or is there something else that's driving that margin higher? I'm just trying to better get a better grasp of the sustainability of that margin.

[Richard Perron, executive]

It's the combination of various factors, okay, the sales mix and if you recall, we made some investments into that segment 3 years or so back, we had added automation, we added capacity. And we also recently made additional investments. All of that leading to operations that are more productive overall. But in the current geopolitical, what we've been able to take advantage of is what we referred to in our official remarks as our strategic global supply chain. We've been able in the context of higher prices of bismuth, not to name it. through our various sources of business, the shapes and form the value add that we're having to make the products that we're selling in high end markets, we've been able to pull the best of our margins, we could.

[Frederic Tremblay, analyst]

Okay. Perfect. And then maybe just lastly on AZUR, you commented on the year that you're booking business. And can you talk about pricing and margins and what you're seeing there. There's obviously been significant improvements since you acquired the company. But just given the strong demand, I would imagine that pricing is stable as well in the new agreements that you're signing to this day.

[Gervais Jacques, executive]

Yes. Indeed, if you look at the new agreement that we're signing compared to the one we had 3, 4 years ago, it's totally different. And the reason is the following. The supply and demand is super tight. And the market has been quite disciplined. Our 2 main competitors in the U.S., 1 of the 2 announced investment to increase its capacity, but also in a manner where it's quite gradual. Then I think the -- from a supply side, there's a lot of discipline and we're growing based on order. Then if you don't have the contract, you're not adding capacity, which definitely helps to maintain and improve the margin.

[Operator]

Next question will be from Michael Glen of Raymond James.

[Michael Glen, analyst]

So just the first question. So look, if I look at your back half guidance, you're effectively pointing to decline in EBITDA relative to the front half of the year at the midpoint of the second half implied guide on EBITDA. Is it realistic to think that your EBITDA will decline that much in the back half of the year versus the first half?

[Richard Perron, executive]

We're going to have a great H2, but we expect it to be lower than H1 for various reasons. On the performance materials, as we've been saying I would say, 8 years out of 10, most often, the volume is down because of the type of industries and clients we are addressing. We are more cautious about their year-end balance sheet. And then in the case of Specialty Semiconductors, obviously, volume is up, but we can foresee at this point in time without exact numbers that operating costs will be higher. So again, we're going to have 2 great quarters ahead, but slightly lower than the first. And so the extent of which is always difficult to assess with precision.

[Michael Glen, analyst]

Okay. And then just to go back to the First Solar, is the volume -- I know you're saying a lot of -- you're commenting a lot of it, but is the volume we should see in the back half of the year consistent with the first solar volume that we saw in the front half of the year? .

[Richard Perron, executive]

It should because essentially, for solar, every, every unit of product, we could produce the took it in the first half. It's not like it's been pace with a lot more in the second half than the first half. So going forward, it should be similar level or slightly higher and then as always, there's always that tricky cutoff part when you reach the holiday period towards the end that may play, but the volume will be superb in the second half.

[Michael Glen, analyst]

Okay. And then one of the comments was towards 2026. Like in M&A, maybe having motivated to enter 2026 with an acquisition. Can you just maybe -- are you getting closer on the type of business you would like to acquire? Or like just maybe additional information on what's happening with your M&A conversations.

[Richard Perron, executive]

We have a short lease of companies that we're spending a fair bit of time to better understand the operations of the market and assess the fit with 5N Plus. So that's where we're at and more entertaining exchange. But at this point in time, it's still getting familiar with the markets, the operations and how it fits into the 5N Plus 3.

[Gervais Jacques, executive]

And again, we're not looking for an acquisition. We're looking for a successful acquisition like then I think the mantra and the mindset is really -- we're super focused on that. .

[Operator]

Next question will be from Amr Ezzat at Ventum Capital Markets.

[Amr Ezzat, analyst]

Congrats. I hate to ask again, but just for an abundance of clarity on the volumes, obviously, where it becomes difficult is you have like all of the spot purchases. So from what you guys said in the Q&A, Q2 results already reflect the run rate that we should have for the rest of 2025. I think we all understand that. But then for 2026, I heard or I thought I understood that we get a bit of an uptick relative to 2025. Did I misunderstand? Or is that correct?

[Richard Perron, executive]

It is correct. '26, we'll have more volume than '25. And that is able -- that is true for renewable and space. Yes.

[Amr Ezzat, analyst]

Yes. Let's just -- yes, for space, I understand. Then so for renewable, how do I think -- how much of an uptick do we have in 2026 relative to 2025? Are you guys like comfortable sharing that?

[Richard Perron, executive]

It's an important uptick. It's in the 35% to 45%.

[Amr Ezzat, analyst]

Okay. Because when you guys like say, 33% for 2025, 2026?

[Richard Perron, executive]

That's the combination of the 2 years. Yes.

[Amr Ezzat, analyst]

Okay. Understood. Then for '27, '28, we layer another 25% on top of that ?

[Richard Perron, executive]

25% over '25, '26? Yes, exactly. On top of that.

[Amr Ezzat, analyst]

Perfect. Okay. I think that was very clear. The expanded agreement includes like CdSe beginning in 2026, which we haven't discussed like to too much in past calls, number one, is the -- is that in addition to the 33% of increased volumes for CdTe?

[Richard Perron, executive]

It is, sir.

[Gervais Jacques, executive]

Yes.

[Amr Ezzat, analyst]

Fantastic. Can you guys like quantify for us like that volume number one. Then if you could elaborate on how CdSe fits into your product and manufacturing road map relative to CdTe? I do understand for first where it's complementary to CdTe within the same sort of module architecture. But I just wonder how does it sort of impact your production processes and requirements and maybe thoughts on the margin profile over time for CdSe relative to CdTe.

[Richard Perron, executive]

Yes. From a manufacturing perspective, it is very similar in terms of equipment and processes, but it will need to be manufactured in a separate room to avoid, obviously, contamination. Okay? But the processes and the type of equipment, all that works out in a similar fashion to CdTe , where we built our own reactors and so on and so forth and the chemistry has a lot of similarities by all of the processes to make it. From a margin perspective, it is also pretty similar.

[Gervais Jacques, executive]

And in terms of quantity, the layer of CdSe, it's thinner, much thinner than the layer of CdTe less quantity.

[Richard Perron, executive]

Yes. volume-wise, it's not at all to the magnitude of CdTe because they use a much thinner layer.

[Gervais Jacques, executive]

But it's a super interesting niche product and a Yes, high value add and technology, pretty similar.

[Operator]

And at this time, gentlemen, it appears that we have no other questions registered. Please proceed.

[Richard Perron, executive]

Okay. Well, we would like to thank you all for joining us this morning, and have a great day.

[Gervais Jacques, executive]

Yes. Thanks.

[Operator]

Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending. And at this time, we ask that you please disconnect your lines.