Annual Meeting of Shareowners - REKOR SYSTEMS INC

Financial Performance:

• Fiscal 26 sales reached $2.4 billion, representing a 19% year-over-year organic growth driven by price realization and modest volume increases.
• Adjusted Earnings Per Share (EPS) surged to $4.57 from $1.34 in the prior year.
• Adjusted EBITDA margin significantly expanded to 26.9%, up from 15.2% in the previous fiscal year.
• Shareholder returns totaled $71 million via dividends and share repurchases.
• Restructuring savings of $27 million were realized in Fiscal 26.

Guidance and Future Outlook:

• Management targets $110 million in total structural cost savings by the end of Fiscal 27.
• Fiscal 27 outlook is optimistic, anticipating improving market conditions and strong growth in key end markets.
• Strategic focus remains on delivering above-market growth, continuous improvement, and customer-centric solutions despite market uncertainty.

Business Segments and Product Lines:

• Growth platforms are being expanded through new wins in AI data center power generation, aerospace and defense, mining projects, and next-generation vehicle power trends.
• Growth is being leveraged through core capabilities in material science, process technology, application engineering, and a secure global supply chain.
• Business expansion occurred with key customers utilizing these distinct manufacturing and wear-solution capabilities.

Market and Competitive Landscape:

• The company successfully navigated an unprecedented tungsten market environment, implementing pricing and operational actions to mitigate impacts.
• Competitiveness is derived from differentiated material science and innovation, allowing the company to solve complex manufacturing challenges for customers.

Risks and Challenges:

• Market volatility related to tungsten pricing and availability presented a significant environmental challenge during the fiscal year.
• General market uncertainty requires continued disciplined execution of growth and cost initiatives.

Management Commentary and Tone:

• CEO Sanjay Chaubey maintained a confident and optimistic tone, highlighting strong performance and progress on strategic initiatives.
• Management emphasized operational discipline, balance sheet flexibility, and the success of the lean transformation and cost structure initiatives.
• The tone reflected conviction in the company's ability to create long-term value and execute on its growth strategy.

Analyst Questions and Answers:

• No questions or comments were received from shareholders via the web portal during the meeting; the Q&A session was therefore concluded without discussion.
• Independent auditors (PricewaterhouseCoopers LLP) were present but did not address questions as none were submitted.

Other Key Points:

• This transcript documents the 2026 Annual Meeting of Share Owners rather than a traditional quarterly earnings call; it covers the election of nine directors and ratification of PricewaterhouseCoopers LLP as the independent auditor for the fiscal year ending June 30, 2027.
• The "Say on Pay" advisory vote regarding executive compensation was approved with approximately 99% of votes cast in favor.
• Final voting results will be reported in a Form 8K filed with the SEC within four business days.
• The record date for voting eligibility was August 28, 2026, with 76,390,031 shares outstanding.
• Note on Entity Naming: The transcript contains inconsistent naming references (switching between "Kenna Metal," "Canemiro," and "CanaMiddle"), which appear to be transcription errors for a single entity.