Earnings call transcript: Decisive Dividend Corp beats Q1 2025 estimates

Decisive Dividend Corporation reported a robust Q1 2025, surpassing earnings expectations with an EPS of $0.05 against a forecast of $0.0448. Revenue reached $39.19 million, exceeding the anticipated $34.04 million. The stock responded positively, rising 1.72% to $6.39 in after-hours trading. InvestingPro analysis reveals the company maintains strong financial health with a profit score of 3.36 out of 5, while its price momentum score stands at 3.56, indicating positive market sentiment. The stock has delivered an impressive 18.93% total return over the past year.

Key Takeaways

• Decisive Dividend achieved record quarterly revenue.
• EPS and revenue both exceeded market forecasts.
• The company plans to launch six new products in 2025.
• Improved leverage ratio and free cash flow.
• Positive stock movement post-earnings announcement.

Company Performance

Decisive Dividend Corporation delivered a strong performance in Q1 2025, with consolidated sales increasing by 34% compared to Q1 2024. The company reported its highest-ever quarterly revenue, driven by robust sales across all business segments. The performance indicates effective execution of its strategic initiatives, positioning the company favorably in its industry.

Financial Highlights

• Revenue: $39.2 million, up 34% year-over-year.
• Earnings per share: $0.05, surpassing the forecast.
• Adjusted EBITDA: $7 million.
• Free cash flow improved by 128% compared to Q1 2024.
• Leverage ratio reduced from 3.1x to 2.7x.

Earnings vs. Forecast

Decisive Dividend’s EPS of $0.05 exceeded the forecast of $0.0448, marking an 11.6% surprise. Revenue outperformed expectations by 15.1%, indicating strong operational execution and market demand. This performance aligns with the company’s historical trend of exceeding market expectations.

Market Reaction

Following the earnings announcement, Decisive Dividend’s stock rose by 1.72%, closing at $6.39. This movement reflects investor optimism about the company’s future prospects, supported by its strong financial results and strategic initiatives. The stock remains within its 52-week range, suggesting stable investor confidence.

Outlook & Guidance

Looking forward, Decisive Dividend plans to focus on mergers and acquisitions within its existing verticals. The company aims to complete additional acquisitions in 2025, targeting domestic and UK-based businesses. It remains committed to maintaining a sustainable and potentially growing dividend, reflecting a positive outlook. According to InvestingPro data, the company has demonstrated strong dividend growth of 10.2% in the last twelve months. With 8 additional ProTips and extensive financial metrics available on InvestingPro, investors can gain deeper insights into the company’s growth trajectory and dividend sustainability.

Executive Commentary

"We were very pleased with our Q1 twenty twenty five operating results, which marked the strongest first quarter and the strongest revenue quarter in decisive history," said CEO Jeff Schellenberg. He emphasized the company’s commitment to sustainable and growing dividends, highlighting the strategic importance of the new COO, Chris Goodchild, in driving operational efficiency.

Risks and Challenges

• U.S. trade policy uncertainties could impact market conditions.
• High leverage ratio, though improved, remains a concern.
• The agricultural sector’s recovery is still uncertain.
• Potential supply chain issues affecting product launches.
• Market saturation in certain segments could limit growth.

Q&A

During the earnings call, analysts inquired about the company’s new product launches and M&A strategy. Executives clarified their approach to maintaining a sustainable dividend payout ratio and highlighted ongoing operational improvements, reinforcing the company’s strategic focus.

Full transcript - Decisive Dividend Corp (DE) Q1 2025:

Lovely, Conference Operator: Good morning. My name is Lovely, and I will be your conference operator today. At this time, I would like to welcome everyone to the Decisive Dividend Corporation First Quarter twenty twenty five Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question and answer session.

We remind you that today’s remarks may include forward looking statements and non IFRS financial measures that are subject to important risks and uncertainties. For more information on these risks and uncertainties, please see the applicable sections of decisive dividend news release and MD and A, which are on our website and have been filed on SEDAR. I would now like to turn the conference over to Jeff Chief Executive Officer and Rick Torreiro, Chief Financial Officer. Please go ahead.

Jeff Schellenberg, Chief Executive Officer, Decisive Dividend Corporation: Thank you, operator. Hello, and good morning, everyone. This is Jeff Schellenberg. I want to welcome everyone here to our Q1 twenty twenty five earnings conference call. We were very pleased with our Q1 twenty twenty five operating results, which marked the strongest first quarter and the strongest revenue quarter in decisive history.

The $39,200,000 in consolidated sales in Q1 twenty twenty five were 34% higher than Q1 twenty twenty four and generated $7,000,000 in adjusted EBITDA in Q1 twenty twenty five, which is nearly as much adjusted EBITDA as was generated in Q1 and Q2 of last year combined. These increases came from across the portfolio with each business vertical realizing sales and adjusted EBITDA increases compared to Q1 twenty twenty four. The hearth businesses, Blaze King and ACR, realized a 17% increase in sales compared to Q1 twenty twenty five on stronger order levels even as they started to enter their typical lower seasonal period. The agriculture businesses, Slimline’s Orchard and Vineyard Sprayer product and IHT generated 31% higher sales in the quarter versus Q1 last year, driven by strong order activity at IHC. The industrial products businesses, which includes Northside, Hawk, Capital I and Slimline’s evaporators had an aggregate 32% increase in sales with each industrial product contributing to the increase in Q1 twenty twenty five over Q1 twenty twenty four.

The building momentum in our merchandising business, marketing impact continued in the quarter and they realized a 38% increase in sales compared to Q1 twenty twenty four. Lastly, the addition of Tech Belt to our group of other wear parts businesses, which is Unicast, Micron and Procore, just after Q1 of last year was a key contributor along with Unicast to the 70% increase in wear part sales over Q1 twenty twenty four. The improvement in Q1 sales and adjusted EBITDA resulted in a 128% improvement in free cash flow less maintenance capital expenditures compared to Q1 twenty twenty four, which is our key metric in measuring our dividend payout ratio. In fact, the free cash flow less maintenance capital expenditures generated in Q1 twenty twenty five were 128% of the amount generated in both Q1 and Q2 twenty twenty four combined. This significant improvement shows the trailing twelve month dividend payout ratio down to 82% from 96% in Q4 twenty twenty four and demonstrates the strength in the free cash flow generation capabilities of our businesses and the sustainability of the current dividend level.

The strong Q1 operating metrics were also greatly improved our leverage ratio from 3.1 times at December 31 to 2.7 times at March 31, which bolsters our capacity under our credit facilities and the cost of borrowing under these facilities. Expected continued operational improvements in Q2 twenty twenty five relative to Q2 twenty twenty four should continue to drive the payout ratio and leverage ratio lower through the next quarter as well, supporting our financing capacity and M and A program. Our expectations around improved operating performance in Q2 twenty twenty five relative to Q2 twenty twenty four is based on the demand for our products that we have seen through the first four months of twenty twenty five. Our aggregate year to date 2025 order levels have outpaced the same period on a pro form a basis in both 2023 and 2024, while being based on more balanced contributions from across the group. These higher order levels left us with 60% higher aggregate order backlogs at the end of the quarter in the Q1 than we had at the end of Q1 twenty twenty four.

That momentum has continued so far in Q2 as April order levels continue to outpace April 2024 and April 2023 order levels. Further, we continue to be on track to launch new products in 2025 that we believe will support long term performance in our businesses. Specifically in our hearth business businesses, we are launching six new products, one in North America and five in The U. And Europe that will then include a smaller Blaze King unit for North America named the 16 and the overnight burn stove in The UK that incorporates Blaze King’s combustion technology with with ACR’s European stylings and sizings, and that’s named the Tempest. We believe these will have a positive impact on our results in the later part of 2025.

While our order activity so far this year and the promise of new product launches to come as the year progresses offer us a strong sense of optimism, there still remains a significant amount of uncertainty with respect to the impact recent U. S. Trade policies may have on the overall economy and as a result on decisive and its subsidiaries. Substantially, all of the products manufactured by the group and sold into The U. S.

Are compliant with the Canada, United States and Mexico agreement. While this and the other factors we outlined in our annual report should mitigate or insulate certain subsidiaries from the direct impact of tariffs, 50% of our overall sales in Q1 were made into The U. S. How The U. S.

Economy and our U. S. Customers are forced to react as a result of any of these impacts means that our business leaders will need to remain keenly focused on their activity levels, customer sentiment and cost structures. We have an excellent group of subsidiary presidents, including Cory Magison, who joined Capital I as President in April, that we have confidence in to continue to make their businesses stronger even through uncertainty. Additionally, the addition of Chris Goodchild as COO of Decisive, who as he stated in his press release quote from our announcement, has an obsession with margin discipline, cash generation and unlocking the full potential of each business we own is exactly the type of support our subsidiary leaders can lean into as we focus on driving organic growth and compounding returns for our shareholders.

With the improved performance of our subsidiaries supporting strengthening of our balance sheet along with the continued strong flow of deal opportunities we see, we are keenly focused on continuing to pursue our strategy of growth through acquisition. However, the times we are in dictate a focused approach that reduce our exposure to some of the prevailing headwinds resulting from current U. S. Trade policy. As a result, our focus from an M and A perspective would be on three different types of businesses.

First, domestic focused businesses that manufacture products that are exposed to natural resource industries. Second, U. S.-based businesses within our existing five focused business verticals to gain exposure to manufacturing capacity and customer base in The U. S. And third, U.

K.-based businesses within our existing five focused business verticals. We continue to see a strong flow of opportunities that fit well within the parameters of the types of business we’re looking for. Further, the increase in the available capacity we have under our existing credit facilities as well as the cost of capital improvement from significantly improved payout ratio demonstrating the sustainability of our dividend levels can support the financing necessary for this type of M and A. As a result, we fully expect to complete additional acquisitions this year. Adding an individual like Goodchild to our organization will also help us move any businesses acquired more quickly through the post transaction phases of the value creation F curve and into accelerated growth, a key to per share financial metric improvement and value creating growth.

We look forward to providing further updates to that on that to our shareholders as our M and A program unfolds. With that, I will now open up the call for questions.

Lovely, Conference Operator: One on your touch tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press the star followed by the number two. If you’re using a speakerphone, please lift the headset before pressing any key. Your first question comes from the line of Russell Stanley from Beacon Securities.

Jeff Schellenberg, Chief Executive Officer, Decisive Dividend Corporation: Good morning, and congrats on the congrats on the quarter. First question, just around the year over year growth and understanding the number of business lines contributed there, but I reached to you, I guess, was a stand there at up 60%. I’m wondering if you can kind of rank order the the drivers there. I think there were several, but wondering which ones were the were the primary drivers behind that and and wanted to understand if those those tailwinds are still intact thus far. Yes, for sure.

No, that it was a really appreciate the comments, Russ, first of all. And yes, IHC was a very significant contributor to our performance in the first quarter for sure. From a key driver perspective, I think we began to see it towards the end of twenty twenty four where there was a strengthening of pork prices in The U. S. Specifically that drove kind of rebound in the confidence of the of pork farmers to invest in our product or in their facilities, our product of which is a real key contributor to energy efficiency and cost saving for them as able to drive the profitability of their businesses.

I think the ramp down or the dialing back of spending in that industry came on the back of two really challenging years of of farmer profitability, including 2023, which was the largest decline in in farmer net income in in you know, while while they’ve been recording that information, that data for the last twenty five years. So a significant drop off in profitability in ’23 resulted in a pullback in spending of farmers on any of these types of products given their unwillingness to leverage themselves or take that type of risk. They want to pay for these things in cash. And so that drop off of profitability in ’23 impacted very directly our 2024 sales, even though our product is part of the solution. And as we saw kind of the financial situation of these farmers firm up and to be able to move into profitability on a per head basis, we began to see a pickup in those those investments.

And it’s really spread across a a wide group of customers that that are looking to reinvest in their barns, improve the efficiency of their barns, and we have a product that can save those farmers up to two thirds of their energy costs. And so, you know, the product sells itself when market conditions are are good especially. And and even when they’ve been challenged, you know, they that that business before we acquired it, even though ’22 and ’23 were tough port pricing periods, they had really strong performance in 2023 because they have such a good solution. And so we have a lot of confidence in the product that we have there. And I think their performance here in towards the back half at least the back quarter of twenty twenty four, they had a good performance as well.

And into 2025 here, it really you know, we’re really pleased with the performance we’re seeing there. Yeah. And, Russ, to your to your last part of the question, we’re definitely seeing that momentum continue for for IHT. That’s great. Thanks for the thanks for the color.

And then maybe around the dividend and and specifically the split between announced taking cash versus the direct subscribers. I think the the number of or the the, you know, stock the amount of dividend taken in stock is up to 13% in the quarter. I think a nice nice quarter over quarter improvement still well below kind of prior highs, and I’m not sure if you have this granularity at hand, but are you seeing that share of dividends taken to stock? Is that starting to decline? Did you see kind of a mark to market improvement during the quarter?

Any color there would be helpful. Thank you. Yes. No problem, Matt. It’s actually been very consistent since about mid last year.

So I think after the challenging first half of the year, we participation roll off, and it was quite high at the early part of the year. But since that period, it’s been pretty consistent to where we see it now. So we haven’t seen an uptick yet, but has been consistent really since kind of the midsummer. That’s great. Thanks for the color.

I’ll get back in queue.

Lovely, Conference Operator: Your next question comes from the line of Christian Nelson. Congratulations

Jeff Schellenberg, Chief Executive Officer, Decisive Dividend Corporation: on a great quarter. My first question is with the current stock price in this quarter, has the company completed any share purchase in line with the share purchase program? Yes. Christian, we have acquired some shares under the NCIB. It’s not a key focus of ours, but something we use to kind of try and protect the floor.

And so that definitely was in place. I don’t know the exact number of shares we purchased, but it wasn’t a large number. Really, our capital allocation strategy is around paying dividends to our shareholders. And we do use the NCIB periodically when we feel like the share price isn’t representative of the value of the company. Okay.

Perfect. And the second question would be, I know in previous earnings calls, made comments on employee share purchase programs and the membership in that with the employee. Has that held strong with employee census for the company? Yes. I mean, over the years, we’ve seen a really nice improvement and higher levels of participation from our employees over time.

We’re actually making some improvements to our program at this time as well to help provide greater levels of access in terms of the timing of them being able to join and a few things like that. And so we continue to view that as a key retention tool and a great opportunity for something that’s actually really attractive to the vendors that we buy businesses from as well, the fact that their employees are going to have an opportunity to become part owners of the business that they work in. And so it’s a really nice feature of our program. And I think it’s part of the reason that we have really strong participation rates across the business. Okay.

Perfect. Thank you for that. And again, congratulations on another great quarter. Thanks, Christian.

Lovely, Conference Operator: Now your next question comes from the line of Steve Hansen from Raymond James. Your line is now open. Please go ahead.

Jeff Schellenberg, Chief Executive Officer, Decisive Dividend Corporation: Yeah. Good morning, guys. Thanks for the time. I apologize because I dropped off earlier, but I just wanted to ask two things. One is, Jeff, can you you’ve got a pretty new strategic hire on the operating side, the COO that’s come in from the auto side.

I just wanted to maybe help help us understand a little bit where you’re gonna direct his focus initially, what kind of targets you’re looking at from a sort of efficiency or or optimization standpoint and where which business is perhaps is gonna be the first focus once he gets on board here. Yeah. No. It’s it’s a great question, Steven. And, yeah, we’re really excited about the the capabilities that Chris brings to the table.

You know, he has, you know, built an extended career in in in auto parts manufacturing, which, you know, across a variety of different types of products. So which has resulted in having exposure to the different, you know, different types of businesses that look like a lot of the different businesses that we have actually. So, you know, we’re really encouraged about not just the capability he brings to the table, but the fit he has in terms of, you know, how, you know, how we like to work with our subsidiaries to support them through through different challenges. And I think that you know, I think, you know, what what Chris will really bring to the table is kind of an overarching ability to to help us really, yeah, enhance our capabilities to to manage our businesses by by dashboard and data. Right?

You know, I think he has really strong capabilities in that, which will improve kind of our ability to more quickly diagnose and address issues through through, yeah, you know, the type of data driven, you know, information management that opens up, you know, you know, clarity around where there’s issues occurring and then his ability to step into that and help address those issues. So I think it’s just just kind of this broad umbrella type of impact that I think he’s going to be able to really help support us with that we’ve been investing in already. And so so I think that’s a critical characteristic of him. But then with respect to individual subsidiaries, you know, we have we have very we have, you know, clear objectives on what we’re trying to achieve from an organic growth perspective. And that really becomes kind of his key guiding light is is how do we help our businesses grow organically.

And that’s that’s you know, operational efficiency is something that he’s you know, has been bred into him through, you know, a couple decades more than that in in in auto parts with with a highly efficient organization in doing that. So I think that’s gonna be obviously a key focus of his, but also, you know, working with our subsidiaries around, you know, adding value to their products, which allows us to drive pricing improvement. You know, I think he has a lot of new product development expertise and capabilities that I think will be very beneficial to us both in installing, I’d say, an increased level of robustness, diligence, rigor to our new product development strategies across our businesses. But also, as we talked about in our prepared comments here, the fact we’re introducing six new products in the hearth division. ISG is working on a cooling mat product, for instance.

He’s a guy that has a tremendous amount of experience in that area that can really help us with that. So we’re excited about those elements. Terms of his initial focus, you know, I think, you know, we we’re undertaking a number of programs already at at, you know, IHG, you know, around operational efficiency improvements. There’s a number of, I would call it, yeah, the the, you know, provide helping support the professionalization of our building material. For instance, across a number of organizations that we get products that we are either engaged in already or working through.

And and, you know, so there’s there’s yeah. We have a a few that are a priority, I would say, that I know he can step into, but but, you know, you know, for different reasons. Right? Maybe less now about kind of immediate fires that we’re fighting, but this ongoing improvement to help us support organic growth in our subsidiaries. So so I think I think he’ll be tremendously impactful, and and we’re very much looking forward to having him on board when he starts June 2.

That’s great. And then, again, I apologize for the cough. This is. Steve, your phone’s cracking up a little bit. Okay.

I think operator, I think he dropped off and we can move to the next question.

Lovely, Conference Operator: Your next question comes from the line of Yuri Lynk from Canaccord Genuity. Go ahead. Your line is now open.

Jeff Schellenberg, Chief Executive Officer, Decisive Dividend Corporation: Good morning, guys, and nice quarter. Thanks, Yuri. Just want to pick up on the the M and A conversation. Wondering how the landscape has evolved and, you know, following COVID and the labor challenges and inflation and now the tariffs, if if you’re seeing any any increase in, you know, full proprietor businesses kind of throwing their hands up and saying, okay. I’m I’m ready to sell now.

Yeah. You know, I think you’re right. These, like, layers of challenges, I think, definitely promote, you know, the the pace at which people are looking at perhaps exiting their businesses. But I think overall, you know, time time just continue to march continues to march forward. And I think that almost more than any of these individual factors is the driver of a significant number of the opportunities that we see in terms of our m and a portfolio.

You know, the owners we we are talking to are absolutely looking at these these at us as an option because they they don’t they’re looking to retire, and they don’t have a succession plan. So perhaps and I would say, you know, maybe the factors you’ve mentioned like COVID or interest rates or inflation or, you know, you know, tariffs now are you know, have an impact on that. It it’s really more so about just the agent stage they are and and and they’re a lot of times coming to the realization that they they may even have hoped that there would be a succession plan within a family structure or something like that, and and it hasn’t turned out that way or they’ve made the decision not to go that route. And so that that becomes the real driver, less any of these individual elements and more just that overall story. And and that’s you know, because of that, our our story, our differentiating advantage, which you talk about kind of the the buy bill hold.

Right? You know, buy bill hold and access to capital are are in the in the market we’re in are are are two material differentiating advantages for us. And and our story just really resonates with those types of folks who want us who would ideally prefer probably to to maintain the ownership of the business and just to keep go have it running as a going concern, but realize, you know, that that time is not on their side. And so they look at us as something that can continue to support and sustain that. And while for us, it’s an opportunity to kind of get in and see what we can do to help drive the organic growth of the business, which is really going to be the source of compounding, which back to Steve’s question about our COO and having those types of expert capabilities that we can deliver to these subsidiaries to help them drive organic growth is a very material source.

I think the key source of compounding opportunity for the businesses that we operate in in the context of our overall model. So, yeah, I guess that would that would be yeah. So I I think the trend continues, and and the pipeline of deal opportunities continues to be strong, really driven by that. Okay. And is it fair to say that the the you you’re looking more it sounds like you’re you’re looking more within your existing verticals.

And if if if that’s the case, can you share, you know, the the position you’re in to kind of ring more either cost and or revenue synergies out of deals that should be now more complementary that now that you’ve got kind of a base in a number of different end markets? Yes, for sure. I think that’s exactly kind of the vision and why we’re looking to pursue opportunities in this way. You know, I think what investing within verticals we have are already invested in helps us do, number one, is reduce transaction risk because we have an understanding of the industries that we’re investing in and some of risks associated with those, which allows us to not have to start from scratch, so to speak, in terms of our diligence around what the potential challenges or the risks that are prevalent in in any particular industry that we’re investing in are. So that that that’s number one.

Number two, we can leverage off the you know, we’ve made significant investments in in finding, attracting, recruiting, retaining really strong sort of executives across the portfolio, and we continue to invest in that. You know, a lot of these folks really want the challenge of of growing whatever you know, the line of business that they’re operating in. And acquiring businesses within those lines, you know, helps us, you know, leverage off the the highly capable people that we’ve put in place in those you know, within within the subsidiaries we have already to give them that next challenge, especially in the cases where they performed really well to open up the door to give them more access to different types of businesses that allow them to perform, do what they’ve done in our existing subsidiaries within an acquired business. And so that’s that’s another reason that’s really beneficial. And I think from a synergy perspective, which is your cost basis, I think there’s there’s a lot of opportunity as we do that to look at things like, you know, administration administrative programs, oversight and management pros programs that allow us to to leverage off of kind of the capabilities we have already to not just repeat those in another business, but have them work with, you know, within the existing structures we have in place that allows us to see some cost savings as well.

And so so that’s that’s also really beneficial. You know, I think we we we we wanna see you know, we’re buying these businesses not just for brand names or those type of things, but to grow into adjacent markets or adjacent products. So so they they’re not just it’s it’s not just the identical type of business in in another jurisdiction. It could be similar. But, you know, the things that we’re we’re we’re looking to add help support, you know, the overall growth of the business as well while leveraging off of the systems and structures we have.

So so I think that’s an important thing for us to do. And, you know, I really again, circling back to it, I think our ability to you know, integrate these transactions in a way that drives their organic growth is is the the key source of compounding return for our shareholders. And so, you know, it’s a real real priority for us to focus on ramping up our operational capabilities and the quality of the support we can provide from expert level teams across different types of business challenges these businesses might face to help achieve that objective. Okay. Makes sense.

Last one for me. Just on the dividend, any I mean, previously, you had identified a a 60% to 75% target payout ratio. Wondering if there’s any update to that and if you see any value in perhaps operating in the, at least in the very low end of that range going forward to keep you know, more dry powder for value accretive M and A? Yeah. I think, you know, I’ll refer to, you know, 2025 annual report, 2024, sorry, annual report, I wrote a letter to investors in that.

And and, you know, we we had some language around that put some language around that in that letter, which is, you know, we we entered 2024 with with a 54 payout ratio, and and we exited in our Q4 payout ratio was 55% when we exited the year just for that quarter. Obviously, the strength of our Q4 performance and our continued strength of our Q1 performance has continued to drive our TTM payout ratio down, and we’re really starting to see improvement in that obviously in Q1 here as we shed a rough quarter in Q1, but and basically more than replaced our Q1 and Q2. So we expect to see continued improvement into that in Q2. But what we stated is what was highlighted through the challenging period that we saw in the first half of twenty twenty four is the importance of balance sheet flexibility. And so as I say in that letter, what our objective is to in the near term is to be more in line with where we entered 2024 and where we exited 2024 in terms of the payout ratio, then which helps support the flexibility in our balance sheet.

Our primary objective with the dividend is sustainable and growing dividends. That sustainability element, we are repeated it kind of over and over again that we believe our current dividend levels are sustainable. And operating with a payout ratio that’s more in line with the levels that I talked about where we enter ’twenty four and exit 2024 helps will help drive that further. But our objective continues to be dividend growth. And we would like to be part of the dividend type of index where we operate within the confines of a flexible balance sheet, but we still are able to generate dividend growth to to support that for our shareholders and be part of those types of indices.

So that’s you know, I think, you know, I agree with you. And and the priority, I think, of of our of our group and and our team is to to ensure that we’re operating our our business in a way that provides the type of flexibility we need to invest in our businesses, you know, invest in the m and a programs, manage our our our our debt ratio levels while also, you know, growing the dividend for our shareholders. And so so that balanced approach within the confines of more flexible kind of levels of payout while maintaining our existing dividend and looking to grow it in the future are what we’re focused on. Thanks. I’ll get back in the queue.

Thanks, Jerry.

Lovely, Conference Operator: Your next question comes from the line of Russell Stanley from Beacon Securities. Just

Jeff Schellenberg, Chief Executive Officer, Decisive Dividend Corporation: a follow-up question. Just around organic growth and new products. You talked about our business plans to launch some products later this year. Guess, can you remind us what type of new product launches you plan or the other new operators? You were there’s some background noise there, but I think you were talking about what the type of new product launches are in our businesses.

So so, yeah, I think, you know, we we we mentioned specifically in in in our disclosure, the hearth industry as where we’ll be seeing a lot of new products launched. And so so in in that sector, you know, we’ll start in North America. We we were working on two kind of major new product lines that will we we think will allow us to access new new market market niches within the existing wood burning stove marketplace where we really have a very strong position in, and that’s both in the down market and up market spaces. So our down market product is a smaller product called the e 16 that’s you know, we expect to launch later this year that that, you know, has a has a a lower price point while still offering kind of the blazing technology because it’s a and it’s a smaller unit. And we’re really excited about that product.

We think actually in in economic times like this with with some level of economic uncertainty actually are wood burning stoves typically do pretty well in that type of environment. And and having a product that that is is, you know, a multiple of times better than what you can walk into, whatever home home hardware or Canadian Tire to buy is is something that we we think will but that that competes kind of at the level of some of the products that are in that space is something that we’re really excited to bring to market. We also have a upmarket fireplace, an insert product that that’s, you know, a a wall mounted unit or an insert like a like like a a fireplace is that we’ll be launching likely in 2026 as we get through the regulatory approval processes, but that’s at the high end of the market. And we’re also you know, it’s Ray, just on that. It’s also new build focus more more than just just renovation, which is our current fleet.

Yeah. And so we think that’s an important product too in North America. So that’s that’s kind of our focus in North America. In in in The UK, you know, we we have we have new wood burning electric and gas products that we’re bringing to market, but we’re really excited the wood burning product. That’s gonna be the first long burn stove available in The UK and European marketplace.

It’s it’s it’s the first of its kind that incorporates blade steam combustion technology with with the the styling and design capabilities that ACR brings to the table in terms of their, you know, more European size and style of fleet that or fleet of products that they already have. And so, you know, we’re we’re looking to launch that kind of later in the summertime here in time for heating season in The U. K. As well with a very focused group of dealers first in The U. K.

And then they’re looking to move into the European marketplace next year with that product. And we think that’s going to be an important product that really drives a strong product differentiator for ACR in that marketplace. In addition to that, we’ve had some nice wins with respect to some electric products that, you know, we’ve we’ve you know, we’re we’re, you know, gonna be selling some of the new electric products that ACR has developed into, you know, some different lot lodges like holiday lodges that that won a contract for across The UK. That’s a multiyear contract, and so we think that’s an important, you know, validation, I guess, of the quality of that new product we’re bringing to market on the electric side, and we get some new gas products as well. So that’s that’s the hearth industry, and then we think those are all really important drivers of of future growth of the business, in, you know, with respect to different market channels that we’ll be operating in in North America, but also opening up the door to geographic growth for our European product is you know, we’re we’re mainly UK focused at this point in time with some distribution into into Europe, Continental Europe, But we really believe these new products are going to open significant doors into the continent, which I think will be really helpful from a geographic expansion perspective and a longer term growth objectives we have for that organization.

Another example of a great new product we have is the cooling mats at IHG. We’re very strong in the heating mats. We have the best product in the marketplace from an energy efficiency and product quality perspective, and so we’re well positioned there. And and, you know, we’ve been working with Purdue University to to commercialize a cooling mat technology that was developed, you know, including an IP license that we have with with them to bring the cooling map product to market that has significant benefit for for as it relates to animal welfare and heat stress that animals experience and especially as people are concerned about things like global warming. This this is a very topical product and something that we think will have some some really important success with as well.

And so we’re we’re gonna be we’re just in the middle of launching some product trials with some key customers to to validate some of the work we’ve done around that. And so we’re excited to see see that going into Barnes to help demonstrate the benefits of this product to to the farmers and and believe there’s a great trajectory that we have for for that product within, you know, within our existing customer base as well as the same same folks who sell that sell the heating mat to. So those are just some examples, you know, within the product within the group of of the different new products that we’re bringing to market. Great. Thanks for the color and congrats again.

Yeah. Thanks, Rick. Thanks, Rick. There

Lovely, Conference Operator: are no further questions at this time. Please continue, mister Jeff Schallenberg.

Jeff Schellenberg, Chief Executive Officer, Decisive Dividend Corporation: All right. Thank you, all of you, for attending our Q1 twenty twenty five conference call. We look forward to updating you on our progress continuing into the next quarter and beyond.

Lovely, Conference Operator: Ladies and gentlemen, this concludes today’s conference call. Thank you for your participation. You may now disconnect.

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