Good morning, and welcome to the ImmuCell Corporation Conference Call to discuss Unaudited Fourth Quarter and Full Year 2025 Financial Results. Please note, this event is being recorded. I would now like to turn the conference call over to Joe Diaz of Lytham Partners. Please go ahead.

Thank you, Bailey, and good morning to all. As the conference call operator indicated, my name is Joe Diaz with Lytham Partners. We are the Investor Relations consulting firm for ImmuCell. I thank all of you for joining us today to discuss the unaudited financial results for the fourth quarter and the year ended December 31, 2025. Listeners are reminded and cautioned that statements made by management during the course of this call include forward-looking statements, which include any statement that refers to future events or expected future results or predictions about the steps the company plans to take in the future. These statements are not guarantees of performance and are subject to risks and uncertainties that could cause actual results, outcomes, or events to differ materially from those discussed today. Additional information regarding forward-looking statements and the risks and uncertainties that could impact future results, outcomes, or events is available under the cautionary note regarding forward-looking statements or the safe harbor statement provided with the press release that the company filed last night, along with the company's other periodic filings with the SEC. Information discussed on today's call speaks only as of today, Thursday, March 5, 2026. The company undertakes no obligation to update any information discussed on today's call. Please note that references to certain non-GAAP financial measures may be made during today's call. With that said, let me turn the call over to Oliver Te Boekhorst, President and CEO of ImmuCell Corporation, for opening remarks. Oliver?

Thanks, Joe, and good morning, everyone. It's my pleasure to welcome you to today's discussion of ImmuCell's Full Year 2025 Results. 2025 was a very successful year for the company. In 2025, we hired a new management team. We increased manufacturing capacity to meet end customer demand and resolved a multiyear backorder situation. We pivoted to a strategy that is dedicated towards maximizing shareholder value from our highly successful First Defense franchise. We achieved total product sales of $27.6 million, and we earned $1.6 million of net operating profit, which was an improvement of $3.3 million compared to 2024, largely driven by significantly expanded gross margins. In our previous calls, including our special investor call on January 9, 2026, to discuss our full-year revenue and our shift in strategy to focus on First Defense, we explained some of the drivers of our revenue performance and the rationale for our new strategy. In summary, we compete in a large growing market with a highly differentiated product portfolio that has a lot of runway for further growth domestically and internationally. And so we decided to double down on this successful First Defense franchise. Our results in 2025 give us confidence in this decision. I will review some of the drivers in more detail and share some of our market observations after Timothy Fiori, our Chief Financial Officer, completes a deeper review of the financials for the fourth quarter and full year 2025. I now turn the call over to him. Tim?

Thank you, Oliver. I'll start with a short recap of product sales results, which are unchanged from our January conference call. All the numbers I'll speak to are approximate and rounded. Product sales for the fourth quarter of 2025 came in at $7.6 million, a decrease of 1.6% as compared to the fourth quarter of 2024. The Q4 decline was so modest; it is noteworthy. As you will recall, our very strong sales in the fourth quarter of 2024 benefited from increased demand and catching up from a prior backorder situation. We had earlier warned that quarter-to-quarter comparisons for the last half of 2025 would be affected by this catch-up factor. That same dynamic will continue to impact growth rates in the first half of 2026, but I want to be clear that this does not impact 2026 operationally, we're shipping orders every day. Digging further into the details, domestic sales for Q4 grew 8.7% as compared to the fourth quarter of 2024 to $7 million, while international sales for Q4 declined a bit more than half to about $600,000 in the same period, mainly driven by order timing in Canada. It's important to note that international sales are only approximately 8% of total sales for Q4 2025. For the year as a whole, in 2025, we grew 4.3% as compared to 2024 to total product sales of $27.6 million. Similar to the quarterly results, we saw growth in domestic sales and a decrease in international sales, again, influenced by order timing from our Canadian distributor. In terms of product mix, we're pleased to see continued shift towards Tri-Shield, reflecting new customer acquisition and migration from our lower-priced Dual-Force products by some customers seeking the broadest protection available. We realized gross margin improvement in 2025 as compared to the prior year. Gross margin as a percentage of product sales increased to 38% during Q4 of 2025 compared to 37% during Q4 of 2024. Notably, we achieved this improvement despite Q4 2025 gross margin being suppressed by noncash inventory write-downs. The full year results show the story more clearly. Gross margin increased to 41% during the full year 2025 compared to 30% during the full year 2024. Gross margin improvement in 2025 was driven by increased manufacturing volumes and efficiencies as well as product price increases, partially offset by noncash inventory write-downs. As previously disclosed in our January conference call, we conducted a thorough review of fixed assets and inventories. As part of that review, we took a noncash write-down across Q3 and Q4 of 2025 of approximately $650,000, mainly consisting of work-in-process colostrum inventory. This noncash write-down is approximately 5.9% of Q4 2025 revenue and approximately 2.4% of full-year 2025 revenue. We will continue to carefully monitor assets, including inventory as part of a rigorous and disciplined capital allocation process. Operating expenses increased to $3 million during Q4 of 2025 compared to $2.2 million during Q4 of 2024. Operating expenses increased to $9.8 million during the full year 2025 compared to $9.6 million during the full year 2024. The increase in both period comparisons was primarily driven by increases in G&A, partially offset by reductions in product development expenses related to Re-Tain. Other expense increased to $2.8 million during Q4 of 2025 compared to $100,000 during Q4 of 2024. Other expense increased to $2.7 million during the full year 2025 compared to $500,000 during the full year 2024. The primary driver of both Q4 and full year 2025 increases came about as a result of our shift in strategy around Re-Tain. In December, we announced a shift away from Re-Tain manufacturing to allow us to focus more on our highly successful First Defense product line. In December, we took a noncash write-down impairment charge of $2.7 million for certain Re-Tain-related property, plant, and equipment. This is $200,000 or so less than I discussed in the January conference call, which is attributable to a slight increase in our estimation of future salvage value. We continue to sharpen our overall assessment of the value of former Re-Tain assets that we plan to repurpose for use in First Defense manufacturing and our estimates of their net value are subject to change. We did have a one-time income from insurance proceeds of $427,000 in the first quarter of 2025, which provided a partial offset to the Re-Tain write-down in the full year view. I'll wrap up the income statement financials with some discussion of the improvements we've seen regarding 2025 net income and earnings per share as compared to prior year. Net loss of $1 million during 2025 represents a $1.1 million year-over-year improvement compared to 2024, even considering the significant impact of the previously mentioned $2.7 million Re-Tain write-down. The year-over-year improvement was driven by higher sales and increased gross margins. Basic net loss per share during 2025 was approximately $0.12 per share in contrast to a net loss of $0.26 per share during the prior year. Please note that we provided EBITDA figures in yesterday's earnings release. However, the EBITDA calculations do not adjust for the impact of write-downs for Re-Tain or inventory, which are obviously material to 2025 results. Lastly, operating income for 2025 was $1.6 million compared to an operating loss of $1.6 million in 2024, a year-over-year improvement of $3.3 million. To wrap up with financials, let me highlight a few key balance sheet items. We ended 2025 with $3.8 million of cash on hand. Working capital increased from $10.6 million at the end of 2024 to $13 million at the end of 2025, driven by higher finished goods inventory. As you may recall, we ended 2024 with near 0 finished goods. We will continue to closely monitor and manage cash and our other assets as we balance long-term investment with near-term operational needs. With that, I'll turn the call back to Oliver for some closing remarks. Oliver?

Thanks, Tim. Congratulations to the team for the excellent financial results in 2025. It was a challenging year for sure with a lot of change, but ImmuCell navigated it well, and we are ready to make 2026 a success. As promised, I will take a little time to review our strategic focus and share some market observations with you. ImmuCell competes in a very attractive, large and growing market for calf health solutions with our First Defense range of products. Calf's health is a dynamic market that has seen rapid and dramatic increases in the value of calves driven by dairy beef cross-breeding and a contraction in the U.S. calving herd, which has tightened calf supply relative to market demand. First Defense is a best-in-class preventative for calf scours, which is a condition that affects 14% to 15% of pre-weaning calves. That's approximately 5 million calves every year in the U.S. alone and is the leading cause of death in these pre-weaning calves. Scours represents up to $1 billion of economic burden in the U.S. due to treatment costs, performance losses, and mortality. And U.S. farmers spend $90 million to $100 million per year on scours prevention products. Our customers, whether they are dairies raising their own calves, calf ranches that raise calves for dairies or cow-calf operations, are all interested in preventing scours outbreaks and protecting these calves that are the highest risk animals on the farm. Calves are born immune incompetent. And in the first few weeks of their lives, they are particularly vulnerable to bacteria and viruses. Our product line protects against three common pathogens that cause scours, namely Bovine Coronavirus, E. coli, and Rotavirus. First Defense products are colostrum-derived and the only USDA-approved solutions for scours that aren't a vaccine and deliver three to six times as many neutralizing antibodies against these pathogens than our primary vaccine competitor does. And being colostrum-derived, we provide these calves a lot of other bioactives to help them stay healthy, too. It should not come as a surprise that we are priced at approximately two-and-a-half times competitive alternatives. These product characteristics have helped us win market share, increasing from 10% to 15% of treated calves in the U.S. in the past eight years, and we capture approximately 29% of the spend in this growing category. Specifically in the U.S. in 2025, producers spent approximately $93 million in the calf scours category, which includes vaccines and our antibody products, which was 14% higher than in 2024. Ten percent came from the increase in the number of calves using scours preventatives, and the rest from price and product mix. And yet, about 55% of calves are still not getting any treatment for scours at all. So when you do the math, the total addressable market in the U.S. is more than $200 million. And internationally, the total addressable market is at least five times as large. ImmuCell maintained approximately 15% share of treated animals in the U.S. in 2025, and we are pleased to report that we added more customers with new account volume more than offsetting normal account attrition in 2025 and that recurring customers increased their purchasing in 2025, driven by higher coverage rates and inventory normalization. We believe momentum accelerated in the fourth quarter. So we gained revenue share against the three largest animal health companies in the world during a time when we were supply constrained due to the manufacturing challenges. Now that we're addressing manufacturing capacity, we have a lot of confidence in future growth. In late December, we announced our strategy to focus on First Defense and pause investment in a subclinical mastitis product that the company had pursued for some time to allow us to focus on the scours market opportunity I just described and, critically important, also on improving our manufacturing capabilities and capacity. To give you some background, we grew our manufacturing capacity from approximately 3 million units in 2023 when we were in a backorder situation to 4.1 million units in 2024 and 4.6 million units in 2025. This helps you understand the gross margin improvement that drove our bottom line results in 2025, although not all that margin improvement was driven by volume; a portion of that was efficiencies and product price increases also. In the past three months, we have completed an exhaustive analysis of our processes led by outside experts and key leadership inside the company, and we have identified over a dozen opportunities to further increase our capacity to between 5 million and 6 million units per year. Units don't match up exactly with revenue because of the different and changing price points of the products in our portfolio, so we will no longer communicate our capacity in terms of revenue. Having said that, we recently implemented medium- and long-term demand and supply planning, and the team is confident we can meet demand in 2026 and 2027 by implementing yield improvements, while we work on our next major capacity expansion. When we focused on First Defense at the end of December, this enabled us to really dive into these yield improvement opportunities, and we are also excited to repurpose assets previously deployed for our subclinical mastitis product to First Defense, and we are now devoting all our time and investments to expanding a successful existing product line. Finally, we previously announced that we are increasing our sales capacity, and I'm pleased to announce that we hired a senior international market development leader, added a new sales manager in the U.S., and are actively recruiting for a third commercial position. We will make additional territory hires based on continuous assessments of calf population density, adoption of calf-level scours prevention solutions, and demonstrated price acceptance within each region. In the meantime, I just returned from a very successful sales meeting last week, where we implemented a new standardized sales approach that will enable us to scale our commercial activities more efficiently. Our top priority at ImmuCell remains solid execution across the organization from sales to manufacturing and including all the support functions that make future profitable growth possible. With that said, we'd be happy to take your questions. Let's have the operator open up the lines.

Our top priority at ImmuCell remains solid execution across the organization from sales to manufacturing and including all the support functions that make future profitable growth possible. With that said, we'd be happy to take your questions. Let's have the operator open up the lines.

Bailey, if I might interject here while the queue builds up, let me begin with a couple of questions for management. Oliver, 2025 certainly was a transformational year for ImmuCell. Looking ahead into '26 and '27, what are the biggest challenges ahead that you see for the company to achieve your goals?

Thank you, Joe, for that question. I see two types of challenges that we're addressing as a company. The first one is a planned increase in yield and followed by an increase in capacity through more major investments. So as I discussed, we believe that with the opportunities we identified in the last three months, we can increase our volume to between 5 million and 6 million units. And this is without making any major investments. This is through improved floor planning, some maintenance, some small additions to existing equipment, and a whole series of activities that are planned for the year that will get us there. So capacity and making sure that we have the capacity to meet market demand is our first order of business. And at the same time, we are now stepping up our commercial activities. So whereas our commercial team has spent a lot of time in the past year to two years managing allocations of products due to our backorder situation, it is now proving to be proactive outreach to gain new customers. And so it's all about growth on the top line for the company. So those would be our two primary initiatives that we're focused on in the coming year.

Will you be expecting any additional Re-Tain write-downs in 2026?

Joe, I'll take that one. We don't anticipate any large write-downs for the assets formerly associated with Re-Tain. We're evaluating the best way to roll out this larger capacity expansion project, medium term, using the former Re-Tain plan and the majority of the former Re-Tain assets. We have booked a modest salvage value, a couple of hundred thousand dollars associated with the assets that have been written down. And there's always a chance that we'll reevaluate a specific piece of equipment over time. But currently, we're really not seeing anything like that.

As it relates to 2025 revenue, how much do you consider to be recurring? And is that something that will be the case in '26 and '27?

Thank you, Joe. I'll respond to that question. Once customers start using our product, they experience a significant decrease in scours related to the antigens that our products address. Despite price increases and some supply constraints in recent years, customers have largely remained loyal to us and our products due to the positive impact on their operations. At this point, we cannot accurately measure churn to provide a precise figure for recurring revenue, particularly because of the complications from backorder situations. For instance, if a customer was unable to obtain our product from one distributor, they would seek it from another, which affects our churn calculations. However, from my discussions with our sales team and my personal visits to customers in the past three to four months, I can confidently say there is a strong sense of loyalty and satisfaction with our products.

Fantastic. Well, with that said, I think this will conclude the Q&A session. I want to thank all of you for participating in today's call. We look forward to talking with you again to review the results for the quarter ended March 31, 2026, during the week of May 11, 2026. Thanks again, and have a great day.

Thank you for attending today's presentation. The conference has now concluded. You may now disconnect.