Good morning, and thank you for joining us. This is Kevin Miller, Chief Financial Officer of RCM Technologies. I am joined today by Brad Vizi, RCM's Executive Chairman. Our presentation during this call will contain forward-looking statements. The information contained in the forward-looking statements is based on our beliefs, estimates, assumptions and information currently available to us, and these matters may materially change in the future. Many of these beliefs, estimates and assumptions are subject to rapid changes. For more information on our forward-looking statements and the risks, uncertainties and other factors to which they are subject, please see the periodic reports on forms 10-K, 10-Q and 8-K that we file with the SEC, as well as our press releases that we issue from time to time. I will now turn this call over to Brad Vizi, Executive Chairman, to provide an overview of RCM's operating performance during the second quarter.

Thanks, Kevin. Good morning, everyone. As we alluded to on our last call, the business remained resilient in the face of economic uncertainty, a testament to the model, which revolves around aligning the right talent in defensible positions of secular growth markets. Furthermore, our brand equity continues to strengthen, providing increased leverage to the business model while allowing us to diversify and strengthen our core client base. With increasing business success comes additional capital markets exposure and the inclusion of RCM into the Russell 2000 Growth Index for the first time in its 50-year history, an important milestone in the journey of our great company and a testament to the strength and commitment of our employee base. I will now provide an update on the progress of each of our business units. We are pleased to report that the Health Care Services Group closed out the 2024/2025 school year with strong momentum. We saw robust growth across our portfolio driven by our commitment to quality, innovation and client satisfaction. As we look ahead to the 2025/2026 school year, we are entering it with tremendous excitement and confidence. Our roster of new school partners is expanding, and we are equally encouraged by the commitments from our existing clients to broaden our role in staffing their schools. This speaks volumes about the trust we have built and the results we have delivered. One of the achievements we are most proud of is our ability to win over districts previously served by competitors. These wins are a direct result of RCM's consultative approach, one that emphasizes partnership, responsiveness and a relentless focus on quality. Our internal training programs continue to fill their role, enabling us to deliver providers who are not only highly qualified, but also better prepared to meet the unique needs of each district. Our pipeline remains robust with a strong flow of additional opportunities that position us well for continued growth. Additionally, we continue to leverage our outstanding team in the Philippines. This resource has proven to be a highly cost-effective asset, accelerating our ability to scale and support new client engagements with speed and efficiency. In short, we are entering the new school year with strong tailwinds, a clear strategy and a deep commitment to delivering value to our clients and shareholders. Transitioning to Life Sciences, Data and Solutions. In the Life Sciences division, we continue to see momentum driven by our strategic focus on innovation and operational excellence. Our recent investment in AI-driven equipment qualification has streamlined compliance protocols while reducing turnaround times across manufacturing sites. Additionally, advancements in data integrity solutions are improving audit readiness and strengthening our competitive position with pharma partners focused on speed to market. These initiatives reinforce our commitment to digital transformation in regulated environments and set the stage for scalable growth. This, combined with building a dedicated Life Sciences Engineering Group, will clearly differentiate RCM for the future. From an IT perspective, we have made meaningful progress in AI and analytics, particularly as applied to Life Sciences. This continues to unlock actionable insights, from predictive forecasting to real-time monitoring. These updates reflect how we are leading technology not just to optimize operations, but to fuel innovation at the core of our business. Lastly, we see continued evolution of our HCM practice beyond our flagship UKG Ready managed service program with our reseller and expansion to other future partners. Now shifting to Engineering. Energy Services continues to move forward with increasing velocity. As we migrate into the second half of the year, we are seeing a sharp acceleration in activity as we align to an expansive integrated strategy, combining our custom engineering capabilities with our turnkey EPC solutions to meet surging market demand. As the need for reliable and resilient power delivery continues to outpace legacy infrastructure, our team is increasingly called upon for engineering design, builds and upgrades. We have made a number of changes in the organization, including increasing efforts to align our brand with our marquee project work, and the industry is taking notice. Furthermore, our ability to deliver precision engineered solutions across the most demanding environments at scale has served as a key differentiator. This is enabled by our growing EPC footprint, our high-performing engineering teams and our focus on integrating advanced technologies and industry-leading 3D design into the delivery model. With continued growth in grid modernization, infrastructure upgrades and data center expansion, our teams are delivering custom solutions that align with the evolving market needs. Key developments this quarter include: Our integrated growth strategy, which is comprised of an expanded focus on custom engineering and turnkey EPC solutions for substations and infrastructure builds to support large-scale client programs. Expanding our depth of services with utility and industrial clients by designing and upgrading facilities with advanced energy-efficient technologies and providing engineering solutions for data centers and supporting substations and electrical infrastructure. Continued technical contributions to the IEEE Power & Energy Society, reinforcing RCM's leadership in the power engineering space. Operational maturity, resulting in streamlined project execution, enhanced talent integration and improved cross-unit coordination through shared services. Our engineering teams remain in the forefront of enabling next-generation energy solutions, positioning RCM as a trusted partner in an increasingly complex, opportunity-rich market. Now to Aerospace. Due to the ongoing significant ramp-up on existing programs and the addition of new clients, the Aerospace and Defense Group has exceeded our business plan goals through the second quarter by almost $3 million in revenue with a healthy margin EBITDA performance. Though we have an aggressive plan for 2025, barring any unforeseen circumstances, we are on our way to achieving it. Headcount continued to increase through Q2 2025 by 53 additional hires, topping Q1 performance. As projected, we have realized a significant year-over-year increase in gross margin and EBITDA in Q2 2025 as well as a sequential increase of 11% and 8% in gross margin and EBITDA, respectively. Our vertical lift in technology innovator customers doing business with the U.S. government continue to spearhead our growth thus far in 2025 with multiple opportunities on the horizon. As anticipated, continued success in supply chain manufacturing and quality engineering with new clients continue to have a positive impact on 2025. Additionally, wins at the beginning of 2025 with two existing customers on two large multiyear projects for S1000D conversion continue to contribute to our success in delivering to our aftermarket clients. Our recruitment team, which continues to build trusted value relationships throughout the client and candidate base, has solidified our year-to-date goals. Our integration of new tools and technologies has kept our team in the forefront of providing enhanced speed-to-market capabilities. We continue to add new clients in Q2 of 2025 with customers requiring our expertise in supply chain manufacturing and quality engineering, with continued requirements for software and systems expertise. We anticipate our growth to continue throughout 2025 as more of the opportunities in hand are realized with the aerospace and defense environment seeking American companies who can hold clearances up to secret and top-secret levels. We anticipate a record year for the Aerospace and Defense Group in 2025. Now I will return the call to Kevin to discuss the Q2 2025 financial results in more detail.

Thank you, Brad. Our consolidated gross profit for the second quarter of 2025 was $22.3 million, reflecting an 11.4% increase from Q2 2024 and representing our highest gross profit in the past 13 quarters. Adjusted EBITDA for Q2 2025 was $8.1 million, up from $7.2 million in Q2 2024, which is a growth of 12.9%. Adjusted EPS for Q2 2025 was $0.69, compared to $0.57 in Q2 2024, marking a growth of 21.1%. In terms of segment performance for the second quarter of 2025, our Health Care segment reported a gross profit of $12.3 million, an increase from $10.6 million in Q2 2024, reflecting a growth of 15.4%. The gross margin for this segment was 28.7%, slightly down from 28.8% in Q2 2024. School revenue for Q2 2025 reached $37.2 million, compared to $30.7 million in Q2 2024, showing a growth of 21.1%. However, nonschool revenue was $5.6 million, down from $6.2 million in Q2 2024. In the Engineering segment, gross profit for Q2 2025 increased to $6.5 million from $6.0 million in Q2 2024, representing an 8.8% growth, marking it as our strongest Engineering gross profit quarter ever. The gross margin for Engineering in Q2 2025 was 24.5%, down from 26.5% in Q2 2024. Our Engineering gross margins can fluctuate, but we generally anticipate normalized gross margins between 22% and 26%. In the IT, Life Sciences, and Data Solutions segments, gross profit for Q2 2025 was $3.5 million, a slight increase from $3.4 million in Q2 2024, which is a 3.4% rise. The gross margin for these segments was 39.8%, up from 34.9% in Q2 2024. Regarding our balance sheet, while our operating cash flow was weak for the quarter after a strong Q1, we expect full-year free cash flow to align with our net income. Specifically for Q2, we had over $10 million from two major school clients that was delayed due to the 2024/2025 school year, but we collected over 80% of that amount and expect to receive the remaining balance this quarter. We also want to note that we experience significant seasonality in Q3 due to summer school closures and high vacation times for our billable workforce, which complicates Q3 forecasts. We do expect to maintain low double-digit growth in adjusted EBITDA for the second half of fiscal 2025. Although we do not foresee the substantial fourth-quarter increase we experienced in fiscal 2023, we believe Q4 2025 will yield our highest adjusted EBITDA for the year. This wraps up our prepared remarks, and we will now open the call for questions.

And first up, I see Liam Burke of B. Riley Securities.

You talked about the data center infrastructure and the grid modernization and how that's accelerating. Could you give us some color on, you have some multiyear preferred partner agreements, how that's working and how that's helping you accelerate into that sector?

Yes, absolutely. Liam, it starts with some of the initiatives we've had in place for several years that are now coming to fruition. First and foremost, I would highlight some of the marquee projects attracting significant attention in the industry. Naturally, these projects become associated with our firm, leading to increased brand equity, and as word spreads, we receive more inquiries. Additionally, historically, RCM has had strong capabilities but did not effectively coordinate and integrate operations. We have recently focused more on this area, particularly in the last 12 to 18 months, and are rolling it out to the marketplace. Some of this is specific to RCM, but there's also a broader industry context. At a high level, we are all observing similar trends in the news and media, especially the surge in spending, which is unprecedented. It's difficult to argue that we are anything but at the early stages of this trend. Overall, I believe we are encountering a prolonged secular bull market. This seems almost guaranteed because numerous supply chain bottlenecks will take considerable time to resolve. Consequently, this will extend the cycle regardless. From our perspective, the industry is vast, and we are starting to gain momentum at an opportune time, making it hard not to see this as a significant positive for the business.

You seem to be adding contracts in the health care space on the educational side. Are most of those still K-12? Or are you able to leverage your brand into other areas of education, like community college or other municipal health programs?

No, they're primarily K-12. We're very excited about the upcoming school year. We've secured around a dozen new contracts, half of which we believe will significantly impact our revenue for the 2025/2026 school year. We're experiencing considerable success in the K-12 sector. While we're exploring other areas, our main focus remains on K-12.

Just to follow on to that. You mentioned that you've gone in and you're taking new business at the expense of competitors. Is that a trend we can expect to continue to see as you continue to add districts?

We better. Yes. No, we certainly expect that. And just to put a little bit more on that, while we are certainly grabbing market share from competitors, it is a high-growth market, right? So you don't necessarily need to grab market share from competitors to grow. But we look to do both, obviously.

Yes. The other thing, Liam, I'd add to that is if you step back and look at the K-12 market as leaders, right, I mean, like a lot of relatively nascent markets that are highly fragmented, there's really a lack of, call it, institutionalization, for a better term, best practices, et cetera. So kind of as a leader in that space, there's a big opportunity for us to step in and really demonstrate our knowledge base and ultimately win against some of the more local and regional competitors. And naturally, when you think about the different segments of the health care market, I mean, there are the things that make that market special, right? I mean the inability to replace that human touch, right? I mean, you magnify that when you start to deal with kids. And so there's a significant opportunity from our perspective that, certainly from our vantage point and our size and given the market opportunity, there's a way to go there.

Next up, we have Bill Sutherland of Benchmark.

On Health Care, Kevin, did you give the breakout of school and other?

Yes, we did. Hold on, let me just...

I can get that later then.

Well, I can give you real fast. It's $37.2 million for schools and $5.6 million for nonschools for the quarter.

Okay. Interested in that internal training program you mentioned. Can you give us some color on that, in health care?

In terms of our internal training program? Yes. I mean we go out, we find people that we think would make good candidates for our schools and we train them up ourselves. And we have training centers in several different locations. It's not something I want to speak a lot about just for competitive reasons. But yes, we...

Are these paragraphs or is this because you're doing a lot of behavioral health now?

It can be paras or RBTs as well, but mainly paras. But there are other types of people that we engage in training as well.

Okay. And what about the international nurse side? I know you've been discussing it.

Yes. Well, they just moved up visa retrogressions for a couple of countries. And we think we're probably going to have about, I don't know, 15 to 20 nurses coming in either this year or early next year. But if the visa retrogression gets moved, which we think it will at some point, we could have who knows how many. We have probably 500 nurses in our pipeline that are interested in coming to the U.S. If you have any inroads with this administration, please write a letter.

Yes. I wish I did. The Engineering GM bounced back very nicely, as you guys noted. Is this kind of a level we should think about as kind of where the business is at this point?

I think it's a good indication of where the business is. But like I said earlier, it's volatile, right? You're going to see quarters where it spikes up and you're going to see quarters where it spikes down, depending on what the mix shift is. And as we said on our last call, we're very, very focused on gross profit dollars, and then managing the cash flow around those gross profit dollars. So if we drop under 20% and we have strong gross profit, that's great. If we push it up and we have strong gross profit, that's great too. We're just really, really focused on gross profit dollars.

Next up, we have William Duberstein, Stone Oak Capital.

It's nice to talk to you all again. We had a great quarter with some noteworthy details. There was a nice sequential improvement in our Engineering gross margins. Delving deeper into that, I believe you are winning many new customers. Should we anticipate that new contracts with these clients might start with a lower gross margin and potentially increase over time as you demonstrate your capabilities? Or is it typically consistent across the board?

You're talking about Engineering?

Engineering specifically.

We don't really view it that way. If we need to pursue a client and find ourselves bidding at a lower margin than usual, we would certainly consider that for the right client. However, in general, we aim to achieve a margin we believe is fair and competitive. I don't think this market is overly sensitive to price. While it is certainly price sensitive given the nature of utilities, these clients prioritize quality over minor price differences. They are not aware of our margins. There's plenty of work available, and delivering quality work often leads to more projects at favorable margins. The main reason you might observe lower margins in our Engineering Group is due to fixed-price contracts that have a higher reliance on subcontractors during certain quarters. Since we earn different margins on subcontractor work compared to our internal salaried engineers, this can lead to a slight decrease. Other factors also play a role. In terms of Engineering, when we consider the three sectors, Aerospace is more competitive, resulting in generally lower margins. However, the Energy Services and Industrial Processing groups usually perform well in terms of margins. Nevertheless, those margins can decrease based on the specific project costs in any given quarter, particularly related to how much revenue is attributed to our subcontractors. Does that make sense?

Yes, absolutely. It was nice to see the improvement there from last quarter. And then just...

Yes, we are generally aiming to improve margins in Engineering compared to the second quarter. However, it depends on the mix shift.

Got it. That's helpful. Bringing back the topic of cash collections, I know you mentioned it in your opening remarks. Should we expect receivables to increase at the end of Q2 since it’s the end of the school year? Or were there specific factors affecting the two schools you mentioned this quarter?

Well, it's really both. The two schools we mentioned simply ran out of money on their purchase orders and couldn't pay us until they received new ones. That happens. We performed exceptionally well with those two schools, and running out of funding for payments is common in school systems. But that's fine. We'll wait for the money and drive the revenue because we always get paid by the schools, and we virtually never have write-offs. They have the purchase orders in place, and we've actually received about 80% of the money so far. I received a notice yesterday that we will get the rest of it next week. So, while our receivables may not look great at the end of Q2, it's a temporary and cyclical situation, and we expect to see those receivables decrease in Q3. Depending on how much we are pushing with some of these new schools, it might increase, but if it does, it will be a positive sign.

Got it. That makes a lot of sense. And then finally, on a previous question, I think you touched on immigration and that you have a lot of nurses interested in coming to the U.S. Is immigration and supply a gating factor at all right now? I mean you guys posted great numbers there, so probably not. But I was just wondering if it was possible you could have done even more if the supply side opened up more, or if that's just sort of a future factor.

We believe we can grow our school business in the 2025/2026 school year regardless of immigration policies. We are confident in our growth compared to last year. If immigration opens up, it could significantly impact our success in 2026. However, we cannot predict immigration outcomes. It's uncertain whether we will see a meaningful influx of nurses in 2026; the number could vary greatly. Over time, we think that for demand to be met, there will need to be an influx of nurses from abroad since we are not producing enough domestically. This situation is unlikely to change soon.

Got it. Great. Hopefully, that does open up.

Next up, we have Ben Andrews.

I enjoyed the quarter. Thank you very much. I'd like to make a couple of statements and then hear your feedback and thoughts. Looking at RCM and the bigger trends, I believe you've positioned the company well in the education and Engineering/T&D areas, which seem to have strong momentum for the future. Over the past three years, our stock has mostly remained stable, but I think you have done an excellent job managing it, both before and after its rise, by reducing the share float. This was a wise move, one of the best I've seen in my career. Considering these two divisions where there appears to be favorable conditions, even with the volatility of RCM's businesses, achieving roughly $2 in EPS per year seems realistic, rather than lower amounts like $1 or $0.50. My thoughts are that with the current trends in stock trading for both small and large caps, it seems like trading might be driven more by AI than by human investors. If we were to introduce a dividend, perhaps at $0.80, it would likely be covered if you're generating a couple of bucks in EPS each year. This could attract a different shareholder base and reward loyal shareholders. Given your hard work in managing these divisions and their potential EPS contribution, along with the current stock performance compared to your historical buybacks, I believe there is a strong case for implementing a dividend.

That's a valid question, and it's something I often consider. We talk about it regularly. Depending on the specific circumstances, perspectives can vary. Currently, the company is in a strong position. Implementing a dividend with a completely debt-free balance sheet and having reduced the share count by around 45%, while maintaining a small net cash position, seems more sensible than ever. We will keep evaluating this, and as we get closer to that possibility, it could become a reality. Meanwhile, there are exciting developments in the business. I share your views about the transformation in the capital markets, particularly in our sector. With fewer shares outstanding and a limited supply of high-quality companies in this market, we could stand out more. Having a clean balance sheet as growth picks up with fewer shares is advantageous. This dynamic has persisted over the decades, and stock appreciation can happen quickly. Thank you for your patience; we're actively working on strengthening the business. The positive news is that we're gaining strength not only in absolute terms but also relatively, making us increasingly appealing. Our size gives us an advantage in identifying opportunities. I liken us to a little big company; we have significant attributes, yet from a valuation standpoint, we remain relatively small. As more substantial outcomes materialize, they will have a significant impact on our financial results. While I appreciate your estimate of $2 in earnings, I would be disappointed if we only achieved that in 24 months. We see the company as a growth entity and our performance relative to peers supports that. We expect strong overall performance, and the valuation will align accordingly. To summarize, we believe we are positioned for significant growth.

Yes, I agree. I agree. And I agree with your assessment that usually you can put in work for years and then, all of a sudden, your valuation comes all within 30 days, even though you're sitting around 36 months waiting for it. It usually is what happens, especially with these smaller cap stocks. The reason I kind of threw that $2 out there, because I think it's a pretty solid number by me just looking at your divisions, and you certainly don't want to overreach when you put in a dividend. If you put in a $0.80 dividend, then you still got money to still pay down debt, you still got money to do some IP acquisitions. I think where we were aligned in conversations from the past is I think it's wise to spend money to buy IP and so it can be assimilated in your company, rather than doing some huge acquisition that often ends up blowing up in your face 24 months later. So that was the thought, where money is spent more evenly across a couple of areas rather than just one area. But I appreciate your thoughts and I appreciate how you guys have built this company. So thank you.

I would like to add, Ben, that we are focused on maintaining a clean balance sheet, which we believe is well within our target range. We are comfortable with our position. Considering the potential outcomes for a company of our size, especially in a favorable scenario within this dynamic environment, a clean balance sheet serves as a strategic asset. This is particularly important for ongoing partnership discussions, which could be significant. These conversations often begin on a solid foundation and can expand over time, leading to substantial growth. However, they can also develop rapidly given the changing markets. We have positioned ourselves effectively with a talented team engaged in these discussions. While there are unpredictable elements as these opportunities develop, our goal is to ensure we are set up to maximize their value when the time is right. In summary, we are not limited in our potential for significant growth opportunities.

Understood, Brad. And you're a people business, and I think levering up people businesses is not a great move. You can get lucky; but if you don't get lucky, then you're in a world of hurt. So I'd rather see a clean balance sheet. I agree with you.

All right. This does conclude today's Q&A session. Speakers, I'll turn it over to you for concluding remarks.

Thank you for attending our Q2 conference call. We look forward to our next update in November.

Bye, everyone.

All right. Ladies and gentlemen, this does conclude your call. You may now disconnect your lines, and thank you again for joining us today.