TTSH

• Navigated challenging housing market with modest unit volume sales improvement due to assortment refinements, but offset by discounting and low-end product sales.
• Refined assortment over the last year included expanding LVT offerings (e.g., Arbour line), adding laminate/engineered wood flooring, and large-format tile; new signature line launched with over 250 wall tile and trim products.
• Addressed tariff risks by sourcing from over 20 countries, carrying more inventory, and having a seasoned purchasing team to identify alternative supplies.
• Took tough decisions like closing 2 distribution centers, reducing corporate workforce by 1/3, closing stores, and focusing on expense reduction, capital spending curtailment, and efficiency identification.

• Intend to continue evaluating efforts to reduce expense, limit capital spending, and identify efficiencies while navigating challenging period.
• Generated $13.5 million of operating cash flow in first half of 2025 and had $27.8 million cash balance at end of Q2 2025.

Comparable store sales decreased by 3.5% due to lower store traffic. Tile volume sales improved in Q2 2025 compared to the prior year, but the volume tailwind was offset by mixing into products with lower average selling prices. Gross margin rate in Q2 was 64.4%, a 160 basis point decrease from Q2 2024, driven by increased discounting and product costs. SG&A expense in Q2 was $56.4 million, $2.1 million lower than Q2 2024, primarily due to decreases in asset impairment, closure-related costs, marketing, and depreciation, partially offset by a write-off of merchandising supplies. In H1 2025, operating cash flow was $13.5 million, and cash balance grew to $27.8 million at the end of the quarter.

• Uncertainty and volatility of tariffs, with proposed tariffs changing rapidly and potential impact on costs.
• Overreliance on a single country outside the U.S. for sourcing, which could be affected by tariff changes.

Q: [No specific investor questions shown] A: [Q&A session ended as per operator instructions]