Concrete Pumping Holdings, Inc.

Good afternoon, everyone, and thank you for participating in today's conference call to discuss Concrete Pumping Holdings financial results for the fourth quarter and fiscal year ended October 31st, 2021. Joining us today are Concrete Pumping Holdings CEO, Bruce Young, CFO, Ian Humphreys, and the company's external director of investor relations, Cody Slaw. Before we go further, I would like to turn the call over to Mr. Slaw to read the company's safe harbor statement within the meaning of the Private Securities Litigation Reform Act of 1995 that provides important cautions regarding forward-looking statements. Cody, please go ahead.

Thanks, Paul. I'd like to remind everyone that in the course of this call, to give you a better understanding of our operations, we will be making certain forward-looking statements regarding our business and outlook. These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from such statements. For information concerning these risks and uncertainties, see concrete pumping holdings, annual report on Form 10-K, quarterly report on Form 10-Q, and other publicly available filings with the SEC. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. On today's call, we will also reference certain non-GAAP financial measures, including adjusted EBITDA, net debt, and free cash flow. which we believe provide useful information for investors. We provide further information about these non-GAAP financial measures and reconciliations to the comparable GAAP measures in our press release issued today or the investor presentation posted on the company's website. I'd like to remind everyone this call will be available for replay later this evening. A webcast replay will also be available via the link provided in today's press release as well as on the company's website. Additionally, we have posted an updated investor presentation to the company's website. Now I'd like to turn the call over to the CEO of Concrete Pumping Holdings, Bruce Young. Bruce?

Thank you, Cody, and good afternoon, everyone. I'm happy to report that we had a strong finish to fiscal year 2021, and our fourth quarter revenue increased 11% to $87.8 million compared to the prior year quarter. The strong results for the quarter were driven by increased revenue from higher construction volumes across each of our operating segments. During the 2021 fiscal year, revenue increased 4% to $315.8 million as we continue to grow our market share in the US and the UK, strengthened our strong financial profile, and reignited our compelling M&A and growth strategy. In addition to multiple acquisitions in fiscal year 2021, and as announced on November 2nd, we welcomed the experienced Pioneer concrete pumping team into the concrete pumping holdings family as we successfully completed the acquisition. With the addition of this outstanding team, their strong customer relationships, and high-quality assets, we are well-positioned to benefit from favorable market dynamics and accelerating construction activity in our important Texas and Georgia regions. This addition also provides a complementary growth platform for our Ecopan service expansion. I'm grateful to our colleagues for their dedication and perseverance in their efforts to complete the acquisition, and we look forward to working together to seamlessly integrate and realize synergies to deliver improved stakeholder value. Integration activities are progressing well, as expected from both an operational and customer-facing perspective. Within our individual reporting segments, our U.S. pumping business increased 8% in the fourth quarter, driven by the contribution from recent acquisitions and the continued strength in our residential and infrastructure end markets. Our commercial business continues to experience pockets of softness across the country, tied to the dynamic environment created by COVID-19 and new variants. The uneven pattern of the country return to work is delaying some of our customers' projects, but we're but we've seen continued progress in high growth markets such as fulfillment centers and data centers, both of which are concrete intensive projects. In our UK segment, revenue increased 27% compared to the prior year quarter due to the country's continued strong recovery from impacts of COVID-19. In Ecopan, our concrete waste management business, revenue increased 11% for the fourth quarter as our sales force has been successful in executing more in-person selling. Ecopan remains an important part of our long-term growth strategy, and we look forward to maintaining double-digit growth expectations as the nation continues to reopen. Turning to some end-market commentary, we continue to see strong demand within the residential market and intentionally tailored our fleet management to maximize our ability to win work. High demand for single-family homes is a key reason for our sustained market share gains, and we still expect residential to remain a bright spot for our company into 2022. In the infrastructure and market, we continue to see momentum in the UK and US regions. In the UK, our team continues to secure energy, road, and rail projects, including the concrete intensive high-speed rail project that we expect to last beyond 2030. In the US, we've mentioned in our recent earnings calls that states have increased public funding for bridges, schools, wastewater treatment plants, and hospitals. Going forward, we will continue to capitalize on increased infrastructure spending at the state level and fully expect the federal spending to increase due to the recent passage of the Infrastructure Investment and Jobs Act. While we do not assume any meaningful impact from the infrastructure bill in our 2022 fiscal year, we remain well-positioned to capitalize on expanded federal and state-level infrastructure investment in 2023 and beyond, although the magnitude is currently tough to estimate. As I mentioned earlier, our commercial end market continues to recover as the economy recovers from the impacts of the pandemic. We are actively bidding projects that require specialty equipment and it is expected these projects will begin in 2022. Now shifting to the cost side of the business and similar to our third quarter, rapid inflationary pressures impacted our income statement quicker and more severe than we were able to pass along to our customers, which caused temporary pressure on margins. The most notable headwind was diesel fuel. Not only did the cost of diesel move higher more quickly, but also consumed more fuel as we navigated higher traffic congestion when compared to the prior year. Typically, our short project durations allow normal inflation to be passed on in our projects. However, given the sudden and sharp inflationary cost environment, we are experiencing a temporary lag in our cost mitigation efforts as we burn off current workload at previously agreed pricing. Moving to labor, it remains a challenge to find qualified workers given the current tightness in the construction job market. As we shared last quarter, our business generally has unique levers to pull to combat labor headwinds, like a higher wage base that helps retain talent and a flexible fleet that can be agile depending on where construction projects and workers are. Despite these levers, the labor environment was difficult to fully offset. With some workers remaining on the sidelines due to COVID, labor rates have been forced higher, impacting various trades across many of our customers' projects. As these labor constraints continue in the industry, it is important to note that the construction backlog in the US and the UK remains strong. We anticipate continued inflation in fiscal year 2022, and we are actively implementing our pass-through pricing mechanisms and working with our customers on new project bids and pricing agreements. Now to provide an update on the acquisitions discussed last quarter, we are very pleased with the strategic tuck-in acquisitions in the Southern California market, and our acquisition of Hitech in Texas has resulted in market share gains. In the UK, we made a small tuck-in acquisition during the fourth quarter, solidifying our leading market share position in Southern Scotland. We believe this acquisition serves as an important gateway to increasing our expansion in this part of the country. We also continue to focus on growing our UK business organically and through opportunistic tuck-in acquisitions. As I mentioned earlier, on November 2nd, we also announced the acquisition of Pioneer, which expanded our presence in Atlanta, Dallas, and San Antonio. We are confident in our ability to realize the benefits of this transaction and deliver stakeholder value creation following the same proven approach we have taken with our previous acquisitions. We will continue to pursue opportunistic M&A that will be accretive to our earnings and have teams that align with our core values of safety, people, and reliability. Lastly, on the topic of M&A, our acquisitions offer a compelling opportunity to cross-sell our Ecopan service, and we look forward to introducing new customers to our cost-effective, environmentally friendly, concrete washout solution. As we close out the 2021 fiscal year and look forward to 2022, we are in a strong position to execute our strategic growth priorities. I will return later to discuss our long-term growth strategy and provide an updated market outlook. But for now, I will pass the call off to Ian to discuss our fourth quarter and fiscal year 2021 financial results in more depth. Ian?