NV5 Global, Inc.

Good afternoon, everyone, and thank you for participating in today's conference call to discuss NV5 financial results for the third quarter of 2020. Joining us today are Dickerson Wright, Chairman and CEO of NV5, Edward Cottespotty, CFO of NV5, Alex Hochman, President and CEO of NV5, Mark Abbato, President and CEO, NV5 Geospatial Solutions, and Richard Tong, Executive Vice President and General Counsel of NV5. I would now like to turn the call over to Richard Tong.

Thank you, operator. Welcome everyone to NV5's third quarter earnings call. Consistent with social distancing, speakers today are connected from different locations. So thank you for our patience, including any latency as may be encountered when we answer questions. Before we proceed, I would like to remind everyone that today's discussions contain forward-looking statements about the company's future business and financial performance. These are based on management's current expectations and are subject to risks and uncertainty. Factors that could cause actual results to differ materially from those statements are included in today's presentation slide in our reports on file with the SEC. During this call, GAAP and non-GAAP financial measures will be discussed. A reconciliation between the two is available in today's earnings release and on the company's website at www.nv5.com. Please note that unless otherwise stated, all references to third quarter 2020 comparisons are being made against the third quarter of 2019. In this presentation, NV5 has included certain non-GAAP financial measures as defined in Regulation G promulgated under the Securities and Exchange Act of 1934 as amendment. The non-GAAP financial measurements included in this presentation are adjusted earnings per share, adjusted EBITDA, and adjusted EBITDA margin. NV5 provides non-GAAP financial measures that supplement GAAP measures as they provide additional insight into NV5's financial results. However, non-GAAP measures have limitations as analytical tools and should not be considered in isolation and are not in accordance or a substitute for GAAP. In addition, other companies may define non-GAAP measures differently. which limits the ability of investors to compare non-GAAP measures of NV5 to those used by peer companies. A webcast replay of this call and its accompanying presentation are also available via the link provided in today's news release and on the Investors section of the company's website. We will begin the call with comments from Dickerson Wright, Chairman and CEO of NV5, before turning the call over to Edward review of the third quarter 2020 results alex hockman president and ceo of nb5 and mark abato president of nb5 geospatial solutions will then provide some insights into the operational opportunities and strategic initiatives before turning the call back to dickerson wright for closing comments we'll then open the call for your questions dickerson please go ahead thank you richard and thanks to everyone who's uh joining our call today For those of you joining by webcast, let's turn to slide five in our presentation. Although there continues to be uncertainty in our personal and business lives associated with the COVID-19 virus, our employees have adapted to this new environment. We are applying technology and software to continue to work remotely to provide essential business services. We continue to be proactive in implementing measures to address business and safety issues for employees working remotely and those supporting field activities that have continued to operate in NV5 offices and laboratories for our client and project locations. What has been the result of our proactive measures? We have maintained the quality of our work, delivered a great operating quarter, and grew backlogged by 9% in quarter three. Our financial position through quarter three 2020 also remains strong. We're continuing our activities with acquisitions and to that extent have two potential acquisitions in due diligence that will strengthen our technology and substantially subscription-based revenue platform. We intend to do both acquisitions out of cash flows and not utilize our credit facility. Our daily cash position continues to average over $60 million. and we intend to continue paying down our debt. Between July and October, we have paid $27.8 million in debt reduction. Our current cash and debt position is significant because the third quarter is usually our lowest cash position for the year due to increased revenue and higher labor utilization. We also continue to benefit from our proactive cross-selling program. Our cross-selling is programmed within our offices, and our cross-selling activity resulted in 7.7 million in cross-sells for the third quarter. As we have stated previously, cross-selling is very important because we strive to keep essential business in-house. We're also keeping significant opportunities for cross-selling between our geospatial, which is QSI, platform and the core business. An example. One of our largest West Coast utility clients contracted the geospatial group to perform an aerial scanning of transmission assets. This work also included 410,000 of CAD work that typically is not performed by our geospatial service group. But this was performed by our core business and utility service groups, so we kept this work within NV5. We're also seeing the benefit of our scalable business model. We turn to page six. Adjusted EBITDA for the third quarter increased to $29.9 million from $17.6 million in the third quarter of 2019. And adjusted earnings per share for the third quarter was $1.13 per share, exceeding the average consensus of $0.70 per share. The majority of MP5 services are considered essential, and we have been able to scale our business to operate efficiently in this type of economic cycle. Our infrastructure, utility services, and international markets have seen growth. We continue to see softening in our hospitality market due to COVID-19 consideration. Our MEP, or mechanical electrical plumbing and technology services, have been impacted as commercial development still has not experienced growth. However, the residential sector is strong, which has been a positive for municipal budget. Our transaction real estate portfolio business, which has been negatively affected by COVID, has begun to see improvement in the third quarter, and we look for positive results for the remainder of 2020. We are pursuing a number of growth opportunities in the technology sector, including data center program management, geospatial service, and subscription-based energy efficiency. They've also been very proactive in our acquisition pursuits. We continue to look for opportunities that strengthen our operating platforms. We also see opportunities in the municipal private provider market, including a recent award by a major Northern California municipality for building department services. Our utility service business continues to provide needed support services to strengthen the aging utility distribution grid, and we have seen growth in our LNG business with a large project award. Through our proactive efforts to expand diversity and employee opportunities, we have also seen an increase in hiring, as well as a significant drop in employee attrition. I will now hand the presentation over to our CFO, Ed Kodispody, to provide an overview of our Q3 results.

Thank you, Dick, and good afternoon, everyone. If you would please turn to slide 8, I'd like to start off with a review of our P&L results.