The Shyft Group, Inc.

Good day and welcome to the SHIFT group fourth quarter and full year 2021 earnings results conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star and then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. At this time, I'd like to turn the conference over to Jairus Pagraps, Group Treasurer and Head of Investor Relations. Please go ahead.

Thank you, Allison. And good morning, everyone, and welcome to the SHIFT Group's fourth quarter full year 2021 earnings call. Joining me on the call today are Daryl Adams, our President and Chief Executive Officer, and John Duyard, our Chief Financial Officer. For today's call, we've included a presentation deck that has been filed with the SEC and is also available on our website at theshiftgroup.com. You may download the deck from the investor relations section of our website to follow along with our presentation during the call. Before we start, please turn the slide to the presentation for our safe harbor statement. You should be aware that certain statements made during today's conference call, which may include management's current outlook, viewpoint, predictions, and projections regarding the shift group and its operations, may be considered forward-looking statements under the Private Securities Litigation Reform Act of 1995. I caution you that, as with any prediction or projection, there are a number of factors that could cause the shift group's actual results to differ materially from projections. All known risks that management believes could maturely affect the results are identified in our forms 10-K and 10-Q filed with the SEC. However, there may be other risks that we cannot anticipate. On the call today, we will provide a business update, including an overview of business trends before moving on to a more detailed review of the results and our outlook for 2022. We will then open the line for Q&A. I'd like to also remind everyone that with the divestiture of the emergency response business in February 2020, the revenues and expenses associated with the ER business, as well as the assets and liabilities, have been reclassified as discontinued operations for all periods presented. With this reclassification, the results discussed today will refer to continuing operations unless otherwise noted. In the fourth quarter of 2021, the company made a change in its segments and moved Montebello and Strobes R Us from the FES segment to the SV segment, consistent with the change in organizational reporting. At this time, I'm pleased to turn the call over to Darrell for his comments beginning on slide three. Thank you, Juris.

Good morning, everyone, and thank you for joining us to review our fourth quarter and full year of 2021 results. The past year was challenging in many ways, but the power of our strategy has again been highlighted in our record results. As I've often said on these calls, we always try to be agile, nimble, flexible, proactive, and solution-based in everything we do. Last year, we saw the benefits of this approach and what is truly possible with the right strategy and the right team. Our team proactively managed through the many challenges with resourcefulness and relentless focus on execution for our customers. 2021 was a year of record financial operational performance built on the incredible efforts of our entire team. Our perseverance as we navigated against industry-wide challenges is what made the difference in our performance and positions us for greater success in the coming years. Our efforts have been rewarded a continued strong customer demand of our products, as illustrated by our backlog, which is now over a billion dollars. Turning to slide four for our financial summary. Our team did a tremendous job executing on our growth plans and navigating supply and labor challenges to generate year-over-year revenue growth of 47 percent to a record $992 million. With our industry-leading products, we continue to see a very strong demand resulting in increased order intake and record backlogs. For the first time in the company's history, adjusted EBITDA was over $100 million, ending at $108 million, up 42% year-over-year. Adjusted income was a record $75 million, while adjusted EPS increased 56% to $208 per share from $1.34 per share. We continue to see positive business opportunities in the market and believe it is imperative that we continue to invest in ourselves. In 2021, we invested $6.5 million in EV development, which impacted our margins by approximately 66 basis points for the full year. We plan to continue these investments in 2022, which John will outline later, as we believe they will put us in a leading position for the transition to electric vehicles throughout our core markets. Please turn to slide five, where I'll provide a business update. Our fleet vehicle service business continues its pattern of strong growth, driven by our two industry-leading parcel delivery vehicles, our traditional walk-in van and our Velocity platform. You'll recall the Velocity platform was a customer-driven, solution-focused innovation where we created an entirely new category of purpose-built Class II and III walk-in vans. We saw tremendous success in 21, as the F2 debuted on the road. Also in 2021, we introduced and secured an additional customer order of approximately 400 units for our Velocity M3 parcel delivery vehicle. As the leading manufacturer of last mile delivery vehicles, we're excited by the potential this unique category has to offer. In fact, building on the success of our Velocity platform, UtilaMaster is now taking orders on the new Velocity R2, an under 10,000-pound GVWR walk-in van built on a Ram ProMaster chassis, which will be debuted at the NTA Truck Show next month in Indianapolis. As a testament to the product's capability, we recently received an order for 2,500 units from a leading parcel delivery customer. Additionally, we recently announced that UtileMaster worked with Ford Pro, to produce two pilot vehicles on the all-electric Ford E transit chassis. These vehicles are currently being tested and are fit with our Velocity body, creating a route delivery vehicle comparable to the Velocity F-Series gas-powered vehicle. Moving to our specialty vehicle segment, demand for our products continued and resulted in strong revenue growth in orders during the quarter. In our motorhome business, demand for our luxury motor coach chassis continues unabated as our market share increased to 31.2% for the quarter, reflecting the strength of our product offerings and brand among luxury motor coach consumers. To date, we continue to experience strong demand for motorhomes, and we expect this demand to continue through 2022. Our market share growth continues to be driven by our introduction of new technologies into the market. Last month, we launched the Red Diamond leveling system at the Tampa RV show. In our service body business, we are seeing indications of improved component and chassis supply beginning in the second quarter. We continue to expand our service body distribution channels geographically, and we recently secured a national distributor of specialty truck products to aid in the expansion of our Magnum products. With strong backlogs, we are well positioned for another year of strong performance in SV. slide six i will update you on our development efforts to design a commercial grade ev chassis delivery vehicle and supporting portable charger for a full ecosystem approach as i've mentioned many times in the past we looked for a viable ev chassis option and were unable to find one that met our needs so we decided to build our own we developed our proof of concept ev chassis an all-new electric delivery vehicle by leveraging nearly 50 years of experience in custom chassis and last-mile delivery body manufacturing. I'm excited to share with you that we are on schedule to our original timeline and plan to have prototype vehicles in our customers' hands for testing and validation in the second half of this year. I'm incredibly excited by the progress the team has made in the development of this vehicle. In two weeks, we plan to reveal our all-new electric vehicle on our proprietary purpose-built Class III EV chassis with a portable charging solution at the NTA Truck Show in Indianapolis. With a new look and a new lightweight body that has a high degree of configurability, this all-new vehicle is ideal for last-mile delivery, work trucks, mass transit, recreational vehicles, and other emerging EV markets. We expect to begin taking orders next month. and build electric delivery vehicles in 2023 with production launching in our Plymouth location and ultimately transitioning to a flexible production facility in the southeast with annual capacity up to 2,500 vehicles per year, directly impacting the current supply gap in the commercial EV segment. With that, I'll turn the call over to John to discuss SHIFT's financial results for the fourth quarter and full year in more detail. as well as provide our 2022 outlook beginning on slide seven.