Ameresco, Inc.

Good day, ladies and gentlemen. Thank you for standing by, and welcome to the Amoresco Incorporated Third Quarter 2019 earnings call. At this time, all participants are on a listen-only mode. Later, we'll conduct a question-and-answer session, and instructions will follow at that time. As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host, Mrs. Leila Dillon, Vice President, Marketing and Communications. Mrs. Dillon, you may begin.

Thank you, Chris, and good morning, everyone. We appreciate you joining us for today's call. Joining me here are George Sakalaris, Amoresco's Chairman, President, and Chief Executive Officer, Doran Hull, Senior Vice President and Chief Financial Officer, and Mark Chiplock, Vice President, Corporate Controller, and Chief Accounting Officer. Before I turn the call over to George, I would like to make a brief statement regarding forward-looking remarks. This call contains forward-looking information regarding future events and the future financial performance of the company. We caution you that such statements are predictions based on management's current expectations or beliefs. Actual results may differ materially as a result of risks and uncertainties that pertain to our business. We refer you to the company's press release issued this morning and to our SEC filings. These documents discuss important factors that could cause actual results to differ materially from those contained in the company's projections or forward-looking statements. We assume no obligation to revise any forward-looking statements made on today's call. In addition, we will be referring to non-GAAP financial measures during this call. These non-GAAP financial measures are not prepared in accordance with generally accepted accounting principles. A gap to non-gap reconciliation, as well as an explanation behind the use of non-gap financial measures, is available in our press release and in the appendix of the slides, which can be downloaded from our website. I will now turn the call over to George. George?

Thank you, Leila, and good morning, everyone. Third quarter results were marked by record. Smart Energy Solutions Awards resulting in record total project backlog. We also had significant growth in the Ameresco assets development pipeline, resulting in a record asset backlog. Some conversions of awards to contracts expected in Q3 were delayed, shifting approximately $30 million of revenue out of the quarter. I will point out that the number of these contracts have already been signed since September 30th. We expect the remainder to close in Q4. And most importantly, the overall trends in our business remain very strong. Our robust asset development pipeline will allow us to more than double our megawatts in operation in the coming years, significantly increasing our base of recurring revenues and earnings. At the same time, we have continued to build our technical expertise to address the increasing complexity of our customers' projects and company-owned assets. As we have indicated during the last year, we have made investments in order to develop significant domain knowledge in areas such as battery storage, microgrids, smart controls, and other advanced energy technologies across all of our regions. As you can see, the success of this strategy is resulting in our record awards. We are also leveraging our expanded platform to grow our Maresco asset business at much higher rates than in the past. We are at the point where all regions are capable to compete and have begun to contribute to these advanced markets. While the company's assets were traditionally developed out of the Northeast offices, we have now expanded our local capabilities into all regions. Our 70-plus offices in North America afford us a unique competitive advantage for traditional smart energy solutions work and asset ownership opportunities. At the end of Q3, Total assets in development, more than double year on year, reaching 287 megawatts by quarter cent. We expect our assets in development to continue to exceed the number of megawatts in operation. Our asset development opportunities are increasingly getting larger and more complex. In fact, we recently announced our largest energy asset project. a 25 megawatt solar plant in Depew, Illinois. Construction is expected to begin the summer of 2020. This installation highlights multiple benefits as it will help the state of Illinois meet its renewable energy goals while at the same time providing income to the local community and of course a good return for Maresco. During the quarter, our Canadian team held a ribbon-cutting ceremony for our first company-owned grid-tied battery energy storage system. The 16-megawatt-hour system has been used in Ontario to store power during periods of excess supply and deliver it back into the grid when demand is high. These types of systems are an integral part of the grid stability. And given the intermittent nature of renewable energy generation, we are confident that the success of such projects will lead to much wider adoption and greater opportunities for Amaresco. As you are aware, California's largest utility, PG&E, has been shutting off power to large portions of its territory to prevent potential wildfires. These blockouts have impacted millions of residential customers along with numerous municipal, institutional, and manufacturing facilities. It's estimated that to date, the blockouts have caused over $2.5 billion in economic losses to the state. We believe that these historic events are creating unprecedented demand for resilient distributed energy resources, which are relevant to our smart energy solutions and Maresco asset business. as well as our integrated solar distribution business. For many CORAs, we have been selling off-grid, stand-alone solar and energy storage systems into California for applications such as cellular towers, water pumps, and supporting local electric utility operations. Years of utility underinvestment and growing weather volatility increase the likelihood that such proactive blackouts will become more frequent and will spread to other geographic areas. PG itself believes that it will take up to 10 years to address these issues. California has always been a leader in renewables and energy technologies for their environmental benefits. We now believe that California will become a leader in advanced technologies for power resiliency. The state recently passed SB 1339 and the governor appointed an energy czar. We should bring much more certainty and urgency around deployment of technologies such as microgrids. This will lead to increased adoption not only in California but across the country as the use of these technologies become more accepted by customers and begin to make more economic sense. We believe and Maresco is exceptionally well positioned to benefit from this emerging market. As we have discussed in the past, our customers are requiring that resiliency be incorporated into more projects. Our core client base of the federal government, municipalities, universities, hospitals, and other institutional clients are leading the charge investing in resiliency programs such as microgrids, CHP, and battery storage. A great example of such a project is our recently completed Fort Leonard Wood project. This installation utilizes the latest in advanced energy technologies. It's powered by a 2.5 megawatt natural gas-fired engine with advanced emission controls and a heat recovery system. Utilizing microgrid controls, The system can operate as part of a functioning grid or in an island mode, thus providing continuous power for mission-critical systems. Our existing customers continue to provide us with additional work. For example, we signed our third United States Postal Service contract this year, one of which includes distributed energy generation with solar. The other two were focused in design, build, built-in modernization. These design-build wins are in part due to the expertise brought to Amoresco from a recently completed acquisition. We are optimistic for the potential of design-built work as an additional complementary revenue stream from our existing customer base. We will continue to pursue similar complementary acquisitions. In summary, market conditions are very strong. And we believe our positioning is excellent, supporting our confidence in a very strong finish to 2019 and solid growth for 2020 and beyond. I will now turn the call over to Doran to review the financials. Doran?