Ameresco, Inc.

Thank you for standing by and welcome to the Ameresco Incorporated First Order Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this call is being recorded. I would now like to turn the conference over to your host, Mrs. Lila Dillon. Vice President, Marketing and Communications. Ms. Dillon, you may begin.

Thank you, Robert, and good afternoon, everyone. We appreciate you joining us for today's call. Joining me here are George Sakalaris, Amoresco's Chairman, President, and Chief Executive Officer, Soren Hull, Senior Vice President and Chief Financial Officer, and Mark Chiplock, Vice President 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 afternoon 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 GAAP to non-GAAP reconciliation, as well as an explanation behind the use of non-GAAP 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, Lila, and good afternoon, everyone. 2020 marks not only the 50th anniversary of Earth Day, but also the 20th anniversary of the founding of Amoresco. Since our inception in 2000, which have seen tremendous technology advancements across our industry. When we started this business, we entered into an addressable ESCO market of about $2 to $3 billion annually, which grew to $7 to $8 billion in recent years. And with our investments in distributed generation, energy infrastructure, battery storage, microgrids, and smart technologies, we have evolved our business and now participate in a combined market opportunity of $20 to $30 billion annually. We have witnessed a heightened awareness of the importance of energy savings and renewables. During this time, we have been consistently profitable. We have built over $7 billion of projects, and our customers have been able to annually realize approximately $1 billion of energy savings. In the past 10 years alone, we have helped reduce over 55 million metric tons of CO2 from the atmosphere. We are very proud of the accomplishments and grateful to our customers and our employees. Unfortunately, This 20-year anniversary is also marked by one of the largest health crises to face the world in many years. Much like the energy solutions we provide, Maresco, as a company, is resilient. In the face of COVID-19 pandemic, we prioritize the health and welfare of our employees and the communities in which we operate. The company quickly established risk prevention policies consistent with current CDC guidelines and state, province, and local health agencies. These policies are being monitored and updated as new information becomes to light. Our geographic footprint of over 70 offices allows us maximum flexibility in our operations, more efficient execution on our project and greatly reduces the risks associated with having all employees in a single location. Our employees' transition to the work-from-home environment was accomplished seamlessly, as we already had the required technologies in place. We are also using this time and our technology platform to invest in our people with a number of employee training initiatives underway. Our work in the field continues, with few disruptions and added protections at each site. Maresco's work qualifies as an essential service in most jurisdictions where we operate, which has enabled us to continue to execute on both project contracts and the build-out of our energy assets. Early in the crisis, we worked closely with many of our customers to move ahead of schedule on some projects to avoid potential delays. This is a good example of how Amoresco is working hand-in-hand with our customers to ensure the development, design, deployment, and operation of their critical infrastructure. We have also built a tremendous network amount of resiliency into Maresco's business model. As many of you know, we have purposely continued to build out our energy asset portfolio in our operational and maintenance business, specifically to add a greater level of visibility and predictability through higher margins recurring revenues. We also entered this year with record levels of contracted backlog, in our project business, providing further visibility for this year and beyond. 2020 is off to an excellent start with strong first quarter results. Although I will go into our first quarter financials in more detail, I do want to touch upon some key highlights to the quarter. Revenue of $212 million represents the highest first quarter revenue in the company's 20-year history, growing 42% compared to last year's first quarter results. We gained significant operating leverage from this increased revenue level, growing our net income by 50% to $6.2 million, adjusted EBITDA by 50% to $21.2 million, a non-gap EPS to 15 cents from 2 cents one year ago. We continue to execute smartly and safely to minimize disruptions on both our contracted project backlog and energy assets in development. Our customers remain as committed as ever, although many of them have had to shift near-term focus resulting in a slower than normal pace of pipeline activity as they prioritize the COVID-19 crisis. We do, however, expect the pace of new business activity to resume later in the third and fourth quarter. We have also shifted our focus to executing on our existing work in progress on both projects and assets, given our great existing project backlog and assets in development. Given these dynamics, we expect our project backlog and assets in development metrics to remain relatively stable in the near term. Before handing the call over to Doran, I want to point out the potential business opportunities we anticipate post-COVID-19. Many companies, institutions, and government entities will exit this crisis in a challenged financial position with a need to reduce their operating budgets. At the same time, many of these organizations are facing declining revenue opportunities and a history of deferred spending on vital infrastructure. In this environment, we believe that MRSCO's guaranteed cost savings from energy efficiency and distributed energy assets will be in greater demand. As this demand increases, we are able to offer our customers flexible financial solutions that do not require any upfront capital. Even before COVID-19, an interesting funding model called public-private partnership, or P3s, has been finding increased interest across the industry. Public-private partnerships are long-term contractual arrangements between a public entity and a private partner that deliver and fund needed infrastructure and services. The higher education sector has demonstrated considerable interest in the P3 model with a few high-profile contract awards that will outsource their entire energy and water infrastructure. Maresco is aggressively pursuing such opportunities with strategic focus on small and medium-sized colleges and universities where we have significant relationships and a competitive advantage. We entered 2020 with an outstanding backlog, multiple recurring revenue streams, and a great competitive position and platform, allowing us to achieve impressive results even in a challenging environment. While the COVID-19 crisis presents near-term challenges, we expect to look back on 2020 as yet another year of strong growth and important company milestones. And as we look beyond the COVID-19 crisis, we believe we will experience an even greater demand for energy savings contracts, providing critical infrastructure upgrades while returning meaningful savings to our customers. We are well prepared for these expanding market opportunities in front of us. I will now turn the call over to Doran to review the financials. Doran?