APi Group Corporation

Good morning, ladies and gentlemen, and welcome to API Group's third quarter 2023 financial results conference call. All participants are now in a listen-only mode until the question and answer session. Please note this call is being recorded. I will be standing by should you need any assistance. I will now turn the call over to Adam Fee, Vice President of Investor Relations at API Group. Please go ahead.

Thank you. Good morning, everyone, and thank you for joining our third quarter 2023 earnings conference call. Joining me on the call today are Russ Becker, our president and CEO, Kevin Crum, our executive vice president and chief financial officer, and Sir Martin Franklin and Jim Lilly, our board co-chairs. Before we begin, I would like to remind you that certain statements in the company's earnings press release announcement and on this call are forward-looking statements which are based on expectations, intentions, and projections regarding the company's future performance. anticipated events or trends, and other matters that are not historical facts. These statements are not a guarantee of future performance and are subject to known and unknown risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. In our press release and filings with the SEC, we detail material risks that may cause our future results to differ from our expectations. Our statements are as of today, November 2nd, and we undertake no obligation to update any forward-looking statements we may make, except as required by law. As a reminder, we have posted a presentation detailing our third quarter financial performance on the investor relations page of our website. Our comments today will also include non-GAAP financial measures and other key operating metrics. The reconciliation of and other information regarding these items can be found in our press release and our presentation. It is now my pleasure to turn the call over to Jim.

Sorry, I was on mute. Thanks, Adam. API delivered another strong quarter of results, including record third quarter net revenues, adjusted EBITDA, and adjusted diluted earnings per share in evolving macro and foreign exchange environment. During our investor day last year, Russ detailed our strategy of focusing on growing our service-based recurring revenue while slowing revenue growth in select businesses through improved project selection. Our goal of evolving away from lower margin, higher risk opportunities, while focusing investments on service revenue expansion is yielding the desired results. This strategy improves margins while simultaneously reducing capital spending, which in turn drives free cash flow generation. The benefits of these initiatives is shown in API's consistently strong and improving financial results. These results are built on strong foundation of driving the company's recurring revenue services-focused business model while expanding the financial discipline of the organization and its leadership team. The team's relentless efforts on adhering to our strategy are driving margin expansion, and we believe there is a long runway of continued margin expansion beyond our established 2025 targets. As we look forward, we believe our balance sheet is even stronger following our repricing and maturity extension and we expect to end the year below our targeted net leverage ratio of 2.5 times X. Since becoming a public company, the team has enhanced their position as the number one provider globally in the growing, highly fragmented fire and life safety services market. Going forward, we are excited to build on our track record of disciplined, predictable, and thoughtful decisions regarding capital allocations with a primary focus on tuck-in M&A at accretive multiples. We have great confidence in the business, and we believe that our laser focus on our long-term 13, 60, 80 value creation targets will generate continued exceptional performance through 2025 and beyond. As a reminder, our financial goals include long-term organic revenue growth above the industry average, adjusted EBITDA margin of 13% or more in 2025, long-term revenues of 60% from inspection, servicing, and monitoring, and long-term adjusted free cash flow conversion of 80%. We look forward to continuing to update you on our positive momentum on margin expansion, service revenue growth, the opportunities for solid organic growth in 2024 and beyond, our visibility on bolt-on M&A at accretive multiples and our strong balance sheet. With that, I'm pleased to turn the call over to Russ for further details.