11/4/2021

speaker
Nora
Conference Call Operator

Good day and thank you for standing by. Welcome to the AHRQ Third Quarter 2021 Earnings Report. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Speaker David Stickney, Vice President of Investor Relations. Please go ahead, sir.

speaker
David Stickney
Vice President of Investor Relations

Thank you, Nora, and welcome, everyone. On the call with me today are Suri Suryakumar, our CEO, our Chief Operating Officer, Dilo Widusuria, and George Avalos, our Chief Financial Officer. Our third quarter results for 2021 were publicized earlier today in a press release. The press release and other company materials are available from our investor relations pages on ARC Document Solutions' website at ir.e-arc.com. In today's earnings announcement, AHRQ offered expanded supplemental disclosures to provide shareholders and analysts with additional information in advance of our quarterly conference call. The disclosures are largely historical and will not be read on today's call. In addition, we are conducting this call from multiple locations today, which may require some additional direction from our speakers, especially during Q&A. Please note that today's call will contain forward-looking statements that fall within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are only predictions based on information as of today, November 4th, 2021, and actual results may differ materially as a result of risks and uncertainties that we highlight in our quarterly and annual SEC filings. This call will also contain references to certain non-GAAP measures, which are reconciled in today's press release and in our Form 8K filing. I'll now turn the call over to our Chairman, President, and CEO, Suri Suryakumar. Suri?

speaker
Suri Suryakumar
Chairman, President, and CEO

Thank you, David, and welcome, everyone. We are delighted with our third quarter of time. Since 2008, our company... and the industry as a whole have been devastated with secular changes. Print revenues, especially related to the construction industry, have nosedived as technology and new workflows have replaced the use of paper. We at ARC have been battling these changes with multiple re-offs and restructures over the years in an effort to stem the revenue erosion and put the company back on a growth track. It has been an uphill task, and the pandemic did not make it easier. However, we now believe we have been successful in transforming the company. We are now a different company than we were in the past. We have new revenue streams from an expanded service portfolio and new customers from a much wider range of industry centers. The results of this transformation can already be seen with more and greater opportunities for growth. Our performance in India demonstrates that we are now on the right track. While a few quarters have had aberrations in the recent past, our fundamentals have remained steadfast. We have continued to generate quality cash and EBITDA allowing us to keep our debt in control, fund our quarterly dividend program, and repurchase our stock. This quarter is the perfect example. EPS grew, and EBITDA was strong for the second consecutive year. Margins were solid, thanks to our new cost structure, and our cash flow performance remains impressive. Clearly, the changes we have made to the company have enhanced our financial performance. But as noted, I expect our transformation to continue generating new growth opportunities as we look forward to the fourth quarter and beyond. While the design and construction industries remain a strong contributor to our revenue, new sales are being dominated by work once we considered to be opportunistic, and by customer segments who had likely never heard of us just two years ago. National retail brands, educational institutions, fitness centers, healthcare companies, marketing agencies, and many other industry segments regularly contribute the lion's share of our news. I think the variety in our customer base its volumes about the appeal of both our digital printing and document scanning services, as well as the effectiveness of our marketing efforts in quoting new customers. Meanwhile, our traditional customers continue to return to work, and our legacy revenues are stabilizing. With regard to our view of the fourth quarter, I mentioned in our last call that we don't think normal seasonal trends will play as a large role as they have historically. Our opinion hasn't changed. Demand for better visual communication, more access to documents and information, pent-up demand, and a competitive holiday retail season are likely to push business deeper into the last quarter of the year than we have seen in the recent past, and we are prepared for it. Finally, our commitment to return shareholder value is as high as it's ever been. We were buyers of our own shares in the open market during the third quarter, and the shareholders will receive their third quarter dividend at the end of November. With that, I'll turn the call over to Dilo to provide further details on the operations of the company during the period. Dilo?

Disclaimer

This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.

-

-