RB Global, Inc.

My name is Chris and I will be your conference operator today. At this time, I would like to welcome everyone to the RB Global third quarter conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, please press star, then the number 2. Thank you. I'll now turn the call over to Mr. Samir Rathod, Vice President of Investor Relations and Market Intelligence, to open the conference call. Mr. Rathod, you may begin your conference.

Hello and good afternoon to everyone. Thank you for joining me and our Chief Executive Officer, Jim Kessler, on today's call. The following discussion will include forward-looking statements. which can be identified by words such as expect, believe, estimate, anticipate, planned, intend, opportunity, and similar expressions. Comments that are not a statement of fact, including but not limited to projections of future earnings, revenue, gross transaction value, debt, and other items, business and market trends, and expectations regarding integration of IAA, including anticipated cost energies, are considered forward-looking and involve risk and uncertainties. The risk and uncertainties that could cause actual results to differ significantly from such forward-looking statements are detailed in our news release issued this afternoon, as well as our most recent quarterly report and annual report on Form 10-K, which are available on the Investor Relations website as well as EBR and CEDAR. On this call, we will also discuss certain non-GAAP financial measures, including forward-looking non-GAAP financial measures. For the identification of non-GAAP financial measures, the most directly comparable GAAP financial measures, and the applicable reconciliation of the two, see our news release, Form 10-K, Form 10-Q, and investor presentation posted on our website. We are unable to present quantitative reconciliation of forward-looking non-GAAP financial measures as management cannot predict all necessary components of such measures. Investors are cautioned not to place undue reliance on forward-looking non-GAAP financial measures. All figures discussed on today's call are U.S. dollars unless otherwise indicated. At this time, I would like to turn the call over to Jim. Jim?

Thank you, Samir, and good afternoon to everyone. Our marketplace platform and growth initiatives showcase their strength and effectiveness, again, in the third quarter as we achieved 17% growth in gross transactional value on a pro forma combined basis. GTV growth across all our verticals reflects our teammates' dedication to being trusted partners to our customers. Our focus on cost and execution drove strong flow through, resulting in robust adjusted EBITDA growth. We continue to make significant strides in integrating IEA. During the third quarter, we brought together our global senior field leadership team for a two-day session. And this meeting served as a platform to emphasize our foundational values of being one team, all in, all about the customer, and easy to do business with. I was excited and energized to see how the teams came together, learned from each other, and how eager everyone was to drive our shared vision of success as one cohesive team. It is this one cohesive team of 8,000 plus members that works hard every day to drive successful outcomes for our customers. And to us, success for our customers comes from consistency. Consistency of over delivering on our commitments, consistency of being proactive with our customers, and consistency of driving the best outcomes for the transactions they entrust us with. This consistency continues to build trust with our customers and ultimately positions us to unlock more market share in all the sectors we service. We have taken quick, decisive steps to improve consistency in our automotive sector. This journey's first step was in the second quarter, where we streamlined the senior leadership team. The new structure made it easier for our customers to partner with us as we transitioned management of service-level agreements, or SLAs, to a holistic customer-based approach, departing from the prior segmented by SLA approach, which caused a lack of accountability. We are now implementing new business process to measure our SLAs in real time, and I personally scrutinize our progress against our commitments weekly. If needed, I actively involve myself in addressing any potential concerns. Through this process, we have also delineated critical responsibilities held by our team members, whether various tasks should be owned at the branch level or how to have corporate best support success in the field. We are looking to implement permanent solutions and not temporary fixes where customers have to yo-yo in their experience. We are also implementing tech improvements and prudently investing to give our teammates the tools they need to drive consistency for our customers. I am delighted to say that we have already seen an uptick in our SLA performance, with one example being improved on-time vehicle pickup. We will also implement a new incentive structure for our branch managers at the start of next year so they are better aligned with the performance they are responsible for driving. We are happy with our SLA performance recently and have made substantial strides since closing. Despite these recent improvements in SLA performance, one customer has notified us that they intend to shift all their assignments away from us by the end of the year. This customer accounted for approximately 4% of total GTV and approximately 5% of total unit volumes annually. I am disappointed that we were not given a chance to continue our partnership, especially considering our demonstrated ability to exceed SLAs in the recent months. were going to continue to over deliver on our commitments to all of our partners like we had in the past quarter and continue to do so in the current quarter beyond this our proactive approach has not gone unnoticed by many of our partners especially regarding cats this year we have had cat events ranging from wildfires in hawaii to hailstorms in texas to floods in new york and of course There was Hurricane Adalia, where I and other leadership team members went to Florida, a state where we have more than 1,500 acres available for cat storage. Although the impact of these events was relatively small compared to the large hurricane, our ability to mobilize our resources across multiple geographies, including internal tow capacity in some regions within overlapping timeframe, allowed us to showcase the breadth and depth of our capabilities. overall we have sustainable competitive advantage when responding to cat events stemming from our combined company footprint the flexibility afforded by our nascar partnership and our ability to pull teammates from across rb global to process cap volumes with remarkable efficiency moving to the construction and transportation sector within the sector are enduring robust and trusted partnerships have consistently placed us in the prime position as the preferred disposition partner in the industry. And this quarter, we saw strong contributions from both our strategic account groups and our region's business. Supply chains in the construction space continue to normalize, aiding end users to obtain new equipment. As they purchase new equipment, it powers the trade-in cycle, ultimately leading to the need for disposition services. On the transportation side, there continues to be stress in the industry, accelerating the need for liquidity solutions for our customers. A recent illustration of this was the Yellow Corporation bankruptcy, which involved a highly competitive bidding process. This unique advantage of having IEA and RB yards at our disposal allowed us to demonstrate that 90% of Yellow assets were within a 100-mile radius of any RB global location. a distinction no other bidder could claim. The combined fiscal footprint not only redefines industry standards, but also reinforces our commitment to serve in our large enterprise customers precisely where they desire and in the manner that best suits their unique needs. To be clear, even with this transaction, we have more than enough capacity at our yards to effectively service all our customers. We are dedicated to optimizing price realization, and our industry-leading global buyer base provides our customers with unparalleled depth and breadth of liquidity. Like any other transaction, we intend to harness the analytical capabilities of Rails and leverage in our pricing teams to identify the most effective format, location, and channel to drive the best outcomes. We currently anticipate it will take three to four quarters to work through the bulk of the yellow consignment. The combination of yards, our marketplace liquidity, and our size allowed us to win the trust of this customer and showcases our ability to do transactions of any size. We never take our customers' trust for granted, and we are committed to continually enhancing their experience. Moving to integration, we realized 12 million actual call synergies in the quarter and have actioned a total of 51 million in annual run rate call synergy since the close of the transaction. Based on our progress, we expect to deliver at least $100 million to $120 million of annual run rate synergies by the end of 2025. As part of our integration efforts, we evaluated our land strategy, including the decision between leasing and owning. In discussions with our value partners, it became evident that land ownership is not a prerequisite for meeting our service level agreements or securing market share. We maintain a surplus of land capacity across our asset classes, allowing us to accommodate our operational requirements easily. However, our capital allocation strategy is guided by financial prudence. We will strategically and opportunistically purchase property in regions successful to CATS or where the market opportunity makes strong financial performance sense for us to make this investment. Given these considerations, we are increasing our 2023 net capital expenditure outlook to approximately 310 million. Let me now hand the call to Sameer to discuss our financial results for the third quarter. Sameer?