REV Group, Inc.

Greetings, and welcome to the REV Group Inc. Third Quarter 2022 Earnings Conference Call. At this time, all participants are on a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Drew Cutup, Vice President, Investor Relations and Corporate Development. Thank you. You may begin. Thank you.

All right. Thank you, Doug. Good morning, and thanks for joining us. Earlier today, we issued our third quarter fiscal 2022 results. A copy of the release is available on our website at investors.revgroup.com. Today's call is being webcast, and the slide presentation, which includes a reconciliation of non-GAAP to GAAP financial measures, is available on our website. Please refer now to slide two of that presentation. Our remarks and answers will include forward-looking statements, which are subject to risks that could cause actual results to differ from those expressed or implied by such forward-looking statements. These risks include, among others, matters that we've described in our Form 8-K filed with the SEC earlier today and other filings we make with the SEC. We disclaim any obligation to update these forward-looking statements, which may not be updated until our next quarterly earnings conference call, if at all. All references on this call to a quarter or year are our fiscal quarter or fiscal year, unless otherwise stated. Joining me on the call today are our President and CEO, Rod Rushing, as well as our CFO, Mark Skanechny. Please turn now to slide three, and I'll turn the call over to Rod.

Thank you, Drew, and good morning to everyone joining us on today's call. Today I'll provide an overview of the quarter's consolidated performance and then move to commercial operating and financial highlights achieved within the quarter before turning it over to Mark for our detailed segment on financials. First, I'd like to provide a few comments on what we are experiencing in the supply chain and labor markets. Like other industrial companies, we have been managing through an inconsistent and challenged supply chain over the past year. While we have seen improvements, these improvements have proven to be temporary and material shortages have subsequently reemerged, impacting our flow and throughput. We have listed the components that have had the most frequent impact on production wiring harnesses, HVAC, axles, radiators, and electronics have consistently been short in supply and remain disruptive to both our starts and completions. We continue our efforts to secure volume commitments and are running processes to qualify and dual-source alternative suppliers, but a consistent, predictable flow of materials has not yet returned. Delivery of OEM chassis have improved in recent months. From 1 OEM, we received an average of 70 chassis per week towards the end of the third quarter. This was up from just 10 per week in the second quarter. The improvement in deliveries was primarily the result of an inventory lot clearing process. These chassis receipts were not aligned to our production plan, to our scheduled component delivery, or to our staffing levels, which created a secondary challenge in managing our production. Receipts of chassis that match our planned productions have not yet improved. This, combined with the potential OEM chassis model year delays, creates a lack of certainty and stability in the predictability of future chassis deliveries. Our current view of supply chain recovery remains consistent with what we provided on our second quarter call. We do not expect to see broad-based improvement until calendar year 2023. As a result, we have maintained our current mine rates that are supported by our chassis supply, our parts availability, and our current staffing levels. Now turning to third quarter results. Consolidated net sales of $595 million increased $2 million versus the third quarter of last year. The increase was driven by higher sales within the recreation segment, partially offset by a decrease in sales in fire and emergency segment. Recreation segment sales continue to reflect strong demand for our RVs across categories, as well as favorable mix within the businesses. Over 80 percent of our year-to-date recreation sales and 90 percent of our EBDA are within the motorized categories. Our businesses continue to benefit from favorable trends and low dealer inventory. Our Midwest brand that serves the Class B Sprinter luxury van market, which grew at 16 percent in the trailing period of 12 months, ending June 30th. In the same period, our Renegade Class C diesel business gained 1.4 points of market share, outpacing the market by 12 percentage points. The combined unit output of these two plants improved 29% versus the third quarter of last year, demonstrating RevDrive's ability to impact our business and deliver bottom-line results. Partially offsetting the increase in recreation sales was a decline in our fire and emergency segment sales. The chastening supply chain challenges we broadly have had the greatest impact in our fire and emergency segment. Fire apparatus is specified to a component level, and is highly engineered, requiring a great deal of planning and execution to deliver with continuous flow. The supply chain serving this industry is the least mature, most localized, and has been more greatly impacted. This directly affects our production throughput. We have expanded the placement of our purchasing resources and our black belts at our suppliers' locations to assist in improving their throughput. Engineering has been another area of that has constrained our throughput. We have supplemented our engineering resources with outsourced offshore engineering to mitigate these issues. There has been significant progress and success in the last two quarters coming from this effort. Additionally, our internal team of lean black belts are aligned and focused on improving our flow. We've tapped our sub-assembly specialists from centers of excellence to deploy best practices across our plants. On a parallel basis, we continue to work the platforming efforts in our fire division to eliminate unnecessary complexity while maintaining the identity and differentiation of our brands. We've expanded the S180 quick delivery pumper program. This will allow us to utilize open production slots at sister plants while providing an alternative for fire departments that require or desire a faster delivery. Within the corridor, we had a transition of leadership in our fire division that resulted in my taking on a greater role in the daily activity of these businesses. I traveled extensively at the close of the past quarter visiting our plants, meeting with our management, our engineers, purchasing and materials handlers, and our production workers. I will continue to focus my daily efforts on improving our fire business while balancing my broader leadership responsibilities until such time that the Division President is named. Consolidated EBDA of $29.5 million was down $12.1 million from prior year. The decline was primarily the result of lower EBDA contribution from our fire and emergency segment and commercial segments, partially offset by an increase in the recreation segment. Sequentially consolidated EBDA improved by $6 million at a 31% incremental margin. We expect this bottom line improvement to continue in the fourth quarter. Please turn to slide four for highlights of the third quarter. We continue to experience strong in-market demand. Booked a bill for the fire and emergency segment was 2.6 times in the quarter, with strengthened orders in both our fire apparatus and aimless units. Demand remains robust for terminal trucks that are needed to support the country's logistics infrastructure. We continue to see strong demand for Class B and Class C RVs, which are our highest margin categories. Consolidated backlog of $3.9 billion is the 11th consecutive record and an increase of 46% versus the prior year. Interest in our electric fire apparatus has been increasing since we launched the Vector, the first all-electric North American-style fire apparatus at this year's FDIC show. Over the past several months, this interest has converted into firm orders for three additional units. In July, our E1 business announced an order for the Vector Rescue Decom apparatus for the city of Rennes, Quebec. In August, our Spartan business announced an order for two Vector pumper trucks. We have sold a total of four units in various configurations from two brands, demonstrating Vector's customization and flexibility to suit fire department needs. Yesterday, we were pleased to announce that our EMC municipal transit business has released its next generation battery electric and fuel cell electric buses that are branded Access EVO. This is the first major platforming and design for manufacturing announcement since we detailed the RevDrive during our 2021 investor day. Past generations of ENT fuel cell electric and battery electric buses were built on completely different platforms. The Access EVO leverages a common structural platform, a common propulsion system, and technologies with over 90% commonality. Not only do we expect lower manufacturing costs, but it provides a simpler solution of aftermarket support, employee training, and maintenance for our customers that operate a mixed fleet. The new designs will allow E&C the flexibility to offer multiple access variations with different power platforms at various lengths of range from 32 to 40 feet. Next-generation access EVO battery electric will have more advanced technology options that we expect will allow longer range than the current generation. The battery system and energy storage for this bus is supplied by Proterra, a manufacturer of industry-leading battery packs for zero-emissions electric vehicles. The next-generation ACCESS EVO fuel cell electric bus will be built on EMC's legacy hydrogen fuel cell electric bus. EMC was the first bus manufacturer to complete the 12-year, 500,000-mile FTA Altoona test for hydrogen fuel cell-powered bus in 2018. BAE is providing their new Gen 3 electric powertrain which is designed to extend the range of the bus to 400 miles, currently the highest range in the industry. We expect significant interest as the FDA announced a $1.7 billion of grants for low and low-emission buses on August 16. These are the first awards related to the bipartisan infrastructure, which provides a total of $5.5 billion over five years to help state and local government authorities buy or lease zero-emission or low-emission transit buses. ANC's home state of California received a total of $236 million of grants, including Los Angeles receiving $104 million. The technology and flexibility of these next-generation buses opens the door to increased market share as we transition to electric transportation. I will now turn it over to Mark for details on our third quarter financial performance. Mark?