AtkinsRéalis Group Inc.

Thank you for standing by. This is the conference operator. Good morning and welcome to Atkins-Realis third quarter 2023 results conference call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there'll be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, You may signal an operator by pressing star, then zero. I would now like to turn the conference over to Denis Jasmine, Vice President, Investor Relations. Please go ahead.

Thank you, Ariel. Good morning, everyone, and thank you for joining us today. For those dining in, we invite you to view the slide presentation that we have posted in the investor section of our website, which we will refer to during this call. So this call is also webcast. With me today are Jim Edwards, President and Chief Executive Officer, and Jeff Kell, Executive Vice President and Chief Financial Officer. Before we begin, I would like to ask everyone to limit themselves to one or two questions to ensure that all analysts have an opportunity to participate. You are welcome to return to the queue for any follow-up questions. I would like to draw your attention to slide two. Comments made on today's call may contain forward-looking information. This information, by its nature, is subject to assumptions, risks, and uncertainties, and as such, actual results may differ materially from the views expressed today. For further information on these assumptions, risks, and uncertainties, please consult the company's relevant filings on set-out blocks. These documents are also available on our website. Also during the call, we may refer to certain non-RFRS financial measures. The conciliation of these amounts to the corresponding RFRS financial measures are reflected in our earnings release and MD&A, which can be found on SEDAR Plus and our website. And now I'll pass the call over to Ian Boyd.

Ian? Thank you, Denny. Good morning, everyone, and thank you for joining us today. We're extremely pleased with our performance during the third quarter, which led to robust results, including record revenue in Actions Realist services and another record backlog. Our Atkins Realis services business revenue expanded organically by 19.5% year-on-year, outperforming our 2023 outlook range that we increased last quarter to 12% to 15%. Segment-adjusted EBIT grew 23% as we continue to actively manage our costs to deliver our targeted margin percentage. We achieved another record backlog this quarter, totaling $12.5 billion as of September 30, as demand for our services remains very strong in our core end markets and geographies. Given our strong year-to-date performance, robust backlog, and a pipeline of prospects, we are raising once again our Atkins Realis Services Organic Revenue Growth Outlook for the full year to between 15% and 17%. We generated positive cash flow following the resilient performance of our businesses and the closing on the sale of our Scandinavian engineering services business. We also continued to successfully add high quality talent in the quarter indicative of our engaging core purpose, values and strong culture. We increased our headcount by an additional 1,200 employees this quarter. This further highlights the current and future strengths of Atkins Realis as we strategically enhance our capabilities, while many companies across the globe shrink in the face of economic uncertainty. Performance this quarter emphasizes the underlying strengths of our pivoting to growth strategy, which has enabled substantial growth across our businesses. We have taken measured steps to become a premier fully integrated professional services and project management company. We have chosen specific geographies and segments that are growing fast. Within them, our technological capabilities of people and scale lead to our ability to grow above the market. We help our customers provide secure, clean and affordable solutions to solve the global energy trilemma. We are hiring the right people and we are operating more collaboratively. This is all happening as public entities increase their focus for the betterment of the planet and its people. I am extremely proud of our achievements to date this year and I'm excited to detail them out today. On slide four, we highlight our backlog growth across Atkins Realis services. Our 7% growth in the third quarter versus the third quarter of last year was driven by wins across four regions and end markets. We continue to see key wins across many of the markets in which we operate, including transportation work in the U.S. and securing a large battery plant contract in Quebec. The further wins emphasize the demand for our services across the globe. Turning to slide five, our engineering services business continues to drive robust organic growth for Atkins Realest, as witnessed a 23% increase during the third quarter. Our second consecutive quarter of revenue generation was driven by securing new wins across our geographic footprint. segment-adjusted EBIT increased 35%, representing a margin in segment-adjusted EBITDA over net revenue margin of 8.7% and 14.4%, respectively, during the quarter. We continue to elevate our backlog, which now stands at approximately $5.1 billion, representing an 11% growth versus our backlog as at September 30, 2022. On slide six, we provide further insight into our engineering services growth in each of our core geographies of the UK, the US, and Canada, as well as other targeted geographies with strong potential. We continue to see exponential demand for our services in these markets, fueled by the need to replace aging infrastructure and provide clean, affordable solutions for the built environment. In the UK and Europe, our capability in supporting growth through infrastructure and water facility development, as well as defense, are driving winds for our business. This comes on the heels of the UK announcing its intent to double its investment in water infrastructure over the next five years. We also secured a key win with the UK Ministry of Defense this quarter, which further strengthens our position as a trusted partner with the government. In the US, The government's commitment to constructing safe and carbon-neutral infrastructure is leading to continued strong performance. The capital infusion from the Infrastructure Investment and Jobs Act and the Inflation Reduction Act remains in the early days, and we have a significant number of bids for additional work, particularly in the transportation, minerals, and metal sectors, highlighting the elevated demand for our services and the opportunities that persist. for Atkins Realis. The line of sight for further opportunities remains vast as the U.S. will continue to invest in lowering the carbon footprint on their aging infrastructure. In Canada, our value proposition is being recognized as we continue to accelerate our backlog with higher quality contracts. These wins are being secured across power and renewables, industrial and transportation end markets. Our focus on investing in our people and on technology will continue to yield robust growth in Canada. Our proven ability to provide end-to-end engineering services will continue to bring other key wins in our core geographies. Infrastructure projects related to net zero and sustainability will continue to drive government spending with growth of the renewables energy market, the delivery of cleaner modes of transport, and industrial projects that support the growing trends of decarbonization and reshoring. We are successfully attracting and retaining top talent to support our growing pipeline in the engineering services business across all of our operating regions. I'd now like to move on to slide seven and the results for our nuclear business. We continue to demonstrate solid growth. with an organic revenue increase of 20% this quarter compared to the third quarter of 2022. Our nuclear backlog is $1.1 billion, which represents a 23% growth versus our backlog that's at September 30, 2022. Segment-adjusted EBIT increased 6%, while margin fell 2.4%, mainly due to the business mix of the nuclear segment this quarter. On slide eight, we highlight achievements in each of the nuclear services that we provide. The market outlook for new build and new nuclear opportunities is gaining more positive traction quarter on quarter. In Ontario, the Energy Minister announced a proposal to expand the Bruce Power Station, which will come in addition to the work we're already performing on this contract. In the UK, the government has announced an allocation of more than £340 million for additional development work at the Sizewell Sea project. And last month, Canada and Romania signed a $3 billion development deal for two new reactors joining the existing CANDU fleet reactors at the Cerna Voda plant. Current projects and in the pipeline of opportunities on life extension work remain robust. In Ontario, we continue to be actively supporting extension work on OPG Darlington and Can Do Life extension work at Bruce Power. Earlier this year, the Ontario government gave its official stamp of approval to the extension of Pickering Nuclear until 2026, which could pave the way for a full refurnishment. And in Romania, we received the award letter for the engineering technology and procurement of tooling and reactor components in support of the life extension of Unit 1 at the Cernoboula Power Plant. On waste management and decommissioning, we're seeing continued progress on our projects in the UK, the UAE, and in the US, we have a strong pipeline of prospects in addition to our recent waste management contract extension at the Hanford into 2024. The focus on providing clean, affordable and secure energy by public entities means significant growth for Atkins Realis, as showcased with our extensive backlog and accelerating revenues. We are constantly harnessing our capabilities across the globe to be a trusted partner to public entities as they seek to achieve their net zero goals. We believe we are well positioned as an industry leader to generate long-term value in the nuclear sector. Now moving to slide 9 and our O&M and links on businesses. Our O&M segment generated $115 million in revenue during the third quarter. An 8.4% organic revenue decreases higher revenues from our REM project were more than offset by the completion of a large contract outside Canada. Segment-interested EBIT margin was very strong in the quarter at 14.2%, well above our long-term target of 5% to 7%. EBIT growth was driven by a closeout of the previously mentioned large contract. We continue to see opportunity for growth and expansion in our core geographies through infrastructure improvements, such as wastewater facilities and highway projects. We remain focused on leveraging strategic partnerships with key industry players and our capital group to maximize bidding opportunities for the future. Our strategic review regarding LinkedIn remains ongoing, and we will provide an update when applicable. The backlog increased 58% to $1.2 billion at the end of the quarter, with continued strong demand for transmission and distribution services. The improvement in quality of backlog gives us confidence to expand margins in the near future. Moving to slide 10 in our LSDK projects in capital business, we recognized $13 million in the quarter in line with our expectations. Our last project, REM, continues to progress well with the South Shore portion operating while testing and commissioning on our Ontario projects is continuing as planned. Our backlog decreased by more than 50% to $305 million primarily representing the grant. As we finalize the LSTK projects for our clients, we continue to pursue recoveries that we are owed, and discussions remain ongoing with our customers. Turned into our capital business, the third quarter revenues were flat while EBIT saw a slight year-over-year decline. We received $10 million in dividends this quarter compared to $14 million in the third quarter of 2022. In October, we received $44 million in dividends. The traffic volume continues to improve compared to the prior year period. Before turning it over to Jeff, I just want to highlight our 2022 ESG report that we published on September 25. Our report emphasizes our core purpose, to engineer a better future for the planet and its people. By utilizing our end-to-end capabilities, we are helping customers reach their net zero carbon targets. Across the globe, we are a critical partner to governments focused on providing affordable and clean energy, decarbonizing the built environment, and building resiliency to climate change impacts. Our report highlights that approximately 50% of our revenues are from projects that directly solve these global challenges. Our commitment to sustainability and our continued focus on building an inspired, inclusive, and equitable workforce attracted talent individuals to help us succeed. Our goals are achieving through their hard work and dedication. I'm really proud of the individuals that act into us. Our ability to attract strong employees is a direct translation into our revenue growth. which has proven out year-to-date across our businesses. Our purpose-built position across our chosen geographies and our end markets fuels our near-term and long-term growth trajectory. And we are really pleased to have organically grown our headcount this year by over 3,500 employees if we don't take into consideration the investment of Scandinavian business. With that, I'll now turn it over to Jeff to discuss the financial highlights.