Black Diamond Group Limited

Welcome to the Black Diamond second quarter 2022 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 Jason Zhang, Director, Investor Relations. Please go ahead.

Thank you. Good morning, and thank you for attending Black Diamond's second quarter 2022 results conference call. With us on the call today is our CEO, Trevor Haynes, and CFO, Toby Labrie. We are also joined today by COO, Modular Space Solutions, Ted Redmond, COO, Workforce Solutions, Mike Ridley, and CIO, Patrick Melanson. Our comments today may include forward-looking statements regarding Black Diamond's future results. We caution that these forward-looking statements are subject to a number of risks and uncertainties that may cause actual results to differ materially from expectations. Management may also make reference to non-GAAP financial measures in today's call, such as adjusted EBITDA or net debt. For more information on these terms, please review the sections of Black Diamond's second quarter 2022 management's discussion and analysis entitled Forward-Looking Statements, risks and uncertainties, and non-GAAP financial measures. This quarter's MD&A news release and financial statements can be found on the company's website at www.blackdiamondgroup.com, as well as on the CDAR website. Dollar amounts discussed in today's calls are expressed in Canadian dollars unless noted otherwise and are generally rounded. I will now turn the call over to Trevor Haynes to review the quarter.

Good morning, and thank you for joining us. Thank you, Jason. We will discuss the results of the quarter, myself and then Toby LaBrie. Let me begin by saying that I'm very pleased to be reporting another strong quarter. I'm also very pleased with how the business is currently operating. We believe this quarter to be an important data set for stakeholders as these results reflect the strong benefits of our successful pivot over the last several years. Of the many benefits, the primary has been the growth of our high margin recurring rental revenue across our specialty rental platforms. Compared to the same quarter last year, we have grown rental revenue by 22% to $28.4 million and adjusted EBITDA of $18.2 million is an increase of 34% year-over-year. We also increased our MSS rental fleet by 424 net units or buildings, through a combination of organic and inorganic means, and have also deployed cash towards dividends, share buybacks, and have redeemed an additional portion of the preferred shares that were issued in connection with the Vanguard acquisition in late 2020. We have done all of the above while keeping our long-term debt essentially flat year over year. We believe this speaks to the strong cash flow generation of our modular building rental platform and anticipate continued momentum in operating and financial performance throughout the second half of 2022 and into 2023. During the quarter, we closed the tuck-in acquisition of Cambrian Trailer Rentals, which has a long-standing history of exceptional service in the southern Alberta market that has been built up over the past 40 years. The outlook for our broader MSS business continues to be positive. Utilization in the quarter was robust at 84%, while average rental rates increased 11% on a constant currency basis, which represents a string of years of increasing average rental rates. We expect continued growth in our core high margin rental revenue, with utilization likely to strengthen further, throughout the summer months over a stable base of existing contracts in place. We also expect that as units turn over from maturing contracts, our new assets are deployed, that rising spot rental rates will continue to have a positive effect on our average monthly rental rates through the next several quarters and certainly through 2023 based on our current outlook. These tailwinds have a powerful effect on returns on assets that have been acquired 5, 10, or 15 years ago as they're able to generate rental revenues that are paid to returns based on capital costs for today's new built units. We take great pride in our systems and processes and our focus on operational excellence. Asset quality typically results in customers being unable to differentiate between a building that might be new or over 15 years old. In my personal view, modular buildings are one of the best alternative asset classes that most investors have never heard of. And I believe that prospects for our MSS business remain very bright. The outlook into 23 is similarly strong in our WFS business, which continues to benefit from existing contracts in place. Recent relative strength in commodity prices have also resulted in improved field level activity in the upstream energy sector. We exited the quarter with utilization of 50% in our WFS business and continue to believe there is powerful operating leverage throughout our large inventory of North American rental assets to drive returns. To illustrate, our adjusted EBITDA in WFS of $10 million was a 61% improvement compared to year-ago quarter and drove return on assets of 28%, up from 17% in the same quarter last year. Australia also remains a bright spot within our portfolio as utilization of 96% in the quarter is reflective of a market that is seeing some of the strongest returns within the company. We remain focused on diversification within our WFS platform and are continuing to see opportunities in mining, disaster recovery, government, and remote infrastructure. Switching to LodgeLink, this company is continuing to benefit from our investment in driving scale and efficiency. Room nights booked were up 58% year over year, however, They dipped sequentially from Q1-22, as is consistent with prior years, as significantly lower room nights booked by Canadian energy services customers due to breakup was mostly offset by our growing customer volumes in the U.S. Net revenue for the quarter was $1.2 million, up 50% year-over-year and flat on a sequential basis despite the decline in room nights booked, as our U.S. bookings provided an offset with higher margins. We anticipate a similar cadence of growth in LodgeLink as we've experienced year to date, driven not just by the ongoing or the onboarding of new companies or customers, but also by gaining a larger share of crew travel spend from existing customers as we demonstrate LodgeLink's value proposition to new users within the organizations that are already customers. We continue to invest growth G&A as well as product and customer experience enhancements, which we believe is the path for continued long-term value creation. To summarize my remarks, we are highly pleased with the results this quarter and believe it is yet another strong data set within a string of quarters where we have been able to demonstrate steady growth in recurring rental revenues, improving utilization and returns on our legacy assets, and the ongoing growth and scale of our digital travel tech platform. We expect these positive trends to continue through the end of the year and well into 2023. With that, I will hand the call over to Toby to provide more detail on our quarterly results. Toby?