Black Diamond Group Limited

As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star, then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star, then 0. I would now like to turn the conference over to Mr. Sean McPherson, Investor Relations Specialist. Please go ahead.

Good morning. Thank you for joining Black Diamond Group's fourth quarter and full year 2024 results conference call. On the line with us today is Chief Executive Officer Trevor Haynes and Chief Financial Officer Toby Labrie, as well as Chief Operating Officer of Modular Space Solutions, Ted Redman, and Chief Operating Officer of Workforce Solutions, Mike Ridley. Please be reminded that our discussions today may include forward-looking statements regarding Black Diamond's future results. and that such statements are subject to a number of risks and uncertainties. Actual financial and operational results may differ materially from these forward-looking expectations. Management may also make reference to various non-GAAP financial measures in today's call, such as adjusted EBITDA or net debt. For more information on these terms and others, please review the sections of Black Diamond's fourth quarter 2024 management's discussion and analysis entitled Forward-Looking Statements, Risks and Uncertainties, and Non-Gap Financial Measures. This quarter's MD&A, financial statements, and press release may be found on the company's website at www.blackdiamondgroup.com and also on the CDAR Plus website at www.cdarplus.ca. Dollar amounts discussed in today's call are expressed in Canadian dollars unless noted and may be rounded. I will now turn the call over to Trevor Haynes to review the operational highlights.

Thank you, Sean, and good morning, everyone. Thank you for joining us this morning. Management is pleased to report continued progress with another strong quarter and full year of growth across the platform. with signs of momentum continuing into 2025. We ended the year on solid footing, reflective of the good work of our teams. Black Diamond generated $132.7 million of revenue in Q4, up 28% from the comparative quarter, $37.2 million of adjusted EBITDA, up 43% from the comparative quarter, and consolidated rental revenue of $38.5 million, up 7% from the comparative quarter. I will leave the balance of the quarterly commentary to Toby Labrie in a minute here and move on to full year. Our full year consolidated rental revenue was up 1% to $146.8 million over the prior year and adjusted EBITDA rose 6% to $113.3 million. This results in a five-year annual compounding growth rate for revenue of 17% of 18% for rental revenue. and 24% for adjusted EBITDA, and 8% for return on asset, or ROA. Capital expenditures in 2024 were $109.2 million, the bulk of which was for rental fleet growth, and of that, the majority is with customer contracts in place. This growth is evident in our contracted revenue outstanding of $159.4 million at year end, which is up 17% or $23 million from the prior period. This robust rental investment and growth informs our confidence in the business's performance heading into 2025. All areas of the business produced strong results in 2024. MSS generated record rental revenue of $94.1 million, up 10% from the prior year, while continuing to grow its contracted future rental revenue by 26% to $128.7 million at year end. Adjusted EBITDA in 2024 for the business unit of $77.8 million increased 7% from the prior period. WSS delivered total revenue of $179 million and adjusted EBITDA of $58.1 million, down 4% and 2% respectively in the prior year. Contracted future revenue of $30.7 million is down 11%, or $3.9 million from the comparative quarter. As a reminder, these marginal decreases were primarily due to the completion of two large-scale pipeline camp projects, but highlight the resilience of this segment's ability to redeploy assets and continue to generate a strong return on assets. Finally, LodgeLink continued its strong growth trajectory with gross bookings up 21% year-over-year to $94.8 million. Total room nights sold increased by 23%, 517,382, and net revenue reached a record $11.4 million, up 16% from the prior year. These results highlight the effectiveness of our operational strategies in a dynamic marketplace and underscore the importance of our approach to disciplined execution. We continue to reinvest cash flow back into the business, primarily with contract-backed opportunities. This resulted in a capital investment program in 2024 that was up 58% on a gross basis and up 59% on a net basis. resulting in full-year capital expenditures of $109.2 million. Looking ahead to 2025, we continue to believe there's ample opportunity for reinvestment, but also expect to be active through our NCIB share buyback program. Further, the company remains in a strong financial position with stable free cash flow generation, a strong balance sheet, and available liquidity of $103.1 million at year-end, This is prior to the recent extension and expansion of our asset-based lending facility, which was increased by $100 million to $425 million and turned out to February 20, 2030. This will support the company's sustained growth trajectory, both organic and inorganic, not only in 2025, but well beyond. While macroeconomic uncertainty related to Taros is very topical, let me address this from a Black Diamond perspective. We believe Black Diamond, with its diversified geographic and industry exposure, remains well positioned in such a backdrop as we anticipate ongoing growth in a number of our verticals. As many of you would be aware, the company does not manufacture, import, or export product between Canada and the United States. Our businesses operate locally and at scale in both countries. As such, we do not expect direct impacts from tariffs. Areas that could be impacted include rising input costs for procurement of new fleet assets or a second derivative impact from lower customer activity in certain sectors. However, we are seeing continued steady demand in our local markets, which leads us to believe our business will have opportunities for ongoing growth and performance. The asset management basis of our business has been and continues to be a beneficiary of inflation, Should the current macro backdrop result in accelerated inflationary pressures, we expect our existing assets will continue to benefit through higher rents while we maintain our capital allocation discipline on new investments and will only look to add new fleet assets should we be successful in ensuring continued strong return on asset characteristics consistent with our trailing performance. With continued strong demand across our end markets and therefore opportunities for growth investment, we are seeing continued demand in education and major infrastructure, as well as humanitarian disaster recovery and military-related projects, coupled with an already healthy amount of contracted rental revenue in place. In summary, 2024 was another very successful year for Black Diamond. We continue to focus on the ongoing compounding profitable growth, diversification, and scale in our portfolio of specialty rental accommodation and workforce travel management businesses, resulting in robust five-year compounding annual growth rates across the business. With MSS rental revenue CAGR of 23% over the five years, WFS rental revenue CAGR of 10%, botulant gross bookings compounding annual growth rate over the five years of 44%, consolidated rental revenue CAGR of 18%, and consolidated EBITDA for the whole company, growing at a compounding rate of 24% through the five years. Our growth strategies are firmly rooted in discipline, prudent, and return on asset capital allocation and operating excellence. We have the financial flexibility and strength in our investing class teams to capitalize on the opportunities that lie ahead. With a substantial amount of future contract backed, Rental revenue, strong free cash flow characteristics, and ample liquidity, Black Diamond is all the necessary tools required to continue to compound long-term growth and shareholder value. I will now turn the call over to our CFO, Toby Labrie, for a more in-depth look at the quarter and overall financial condition of the company. Toby. Thanks, Trevor.