Doman Building Materials Group Ltd.

Good day and welcome to the Dolman Building Material Group Limited Select Quarter 2022 Financial Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Ali Madami. Please go ahead.

Thank you. Good morning, everyone, and thank you for joining us this morning for Dolman Building Material's second quarter 2022 Financial Results Conference Call. Joining me this morning are the company's Chairman and Chief Executive Officer, Amar Dolman, and Chief Financial Officer, James Cote. If you have not seen the news release, which was issued after the close of markets yesterday, it is available on the company's website, as well as on CDAR, along with our MD&A and financial statements. I would also like to remind you that a replay of this call will be accessible until midnight on August 19th. Following management's presentation and commentary of the second quarter results, we will conduct a question and answer session for analysts only. Instructions will be provided at that time for you to join the queue for questions. Before we begin, we are required to provide the following statements regarding forward-looking information, which is made on behalf of Dillman Building Materials Group Limited and all of its representatives on this call. Remarks and answers to your questions today may contain forward-looking information about future events or the company's future performance. This information is subject to risks and uncertainties that may cause actual events or results to differ materially. Any information regarding forward-looking statements is made as of the date of this call, and the company does not undertake to update any forward-looking statements. Please read the forward-looking statements and risk factors in the MDNA as these outline the material factors which could cause or would cause actual results to differ. The company will not provide guidance regarding future earnings during today's call, and management does not anticipate providing guidance in future quarterly or interim communications with investors. I'll now turn the call over to Amar. Thank you.

Thanks very much, Ellie, and good morning, everybody. Thanks for joining us on today's call. On the back of a solid first quarter with record results stemming from strong pricing, which started to normalize late in that period, they were complemented by steady demand. The second quarter started off as what I would qualify as expected. Our expectations were that we could see pricing normalization caused by macroeconomic headwinds triggered by interest rate hikes and concerns around demand slowing down and overall risks of a downturn in the housing and construction markets. This trend was exactly what we experienced going into the second quarter with downward pricing being the theme as we worked through inventories in the period. Given the continued downward pressure on pricing going into the second quarter, we prudently managed working through our inventories and protecting gross margins to the extent possible. Mid-quarter we started seeing signs of pricing stabilization at levels which are very healthy for our business And market demand for our products remained robust, which sets up well in a stable pricing environment with less price volatility, normalized margin levels, and robust market demand in our key markets. Despite some of the industry-wide challenges around pricing and demand dynamics during the quarter, our sales reached $871 million. Our recent acquisition of Hickson Lumber was a major contributor to our revenue growth in the quarter, and our integration efforts at Hickson Lumber continue to be carried out as planned. I am both pleased with and very proud of our financial performance during what I continue to consider a challenging quarter, specifically from a pricing trend perspective where we have had to be extremely responsive to industry-wide price volatility while ensuring that our first-class level of service remains on point. As a result of our collective efforts, our revenues amounted to $871 million. Our gross margins were challenged from my earlier commentary on inventories and pricing dynamics, at just under 12% or $103 million. Our adjusted EBITDA amounted to $52.1 million, and our net earnings came in at $21 million. And lastly, we paid a quarterly dividend totaling $0.14 per share. Looking ahead, we are cautiously optimistic as we believe that the pricing environment and market demand is nearing an equilibrium at healthy levels while we continue to manage our costs and always look for growth opportunities. Our balance sheet optimization strategy is also tracking well, with nearly $100 million of debt reduction over the past 12 months, which is a key priority for us, and we look forward to having the solid, growth-friendly, and fire-ready balance sheet for opportunistic acquisitions. A little bit of color on how the third quarter has started off. We continue to see a healthy level of activity, and pricing trends seem to be leveling off at what we would consider healthy levels. However, there are still macroeconomic-driven factors that could stir up volatility, and we are monitoring and managing inventory levels closely, to ensure we minimize any impact to our financial performance. As always, we remain confident in our ability to work through volatile markets diligently while serving our customers' needs with the highest level of service. We remain very excited about our growth profile and the overall prospects of the business. We have built a solid, diverse, and resilient business in North America with a broad and growing footprint, which we are extremely proud of. And with that, I would like to ask Jay Cote, our CFO, to take over and provide a review of the company's second quarter 2022 financial results in greater detail, and then we will open up the call for any questions you might have. Jay? Thank you, Omar. Good morning, everyone.