Parkland Corporation

Good morning. My name is Pam and I will be your conference operator today. At this time, I'd like to welcome everyone to Parkland's 2022 Q2 Results Analyst Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star then the number one on your telephone keypad. If you would like to withdraw your question, please press star then the number two. Thank you. I would now like to turn the conference call over to Ms. Valerie Roberts, Director of Investor Relations for Parkland. Please go ahead.

Thank you, Operator. With me today on the call are Bob Espy, President and CEO, and Marcel Tunison, Chief Financial Officer. This call is webcast, and I encourage listeners to follow along with the supporting slides. We will go through our prepared remarks and then open it up for questions from the investment community. Please limit yourself to one question and a follow-up if necessary, and if you have other questions, re-enter the queue. We would ask analysts to follow up directly with the investor relations team afterwards for any detailed modeling questions. During our call today, we may make forward-looking statements regarding expected future performance. These statements are based on current views and assumptions and are subject to uncertainties which are difficult to predict. These uncertainties include, but are not limited to, expected operating results and industry conditions, among other factors. Risk factors applicable to our business are set out in our revised annual information form and management's discussion and analysis. We will also be discussing non-GAAP and other financial measures, which do not have any standardized meanings prescribed by IFRS. These measures are identified and defined in Parkland's continuous disclosure documents, which are available on our website or on CDAR. Please refer to these documents as they identify factors which may cause actual results to differ materially from any forward-looking statement. Dollar amounts discussed in today's calls are expressed in Canadian dollars unless otherwise noted. I will now turn the call over to Bob.

Great. Thank you, Val, and good morning, everyone. We appreciate you taking the time to join us. I'm delighted to lead off by acknowledging our announcement to exchange 20 million parkland shares for the remaining 25% of Sol, held by the Simpson family. This will consolidate our ownership of Sol to 100%. We appreciate the opportunity to continue to work and grow our relationship with the Simpsons. They are highly supportive shareholders who share our conviction in the parkland strategy and long term vision. We are excited to continue our long standing relationship with the Simpsons who upon completion will own approximately 19.5% of parkland. I believe now is the right time to consolidate our ownership. We're doing this on a leverage neutral basis and can see significant future growth opportunity. The Simpson family has and will continue to play an integral part in our growth. We greatly value their continued support and appreciate the confidence they are showing in the Parkland team's ability to build long-term value. Turning now to the photo on today's cover, which features one of our recently rebranded retail locations in Miami. You recall that in December last year, we seized an opportunity to leverage our existing commercial and supply business in Florida by adding a retail network. Our purchase of Urbietta provides us with immediate retail scale and density. After we closed the Urbietta transaction, we began the integration process. We have tied these sites into our existing supply platform and applied our on-the-run brand to several locations, which are being well received. The result is visually strong and it helps differentiate us in the market. Our integration of this retail network reflects our broader integration activity, which plays a key role in our growth and success. With that, let's dive into the quarter. Quarter after quarter, we continue to demonstrate the resilience of a diversified and integrated business model and our ability to grow through economic cycles. In Q2, we delivered adjusted EBIT at $450 million. This brings us to $837 million year to date, both records for our company. Through 2022, We have focused on integrating and capturing synergies from the great companies we have acquired. We are trending well ahead of schedule on our synergy capture. Marcel will speak about this later on the call. We have also focused on reducing our leverage ratio. We are making strong progress and lowering our leverage by 0.3 turns in the quarter to 3.2. We expect to return to below three times early next year. Our consistent performance is underpinned by many structural advantages. Our trading logistics and refining expertise helps us reliably source and make competitively priced product. Our supply infrastructure enables us to transport, store, and deliver our products across 25 countries. We serve diversified customers spanning retail, commercial, wholesale, shipping, and aviation. each have diverse product needs. Our integrated business model is unique among our peers, and it positions us to optimize margins through each part of the value chain while remaining competitive in our markets. Through COVID, higher unit margins offset volume declines in our retail business. And again this year, while commodity prices are dampening COVID volume recovery, unit margins are offsetting volume and inflationary pressures. In our commercial business, we sell diesel propane, aviation, and marine fuels. We continue to see strength in volumes with 6% year-over-year growth as we integrate acquisitions, win national accounts, and expand these businesses across our footprint. We are confident in our integrated model and our growth trajectory. We are pleased to announce an increase in our 2022 adjusted EBITDA guidance of $1.6 to $1.7 billion. The combination of consistent operational performance, an increase in our guidance, and our consolidation of SOL gives us confidence to meet our $2 billion of adjusted EBITDA by mid-decade. Our exceptional results are underpinned by hard work and dedication of our talented Parkland team, some of whom you can see on the slide. I would like to extend my sincere thanks for their ongoing commitment to Parkland. I'll now turn the call over to Marcel to speak in more detail about the financial results on slide four.