Good morning, and welcome to Cervus Equipment's first quarter 2021 results conference call. At this time, all participants are in a listen-only mode. This call is being webcast, and a replay will be available on Cervus's website. You may access the accompanying presentation now by going to the investor page on Cervus's website at cervusequipment.com. Cervus will conduct a question and answer session for analysts and institutional investors as a part of today's call. Instructions will be provided for you to queue up for questions. If anyone has difficulties hearing the call, please press star zero for operator assistance. I would now like to turn the call over to Cervus's Chief Financial Officer, Ms. Catie Busch. Please go ahead, Ms. Busch. Thank you, operator. Good morning, everyone. Thank you for joining us today to discuss the results of Cervus Equipment for the first quarter of 2021. On the call with me is Angela Lekatsas, Cervus's President and Chief Executive Officer. Also joining us today is Scott Johnston, Cervus's Chief Operating Officer, who will be available for the question and answer portion of the call. Before we continue, I would like to advise listeners that this presentation may contain forward-looking statements and information that is subject to certain risks, uncertainties, and assumptions. For a complete discussion of the factors, risks, and uncertainties that may lead to actual results or events differing materially from those expected, please refer to Cervus's most recent quarterly MD&A, which is available. Please note that during today's call, we will discuss non-GAAP financial measures, including results on an adjusted basis and key performance indicators. We have included reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures in MD&A. Turning to slide three, I will walk through the components of the quarter-over-quarter change in adjusted income before tax. Overall, adjusted income before tax increased CAD 2.7 million, which is comparing the two gray bars on the far left and the far right margins of the chart. This increase in profitability reflects our strategic focus on growing product support revenue as well as lower finance costs, which I will discuss in more detail. Improved profitability was delivered across all our segments, despite the continued impact of the pandemic on our transportation and industrial businesses, as well as on our Cervus-related revenues in all our segments. Moving left to right, the left component of the quarter-over-quarter increase was a CAD 1.8 million increase in product support gross profit. This was driven by 11% in parts revenue, partly offset by a decline in Cervus and other revenues of 3%. Equipment revenue decreased 4% quarter-over-quarter, primarily the result of delayed deliveries from our manufacturers in the current year. However, equipment gross profit increased marginally quarter-over-quarter, in part due to a reduction in inventory impairment. General and administrative or G&A expense increased CAD 200,000 or 1% in the quarter. This was driven by investments in strategic initiatives to grow parts sales and the addition of two new locations in our agriculture segment, which were added after the first quarter of 2020. Net finance costs decreased CAD 1.4 million or 41% for the quarter as we benefited from reduced inventory levels, a reduction in long-term debt, as well as lower interest rates. The combination of these factors resulted in the CAD 2.7 million increase in adjusted income before tax in the quarter. Turning to slide four and the balance sheet. Total inventory decreased CAD 70 million compared to the first quarter of 2020, reflecting a CAD 49 million decrease in agriculture inventory and a CAD 19 million decrease in transportation inventory. Our access to available capital or our liquidity increased 39% compared to the first quarter of 2020. At the end of the first quarter, we had CAD 164 million of financing available, including CAD 110 million undrawn under our syndicated credit facility and CAD 38 million in cash. We are very pleased with this strong financial position. A quarterly dividend of CAD 11 per share was declared to shareholders of record as at March 31st, 2021. Turning to slide five. Our operations continue to generate strong cash flow across industry cycles. In the first quarter of 2021, we generated adjusted free cash flow of CAD 7 million and an increment of CAD 3 million compared to the first quarter of 2020. Please refer to our MD&A for a more detailed discussion of this measure. I will now turn the call over to Angela Lekatsas, President and CEO of Cervus, for a discussion of our strategy advancements and our outlook. Angela? Thank you, Catie, and welcome everyone. On today's call, I will be highlighting significant aspects of our first quarter performance relative to our strategic objectives. These are our product support growth, absorption rates, and return on invested capital, largely achieved through inventory turn improvement. I will also be providing an update on how we are navigating the current environment and discussing our outlook going forward. Starting with product support. Revenue grew by CAD 4.9 million from CAD 74.4 million in Q1 of 2020 to CAD 79.3 million in Q1 of 2021. As Catie mentioned, this was primarily attributable to growth in parts revenue. If we dive in a little deeper into the segment improvements, we delivered parts revenue growth in all three segments with CAD 4.1 million or 18% growth in agriculture, CAD 1.5 million or 6% growth in transportation, and CAD 0.1 million or 1% growth in industrial. Despite the challenges of the pandemic, this revenue growth focus on initiatives such as expanded product offerings, increased capabilities for online and on the road part sales, expansion of on-site inventory at our agriculture customer sites, and our new locations in Nipawin, Saskatchewan and Colac, Australia. Another area of product support growth has been in our industrial segment, as the reluctance to make large capital expenditures resulted in increased demand for rental equipment and improved outlook for the general economy has increased training programs. This growth has been partly offset by a decline in service revenue across all segments. Continue to limit discretionary spending on non-essential repairs and maintenance, as well as performing some of this work in-house in order to limit potential exposure to COVID-19. Moving to the chart on the right, absorption improved substantially across all of our segments quarter-over-quarter. This was driven by profitable growth of product support, combined with sustainable cost management from a leaner organization, operational efficiencies and variable expense management. Turning to our third strategic objective, which is driving return on invested capital, we achieved a trailing 12 months return on invested capital of 20.3% for Q1 2021, largely driven by improvement in profitability and the effective management of our largest asset inventory. We continued to deliver on our initiative to increase velocity of used equipment turns through the trade washout cycle that you saw last year. By Q4 in 2020, we had exceeded our long-term overall goal of 2.5 turns, and in Q1 this year, we delivered 3.28 turns in agriculture, 2.99 turns in transportation and 2.84 turns in industrial. Moving to the outlook, seeding season is underway for most farmers in our Canadian geography. Though moisture levels remain below average in some regions, seeding activity has progressed largely uninterrupted. Meanwhile, strong global demand and market prices for canola as well as other principal field crops, are anticipated to help elevate farm net cash income in 2021, surpassing the record levels set in 2020. While these improvements in Canadian agriculture fundamentals are expected to support farmer sentiment, an increase in U.S. and Canadian new equipment orders, compounded by disruptions to supply chain channels, has resulted in delayed deliveries and extended lead times for new equipment as demand outpaces supply. These delays in receiving equipment and in turn delivering it to customers, could impact the timing of sales in the year. In addition, our ability to supply in-season new equipment demand may be limited by the availability of equipment from our manufacturers. Agriculture sectors in both Australia and New Zealand are positioned to perform well in 2021, supported by strong market fundamentals and positive weather conditions. However, sourcing product in a timely manner has also been a challenge in these regions. The pandemic has disrupted the networks through which equipment is transported to market, including ports which are experiencing heavy congestion. Moving to Slide nine, demand for equipment in our transportation segment is anticipated to rebound in 2021. PACCAR, the owner of Peterbilt, recently upgraded its estimated 2021 Class 8 sales in North America to a range of 260,000-290,000 units, which is a 20%-35% improvement over 2020 unit sales. While market demand for trucks is anticipated to heat up in 2021, a global shortage in semiconductors and other components has impeded production and extended delivery timelines. This has been exacerbated by distribution challenges caused by the pandemic, including a shortage of drivers and border restrictions. Extended factory delivery dates are expected to impact the availability and the timing of equipment in the year, and we are now working with customers to place orders for 2022. Turning to our industrial segment, improvements in the resource sectors in Alberta and Saskatchewan have been positive for customer sentiment. With warmer weather conditions settling in, construction season and housing starts are expected to support rental and training activity. However, the pandemic continues to have an impact on our business with extended delivery times for equipment and a reduction in preventative maintenance work performed at customer sites. In what is typically our slowest quarter, I am proud of the team's execution on our strategic initiatives, growing our product support business in spite of the numerous challenges presented by the global pandemic. As we look forward, it is anticipated that the supply chain disruptions and extended factory delivery dates mentioned earlier could continue into the second and third quarter of the year. We continue to work proactively and in partnership with our manufacturers to limit the impact this will have on our customers and our business. Operator, we are now ready for the question and answer portion of our call. Thank you. We will now conduct a question and answer session for analysts and institutional investors. If you have a question, please press the star key followed by the one key on your touchtone phone. Please ensure you lift the handset if you are using a speakerphone before pressing any keys. One moment please for the first question. Your first question comes from Cherilyn Radbourne from TD Securities. Your line is open. Thanks very much, and good morning. Angela, I wonder if you could speak about the supply chain constraints that you're facing. Is that just with respect to prime product, or is parts supply affected as well? Pardon the interruption. There's been a technical difficulty. We'll be resume in one moment. Thank you. Cherilyn, can you please restate your question? Yes, thanks very much, and good morning. Angela, just in terms of the supply chain constraints that you're facing, is that just with respect to prime product, or is parts supply affected as well? Thanks, Cherilyn, for your question. My apologies to everyone. Our phone system disconnected us, so we're on a cell phone right now. I hope you can hear us. Cherilyn, the supply chain issues are really across the board. We have been able to maneuver through the parts so far quite well. We did a lot of advanced stocking. We are using our multiple locations to ensure that we move product as it's needed among our locations, and we're also being very proactive to make sure that nothing gets replaced that still has a little bit of life left in it. We're working very hard to make sure that we can repair as opposed to replace parts because there is a shortage. It just seems across the board. Scott Johnston, did you want to add any additional color to that for Cherilyn? What the manufacturers are doing is, obviously vendors are impacted by COVID, taking shutdowns as well as there's disruptions in the actual logistics or transportation. They are basically prioritizing the parts that come into the factories for the manufacturing of whole goods. Thus, some equipment is actually being delivered to the dealers whereby when the components become available, the dealer will install them and complete the actual whole good to 100% and ready for customer delivery. Whole goods, number one, and then parts availability at the dealership level, number two. To Angela's point, absolutely, we could see this coming, and we took many proactive steps to make certain that we could guarantee our customers uptime with their equipment. Okay. Very good. Just maybe to stay with the prime product demand, is there another way to satisfy that, either by sourcing used or reconditioning equipment, or does this effectively extend the cycle into 2022? Scott, do you want to take that one? You'll note that our turn at 2.99 times in transportation and 3.28 in our Used segment within agriculture is customers basically need that operational capacity. There's strong demand for Used equipment currently, and we will see basically an ongoing trend to basically upgrade fleets as equipment becomes available from the OEMs. Okay. Could you talk about soil moisture conditions? I think you referenced good soil moisture in the MD&A, but I think I've seen some level of concern around dryness, particularly in southern Saskatchewan and Manitoba. Just curious how dependent the outlook is on rainfall through the growing season? Well, we're fortunate in Saskatchewan whereby we are central and northern Saskatchewan, the Melfort, Prince Albert, Saskatoon region. I would say that right now seeding is approximately 50% complete. It has been uninterrupted and a very smooth seeding season. I can tell you that most farms are taking a bit of a hiatus for approximately one week because they're getting ahead of themselves. They would be finished far sooner, and of course, we've had temperatures in Saskatoon this past week of -11 degrees Celsius overnight. Part of the concern is early seeding and early emergence. There's a possibility of frost and having to reseed some of those acres. Right now everybody's basically ahead of where they normally would be at. Yes, we do need rain, but there is sufficient soil moisture to promote strong germination. It's been good to this point and, like always in the agricultural segment, we're always looking for rain. We'll take whatever we can get. Yeah, just to add to that, it's been a pretty good season. Moisture levels, you're right, Cherilyn, they're not ideal. They are adequate, so we'll take more rain if we can get it. Okay. Very good. I'll get back in queue. Thank you. Thank you. Your next question comes from Nick Corcoran from Acumen Capital. Your line is open. Good morning, and thanks for taking my questions. Good morning, Nick. The first question is just to do with Ag. The new and used was down year-over-year in Q1. Can you indicate how much of this was price versus volume? Sure. I'll maybe talk a little bit about the year-over-year comparison for Q1. It is difficult in our slowest quarter to try and suggest that it's a trend, but there's a lot of noise and there's a big timing difference because if you look at Q1 of last year, we were actually carrying forward all seasons of new equipment from 2019 into Q1 of 2020, and it was available for sale. That combined with a weakening Canadian dollar, caused our customers to really buy early in the season and pulled forward sales into Q1 2020. We have the opposite happening in 2021, where the product wasn't available, but the demand was there. There was a certain amount that was pushed out into Q2. Generally, Nick, I would say there is about a CAD 15 million difference year-over-year between what was pulled forward and what was pushed out to compare the two years. It's not price, it's largely volume. Great. That's good color. Just looking forward, how much do you see new equipment in Ag being constrained by the supply chain issues? That's really hard to say at this point, Nick. We see that there is constraint. I don't know that anybody has the crystal ball to say how much it's going to be or how long the constraint is going to last. I do think that for the entire year of 2021, you're going to see timing differences when you're trying to compare quarter over quarter between equipment. Whether it's Ag or whether it's transportation, the timing of delivery is being pushed out and from even from now, just quarter over quarter, but also into 2022. If we had a crystal ball, that'd be great, but just really can't tell that at this point in time. The last question from me, what have you seen in terms of OEM behavior with the type of product they're shipping? Are they shipping all their product equally, or are they prioritizing the higher price or higher margin products? Yeah, we haven't really heard that. Maybe Scott has some color on that. I think they're trying to meet demand for in-season first. Obviously, a lot of our equipment is seasonal, so they want to address what is needed in season first as a priority. Scott, do you have any additional color on that? There's a couple of points. Customer demand remains consistent and strong amongst all segments. I will say that both in the transportation and Ag segment, there's certain models and certain pieces of equipment that quite frankly today we are selling out to Q1 2022 because of the strong demand and the order boards are full at this point in time. Great. That's all for me. Thank you. Thanks, Nick. Again, if you would like to ask a question, please press star one on your telephone keypad. Your next question comes from Bryan Fast from Raymond James. Your line is open. Thanks. Good morning. Good morning, Bryan. Just to follow up on Nick's question there. I guess just looking for some color around how customers have reacted to the delays in the deliveries. Are you seeing purchase decisions deferred, or are customers willing to wait for the extended delivery times? Well, I'll make a comment and then maybe turn it over to Scott. Our customers, the majority of what we sell is pre-ordered or under early order program. The demand that is created from the knowledge that there's shortages is a current thing. The orders that have been placed last year for this season are there, and manufacturers are trying their best to deliver on that. Scott, did you have any additional color on that? Well, as we know, at all times, there's macroeconomic things at play. Right now, the Canadian dollar is strengthening, which obviously reduces the cost of whole goods equipment manufactured in the United States. Commodity pricing is through the roof relative to wheat, canola, and many of the crops that are in rotation in Western Canada. There's a lot of optimism. I think there's strong balance sheets, and customers recognize the cost of equipment, the importance of uptime and operational reliability, and with all those things considered, we're not having a problem, and we have a strong early order program and orders out to Q1 2022. Okay, thanks. Leave it on the supply constraint questions and turn my focus on product support. As you march towards your 50/50 targets, how are you tackling the challenge of recruiting skilled labor? It's our number one priority. We have, obviously, a number of initiatives in place to make service one of the best places to work but also be able to attract and retain service technicians in particular. Right now, because of the pandemic, service has really underperformed relative to parts. We've been able to attract and retain parts technicians. Service technicians is where the shortage might come in, especially when the pandemic is over, if we can say it will be over. I think at that point in time, there will be a huge demand for service technicians as other businesses pick up. We are out recruiting and putting programs in place to be able to retain those that we have. We also are recruiting internationally to build our bench strength in Canada with service technicians. That's also a great source of talent for us. Okay, that's it for me. Thanks. Thanks, Bryan. Your next question comes from Cherilyn Radbourne from TD Securities. Your line is open. Thank you. A few more from me, if I could. Just in terms of sort of the disconnect between parts sales versus service revenue, which I think we also saw in 2020, what do you think customers are looking to see in the macro backdrop to reduce some of the insourcing of service that you mentioned? What we've seen through the pandemic, Cherilyn, is that there has been, if we take agriculture, for example, there has been a lot more kids that have stayed home on the farm as opposed to go out to work. They're helping to work. The customers are preferring to actually do service on farm themselves rather than have someone come on-site and potentially risk their family or their workers with COVID or bring their equipment into the shop. With respect to transportation, we've certainly seen a number of the trucks and fleets that have been parked, and if you don't have miles, you don't have service. It's certainly something that I think almost all of the dealerships have seen through this pandemic is parts are going up because things still need to be fixed, but they're being fixed on premise of customers as opposed to being brought into the shop. We certainly anticipate that that is going to reverse itself to a more normal relationship to parts once COVID passes. Okay. That's actually really interesting. Yeah, we found it interesting too. Yeah. In terms of the M&A landscape, could you sort of speak to targets and where valuations are at and Cervus's appetite to engage in that? Yeah, I think with respect to M&A, I think there are opportunities that are out there. They're not always the best opportunities. Companies do suffer during a downturn, and it becomes evident where their weaknesses are. We're kicking tires and looking for things that are complementary to our existing footprint, and that's why we did some growth in Australia. We continue to look at some more growth in Australia. Again, when you think about the OEM-specific growth, it's not always within our control. It's part of a bigger master plan. The willing seller, the willing buyer, and the most important part, the willing OEM. I'm more focused on some potential acquisitions that would help build out our 50/50 and really bring strong product support to our portfolio, while at the same time leveraging the footprint and the customer base that we have. Things that are complementary to geographically where we are and the types of things that our customers will be interested in engaging with us on. Greenfield is still very interesting where we have gaps in service, which is why we went to Nipawin, and it started a location there, which has been absolutely excellent for us. Vapormatic is also an avenue for growth where we're providing all makes and models of tractor parts in New Zealand. Those are all things that are part of the mix. I would say that I don't know that valuations have maybe come in line with the performance that some companies have seen in the last couple of years. I think people are looking at the impacts of the pandemic and some of the macroeconomic factors as being maybe anomalies and not indicative of what their businesses could do. In some cases, I've seen valuations that are above what we would certainly want to pay. In balancing all those things, we absolutely want to continue on our path of growth. If I could summarize, it sounds like you have capacity, you have interest, but you're being quite selective. Is that fair? That's a great way to put it. Thank you for shortening my commentary. I'm not sure about this last question, but did just want to ask whether the material handling business benefits from strong retailer e-commerce activity at all, or not really, given its raw territory? So far, no, but e-commerce is absolutely an area that we are focusing on building out. I can't say right now a timeline or exactly how that's going to manifest itself. The place that e-commerce is good in material handling is on the training side. With the pandemic, we have learned how to provide training as much as we can, but not the hands-on stuff electronically, and that has advanced our portfolio of training opportunities. E-commerce is something that we're looking to build out in all of our divisions, and not just industrial, Cherilyn Radbourne. Okay. Thank you. That's all from me this morning. Thanks, Cherilyn. Thank you. Angela Lekatsas and Ms. Cistone, there are no further questions at this time. Well, I would just like to say thank you to everyone for joining us this morning. Catie, Scott, and I look forward to speaking with you again following the release of our second quarter results. Ladies and gentlemen, we may now disconnect the conference call and webcast. Thank you for participating today.