Thank you for standing by. This is the conference operator. Welcome to Dexterra Group's Q4 2022 results conference call. As a reminder, all participants are in listen-only mode. 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 one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and zero. I would now like to turn the conference over to Drew Knight, Chief Financial Officer. Please go ahead, sir. Thank you, Carl. Good afternoon. My name is Drew Knight, and I am the chief financial officer of Dexterra Group Inc. With me today on the call are John MacCuish, CEO, Mark Becker, our incoming CEO, and our board chair, Bill McFarland, who will provide some brief introductory comments. After a brief presentation, we will take questions, with the call ending by 5:15PM Eastern Time. We will be commenting on our Q4 2022 results with the assumption that you have read the Q4 earnings press release and MD&A and financial statements. The slide presentation, which supports today's comments, is posted on our website, and we encourage participants to access the slides and follow along with our presentation. Before we begin, I would like to make some comments about forward-looking information. In yesterday's news release and on slide two of the presentation that we have posted to our website, you will find cautionary notes in that regard. I won't read the content of the cautionary notes in their entirety. We do claim their protection for any forward-looking information that we might disclose in this conference call today. I will now turn it over to Bill McFarland for his introductory comments. Thank you, Drew, and welcome. The overall Q4 and 2022 year-end results were below expectations as we dealt with one-time non-recurring items and cost pressures in the modular business related to a series of 2021 fixed-price contracts, primarily in the BC social affordable housing space. We also experienced a slower start in a post-COVID world to the Dana business, which we recently acquired in January 2022. Management will discuss these items in more detail on the call. On a positive note, our WAFES business had a great Q4 and year. The IFM business is also well-positioned for strong profitability starting in Q1 2023, and the modular business four-point plan is being executed. Dexterra enters 2023 solidly financed with a strong management team and is very focused on improving profitability. Our long-term goals continue to be to build a profitable, sustainable business that delivers above-average returns to shareholders, coupled with being an organization that all stakeholders are proud of. It is my pleasure today to welcome Mark Becker, Our new CEO, effective May 1, 2023, to this call. I also wanna give a big thanks to John MacCuish for all his efforts, insights, and support over the past several years. John has been instrumental in building our Dexterra platform, which will lead to future success. Before I pass it over to John, let me reinforce. The management team and board of Dexterra enters 2023 with optimism about the future and is excited about the prospects of the company. John, over to you. Thank you, Bill. Our revenue was CAD 971 million in 2022 and CAD 243 million in Q4, increases of 32% and 26%, respectively, compared to 2021. All three business units experienced healthy revenue growth. Adjusted EBITDA was challenged at CAD 64.7 million for 2022 and CAD 14 million in Q4. Lower EBITDA was primarily due to fixed price contracts in the modular social affordable housing business, where cost inflation impacted our results. We are proactively managing inflation across the business, including reviewing and enacting cost escalation clauses in client contracts. We are implementing strategic sourcing initiatives across all commodities and subcontractors, addressing food inflation and managing labor hours to drive greater productivity. I will now go into additional details by business unit. Starting with IFM, this business unit increased annual revenue by 80% to CAD 279 million for 2022. For Q4, revenue doubled to CAD 78 million compared to 2021. This increase was largely driven by the 2022 acquisitions, which contributed revenue of CAD 108 million for 2022 and CAD 33 million in Q4. Excluding the acquisitions, organic growth was 10% for 2022 and 16% for Q4. We continue to see good organic growth and new wins in 2023. Adjusted EBITDA of CAD 13.5 million for 2022 and CAD 2.7 million in Q4 was about CAD 2 million or 17% on a full year basis after adjusting for 2021 Qs of CAD 1.7 million. Our 2022 profit was impacted by negative margins in Dana due to the reopening of its services, including startup costs. We are confident that Dana business will have good margins starting in Q1 2023. With a base of business of over CAD 80 million annually, this will have a big impact on our 2023 profitability. Excluding the impact of lost contracts in Dana, adjusted EBITDA margins in Q4 2022 were approximately 6%. The majority of our IFM contracts include inflation provisions. There is a lag before these costs are passed on to clients, which reduced margins somewhere in the neighborhood of 100 basis points in 2022. On December 2, 2022, we signed an agreement to acquire all outstanding shares of VCI Controls. I'm pleased to say that acquisition closed on January 31, 2023. VCI adds capability to our service offerings, including building automation controls and energy efficiency solutions. These skills bolster our ability to help clients address emerging healthy building requirements and net zero carbon building performance. Moving over to WAFES. This business unit increased annual revenue by 24%, demonstrating the strength of our brand and strong market position. For Q4, revenue grew 10% year-over-year in our slowest quarter. These increases are attributed to growth in camp catering, install activities, and higher occupancy levels. Our WAFES business is very strong and continues to renew contracts, win new work, and grow market share. An important component of WAFES is energy services, which increased revenue significantly in 2022. Energy services results are a product of very strong demand for access matting and space rentals in the natural resource sector. The WAFES strong revenue translated to record EBITDA that more than compensated for the CAD 6.6 million in Qs funding received in 2021. Our adjusted EBITDA as a percentage of revenue of 15% was lower than in 2021. This reflected both the mix of business and impact of inflation. Q4 included retroactive price increases of CAD 2.8 million. The Modular Solutions business grew 2022 revenues by 10%. Profitability was impacted by cost inflation, as discussed earlier. Total cost impacts amounted to about CAD 20 million on contracts with revenue of about CAD 150 million, of which about CAD 65 million was recorded in 2022. The additional revenue will be recorded in 2023 as the projects are completed. These 2023 projects will have a nominal EBITDA, as the estimated losses have been recorded in 2022, including a special CAD 8 million cost in Q4. We are focused on executing our four-point business improvement plan. This plan is A, improve our project management practices and process. B, put pricing validity mechanisms in all new contracts. C, implement strategic supply chain management initiatives for lumber and other commodities. Finally, to continue to diversify the project pipeline. I will now turn it over to Drew for comments on our financial position. Thank you, John. I'll speak about non-recurring items on slide 10. Corporate costs included CAD 12.1 million of non-recurring costs. The largest item relates to pre-merger commercial disputes of CAD 6.9 million, which are now substantially complete. In Q4, we also provided for future losses on an onerous IFM contract, system implementation and integration costs, and severance as we right-sized our talent pool. Normalized SG&A costs were CAD 38.2 million or 4% of revenue for 2022, which is down from 5% for 2021 due to the increased scale of the business. Looking at slide 11, the corporation's financial position and liquidity remain strong, with debt at CAD 94 million and CAD 95 million of unused capacity on our credit lines at the end of 2022. Debt levels are expected to be further reduced in upcoming quarters in the absence of acquisitions. We are in a strong financial position and expect to renew our debt facility in the next six months. The interest cost on our debt has been impacted by the increases in the Bank of Canada rate in 2022. The interest rate in Q4 was approximately 7.6%. Free cash flow was CAD 40.9 million in 2022 and is expected to approximate 50% of EBITDA in future periods. We think this is a key market leading KPI. Dexterra declared a dividend for the Q1 of 2023 of eight and three quarter cents per share payable to shareholders of record at the close of business on March 31, 2023, which will be paid on April 17, 2023. I will now turn it over to Mark for closing comments. Great. Thanks, Drew, and I'm glad to be part of the call and excited to be about my new opportunity at Dexterra. I'll be speaking to some of the points on slide 13. In my role as COO, I've gained a strong understanding of our business, our clients, and our markets. We've bolstered the organization in 2022 with three strong business unit presidents. The focus of my team over the next couple of quarters, first and foremost, is execution and profitability. I'm confident we have strong plans in place to achieve this result. In IFM, we are addressing specific accounts with lower margins to address inflationary challenges. In the Dana business, we right-sized the organization and adjusted product pricing while maintaining the quality expected from our Dana brand. Also in Dana, we had some pre-COVID contracts that had to be renegotiated or terminated. In the post-pandemic world, the dynamics around workforces and offices related to hybrid work environment and retail hospitals changed substantially. These have all been addressed. Additionally, there were restart of large contracts, requiring new staff as many people had found jobs during the pandemic elsewhere during the pandemic, and there was also inflation costs to be dealt with. In 2023, we're doubling down on our sales efforts in Dana around key geographies, market verticals, and cross-selling opportunities with good early wins and results in 2023. Collectively, this will all lead to greater profitability in IFM in 2023. A key metric for Modular Solutions is the backlog of projects. We're closely monitoring the timing of new affordable housing and other projects expected to come to market in mid 2023 relative to our available plant capacity. The U.S. housing sector has also experienced some slowdown given higher interest rates. We are confident that the social affordable housing market will broadly remain strong with access to government funding, we're seeing ample signs of that. A key focus for us will be to build the backlog as we continue to look to diversify our product lines. In WAFES, with our strong brand and delivery capabilities, we're continuing to take advantage of the market conditions around the energy and mining segments to maximize not only our current revenue returns, but also our sales pipeline. No different than the other business units, inflation management is key, and the WAFES team is taking a proactive and rigorous approach to continue to support our strong margins. Lastly, we're continuing with our M&A program in 2023 and hope to close some accretive acquisitions in the back half of the year. Big picture, our company is undervalued in the market, and we believe as we execute, significantly improve our profitability and grow, especially in the IFM space, that the market will recognize our value over time. I'm confident and energized about our plans and excited to be the new CEO of Dexterra and the future ahead. This concludes our prepared remarks, and I'll turn the call back to Carl for the Q&A portion. Thank you. We will now begin the question-and-answer session. To join the question queue, you may press star one on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star two. In the interest of time, each analyst is kindly requested to limit themselves to two questions each. We will pause for a moment as callers join the queue. The first question comes from Chris Murray of ATB Capital Markets. Please go ahead. Thanks, folks. Good afternoon. First, John, just let me offer my congratulations on your retirement. Really appreciate all the help you've given us over the years. I guess first question is on the CAD 8 million write-down in modular. Can you help us understand at what point should the project's size of that write-down actually be completed? How do we think about margin profile on a go-forward basis past that? Yeah. Thanks, Chris. Good question. You know, we took the provision at the end of 2022 to reflect, you know, some of the losses that we've seen on those projects. What that really manifests is, you know, nominalized margins that we'll see on these projects as we complete them through the year. The market survey has seen a 20% increase kinda year-over-year in inflation costs and residential building. You know, we've tried to reflect that in our projects and, you know, we think we've covered it, but it really manifests in terms of kinda nominalized margins through 2023. We will be completing these projects through the balance of the year. Our, kind of our new contract provisions, our new approach to execution on projects takes place on new projects that'll all be, you know, transitioning through 2023. We do expect to complete all these projects that we're talking about before the end of the year. Okay. That's helpful. You've historically talked about kind of a, call it a high single-digit type EBITDA margin. Is that still sort of the expectation as we exit 2023 and into 2024? Yeah. I mean, some of it is related to the, you know, inflation that we will see going forward and the inflation effects that we see, and we do see a bit of a delay on contracts and projects, specifically around modular. You know, we've been at that 6% level in the past. We'll be seeking to get back to that, and we will be kinda seeking to execute kind of our new tranche of projects at that level. That's the level we would be seeking to get to and hopefully beyond. Okay. That's helpful. Just kind of move a couple quick clarifications. guys, the new acquisition... Maybe I'm just trying to understand this. You did the acquisition of the business for IFM, then you kinda had to take some immediate charges around restructuring. Could you just maybe explain that one a little bit better? I was just going through the MD&A, and it doesn't make a lot of sense. Yeah, it's Mark again, Chris. The provision that we took was really related to the, you know, the systems integration with VCI as we integrated it into our business, really related to our tracking available hours, materials, and subcontractors. It's related to the acquisition of that element of the business we bought it from into our system. That's a one-time cost that we incorporated and will help us kinda execute VCI, part of our Dexterra on-demand business going forward. Okay. When that progress completes. Then... And- Okay. It's John. If you're referring to Dana, I just wanna point out that, you know, only 50% of their projects were active. That was the, just the realization of bringing those back online and fully, you know, implementing them as we move forward out of COVID. Okay. No, that's helpful. Thank you. Then Drew, just one clarification. You'd mentioned the charge was due to pre-acquisition contracts. I'm assuming you're implying pre-acquisition with Horizon North. Like, these are from a couple years ago. This wasn't due to Dana or anything that's happened recently. That's correct. Okay. Thanks. No problem. The next question. Maybe the next question. Certainly, sir. The next question comes from Michael Doumet of Scotiabank. Please go ahead. Good afternoon, guys. Chris congratulated John, so I'll congratulate Mark on the upcoming role. You know, maybe Mark, first question for you. You know, I think your last slide addressed some of it, but I wanted to ask, you know, what you thought were some of the largest opportunities or best opportunities for Dexterra and primarily from a capital market standpoint, you know, how would you like for investors to regard Dexterra in the next couple of years? That's a good question, Michael. You know, I would say, you know, from my perspective, you know, we are a growth story, and we are looking to continue to grow in IFM. You know, as I mentioned, you know, our focus this year is really around profitability and execution. You know, as we do that, we are continuing our merger acquisition program, where we are, you know, looking at targets, looking at opportunities that'll be accretive to the business. You know, with good luck here around, you know, how we execute in 2023, we're hopefully, you know, hopeful to bring some additional accretive deals to the table that will help us grow and specifically again around the IFM side of things. Okay. Perfect. That's helpful. Then, you know, the second question I have is on Modular Solutions. I think, you know, I think we all appreciate how the end market and the growth prospects are really compelling, but you've dealt with, you know, many challenges, and the results have been disappointing. I'm wondering, you know, if this is like an industry issue and whether, you know, you think maybe the industry needs to get a little bit smarter in terms of how it quotes and how it protects margins, or in your opinion, whether there's still a lot of work to do in terms of understanding how to get this business and the industry to something that's, you know, a little bit more profitable and higher return. Yeah. When you say industry, Michael, you know, I treat that as kind of the construction industry because I think it doesn't matter in this environment whether you've been in modular and... or, you know, any other kind of construction, it's been challenging. You know, John talked about kind of what we call our four-point plan related to, kind of improving our execution. You know, there's things we're putting in place now and others are in the industry as well. So we're not unique in that regard. You know, related specifically around some of the commercial mechanisms in the contracts, you know, related to pricing validity. Like, as an example, you know, some of our affordable housing projects, our clients are getting, you know, 30-day validity on their pricing for their projects, meaning the pricing that we charge them, you know, for the turnkey project is really only valid for 30 days related to subcontract costs and material costs underneath that. Our clients don't love that, but it's the reality of today that we see in this inflationary environment. Actually, to be honest, they're reacting quite well and moving their project approvals along. I think that focus on the commercial side with the contracts is one of the key things that will get us into profitable mode. Really the other things related to execution around project management. Additionally, you know, some of the supply chain things that we're working on, both around securing material prices, bulk purchases, which helps us related to that, Michael. That's good to hear. maybe just one sneaky... Like, just try to sneak one in here for a third. just, how certain are you that, the CAD 8 million provision will suffice? You know, we're trying to, you know, get that number right. You know, we don't wanna overshoot, and we don't wanna undershoot. You know, as we see the end horizon, if I could say it that way, Michael, around these projects, you know, we're kinda seeing the end of the tunnel or the finish line on these projects and really trying to set that right. Because, you know, even just from an accounting perspective and just a financial perspective, we do wanna kinda hit that good balance related to what we think we need to complete those projects. Once again, if you have a question, please press Star then one. The next question comes from Zachary Evershed of National Bank Financial. Please go ahead. Good afternoon, everyone. Thanks for taking my questions. Zach. Could you get deeper into what's not working with Dana now that school is back in session and the compression and the expected annual run rate revenues? Just, some more color around that, please. Yeah. Zach, it's Mark. You know, we're actually seeing better results out of Dana at this point, you know, since the beginning of the year. I think as you alluded to, you know, it's our peak season related to Dana, related to the educational environment as well as the leisure, you know, ski hill side of things. Some of the things I mentioned, you know, related to some of the contract remediation, if I could say it that way, on Dana, as well as, you know, getting some of these new projects ramped back up again. We are delivering better results from Dana, we're seeing that kind of real-time as we go along this year. Thank you for that. The modular backlog declining quarter-over-quarter by more than the revenue booked in Q4. Could you dive into the details there? Do you think that the CAD 40 million in annualized revenues recurring, do you think that's at risk? Yeah. I mean, we have seen, you know, the backlog drop to some degree, and some of that, Zach, is just working those projects through the plant and through construction execution in the field. You know, we continue to see, you know, a lot of inertia around, specifically around affordable housing projects and funding. You know, we do hear from some of the major, you know, municipalities and constituents that, you know, their budgets are not shrinking. They're not staying the same. They're actually growing in terms of the projects that they're trying to bring to bear and affordable housing they're trying to bring to bear. It really boils down to a question of a question of timing, related to when those things are coming to bear. In fact, you know, with our clients, we're actually making sure they're very well aware of where we are in terms of our plant capacity and as our project management related capacity. It's kind of an ongoing conversation, but we certainly see a lot of projects coming forward, and we expect that backlog to increase. One thing we are seeing, though, Zach, I'll mention, is around school portables. That's a very strong business for us. You know, we are seeing quite an increase amount of school portables that are coming to market and that we're manufacturing and selling. The next question comes from Frederic Bastien of Raymond James. Please go ahead. Good afternoon. There was a little to no commentary made on TRICOM. Can you provide an update on how that business is going and how, you know, is it meeting your expectations for growth? Thanks, Frederic. It's Mark again. We're actually very pleased with TRICOM and, you know, what we call our HRL business unit, which is hospitality, rail, and leisure. A lot of the activity both in Canada, you know, Central Canada, Western Canada, and now into the U.S., Washington state, Arizona, Texas. I would say one of the strengths we're seeing with that business is the sales profile that they're bringing to bear and really bringing on new contracts as we saw them doing when they were an independent company before we acquired their assets. They're continuing to do that. I would say, if I look at our sales pipeline, and our sales profile that we're bringing to bear and bringing to, bringing into the P&L, is actually, kind of one of our strongest elements that we do have across our portfolio. The leaders that we've got running that are continuing to kind of impress us with their, what they're able to bring to the table. We're, we're actually quite happy with it, Frederic. Okay. Thanks for that. I just wanna move to the smaller acquisition you completed just before the year-end, VCI Controls. We haven't had the opportunity to talk with you since. Can you provide a little bit of background on that business and what it will bring to Dexterra? Yeah. VCI is really, really, you know, kind of a building envelope controls, kind of solution and an organization that's kinda got a well-established kinda capability and business around, you know, HVAC, energy and management systems. You know, it's really complementary to, you know, we've got it, kinda connected directly up to our Dexterra on-demand business because a lot of it is related to, you know, mobile field work and direct field work to contractors. Pardon me, to clients. You know, we're really leveraging, you know, that element across all of our business lines in IFM and our business elements in IFM. I think, you know, you've heard from us before, you know, that really the integrated side, I guess, of Integrated Facilities Management, you know, the more complex side, the more building energy systems, building envelope work. This is actually bringing a set of capability, some people with expertise that is really helping us to leverage that across our portfolio, and really ties into the kind of the healthy buildings situation that we see a lot of interest from clients, and we are able to bring that to bear with the VCI Solution and people that we do have and ties in as well to kind of the low carbon environment. All of our clients, particularly around buildings and facilities are, as everyone is, you know, measuring carbon, measuring carbon reduction. Part of how you do that is actually with energy systems and HVAC systems. We're really looking to take what's, I guess, I'll characterize as a smaller acquisition and really leverage that broadly across Dexterra IFM as it relates to the capability that they bring. The next question comes from Trevor Reynolds of Acumen Capital. Please go ahead. Hey, guys. I'm just wondering, you guys discussed the lag and cost pass-through in IFM. I'm just wondering when most of those took effect. Like, should we be expecting a clean Q1 on that front? That's a good question, Trevor. you know, we are still seeing inflation continuing on here, albeit things have abated a little. We are still seeing it. you know, of all the things that we're working on here and we work on tactically related to profitability improvement, that's almost the number one thing that we're working on, and it's across our contracts. Our contracts vary in terms of the, you know, the provisions. Most have it provisions related to either, you know, connections to CPI or connections to repricing on contracts. For us, it doesn't matter, and it's across all of our business units. you know, we're taking a very proactive and a very active approach with our clients, related to bringing to them, you know, pricing increases, pricing changes, adjustments to contracts, related to inflation. you know, really that's gotta continue. you know, if you take out, you know, certainly the IFM side, you know, we've got kind of a 6% margin, less Dana. you know, we're looking to build on that, but that's really gonna be dependent about how quickly we can resolve and how fast we can stay ahead of that ball wave related to inflation. no different in loss as well, you know, albeit a higher margin. There's a lot of effort going on related to that, to address inflation kind of across the portfolio, contract by contract and client by client. You know, I would say, you know, our clients are listening. They are aware, and they're seeing it from all their providers that inflation is a big deal. I would say generally we're finding good collaboration with them. It's a matter of just keeping the effort moving and getting through it. You know, at the end of the day, we can't really predict inflation, but we're our point and our effort is really to stay ahead of that with our clients. As we stay ahead of that, it's our mechanism, related to maintaining our margins. That's helpful. Thanks. Like, I guess just a follow-up. Like, are you looking at all on new contracts that you're putting out? Like, is there ways to decrease that lag time, in terms of the inflationary pass-through? Yeah, that's a good point. Definitely in all our contracts, and this wouldn't be unique to us or anyone. Everyone else is really sharpening what they're putting into their commercial agreements and their contracts related to inflation. To be honest, clients are expecting that, and they're dealing with that because we went for so many years with a very flat inflation environment where you always wanted inflation indexing because some of these contracts are very long cycle, and you have to have an inflation index. Just the level of acuity, the level of profile related to inflation, it's a much more significant part of all our contracts that we are putting in place. Thank you. This concludes the question and answer session and today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.