The conference will begin shortly. To raise and lower your hand during Q&A, you can dial star one one. Good day, ladies and gentlemen, thank you for standing by. Welcome to the FirstService Corporation Fourth Quarter 2022 Earnings Conference Call. Today's call is being recorded. Legal counsel requires us to advise that the discussion scheduled to take place today may contain forward-looking statements that involve known and unknown risks and uncertainties. Actual results may be materially different from any future results, performance, or achievements contemplated in the forward-looking statements. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the company's annual information form as filed with the Canadian Securities Administrators and in the company's annual report on Form 40-F as filed with the U.S. Securities and Exchange Commission. As a reminder, today's call is being recorded. Today is February seventh, 2023. I would now like to turn the call over to Chief Executive Officer, Mr. Scott Patterson. Please go ahead, sir. Thank you, Howard. Good morning, everyone. Thank you for joining our fourth quarter and year-end conference call. Jeremy Rakusen is on the line with me this morning. I will open by saying that we are extremely proud with how we closed out the year. Our teams drove very strong top-line organic growth. It was our strongest growth quarter of the year. Importantly, we delivered even stronger growth at the EBITDA line. Our teams have been battling inflationary cost pressures and margin headwinds all year. The margin results for the quarter, in large part, are a credit to their year-long discipline around cost containment and incremental pricing initiatives. We also benefited from operating leverage in our Brands division. Total revenues for the quarter were up 19% over the prior year, with organic revenue growth an impressive 15%, boosted by particularly strong growth in our Brands division. EBITDA was up 23%, reflecting a margin of 10.1% versus 9.7% in the prior year. Jeremy will jump into the margin and EPS detail in his comments. Looking at our divisional results. FirstService Residential revenues were up 9%, 8% organically. The organic growth was again driven by net new contract wins and was broad-based across North America with all of our regions showing solid gains. Just after year-end, we were very pleased to announce two acquisitions for FirstService Residential in the New York City market. Tudor Realty Services and Charles H. Greenthal & Company together add over 350 co-op and condominium properties to our New York City operations. The two marquee portfolios further extend our dominant leadership position in the market. We're excited to welcome the Tudor and Greenthal teams to the FirstService Residential family and look forward to working together to bring additional value to our new communities. Looking forward to 2023, we expect to show growth at FirstService Residential at or above 10%, very similar to what we experienced this year, with the organic growth at mid to high single digit. This is a contractual recurring revenue model with only modest swings quarter- to- quarter as ancillary revenues fluctuate. Moving on to FirstService Brands. Revenues for the quarter were up 28% with three-quarters of the growth coming organically. The impressive organic growth number was supported across the board by strong results at our restoration brands, home improvement brands, and Century Fire. Let me go through each, starting with restoration, which includes our results from Paul Davis and First Onsite. Revenues for the quarter were very strong, up about 30% from Q4 of 2021, split two-thirds organic growth and one-third from tuck under acquisitions over the last year. During the quarter, we generated about $85 million from Hurricanes Ian and Fiona, which compares to $40 million of revenue booked in the prior year quarter from storm activity, primarily Hurricane Ida. Organic growth excluding named weather events was mid-single digit. During the quarter, we completed two tuck under acquisitions within restoration, one under First Onsite and one as part of our Paul Davis company-owned platform. At First Onsite, we acquired Emergency Restoration, a regional provider of water mitigation and property restoration services in New Orleans. This is an important addition to our footprint that enhances our client coverage in a region that regularly gets hit with weather. We're off to a great start with this new operation in terms of booking work and adding customers. At Paul Davis, we acquired our franchised operation serving the Salt Lake City and Las Vegas metropolitan areas. This business is one of the largest franchises in the Paul Davis network and the largest restoration company in Salt Lake City. We're excited to partner with Brandon Radmall and his team, and believe we have an opportunity to significantly grow these markets. We now own 14 operations within the aggregate network of 330 Paul Davis operations across North America. Looking forward in restoration, we're expecting a solid front half of the year. We're carrying a strong backlog into Q1, both from Hurricane Ian and Winter Storm Elliott, which hit the last week of December. Elliott was highly unusual in its scope, stretching from the Great Lakes area down to the Mexico border. About 60% of the North American population faced some sort of winter weather advisory or temperature warning. Many of our branches in the U.S. and Canada saw a spike in activity, primarily relating to wind damage and water damage from burst pipes. Our pipeline is up about 25% compared to last year, which will provide a boost for us the next couple of quarters. We expect to show year-over-year revenue growth of about 20% over the first six months, weighted towards Q1. It's difficult to estimate how quickly we can work through the backlog and where exactly the revenue will fall. Suffice to say, we're off to a strong start in restoration, and we will provide more visibility at each quarter end. Moving now to our home improvement brands, including California Closets, CertaPro Painters, Floor Coverings International, and Pillar To Post Home Inspection. As a group, these brands were up about 10% against a strong Q4 from 2021 that was up 30% over the year prior. December weather impacted our ability to complete as much work as we expected, and our revenues reflected as much. We fell a bit short of our internal estimates. All that work now flows into January, and we will make it up. Looking forward, we expect continued growth in 2023. At this point, we estimate growth at a high single-digit level against a very strong 2022. The macro environment is mixed. Home sales are down significantly, while home prices and home equity levels are holding. In general, we're facing modest headwinds in home improvement. Our teams feel strongly we will battle through and continue to grow. The markets are very large, the work is there. We have the teams and brand strength to secure it. During the quarter, we further expanded our company-owned operations at California Closets with the acquisition of our franchise territory in Portland, Oregon, adding a market with significant future growth potential. We now own 21 of the 80 California Closet locations, which account for about 50% of system-wide sales. On to Century Fire, which had a very impressive fourth quarter, up almost 30% from the prior year with over 20% organic growth. All aspects of Century's service offering, including sprinkler and alarm installation, service inspection and repair, and national accounts, showed strong momentum in the quarter. Bid activity and backlogs remain very strong, and while we do start bumping up against big comparative quarters, we still expect to generate double-digit growth at Century this coming year. Before I pass on to Jeremy, I want to reiterate how pleased we are with our finish to the year and our 2022 full year performance. Again, this year, we generated in and around 10% organic growth, which is a true credit to our teams and their ability to consistently take share. Over to you, Jeremy. Thank you, Scott. Good morning, everyone. As Scott just highlighted, we are pleased with our 2022 financial results, culminating in a particularly strong fourth quarter to cap off the year. I will first summarize our consolidated performance for the quarter and full year, and subsequently provide more segmented detail within our two divisions. During our Q4, we delivered consolidated revenues totaling $1.02 billion an Adjusted EBITDA of $102.5 million, up 19% and 23% respectively, with our margin increasing by 40 basis points to 10.1%. For the full year, consolidated revenues were $3.75 billion, a 15% increase year-over-year. Adjusted EBITDA came in at $351.7 million, up 7% over the prior year and yielding a 9.4% margin compared to 10.1% in 2021. In terms of our net earnings, in the fourth quarter, Adjusted EPS came in at $1.22, up a penny versus last year's fourth quarter. For the full year, we reported adjusted EPS of $4.24. Down from $4.57 in 2021. Two items negatively impacting our year-over-year earnings per share performance were non-operating one-time gains in the prior year 2021 and higher interest costs in 2022. As discussed on last year's Q4 2021 call, we reported during that quarter a gain on sale of a building. Earlier in 2021, we also realized a gain on sale from a non-core business. These two gains resulted in other income of almost $20 million pre-tax with an aggregate $0.33 positive impact to earnings per share in 2021. In 2022, the higher interest rate environment and our larger average debt levels triggered a $9 million increase in interest costs compared to the prior year, a headwind of $0.15 to our earnings per share. Note that these comments on our Adjusted EBITDA and Adjusted EPS results, respectively, reflect adjustments to GAAP operating earnings and GAAP EPS, which are disclosed in this morning's press release and are consistent with our approach in prior periods. I will provide additional commentary on our division results for both the fourth quarter and full year. At FirstService Residential for the fourth quarter, revenues were $442 million, up 9% versus the prior year period, and the division reported EBITDA of $38.1 million, up 7% quarter over quarter. We saw our margin for the quarter come in at 8.6%, slightly lower than the 8.8% margin in Q4 2021. For the full year, revenues increased by 12% over 2021, including 8% organic growth, yielding an 8% increase in annual EBITDA. We are very pleased with this profitability profile, particularly in the face of a significant decline in home resale activity in the latter part of the year, which drives higher margin transfer and disclosure ancillary revenue. FirstService Residential will tend to generate 9%-10% annual margins and typically be towards the upper half of the span, with revenue mix and seasonality factors driving where we ultimately land in any given reporting period. We finished the year with a 9.5% EBITDA margin, so right down the middle of our typical range, and our margin outlook for 2023 is expected to be within the same vicinity. Now on to FirstService Brands. In the fourth quarter, the division recorded revenues of $578 million, a 28% increase, and EBITDA was up a similar 27% to $67.4 million, with our margin at 11.7%, relatively in line with Q4 2021. For the full year, top line performance was very strong, with 19% total revenue growth, including 11% organic growth. Our annual EBITDA grew 4% and yielded a 9.9% margin versus the prior year of 11.3%. We spoke in earlier quarters during 2022 about the year-over-year decline in Brands division margins being a function of First Onsite restoration, ongoing platform investments, combined with mild weather. In the current fourth quarter, with the benefit of hurricanes Ian and Fiona, First Onsite performed at a better margin than prior sequential quarters, contributing to the in-line Q4 margin performance for the division. Finally, to close off my commentary on the P&L, we reported lower corporate costs in both the fourth quarter and for the year compared to prior 2021 periods. The biggest driver was lower incentive compensation for our corporate executive management and employee teams, reflecting alignment with more tempered earnings performance for the year. Turning now to a few perspectives on our cash flow and capital deployment. For the fourth quarter, cash flow from operations before working capital was $86 million, up 30%, and after working capital delivered $54 million, an increase of almost 70% over the prior year period. We incurred $22 million of capital expenditures during Q4, resulting in a full year CapEx total of $78 million, which came in lower than our most recently indicated target of $85 million. We expect 2023 capital expenditures to be higher at approximately $100 million, which includes a significant FirstService Residential office move that was deferred from 2022. Excluding the spending for that move, our consolidated CapEx would come in at roughly $80 million, which would be in the circle of our typical 2% of revenues and 20% of EBITDA thresholds. The fourth quarter also saw a resumption of strong tuck-under acquisition activity after a couple of quiet quarters. We deployed approximately $45 million of acquisition capital during Q4, as you heard from Scott, our recent transactions span across various of our brands within both divisions and will drive incremental revenue growth into 2023. We are an organic growth company first and foremost, and we clearly see the opportunities for each of our businesses to extend their track record of winning share and growing at healthy rates for many years. So we continue to prioritize our capital deployment towards organic as well as strategic acquisition growth initiatives. At the same time, our ability to consistently deliver earnings and cash flow, which compound over time, provides us with capacity to also incrementally return capital to our shareholders. Yesterday, we continued this trend with the approval of an 11% dividend increase to $0.90 per share annually in U.S. dollars, up from the prior $0.81. We have now more than doubled our annual distribution with dividend hikes of 10%+ over the past eight consecutive years. Our 2022 year-end balance sheet remains strong in every respect. We closed out the year with just under $600 million of net debt and our leverage at 1.6x net debt to Adjusted EBITDA, modestly up from 1.4x at 2021 year-end, but still at a very conservative level. Our liquidity is ample at $520 million, reflecting significant cash on hand and capacity under our revolving bank credit lines. We also have master shelf facilities with our long-standing senior note holders, which we put in place during 2022, providing additional sources of debt financing and where we can potentially term out fixed rate debt tranches as market conditions and our capital requirements dictate. Looking forward and synthesizing some of the segmented indicators you have heard from Scott and me, on a consolidated basis, we expect to deliver top line growth for 2023 in the 10% range, with a healthy mid-single digit plus percentage contribution from organic growth. This annual outlook is currently skewed with higher growth in the front part of the year, given the year-over-year weather patterns and backlogs in our restoration operations. Our consolidated EBITDA margin for the full year should be relatively in line to modestly better than 2022. We see Q1 consolidated margins coming in roughly flat to prior year, with margin improvement in the Brands division on the back of heightened restoration activity, offset by the Residential division's tough comparison against higher home retail activity in Q1 2022. We see potential for modest year-over-year consolidated margin improvement during the middle of the year, assuming continued top-line momentum with our Brands. This concludes our prepared comments. Operator, could you please now open up the call to questions? Thank you very much. Ladies and gentlemen, if you have a question or comment at this time, please press star one one on your telephone keypad. If your question has been answered or you wish to remove yourself from the queue, you may simply press star one one again. Once more, to ask a question or comment, please press star one one on your telephone keypad. Please stand by while we. Our first question or comment comes from the line of Stephen MacLeod from BMO. Mr. MacLeod, your line is open. Great. Thank you. Good morning, guys. Good morning. Morning. Just a couple of questions just on the restoration business and some of the strength you saw in Q4. Thank you for quantifying it at roughly $85 million. I know some of that is expected to flow into Q1 and maybe Q2 as well. I was just wondering if you could give us a sense of sort of how much business is left in that backlog. It's, you know, it's a number that evolves every day as we add new business and as the scope of our jobs changes. So it's not a number. We're not gonna be providing the backlog number every quarter, Stephen. I'm gonna give you some sense for our expectation in the coming quarters in terms of what we can complete and convert to revenue. So we expect to be up in the first six months about 20%, as I said in my prepared comments. A lot of this work, we are now into the reconstruction phase of our Hurricane Ian work, and there are logistics around that, including permitting, which could lead to delays and supply chain issues, which could lead to delays. It's tough to pin Q1 revenues and the amount of the backlog that will be converted in Q1. Okay. That, that makes sense. Thanks for that color. Then, just on the home improvement business, clearly, holding in quite well and, expected to hold in quite well even up against a strong last year period, given the macro backdrop. I'm just curious, Could you give a little bit of color around, like are you seeing more macro sensitivity in different brands versus others as you kinda roll into 2023? They're moving in sync, I would say. you know, we did have a fall off at the end of the year in terms of leads and activity, but it's bounced back in the last several weeks. while the activity levels are down from. A year ago, they're still at a healthy level, and if the leads hold where they are today, we certainly have the activity to hit our growth goals this year. Okay. That's great. Thanks, Scott. I'll turn it back in line and get back in line. Thank you. Thanks, Steve. Thank you. Our next question, I tell you, comes from the line of Stephen Sheldon from William Blair. Mr. Sheldon, your line is now open. Thanks, nice results here. Appreciate all the commentary on 2023. I think Resi, the growth expectations there stand out a little bit. I think you're talking about organic growth in 2023 being a little higher than normal. I think you said mid-to-high single-digit versus 3%-5% that you've talked about historically. Can you just give more detail about what's driving that? Is that more about the strong contract wins you've talked about recently, or is it still kind of more just a flow through in pricing increases that you're driving from wage inflation? Just any detail there. Would you expect a normalization back to that 3%-5%, you know, as we look beyond 2023? The, you know, the increase from 3 to 5 to, say, 5 to 7 or 5 to 8 is certainly some of that is price, Stephen. We're getting 2%-3%, I think we said the last few quarters, and that's still where we are, and that seems to have lifted us to hitting that, at least that mid-single digit more consistently. We are, you know, we are winning business at and holding our retention. Those are the two key variables in this business, keeping your accounts and adding new ones. The teams are very focused on that. I would say in the last, in, you know, 2022 was strong in that regard, which should carry forward into this year. Whether we'll see it come back in 2024, too early to say. You know, if we can grow organically in this business at 5% long term, we'll take it. Got it. Great to hear. Just as we think about our models, interest expense took a step up this quarter. I think it's probably reflective of the floating rate debt. Just given where things are now, you know, is the 4Q interest expense came in at $9 million, is that a good run rate to assume as we think about 2023 at this point? Yeah, Stephen, I think it's a good number. It, you know, really depends on how much capital we deploy and where debt levels go. You know, interest rates are kind of running in for us blended at 5.5%, 6%. I think there, as you asked, the exit rate from Q4 annualized would be a good figure. Great. Thank you. Thanks. Thank you. Our next question, I tell you, comes from the line of Daryl Young from TD Securities. Mr. Young, your line is now open. Hey, good morning, guys. Just a question around the restoration platform. I think you said, excluding storm activity, you were running at mid-single digit organic growth in the quarter. It's very healthy, but it is a bit of a deceleration, I think, from sort of 10% organic growth, recently. Is there anything to make of that? And I guess also, should we look at some of the investments you're making today as potentially allowing you to re-accelerate into high single digits or low double digit organically in restoration? Yeah, Daryl, we grew 10% for the year organically, if you ex storms. I think that's a good number for this business. You know, in Q4, I think the mobilization around Ian and Fiona, and prioritizing our accounts in an event that was, you know, as sizable as that was, probably did detract a little bit from our growth within, you know, across North America, out of our branches because of the resources that were deployed to that event. 10% is, I think, a better number long term for this business. Okay, great. With respect to Century Fire, what% of that growth or work would relate to clients that you have as restoration clients as well? I guess just trying to ferret out if there's a lot of cross-sell happening that's helping to supercharge the growth there 'cause it's been very impressive. No, nothing material. I mean, it's not even a stat we follow. It's a discrete business. While they have collaborated around national accounts, it's not a, it's not a material cross-sell. Okay, great. I'll hop back in the queue. Thanks. Yeah. Just to finish, as I, you know, said in my prepared comments, they just, they're driving really in all aspects of the business right now. We, you know, we expect to see it continue into 2023. Okay, great. Thanks again, and congrats on a good result, guys. Thanks, Daryl. Thank you. Again, ladies and gentlemen, if you have a question or comment at this time, please press star one one on your telephone keypad. Our next question or comment comes from the line of Mr. Frederic Bastien from Raymond James. Mr. Bastien, your line is open. Hi, good morning, guys. Hey, Fred. I appreciate it's difficult to call out the restoration volumes you're gonna get from the weather events, when referencing the 20% growth, you know, we don't really have the revenue base, from which to extrapolate the actual amount of, you know, the revenues you're gonna get. I kinda recall last, maybe six months ago, talking about restoration being now like $800 million-$900 million revenue business. Is that kinda the ballpark that we're still at given the recent acquisitions? Jeremy, over to you. Yes. Absent significant weather events layered on top, you know, 800 to 900's a good number, Frederic, baseline, annualized. Okay. that 20% growth, we'd apply that to half of that $800 million-$900 million. Is that correct? Yeah. Okay, just wanted to double-check. Cool. Thanks for that. Working capital, obviously, with the restoration activities and, you know, the growth of that particular business, you've been investing in working capital, how should we think about, you know, deployment of working capital in 2023? You know, I've made the point before, Frederic, that your restoration has changed the, you know, the working capital profile, and it does. You know, we've got great clients that will pay, but it takes time as these projects work through, and it's on the back of insurance carrier coverage. It's hard to, you know, dictate the timing of when we're gonna start to, you know, see positive working capital swings, although in Q4, I think you could see that it was a lot better than Q3, where we were in the mobilization phase. I think you gotta take a multi-year view on working capital usage across our businesses. I think because of the moving parts and the seasonality and, you know, I think 2% of revenue is 20% of EBITDA on a multi-year or protracted period measurement basis is the way to look at it. Looking at pre-cash conversion before working capital is something that I would kinda emphasize and, you know, to take out the volatile swings on working capital. Okay, thanks. Just housekeeping for me, last few ones. What tax rate should we be working with and, similarly, non-controlling interest as a% of pre-tax profit? Just that% number would be useful. Yeah, tax rate we see for 2023 in around 26%, so a little bit higher. We were at 25 in 2022. In non-controlling interest share of earnings, 6%-7%'s a good number, sort of where we came out the middle of that for 2022. Great. Thank you both. Great to see, earnings and results, improve heading into the year. Quite encouraging. Thanks. Thanks, Frederic. Appreciate it. Thank you. I'm showing no additional questions in the queue at this time. I'd like to turn the conference back over to Mr. Patterson for any closing remarks. Thank you, everyone, for joining this morning. We look forward to reporting on our Q1 towards the end of April. Have a great day. Ladies and gentlemen, this concludes the fourth quarter investors conference call. Thank you for your participation and-