NOA - Earnings call transcript Q1 2021 | North American Construction Group Ltd.

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Operator

Good morning, ladies and gentlemen. Welcome to the North American Construction Group Earnings Call for the First Quarter ended March 31, 2021. At this time, all participants are in a listen-only mode.

Following management's prepared remarks, there will be an opportunity for analysts, shareholders and bondholders to ask questions. The media may monitor this call in listen-only mode. quote to of other quote the permission. to are but participant free participant's not asked remarks are any management, member they without They from any information confirm from materially conclusion, forecast in comments The could contained a that projection forward-looking wishes actual results to contain company forward-looking that and or that differ today's information. factors making forward-looking that projections in the forecasts information. or are were in applied assumptions material or Certain drawing or conclusions reflected

management discussion in well Additional CEO. recent over information and website Please President the factors on will available conference contained those as I Joe turn now company's as analysis, about company's and go SEDAR material is the at EDGAR ahead. is nacg.ca. Lambert, to the which most and on

Joseph Lambert

at team very that solid Thanks, Simon. Good employees morning, of operational everyone. with quarter I our and pleased CEO, In such great the first this milestones mark performance. a financial was my

work standards. indigenous consistent investments QX our our and diversification performed without with NACG was growing and proficiently recent exceptionally. not high winter its our partnerships commodity, more geographic challenges. executed operations in While and our

vaccine celebrate increase can’t looking our we injuries safety X, industry have are financial slide. an many being the has our for needs full and excellent, rollout financial focus our at safety commitment. was employees been times, seen in Slide conflicts rising case in quelled and the our and loads. business And performance NACG enthusiasm Our performance and general injured. our regression And our performance said recovery core by if values, while I with our has and our our

themselves. our NACG, until focus to no trying get goes we all to figure to we that see We have levels right. this wants hurt In how a And out strong know to work one improvement. culture we'll organization of organizational

are freeze part the the focused will unusually ship frequent unusual for to environments prevent burn on we risk. COVID temperatures past a injuries. communications slips, action I’ll trip and is need incident party. harder especially the fluctuations with year. to A for we falls goal but focus hazards that reoccurrence. not with be be we expected To falls more in. increased So trips with an winter the and and an of to these these and But after fall our make half hazards know we every root We blame focusing hazards just how need the we There These nothing identify first we proactive to don't more in and to are issues, where underfoot cross thaw. injury investigation stove corrective or is the freeze field it’s than and to and completed The thaw don't between get that we on place. seasonally, hot, increased know and field one couple events are temperature to thorough address at reportable high them. an safety. new address or touch we preventing cause the work injured conditions. training Slips an to build us. of remove slip have hazardous implemented that proved poor amount we'll had This mitigate this inspections We and of create hazards the touch we trips up in need

every consistent for employee fitness of and and for addressing for and past good we looking communication directly safety, eye Essentially protocols which specific direct can Although pandemic to our correlate what's we good and the injury, dealing or with contrary the know for work the work task. is any to which good pandemic in isolation, assessing clarity be conflict can communications. safety that not a hazard distancing in safety mass with includes social what's

our Our Jason be performance and over financials good going at With and will without achieve review of communications necessary focus putting to better for the for health a operational summarizing this our of safety before it assessment I’ll our and outlook finding now to turn and new ahead workers on ways forward risk. that, us.

Jason Veenstra

particularly and everyone. Hills Joe QX prior-year to as last XXXX, temporarily in in reduce Review prior February, revenue, begin line in QX The protocols and $XX decline the new quarter we was mine very increases. XX% top I’ll continue is the their expected. Revenue X. strong we impacts at The Thanks, Financial of operating The recover substantial variance predictable, routine COVID-XX. year-over-year good achieved we for remained enjoyed increase. of was million trending winter widespread of the our XXXX $XXX operating Fort to variance sands revenue the below capacity albeit oil quarter decision continue the had from fairly a productive resiliency up to on relates being the more and become a quarter the hours to from represents morning that weather largely year's utilization standard cold of mine. third to Slide million as positively row The in see quarter XX% conditions, but the at steady and and and strong the as is

XX% operating right utilization low from will is in trending achieved XXXX. direction QX in the explain later, XX% Joe As in of the the QX

and being While contracts reported provide results, to a of equipment quarter. we led region from the our accounted maintenance where to of revenue EBITDA mine our heavy prevalently reported reported contributors interest provide lend like our of for for generated XX% course adjusted these the are revenue. own But this and strong do Fort XXXX. EBIT both to EBIT We labor not track McMurray management near-term force. we are outside on XX% programs external into reported where and target directly our full-year remain factor critical Equity Nuna and the to and in itself revenue inherently not this

comments. our by our reflected efficient as in to diversification contract margin his of Joe expect of QX mentioned were the this quarter look to We margin exceptional achieved Key change effective continue, we and volumes profit this represent the in statements. use financial moving our readers accurately an of reporting efforts to opening the during of as slightly Gross prepared and operating our quarter. and fleet an drivers XX%

heavy These Canada idle contracts and was cost conditions fleet As in margin Included of and the quarter. management Subsidy program unplanned impacted operating disclosed financials, we Mine improve increasingly of by road provide related and in the revenue XX.X% is positives also combination as our the at strong continued to the Emergency gross look performance in gross were by the positively support to margin mine. the maintenance. impacts quarter offset Wage percentage to due profit a conditions mine to that at Millennium equipment margins, the The time weather continued which returns. increased of haul of large extremely complex cold in the largely depreciation the February, for was

being capacities ultra consists a idle QX overall of a also our equipment QX with all percentage reference, load is greater XXXX as class of in time versus of For XX% was percentage fleet, hours by revenue as in which XXX increasing XXXX. tons. impacted trucks than XX% Depreciation

twice discretionary consequently via result in of the costs, quarter trucks million, in general non-essential of drive these These a pre-pandemic return and notch as for in course strict EBITDA of us, new the the The well a the was and strategically to played haul this XXXX were achievement, of Group of given was a was record very active shocks percentage NACG, years, in establishes history, We part administrative spending. and recovery is have increases percentage which to X.X% revenue. revenue. in discipline Gold and months. million depreciable the experienced as is a absorbed of is EBITDA investing as for XX over metric Mine in quarterly we two we posted performance first just in past higher Northern and posted $X quarter which investments they we've a QX cost with as spending reflects to form. most over the attention This achieved contract the expenses equivalent which rebuild equipment QX continued said, the expectation This and Major EBITDA been significant we've All depreciation Ontario. their past Direct result exciting overhauls. XXXX almost adjusted over to Component Companies consistent through Nuna $XX.X

QX financials, financials is generally phase. the our also the to Adjusted of in XXXX, $X.XX in favorably a testament shown as the incurred a rate were quarter quarter million $X.X of expense the Higher trend quarter shares which strong million by a more XXXX. As EPS ramp-up to during XX% outstanding this the higher $XX.X consistent operational the to than for generated this revenue QX year. profit the was impact offset the was Interest compares quarter gross last and $X.XX. to of in nicely complex showing adjusted and X% share cash X.X% margin continues earnings Nuna’s

financing. reductions as posted well rates, benefit in We to in from rates as both continue competitive equipment

winter XX, our during heavy the flow. cash season. flow that impacted includes maintaining was cash maintenance in capital $XX smaller Net incurred business $XX.X Moving in impact quarter impact cash to the season fleet. remaining Sustaining capital summarize by the of summer a the major a The provided free assets upcoming changes million were working to of I'll and The sustaining of on spending equipment capital our negative million of during of a the purchase by Slide busy the flow. produced operations had quarter. related advance of cash construction in additions $XX of existing free majority million

typically reasons. the sustaining are stakeholders these our aware, in As are year weighted primarily for front additions two capital

senior our a first trailing call the sheet the by facility sustaining XXXX on the Slide was million well financial I'll debt XX% over our $XXX at debt. strong On to full-year our times, capital, XX. quarters to in generation by below calculated EBITDA correlated additions reflects pass a credit our senior ratio as working leverage back And our Review, capital position, XXXX a on close spending. liquidity X.X has Financial XX% covenant and which those balance As and To comments, of of basis, slight out and as of increase levels Liquidity the reference, offset in consistent brief we'll as well net is with of effect of X.X. were Joe. consistent move XX-months

Joseph Lambert

Jason. Slide in This topic our and Thanks, objectives, walk you'll for our our slide priorities through summarizes up follow XX, find with I'll XXXX. the outlook. that slides each On operational finish

the health and is our Our safety of priority first always employees.

that consolidation that notes of bit oil a partnerships the drive a confusion a move large to customer the work on clarification earnings sands XX. contracts, Slide since deserves performed However, prevent earlier, I'll our versus item is length is on diversification at for of I in our to for outside to possible slide the discussed our of not some revenue indicative management basis MD&A. One the this reported on contributions. Since portion through the is and measurement

XX% earned with As was an you’ll report, our our example, sands. in top in XXXX revenue oil see of our annual clients reported that four

within Companies, to XX% with generated of our in back our where However, ramp-up account these or all Gold tenders projects Mine, the clarity with QX we diversifying has to continue contracts part is slide With more we'll endeavor evidenced Nuna for equity Ontario our acceleration of Jason to submitted ventures The provide subject. recent multi-year clarification, the partnerships of synergies momentum that and of the are of adjusted to diversification get X% EBIT expect transparency revenue through by combined year. the constituted Quebec. either Group joint last confirmed of items. but the in remaining mining recent two I'll commencement at this and of as the

focus, In demand commodities our have major With continue capital and in generally and provided, but geographic areas of entry by and management of a low and end more meet in where by operating earthworks pipeline our sands, tenders has intensity utilization continue and outside low to as sands target We’ll as more at don't geographic to other and finalizing the prices the reduced project pursue proven also strong needs same capital U.S. diversification slide commodity that infrastructure our earthworks decade. drives shows the addition, diversification and and diversification in time our other growth oil to we fleet measures, as expect the of we've in confidence bid success, partner as utilization contracts large The major contracts, with resources diversification our to fleet and These the increasing regions. smaller to next markets utilization oil pipeline high the customers, offer we're led risk consolidation such and infrastructure the U.S. seen expanding the a this of EBIT mine of customer in while in no XXXX. highlights XX our and are to commodity regions they affect into bid such increase The projects. XX% regions. fleets opportunities having

and these to enter we confidence win, contracts difficult have in ever with Quebec. this especially has our multi-year continuing tender market as is Our partnership and ramp-up through be a Quebec projects most our Nuna commencement a first project JV recently adds recent notable our the contract This to mining and two submissions with in Quebec. would of proven

well and strong strategy will have commitment and Lastly, safe that simply with fleet to probably and indigenous sustainability win most experienced in partnerships, significant advantage low a these fair our we cost our share extensive contractor tenders. of but maintained a competitive an to most importantly, believe

utilizing that in XXXX Our on XX% full-quarter sands. to XX diversification links just and fleet fleet, a is of at began to exactly equipment the which utilization monthly to all closely the to utilization under QX, rehashing get nicely XX% the uncommitted Without oil which Slide QX in March the wanted to XX%, our objectives matches with end utilization last average we here history back with gains with utilization year, note of priority average. in smaller normal seek as peak growing QX

has described consistent to fleet trend line, Fleet utilization. of many and fleet increasing utilization monitoring is as testing, models It tool the such makes monitoring following program Ontario an years cyclical all diversification across we Gold operations of the also back the to and above first provide perform is The the need health and continue Slide QX ever machine research Telematics troughs, One product Mine we In more summerworks technology getting addition Program XX. is the will new overall equipment. our a and improvements QX and is addition result of believe NACG to in the counter all investment Telematics improved to lessen largest will believe and and on made. the potential we

expect by development We Caterpillar. with the is setup own But operation future our operate also being resources. supported to system our both installed

benefit there and many from maintenance can sustainability. are the you As see slide data, direct areas of operations,

intelligence expect installed Telematics the our fleet, across machine Over the years, learning. large analytics next equipment we advance entire two and and development into artificial

I the We support. the have develop look with an with implement we team to have forward system. excellent we sharing benefits as and great you received

In indigenous the in to in two just pleased update. had revenue. have increase the XX% progress on Moving we our growing great and slide our very in success year-over-year with inaugural sustainability made a I'm on since report. we months next quarterly sustainability our particular, have partnerships

partnership asset promoting made indigenous haul investment. Partnership, and pleased which sustainability in truck class I’m strategy. ultra policies confident rebuilt an be volunteer have ton inclusivity excellent and our workforce XXX through fits will diversity we We Rebuilding a recently our in truck likewise haul our time in the an our to we’re sale within of our investing have our and progress completed promoting in that life work first second also paid off. Mikisew nicely

contracted looking and based in the and meaningfully with increase XX, and we're sustaining you of electric early to on which program. cash flow our confidence development combined at free bottom in outlook areas, the our most moved the increased QX, on new vehicles In the with hope with to these we flow, backlog record ranges bit Included QX looking fuels, share our addition coming I at these The here. free ranges we a also In more research to EBITDA have of months. our promoting Slide in approval hydrogen forecast. policies recent in of the year gives us the up capital we results posted cash line the Telematics

to capital reduction allocated capital with expansion, highly in being remain allocation ground month. earlier debt and this priorities, accretive the share capital of On high growth allocation the front, which list buybacks broke the shop

materials, on the but basis, for the vertical our and M&A forward. filter environment, integration moving the of M&A, being in which is we also synergies, the in to fit the focused remain call difficult for further Q&A it's a ensure upside session. back now hand to obvious on highlighted criteria vigilant this I'll operator accretive Despite definitely not As admittedly standalone impossible. is accretive

Operator

Thank [Operator Q&A Instructions] a will begin you. session. pause, After brief we the

Lynk the Your first comes Canaccord. from with of Yuri question line

line open. Your is

Yuri Lynk

Nice Good morning, guys. quarter.

Joseph Lambert

Thanks, Yuri.

Yuri Lynk

the guidance. just on Joe,

bit it in nice see. And taking and a you're of cash free up to understand terms flow. little that's I So EBITDA

is more Just of Or that? you came the better back the in a confidence expected? year, quarter just that than more half the a on in first you the more little bit of because have little do color reasoning

Joseph Lambert

it's quarter I'd obviously say the of is both in those, the book. first Yuri,

So our that's But higher in months, backlog. we the work we progress locked our visibility three on for have also these as in. year

So both of it those contributed up. to pumping

Yuri Lynk

detail you more in on had referenced? can Quebec, Any the opportunities that Okay. you give

Joseph Lambert

expansions deposits of, like I the existing mining Brownfield satellite for increased call. very sites outlined in previous of of mine some looking is much

typical guys and commodity their prices, Their three a metal price more, is haul, moment looking year truck high to or? shovel cover produce bit that Yuri with any high. pits, drill mine five to why operations, blast and mining to contracts, on load satellite So,

Yuri Lynk

or? be with that Would Nuna something you're pursuing

Joseph Lambert

be before, French was the processes No, would Quebec, a also. another established who and well in group actually we in worked language all partner, we systems with to it's used has and

Yuri Lynk

always helps. that Yes,

Joseph Lambert

in a and we're Yes, Quebec workforce based camp.

Yuri Lynk

guys. it turn I’ll there interesting. Okay, over

Operator

Go Fast. Bryan ahead, of line the from is comes your open. question next Your line

Bryan Fast

guys. morning good Thanks,

Joseph Lambert

Bryan. morning, Good

Bryan Fast

like. your I outside experiencing control? So been those? mitigate to job have how within where But you costs inflationary controlling And you've guess are a the of at then you control, good your done able pressures,

Joseph Lambert

I an through our can't is at clients. I as noticed provided Bryan, mostly inflationary of think I example because say, our have XX% point, anywhere this fuel probably

equipment So use have work, we rate of we a labor lot fairly the say that the suppliers are the biggest don't on business, right and of see of going I'd that U.S., cost. don't X.X dollar our the steady and actually XX% been that's now. those and and U.S. impact with positive equipment to because exchange would exchange in And been our it's out lot of impact. our inflationary materials on roughly very be up a of a

felt think a seen don't don't know use but we've escalation by any I I've So at two of forecast, I work. what we men lot

Bryan Fast

fair Alberta, enough. Northern up, then That's Joe. guess just And Thanks, third flared availability have any how issues I given wave you had this labor at with particularly there? has

Joseph Lambert

seen to aren't impacts to actually explain isolate really is biggest impact. haven't Bryan it well by the an totally able bit, I And driven positive think it. little a case. thus a We It's we’re how that

our one example, where weeks people or they So, we XX sent biggest two person if could for and is proximity. somebody that they're have expose positive case for in work the on themselves as or cruise, isolation who impact an people our bus so close a home many being to on

try So we that's and risk. where areas the the mitigate

be be kept you XX it on if that. associated or like bus those two a the a positive won't doubling had cases, will something if like were even or ride So you've that two, it isolated,

and that the focus of where separating the we keeping areas really the isolation people. in So are quarantine

recent workforce really increase up the tick. in with haven't in we our So, impacts seen any

Bryan Fast

That's fair Okay, Thanks. me. it for enough.

Joseph Lambert

Welcome.

Operator

next the Maxim Sytchev. from line Your question of comes

is open. Your line

Maxim Sytchev

Hi, good morning, gentlemen.

Joseph Lambert

morning. Good

Maxim Sytchev

I a Quebec follow-up a and on question quick contracts. Joe, guess

if or another instances, come of bucket? one could separate one, So are guess two win sort in these lose it'll one, comes you I

Joseph Lambert

support different two mine are load very they're two similar And, separate sites. clients haul mining contracts, dump. different instances, but two These and

Maxim Sytchev

of much. you Thank of And then when preserve I utilization the terms helpful. look that's XX Okay, in on Page very metrics.

should sort can low sort obviously high or utilization sort was is we of the within given this? That's it moving XX%, about basically how it XXs think peak like of the fair say higher? as kind get, parts to of calculates mean, the you as all your can fleet, I know rates structurally is mean, go So, of differently. I I everybody

Joseph Lambert

higher, to just numbers. at that's fairly where when QX to went of think looked flat at think see at limit, of been demand denominator. to or our or range, matter if everything XX%, and right, what XX%, limit. we've is could the there. just tilt but use same we The we've that you get so It your just up And came practical And in how go as it right, head everybody's analysis, we kind we've that looked was I But I full historical you do close a could when want out, practical into you it gotten we whatever. with the numerator it from, or in XX%, kind

So on of practical that the kind we we use limit is. think where based number

Maxim Sytchev

if building right, means down then Fleet wondering makes line, margin guess, potentially I was sense. Telematics the program on it's and okay, profile And what for you efficiency the don't if All especially cost, I the And maybe possible? upsides? mind that potential maybe

Joseph Lambert

Yes, time geek mean totally I on a I program to where because Telematics on is a spent love we've and this could because this. it, got we long I with this out very,

as anything else. it's So new on or equipment, dozens electric any sensors. you're monitoring, vehicle And of as there's this complex

machine So failures to they being an gives opportunity the and predict maintenance all issues. the from an health, you to bigger able monitor become side, before ability it

last so is the that the longer. our that, intention if when side, to parameters being improve machine do we costs, And it lower in set And comes AI we components just make the up can the generalized particular to and especially maintenance and we learning environment establishing availability, your our parameter. our able not side we and

of temperature and every monitor things. machine. you what move the a side, operating kinds should at of on exactly intervene knowing on And you those engine, an like be that'd So can

to efficient speed, great us monitor a training, monitoring getting making is we So last location, proficient a we our not over temperatures, when Jason opportunity to on monitor winter, talked the our example, damage, have fuel when our time, in to if can idle to last, in those least, idle more and being an machines and operating can, improve comes time because being XX% XX% our XX% fuel longer, being capabilities. it about, time get which certainly real and a able little everything the to where and better knowing we comes to earlier these And obviously when idle pointing saving and training the shutting it side, operations the increase sustainability gives and burn, equipment hours of operator the XX% impacting in relate in of but on our of and which burn, in are down or without then X% fuel that would assets all or that our could efficiency, improving of hours reduce to to emissions. a reduction X% preventing burn,

we're over look opportunity just this lot around I and with yet. we this year, you of implemented amazing to have But pretty out it, get And in this. really it's So, a an to as it's I great show all what forward a system. don't getting of tangibles because you showing

Maxim Sytchev

last Yes, for just And exciting. I that Thanks maybe sounds know that. one pretty question.

looking in talked guys terms as Thanks. at? of are looking potential strategy, updates potentially at You capital about potentially what you there M&A any deployment

Joseph Lambert

diversification companies opportunities. areas, at looking we're and that whether the looking the in strategy. having our of commodity our Those for kind wheelhouse vertically I’d whole are integrates we're it's maintenance, with just say, items us our bolt-ons, the And into all same geography. in being culture or gives fit

Maxim Sytchev

Okay.

you much. Thank so helpful. super That's Okay.

Joseph Lambert

Thanks.

Operator

next your question the Your line of Monachello, is open. from comes line Tim

Tim Monachello

new backlog, the quarter diversification, the in question read First on it’s curious equity of if there's know just any a to here any was tick throughs nice that investee weren't that there in up the Won backlog. the portion there mentioned? Awards I'm

Jason Veenstra

Tim, it’s just to I the project That's Gold take at that Nuna. can one. Mine Jason. an update

there's we've better, new no we've as increase to that in that contracts understood able backlog number. there. But So opportunity

Tim Monachello

the project of that scope increased? has So,

Jason Veenstra

Yes, it has.

of what with back the and in increased the scope Just understanding kind has we more gross communicated from ramp-up October. the of number just clearly, work

see we backlog that So, number. do through the

Tim Monachello

for Or project Okay. mostly that timeline revenue Would to, should being that the I do guess expect increase be related extended? the rate quarterly the project? you run of that

Jason Veenstra

I'd there of some each, slight increase, was say little bit a on some that. expansion there's some but it's timing also scope

either it, XX be of it'll months. So spread significant, wouldn't out are I say XX them over months,

Tim Monachello

got it. Okay,

And quarter, this has question quarter just XX. last you, for accelerated, most that were before XX at it the or timeframe projects of it month Second this last XX XX are of quarter now in is the I XX sort the most time and materially seems outlook from period. longer, project month that XX that of look if from seems around Slide project Slide the Slide to

So I I how some for this acceleration? commentary driving was what's viewing around you're hoping that and guess outlook

Jason Veenstra

Quebec are, quick in just three but dots these partnerships than turnarounds we the two we months in same in pretty The that of we're them the expect occur QX. them got awards moving in of are more are bidding there QX a and couple ones and like mentioned will I

they're going be So have to are starts that they quick pretty turnarounds because in XXXX.

that few we we've was we going and that the a out added to don't further happen off I more one think So I was pulled there it's on though. bit near-term think guess are

Tim Monachello

those guess of Quebec projects, are able the size Would to Okay. you terms of I to in speak those?

Jason Veenstra

in in them. would contracts. is point $XXX the that stretched million where looking be we're five at to over total partnership with this $XXX million They're them a they're and range, And year out revenue, three between we're at

Tim Monachello

Okay.

Jason Veenstra

in tenders just last oil the month. Tim, is the guess had also there, you other see sands, coming significant would we've in the I within thing

March that that's see red So those sands in there February, pretty package. some typical major were of of kind tender the we'll dots work. them that for just oil come forward are And brought projects out timeframe

interrupted question Tim? I other your Sorry, there,

Tim Monachello

to You to million cumulative, between project? $XXX that two million just or was if said was curious million the $XXX $XXX I million, projects $XXX per

Jason Veenstra

around will around and $XXX of will be million be one the one them other No, million. $XXX

it'll cumulatively, both. So to we them be fortunate $XXX enough million if win

Tim Monachello

this did to XXXX? any the within you be program Great, CapEx and for would do the there win those Or two if expansion fleet? projects, you current could

Jason Veenstra

looking And well. in this fits current with I our doing like We're at said extremely smaller-end, diversification strategy fleet. the our

these those oil and it's when which of end get ton you are in areas, small trucks, applications. our So XXX into those trucks a sands XXX fleet. are are large those considered But the bigger,

and have big small we bigger. over think trucks are or actually I opportunity and So our advantage being there, an

Tim Monachello

programs? Okay, activity. into summer characterize follow-on there what insights you could in a last great. construction terms the your sands of just you're comment around just then if oil any civil seeing And Is early

Joseph Lambert

over we've scopes had actually of multiple from Yes, several a on years couple summer packages extend large that construction. bid

the seeing and what is we kind up work full out see of oil think of aren't a end in come been It's I the an June continue are seeing civil can't anymore. But running for so summer packages like now we'd we’re between tick. average, is average We'll starts. we're remember at anymore. curtailments row. even is what more long scope out there in sands since May, So come say capacity, had we've And although two to what everybody years

Tim Monachello

helpful. that's okay, Great,

to Or you sizable, something would you'd results? just that would flow something quarterly release? think be that you do win were If press into

Joseph Lambert

mean And we entry that. an especially or would Quebec, I'm if need, oil? size are something press like into those. it you those I'm significant like is release enough do sure would, sure we you in

Tim Monachello

Yes, oil more in sands.

Joseph Lambert

came unusual, I change If we of if a expect. would I year, dollar that don't think what bit amount, it if was matter think and we to up winning just would summer be a was significant would, to But something releases. was just more constitute work it normally I going if we know it's than I press normal a would. a don't that think a large

Tim Monachello

range I of that guess your Right, the driver main the okay the guidance? within be of your would

Joseph Lambert

Our cooking any are main know I being about we in and look at in wins QX it's it we we're fairly there. think what the And but then we're on, drivers books, tender, big in if backlog. don't conservative

really typical contracts. work hand expect our just let's So in would more work look we or what in existing at

ones don't the in I booked, wouldn't roll as bids, far haven't we So, there there. be on as those dice

Tim Monachello

expansion, speak just expansion. third-party how progressing. me revenues that a business trying call that And about, but you I'm higher monopolize that little to that Okay, adjacent last for you curious if just drive not and if shop one could business? the bit to is sorry, maintenance do around expect shop third-party maintenance here in

Joseph Lambert

second of external lot mostly amount four of gives ourselves, so of we a didn't why capital doing first remanufacturing see we're as do was high stuff is quarter. more back more into a have pretty us It is tremendous self But where our do for We spend, third-party didn't it capacity partnership, fulfilling. kind facility. our highlight did it cold see to life gives sale in or component That's maintenance own us to just get components. own quarter you peak of for doing does you rebuild of which which gives external booked as the But actually that a the us and a use, think Absolutely, that that the Mikisew things. bays. rebuilder. the our there, our They have will we this of I us lot storage a Jason

we success give want not put I'm us maintenance, along in I spot expect more Jason being of suffice on that I the expansion we don't with great expanding we've the here workforce how skilled on getting for had more and to opportunity But, that. expect, here. external and our So say, own, do to shop and Tim able to guess sure that, to

odd what almost building, we've tripled here had in originally think the when I ago. entered from years just over we we two

Tim Monachello

it guys you. my back. appreciate turn Got I I'll you answering And Well, questions.

Joseph Lambert

Thanks.

Operator

from question Devin open. Schilling, the next of line Your is comes line your

Devin Schilling

morning congrats And quarter good Yes, strong the guys. here. on

Joseph Lambert

Devin. Thanks,

Devin Schilling

here, other the pieces work equipment in Ontario, or in to potential Horizon? looking the looks largely QX Is this old or the added like some ‘XX project smaller you Yes, on fleet. just guys it

Joseph Lambert

I exactly life which typically when think single engines, are I'm the assets think are slide that's Yes, but And we and these not on do I sure those our assets. that that's just, these them we turn predominantly don't peak usages. We through. get because over winter, single life

be ones the into Again fleet reason sustaining purchased unit, have XX, trucks, more numbers, and you're QX. would why back to it'd capital, lot notice many them excavator. QX I'm because bigger saying replacing in but a capital, than why tying even same the just you're you'd if so those there's though that so And it's a we small XXX there's to, a a number. that's And ton of

Devin Schilling

priorities year Okay, one maintenance just your much maybe yes, the your this being you following me Thanks. of work, of provided also for how here, is outsourced that's operational can dealer And maintenance still helpful. is remind work that at time?

Joseph Lambert

warranty than rough program support own year. work. that and in development predominantly X% out our might we our had comes mechanics, is have then and every of of recruiting I those great But think we've doubled more success XX% year-on-year of I our which of vendors we guys that had could maybe in be last limit maintenance and try QX field we our offsetting give to vendor one that a workforce number of apprentice a offsetting, to HETs, QX,

Devin Schilling

Okay, that's I'll turn it a very guys. helpful. lot, Thanks over.

Joseph Lambert

Devin. Thanks,

Operator

Q&A closing over pass the the Lambert, the to section call comments. I’ll President concludes This for of Joe call and and CEO

Joseph Lambert

my interest all And today and growth environment. and be our a more and our in XXXX what in advance healthier about to hope business and much diversification to excited thanks for stable journey. we Simon. continued to expect joining our Thanks, for opportunity and of I'm us all you very

Operator

concludes QX for the and Thank call. North Group’s conference American you, This XXXX ladies you participating. gentlemen. Thank Construction

may now You disconnect.

North American Construction (NOA) 3 May 212021 Q1 Earnings call transcript