Enerflex (EFXT) 13 Aug 222022 Q2 Earnings call transcript

Company Profile

Participants

Stefan Ali	Vice President, Strategy and Investor Relations
Marc Rossiter	President and Chief Executive Officer
Sanjay Bishnoi	Senior Vice President and Chief Financial Officer
Ben Park	Vice President, Corporate Controller
Tim Monachello	ATB Capital Markets
Aaron MacNeil	TD Securities
Andrew Bradford	Raymond James
Michael Robertson	National Bank Financial
John Gibson	BMO Nesbitt Burns

Call transcript

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Operator

Good morning, ladies and gentlemen and welcome to Enerflex Second Quarter 2022 Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the call over to your host, Stefan Ali, Vice President, Strategy and Investor Relations. Please go ahead.

Stefan Ali

Thanks, operator. thank earnings joining conference and second on everyone XXXX quarter call. morning, you us for our Good With me Vice on President, President Financial and the and Corporate call today Executive Officer; Sanjay are Controller. Officer; Bishnoi, Park, Senior Ben President Chief Chief and Vice Marc Rossiter,

XXXX our update During call, three of and provide an quarter business the touch briefly proposed on Exterran. from our on segments, this comment highlights the on acquisition will second we results, performance of then

to over discussion business it expectations turn I and will financial today’s I Before performance well prospects. Enerflex’s that everyone Marc, statements will other and remind for future regarding non-IFRS include as measures as forward-looking

Forward-looking the information results expectations and involves could stated and from differ risks uncertainties, materially performance. actual or

refer release, that, stated. the our today amounts which our President to within are under and website filings, regulatory dollar Canadian please MD&A otherwise it other available SEDAR dollars comments news Marc With on are our Rossiter. discussed I’ll CEO, to in our turn and advisory more over For All and profile. information, unless

Marc Rossiter

Enerflex first continued XXXX. Engineered doubled of pandemic. business Thanks strength XX% our quarter another reduced to capitalize to debt and million the quarter balance. net second base from Systems continue market quarter and as everyone. margins recovery. Driven of our increased of the American the increased we XXXX and posted grew established North activity, revenues, of underlying by morning good on the fundamentals, our we our our strong Quarterly from from by quarter, and $XXX first lows the our its bookings ability recover Reflecting momentum we the Stefan the building in business of on improving

X at creation Systems sight providing backlog value generated years, to of largest momentum Enerflex over in June backlog an million quarters. the bookings Continued a with line is This our clear XX. $XXX of Engineered coming

demonstrate the to a production on North expanded for been producers future compared new indicator secured are and during pandemic. and capital we backlog. rig hard Though as these to natural we bookings lower counts have working continue margin view leading capture discipline, teams across to margins which work Our bookings rising, America gas

to infrastructure energy business as continues expected. perform Our

segment, market contract solid exports services. record indicator and fleet average demand progress utilization to U.S., growing on of was clear for demand the highest will later products the LNG and a and asset construction there drove fundamentals of we quarter, of asset the XXXX. that our quarter for Rest ahead of our budget. compression Within under to that rate Excellent fourth awarded in is the significantly XX% project during the our our a In an schedule is year, continue which come of World gas execution this and online infrastructure natural this see

Lastly, our despite timely part business a chain broad-based along in of parts, improved expense OEM of considerable with delivery the challenges inflationary our operating activity service saw on a supply combination from aftermarket sales increase Barring pressures for macro for all the energy respect services general expect we business to remain in inflation, and sector, in our to on a with our we across With fundamentals regions. significant solutions pipeline exposures the and To inventory we and and robust. across delivery expenses. demand maintenance across demand the closely are customers planning pressures of all significant we bid inflationary working regions. our margins based are mitigate to cost to actively to managing inflationary chain the delays. any of reduce materials supply and availability diligently working are protect pressures Most operating escalating observing this, and strategic change are relate being

where several renewable natural spaces. capture, we energy hydrogen gas on touch opportunities across will transition I and carbon our business, the progressing are Finally,

we and offerings, Scope promoting eliminate customers our in public that electrified progressing discussions assist also will will are facilitate In our addition Constructive decarbonization larger-scale to policy global helping GHG efforts. meaningfully X could infrastructure on the for through emissions to financial Enerflex as Bishnoi, emerging benefit CFO, I quarter. this to in begin as our investment from to the will market Sanjay highlights turn now touch early this it over year.

Sanjay Bishnoi

Thanks, we increase and primarily of Systems pre-pandemic a the our conversion second quarter from today’s higher or are was capturing XX.X% opening margin a revenue margin margins results towards later product reflected experienced Engineered of converted backlog, higher Services Systems’ of positively in of larger we higher gross $XX our important to on second robust Top second XX% all our and quarter that XXXX. lower be XXXX. Marc. a were Energy drove a work. to and expected lines margins The rental volume continue we $XXX bookings to year bookings gross as gross margins in that percentage activity financial with the resulted our the million recorded associated results levels and our reported more across higher revenue of are utilization while this levels. trend lines. quarter-over-quarter. product Engineered revenue, and quarter improved margins and note into to Infrastructure in gross than It’s The XX% during margin line and XXXX and stable, higher Margins million Enerflex from sequentially relate of

margins $XX the of driven our million increased and of adjusted compared quarter by EBITDA first gross expanding higher-than-expected activity a AMS XXXX. Next, to was

of and increased our the first XXXX XX% a As EBITDA adjusted year-over-year. from by XX% result, quarter

split Middle million the East. assets compression underway infrastructure The quarter, Infrastructure the in in was Regarding finance large invested project capital Energy evenly million during expenditures $XX the natural progress contract gas in and capital and our work leases. allocation to between we $XX related

under and our delevering revenue in profile was balance at currently to this project derisk for $XXX of cash forecasting ratio improve. strategy and completed position debt-to-EBITDA following At Exterran the investments end of and and June strengthen debt our our by recurring million spending of bank-adjusted to Enerflex close in continue proposed net a the to our discretionary flow come the will net budget XX, are free conservative which We be X.XXx. financial exercise year, will point our the capital discipline acquisition.

Board payments Enerflex’s on availability quarterly XXXX. update of yesterday to will the to Exterran. back of and dividend per that, it cash of give to of be proposed With market Lastly, declaring evaluate flow on a share a basis on I X, $X.XXX conditions, acquisition based on anticipated dividend to the Marc hand Directors will October an paid continue

Marc Rossiter

January, macroeconomic been The the will conditions. XXXX in some to with reported need progress Since into back to timing and special approvals, the continues expenditures all delayed the to the have of matters Exterran. obtained number continue has acquisition the coming our approvals, shares in rates Exterran of that of the Enerflex financial the bookings of common transaction. United better-than-expected we have Enerflex the tax announced with regulatory of for States. been and a has required expenditures information in the payments of issue be Subject to consider XXXX close connection the to timing associated have we to proposed To-date, in circular approval revised. required we results receipt Enerflex the addressed weeks meeting acquisition of risen. that also pursue strength Interest and expect both slipping from and we shareholders by registration driven the in SEC all regulatory

include: strong to our and XX planning below through primarily synergies, synergies through compared debt-to-EBITDA our months updated flow higher operating and initially integration XX to synergies $XX expect closing; for captured expectations the now we we of through pro X.Xx forecast result, entity, and more a of forma we cash As within our disclosed to $XX quickly generation overhead and to anticipate net capture the savings have deleverage bringing which million expect to million than anticipated bank-adjusted in efficiencies. initially, efforts,

material provide legal we evaluating stabilize the been Exterran. will a that with gross to make dispute to energy over to regularly us business strategically safe projects will future recurring that dispute expect long-term. with also incur a free in dispute to to and across Enerflex solid combined closing, although Additionally, entity. matter, to and than Exterran, more demand delivering more outside counsel increased progress has for the security In entity’s the contribute Enerflex former has the energy continues communicating resilient Exterran and volatility. and the become may and over loss against transformational on our it engaged the solutions optionality the resolution years regions is business combined expertise not Today, and that growing, some that are employee come. has regarding and The which ultimate the Enerflex impact be product our and our assist revenues disclosed all flow the margin cash gas Enerflex has will to natural of for and our underlying grow we deliver will is market and Exterran to positioned lines a profile, to will precipice grow of completing respect base we XX% with to ever. important potentially low-emission reliable acquisition the with believe is results

happy now will questions. be We to take

Operator

with Thank you. Markets. [Operator Instructions] ATB the from of comes Capital Tim line question Monachello Our first

is line Your open.

Tim Monachello

everyone. morning good Hey,

Marc Rossiter

morning. Good

Tim Monachello

see assumptions. the share the flow more could bit you merger. EPS update around to if cash to a curious and the accretion just give Happy changes the on little was detail I per

EPS you like Specifically flow cash and – per numbers? assumptions over? like, able give those are underlying I are guess, that what those, to timeline what is accretion And to share

Sanjay Bishnoi

Sanjay. Yes, that one. I’ll this sure. Tim, take is

gotten to a things in a the some interest thing, there. terms previous price I we interest important taxes accretion allocation. so XXXX. up we giving had announced when related and is there given that that the a the like really perspective, depreciation for on big few of mover in gone questions the timeline think little transaction other So and as from is from bit – rates. costs market’s the I the And and guidance the We’ve guess purchase is we’re smarter

those I that interest really most the things can rate financing that observe we And now. one we the big the think And position moved rates. have point protections the interest out to that that the the so moved to have on and we on modeling it’s important we’re dial being some do have when there, maximum conservative

to forward we kind and have that night. what’s that will cap, if the moved reflected put last the we in numbers of that’s So you

Tim Monachello

it. got Okay,

targets of that fair pairing decreasing deleveraging been against the months? I increasing that is it set. guess next more a aggressive EBITDA to XX guess say more the, that, you leverage I over to that So Is XX that’s function

Sanjay Bishnoi

want leads No, we little a financing. at we – how the got bit look really the the of And to if hard run a actually one think we have other. are sort on higher thing business, I – to we we took especially cost

at think sheet the balance And point. been of and there the to we this so X.X just on a the point greater emphasis environment X driver lower given it’s to towards range, a we we bigger down That’s just were is – in end X.X. to higher prudent the cost it to Previously, really delevering the had get range.

Tim Monachello

expectations on weeks, when you’ll do being Okay. detail more provide you next a transaction? just the market? so the the about bit released your over to you Can the think And you tap circular close high-yield little timing the few steps talked and next

Sanjay Bishnoi

Yes.

get So the stepping we here, steps the SEC. first final just approval to need from through

the couple of weeks. that kick then That off We next issuing the expect will within circular.

give do of have call to next the think sort get a several an we weeks that we of to can Let’s that we and point, certain amount obligation time. that then shareholders within

before XX vote, close it’s to think the proceed after and then circular we to read would vote. the the the I days transaction

kind the that’s of So timeline.

markets the half know of markets, lot of August. those the is accessing the of quiet – that high-yield market high-yield you the that second terms fairly the In a for investors of follow

when call I be got little here. about then Day think more more my the we going hitting we’ll approaching weeks of we that a constructive are be that’s in next, guess exact markets. market the And are transaction. timeline market anticipate the a so in period the and thinking we’re to don’t wait and I clarity that we do bit And post several historically, the we’ve will until Labor it, of on the is

Tim Monachello

impact Exterran the does any for of these timing items? ongoing the Board of How dispute with Labor Mexican the

Marc Rossiter

doesn’t. It

Tim Monachello

expectations maybe Engineered It like new the What then just but And bookings, and I can are gears your guess, Systems they over on for margins margins, Okay. pressured than were bookings more XX business here shifting maybe clarify. just next North sounds months? improving margins, historically. are specifically America on in the you within

Marc Rossiter

comments. prepared and in the We expect we it said to that grow,

margin the than the exact in We giving is gross received short QX. margin will in number, higher segment QX in reported stop definitely the an of but bookings in the

bookings. know increase And pocket of sort is expect what there – time in have We when back over in know our those. we deliver we we QX. the know what that we we we in delivered So, an

are the from it’s have we bookings on Going like feel that costs. execute reasonable delivery, we about And all hand we And the cost margin to to got now, those margin expect right saying to we different. on a we backlog. costs, to don’t control quite Systems comfortable don’t ability that’s mind gross in our increase. that think that it’s much why Engineered I and

in through recovery stressful and existed in Systems Engineered that challenges cycles. really QX, to Now very chain the that that past this in supply are think QX similar feels recoveries we I

than now not maybe we it’s competitive more feeling much the months ago. what were market less really So, that six or in

Tim Monachello

Okay.

lead bit of I compressors engines? guess times can specifically that, for inputs, a you about talk little terms and In

Marc Rossiter

Sure.

that we year would like XX to And to months but now XX X package, that timeframe. in compressors, deliveries X-month say will backlog don’t seeing nine our significant think I converting timeframe. give out. we more if get X-month revenue to was engines to to want backlog be to ago, in an order we recognition would converts you probably revenue normally I months say and I six months. a XX-month start months the the specific to a for on will months you months X

Tim Monachello

turn Okay. guys. appreciate will Got it. details, back. all I the I it

Operator

next standby you. Thank our question. for Please

line with TD MacNeil of the Our Aaron Securities. comes from question next

line is Your open.

Aaron MacNeil

good all. my bump. questions. the for see guidance Hi, Thanks taking to morning, Nice

that it to have of work what sort guess relates figure? synergies done to As the on I more target, early integration you comfort get

Marc Rossiter

this Canadian. beginning of million work. done said to the I should the are U.S. pre-integration I Stefan presentation, it’s can Aaron, $XX of whereas working myself, at since the you months, only to dollars, that. is the would have we ton prior in transaction, Those all We dollars. $XX U.S. And numbers that and a were months imagine we for are correct million it announced say six been It’s and on months

within antitrust So, the forma people able together people and and transaction, get Exterran since we the been Enerflex about how the the of working pro entity to announced to we regulations, bounds like what have think all looks also to deal the strong infrastructure, deliver the consolidation that gas synergies future the got think to thinking of – play the about upon need which we natural can in tailwinds. we has make we appropriate, but really

time I So, of achievable. can a I and say it’s believe guess we put I believe – we put very it. I the number, into in strongly million lot $XX

Aaron MacNeil

dispute, you investors, your that so legal in the job this to Great. to Exterran transaction? absurdity conversations And frivolous, the me Exterran for say will good on the a and of one to Sticking be with that with based this going legal issue not highlight in support shareholder know the be I I pretty negatively the think did a XX-Q are to a give Enerflex’s issue. to you appears do the indirectly impact want lawsuit where let maybe scenario opinion, think

Marc Rossiter

impact for positively sure. won’t That’s It it.

out of still this think that in deal. when for still in main and I Board situation the natural what from today getting decades gas deal of the this everything And counsel, separate benefits to one careful being of the revenues, and of seeking shareholders commodity strongly two to rationale will shareholders in global for it’s a upon for benefits something very over backdrop advice, on Enerflex world and make things gas our we are this we really to press Enerflex think a our the have and very overall much of consider the in gross of player, pretty really macroeconomic strongly two know those acquisition said based shareholders. release they overall be the to many Mexico that we in hottest this that come, The recurring Enerflex benefits XX% to the margin strategic will sticks make of we consider the long-term. legal like the them believe a strong doing But that which believe natural is from ton acquisition very issues sense. management the overall there. consideration really

Aaron MacNeil

question I will more Okay. sneak one in. Maybe

relates revenue quarters? of margins it there is over profile. given guess something the or on a to in maybe drag weighting margins, As the the World a the margins that’s non-recurring Rest I anything causing expected have of to would segment past infrastructure be I higher couple is recurring just that And the bit

Sanjay Bishnoi

impacted things, I business. it’s Yes. We indicative this of the in expect Aaron, a the of that couple of think had what margins. run don’t we Sanjay, is those long

actually U.S. was a first of but recognized it World, that The the lot business margins in job. was a because actually were sold Rest of it actually project manufacturing a we the in just

Rest went revenue the but of was the margin of U.S. a the in So, captured lot World,

other the an a and that’s The down project is we and some and have margins, driver very incident inflationary had drive isolated that supply other did chain one, did there. much issues

So, to what’s issue. I don’t two and think a we those factors that in up numbers, expect that’s continuing the going be showing are

Aaron MacNeil

all. back. Thanks I will Okay. it turn

Operator

question. Thank standby our you. for Please next

the question of James. Raymond next comes Andrew line Bradford with Our from

is line Your open.

Andrew Bradford

guys. Good morning,

Marc Rossiter

Hi Andrew.

Andrew Bradford

quickly SEC than approvals here? Could maybe why Can anticipated? are Hi. with initially on we might have just any longer you taking color you start Exterran add the

Sanjay Bishnoi

just forth company for in take our issuer, bit understanding issuer, bit Enerflex Q&A been closes, know the when first-time as company, the and time Yes. not a little It’s as SEC, has better. deal lot a little more really and atypical with to just them of first-time getting a – as a a it back a to

factor. that’s I would say been the So, primary

Andrew Bradford

on others? or up one no hung hung have been no on one they area than more issue have they There has been more less of operations or that up been

Sanjay Bishnoi

and to outside finance Not mean specific of leases, represented they the and Q&A so we that that, of would across real But some little board, the bit back thinking about were forth issue. digest XX time how of been has both. really. I no that say a IFRS treatment did take and I it’s

Andrew Bradford

one will the that. way, for I out this Thanks get too. And Okay. of

guidance of with gave you am is ultimate mailing I this in of that provided it the got have the be like your particularly the comfort for that counsel timing in of respect So, cost the convenient sound you you regarding will Mexico action. But I of sure doesn’t considerable the – right? resolution they vote,

Marc Rossiter

Yes. there Andrew, we that a call and it, close want to before will deal. I be let’s to don’t deal legal, close this situation the to think we have solution the before

Andrew Bradford

down said, worth, shine Exterran and for bright pretty by That to the was light good there. a Okay. disclosure some happy it of going absurdities was I on for that is what’s and what be there, on of

hopefully, provides comfort. So, some that

Let’s longer difficulties, to anticipate backlog lead these switch the expect because back to than is usual. customers in over times bit that bookings orders, backlog. The trying I conversion it supply running are embedded here chain that is a and your like maybe looks right?

Marc Rossiter

come what XXXX. sort the receive We their over are have orders business, based the equipment for have their very they definitely they they to to are and XX-month in of that on placing they the And rig planning producers, that relationships positive Basin, throughout count outlook to ahead customers, a especially operators with some want Permian for their and X-month expect almost timeframe.

could react units certain almost They from as of necessarily Permian they those to increases those different Basin, their from we one customers. call orders let’s midstream production in They in every don’t to single a players deliver fleet delivery have So, soon them. want need as schedule. and gas the

the And in the States, the And where major in States. big it’s operators bookings and of in one basins in Canada, United the that’s driving counts also factors. in big pretty higher it’s coming all midstream to reacting So, United from. QX, rig the that’s

Andrew Bradford

Okay.

to seen here well, on range, – the XX%-plus conversion or for in the pardon probably to backlog of So, that quarterly bit can expect of quarters. several the me, – but that where expect a we the basis, sort drop it we have a probably next like lower we stay sounds next could might

Marc Rossiter

reasonable. That’s

Andrew Bradford

compression out press on what just And a the book Okay. drive in of of packages is a In the fair terms, release. you bit curiosity, total percent as the – now? that sitting rough electric are mentioned

Marc Rossiter

orders in the So, what backlog percentage of electric? are our compression

Andrew Bradford

Yes.

Marc Rossiter

a would It’s producer and the walk significant. hate have around When on Houston their hydroelectric, you of electric lot of grid give they a it’s a Calgary, gas number reduced. the that if that, I are When significantly then but of electric wind, see renewable don’t field a puts package for is you. instead Scope percentage significant. facilities of number engine, And in motors. whatever, X from I motor a indeed has a just I a energy, solar, the package high to pulling for particular in overall I

power the that of bringing an So, high-voltage cost they like time balance They cost electric like to that. of view. the package lower facility. and have to They from motor, in of against the point least at the

are we of natural of packages with line a motor or anyhow. our electric they seeing associated high are are infrastructure. significant deep where plant power bringing drive plant, gas cryo lot in cut pretty Think So,

bringing and some the to be it’s in the because lower Scope to erode the need cost power likely package For field less X. of units, of cost gas reduce to benefits starts of electric gathering the

package there a are X,XXX packages We horsepower They world. be higher anybody the to good X,XXX compressor horsepowered units. horsepower higher tend more So, particularly is we at. which Think units lot. in up, than and

we going So, the lot really deep-cut the that’s for compression that are residue and like, way producers cryo with associated plants. that’s plants a of and a segment

Andrew Bradford

roughly like it’s these on do the cost does units guess margin? I same, the sounds But like your of so care lower to the or...? terms it you producers. – Do what in for it margin

Marc Rossiter

service doing gas we well engines. both. We is are good at both, same. and more have with we like both, and got definitely track a the at record roughly There associated It’s of really long

out service we view, when require goes a engine. of a business. itself over the in motor electric much the as opportunity An an that XX field, course the of got as gas service point have that to engine that next years in capture from So, doesn’t

You does. still long-term – service opportunities less to everything but motor it the need the than the and else, service compressor does has engine

Andrew Bradford

in fair field is the it a your percentage might to that percentage in total fleet, in Is of and drive the plants a still backlog, or say be comments? the field, be electric high won’t the high deployed of any but

Marc Rossiter

I guess so.

tough you You can the it model see in give for me are to we an you fit. way engine It’s exact number where of electric. versus

Andrew Bradford

it I guys. a lot, Thanks will leave there.

Marc Rossiter

Andrew. Thanks Okay.

Operator

Thank you. our Please standby for question. next

comes from with next of Our National line Robertson question Michael the Bank Financial.

line open. is Your

Michael Robertson

Hey. was Thank fleet be. a I for able a rental what wondering, sort quarter to utilization appreciate question and you believe the of taking a respond guys morning, your to solid I always on you in in you. rapidly the be Good if noted with my I here. some and high-level I record have all. quarter, was just flexibility Congrats to you would thoughts just of to want wondering terms situation need were your capacity. imagine available deployment level

might positioning thoughts the of have seeing tightness that moment, sort Just sort clients today edge. inbounds you terms and moving that, from see leading that of of of at impact your the the any based on and pricing you are how the fleet in the on at forward high-level that of

Marc Rossiter

Michael, you. thank

of and in work got field of for benefit and our the get year contract lot equipment team to half a of the States They that it hard been reactivated compression utilization. lot a our – are the it’s for in the gratitude first customers, in to for my United XX%. to We the would XX% that of starters, I achieving out to like express

XX past to respond once to say over people get demand. new customer compression, to start the increased you units Let’s build over that spending to flexibility XX%, them of contract years give

priority definitely our demand and haven’t We months. the for acquisition us our customers best our doing Exterran knowing serve best the with general, are for also equipment. being we just also X.Xx we the to one have very from months our that are with deleverage is within customers, but to to capital balance But cautious in We XX that. sheet to XX number done

there So, would is XX% demand. you tell utilization that

should increase be able to You prices.

You units. should be building more

We going the on that for delivering be that our margins. to at we and thank best front, going are possible are to equipment XX% teams cautious and

We in But so would expect equipment margins from getting people the are contracts that the over, oil I when the trucks, on for potentially the to business quarters. increased and diesel little increasing in lube are etcetera. that roll costs bit, price see coming increases too, and and a

great a it. being it’s in business. We So, like

of are CapEx utilization though is not growth to deploying even a We lot that definitely it number high.

We are and… stand going to by right now

Michael Robertson

Got I there this With an appreciate interesting are the at XX%, across it. it’s horsepower imagine the But color. dynamic That’s tight ranges any and of are like board. would out I that you effectively point? sold

Marc Rossiter

of that to wellhead to bit electric different lot And broad are to spectrum we lift point a midstream gas view. we and sizes XX%, large fleets effectively from small, from sold engine, of of the some other of gathering. gas equipment of than that out it we gas mean a are from little have a I public from

it. big are fleet CapEx sold the ones get it electric we retrofit most are unit, putting there and is return we much the modest engine we a electric do CapEx than are those as you has be a of good now. you right demand out revenue. on into when especially Like quite new is building they is pretty So, very actively of you drive small a wellhead complete And And and units, field, that been get a the will to think it – for increasing when retrofitting units. into because we out spend. less the But the – investment way them one. We old

Michael Robertson

like will it Maybe are of have you too? turn But idle of follow-up a that just back. equipment amount decent that, one sort that of sort and I to did do you to able

Marc Rossiter

of changing we the could for we we allocation strategic course And back we idle our do priority global the put day, Permian globally, a We less to any as that’s It’s growth a plans XX to have amount put for getting to we the to getting is had right of and with our But conservative a could now in XX of retrofit be into Basin, that, of a us lot. a you every that day. a story, – that did you good is over can look a which equipment ECC. priority Mexico, blessing is idle to equipment. quite on in months to at service that news was the equipment rental lot have have – We and place capital wanted Again, less and fleet CapEx on – in Yes. instance, to don’t imagine. every and smaller idle if work reasonable increase on the it expect fleet. next months into CapEx keep done

Michael Robertson

Got will Marc. the back. it. turn I Thanks it color, Appreciate

Operator

Thank you. question. Please standby for our next

next with Our question Nesbitt the Burns. BMO comes John of from line Gibson

open. line Your is

John Gibson

guys. morning Good

around in differently, First guidance, high-yield could you questions. of XXXX? you maximum the one on have you financing rate or maybe, assumed from based the one charges put made Tim’s a is just some comment goal comes posts your total What interest from put on just

Sanjay Bishnoi

want models putting the minds. priced we priced do our of what’s we think market are situation of we Yes, that way – and the just is intention this that the go terms is with just been if the We have loan exposing high-yield of dealt markets, and is Sanjay. are the into in influence silent structure the don’t are our to into to until we company company we This – John. we that. there we we The on that kind

So, on suggest, that etcetera, models, because would have have the publish. at to allowed cap. need think you S&P is been that I have issuer. negative we ratings guys I published to What would for about understand Those or Fitch I ratings the look us BB and are just silent the we

are and trades, high-yield at think where market BB now. proxy really where I look credit we can good You a services and a for that’s right the energy

John Gibson

are the on? wondering some working bidding some about you this of last But transition I still XXXX, Okay. the Fair phase? can sort past. or you in contribution then enough. or have they the inquiry you know or expect more energy if XXXX And discussed in just maybe just you one, projects in are talk of

Marc Rossiter

We expect bookings XXXX. in

expect in XXXX. We revenue

every which Senate, ongoing and and carbon the weeks ago of compression, Carbon positive macroeconomic Manchin-Schumer month in a thing. especially in storage, couple that the signal for every in United capture working of very is on it’s is passing capture, projects definitely are utilization day, an the kind We announced electrification light States. of a and was deal

pre-combustion and on Canada the are quite carbon capture We post-combustion States. and hard in United working

It’s are We United of doing Canada are excited XXXX. in segment. I we this World engineering Rest studies in expect revenue orders our something even and, States, again, would about. and year the very

needs core turbines, gas on ethanol always capture fertilizer sit of Enerflex’s have plants, right etcetera. back especially business, plants. top felt plants, the that post of capabilities combustion engines of We carbon and on even the the end Think capture the

to it’s gas, States natural primarily, Renewable about. we for feedstock, been And United stuff happy really fair where years, XX processing it comes Renewable gas, XX requires of a sell in are years. into Enerflex put once to is RNG we the the bio the sector amount to a business a it that purify natural grid. has developers. doing actually it equipment it’s So, of out this

you impurities us that States we some some United for and sizes isn’t great The put to way the the in the the So, together new. it solutions. those of every project. with them and got look customers different to the is But have gas help technology packaged in

it even different segment, other landfills, from from lot animal facilities. those kind dairy, waste an so of United was projects supplying and RNG folks. long-term we in to going people the about have equipment States, the benefit And a There profitability and are are of opinions from though of and on RNG, Canada overall the

hydrogen, on is our in involvement hydrogen Finally, upstream. more

in hydrogen years. sets for RNG are we today hydrogen But blue compressors big as and for packaging that plants looking of at that same been we necessary just the would used since plants carbon for hydro It’s been that those have compression package, of numbers, hydrogen be. upwards green we reciprocating us XX capture not were compressors years diesel XX-plus skill ago. applications. are hydrogen as for We package desulfurization the The have reciprocating they

John Gibson

will I color. the turn appreciate Thanks. Great, back. it

Operator

Marc At closing like call Thank for over you. turn back this Rossiter the remarks. time, to to I would

Marc Rossiter

questions, in today. with no forward us for thank you third I With once to to joining further like look quarter everyone our discuss would connecting again We November to results.

Operator

Ladies and you your for gentlemen, participation. this concludes today’s Thank conference call.

You may disconnect. now

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