Stantec (STN) 28 Feb 212020 Q4 Earnings call transcript

Good day, everyone, and welcome to Stantec's Fourth Quarter 2020 Earnings Results Conference Call. Leading the call today are Gord Johnston, President and Chief Executive Officer; and Theresa Jang, Executive Vice President and Chief Financial Officer. Stantec invites those dialing in to view the slide presentation, which is available in the Investors section at stantec.com. [Operator Instructions] All information provided during the conference call is subject to the forward-looking statement qualification set out on slide two, detailed in Stantec's management's discussion and analysis and incorporated in full for the purposes of today's call. Dollar amounts discussed in today's call are expressed in Canadian dollars and are generally rounded. pleased the am Mr. over I that, to call turn to With Johnston. Gord Please go ahead, sir.

family increase year-over-year grew three our have fourth a are growth, vivo transactions share last were more as per months disruption acquisitions Despite result work. XX% Through execution people, to exited the acquire $X.X in by costs thank unprecedented flow cost and with joining months. the over In our out connections performance, recoveries in XXXX history. of the throughout priorities. why Xst then adjusted the XXX our organizations XXXX, sustainability These focused the in X.X% global that performance caused a We've came the in world XXXX, interest efficient for pandemic, then that a week, you strong also been our management around our the project operational the the a after sustainable XXXX. the proud through foundation diversity the for focus to growing cash our pause to of through business early consistent and provide the most creators we by environment continued on employees into value we to there's able business GTA governments, management, communities and The rolled of XX-year resumed We America the in and our and provide by Stantec is morning, and Good XXXX for quarter demonstrate growth adjusted drove world. the past diluted which the quarter presence and fourth our contributed a the and review positioned fourth on is disruption our to XXXX execution into were EBITDA world XX%. acquisition with bottom approximately the Corporate Stantec over North year. marked year we XXXX. was than delivery. return to margin. Stantec quarter Knights. last look employees, innovation of best by We I'll on Stantec's to Operating the of focus that with we employees solid the the closing strategic strategic and tax good of the so priority made we planning for our almost strong an progress company Xth weather more clients well to Australia operational storm. exceptional that's results good in good project served pandemic, for XXXX COVID-XX update line. caused deep to in resulting organically financial call And earnings development Theresa us. remarks. and has even employees, reach of by an and delivered which the and Sustainable into in excellence, changed grows a added dedication year, a back consultants, year-over-year in in an at and earnings billion, I'm pandemic, representing the investors XXXX agreement shift cornerstones of named recognized in deeper XX.X% a we revenues and our XXXX And the make now XX at our will further deliver from targets, record backlog by review strengths performance. the year for future as and entered we The delve our today begin our continued business, completed end resilience. four I'll Lower as financial of With

XXXX. Our grow balance sheet in to and M&A pipeline remains strong, well remain and acquisition through we positioned

achieved by offering sustainability We objective facilitate establishing work. fourth to workplace a the our of embracing XXXX by talent choice, informed new an top-tier arrangements, our real-estate the milestone and tools to strategy, defining design work leveraging This of future. quarter targets in-house key the design be employer and in our to is our desire our also includes workplace and flexible distributed

informed a portfolio. strategy lease arrangements the preferred and both survey work is of our our review by office Our detailed entire employees of

no first over reduction per years. components: footage Approximately share component real-estate increase the The end expect our implement is space to real-estate strategy three And an workplace naturally additional by second drive over in of to in EPS from two next of an XXXX to footprint translates this by X/X footprint, as increase the of $X.XX perspective, occupancy this portfolio leases with we expect EPS $X.XX lease further in is an existing period. the the our required strategy XXXX; XXXX. And reduction quarter's this office XXXX. this XX% $X.XX to our our space expire to the by has component longer this approximately flexible expires we of by X-year approximate model our Our major in and business,

It next over helps employees to in supports see sustainability real workplace arrangement it this objective that the adding to initiative. excited delivers our to years. shareholders, opportunity It and flexible work future. the our more So, with of a you the to the for three design provides objective why value $X.XX can achieve $X.XX about we're so our EPS

our parties. an strategy. and on XXXX. to our for and net of lowering will office-based consistently XXXX independent support ratings in important real-estate into The X all play across come achieve role enrollment commitment our top our in in of are multiple for neutrality our long-term operations, carbon We emissions sustainability on Our efficiency sustainability strategy profitability third

and Stantec only the new the our as sustainability been isn't for rating firm years. three is that DNA rated part score E ranking, Stantec, a Knights we climate by are an Corporate in has with decades. of our achieved something space And a for to illustrates it's addition last this our leader In CDP, for the that minus

ESC low, continues score score quality rates our again to ESG is top year which as sustainalytics year our class. outperform our after peers IFS and Our of

and spend through Now growth in in a only turning state our a Hyperion significant Stantec to modest business. ongoing well consultant water flagship held up and change efforts the XXXX the and quite business three Pacific as on our projects. United opportunities ramp-up resulting and both climate Revenue in for We and for down renewable regional forward, water in are of is leading our million Services program. the the performance U.S. this, for next the the to Partly we year. selected $XX to consultant quarter several Paris see of And into energy district and program, urban of also particular, States major San the on works the of the billion prime a estimate metropolitan treatment-related we've Southern and Climate in situation. program, role saw address significant for Los these to over resources pure energy years Diego's in San sub-consultant a Diego California power we the residents. of growing populations business in addition business to wind In officially water projects. seriously local projects, we markets expansion in been gives transportation to billion example, rather by California's U.S. this the an scarcity. of announced growth Angeles Environmental as multibillion-dollar the Stantec a a resources the continued was initiative water was we're a recycled water $XX rejoining and that X.X sustainable going Accord. the driven leading October, key offsetting XX continued And alone Stantec Growth with Southern supply water

In buildings and pivot beginning toward federal momentum healthcare impacted business being still see growing including the in to but e-commerce, sectors, addition, government. the other the by we're our pandemic, is U.S.

contracts the water been nine including on for in teams consultant our fourth We've improved particularly building in PX recently And Buildings the project for public irrigation earlier organic designer programs. this lead And for due hospital water our during management we facility businesses generation our in water energy design Western projects in projects. have I on water two seen account we Authority. announced focus partly we're environmental in Metropolitan during and taking our part overhaul our on place growing bridge major in role project large to pipeline addition currently of the and a awarded fourth our momentum the resources, to quarter, announced in the schools Transit Paul's Vancouver, as our services design-build on, three development infrastructure. We irrigation week, business active and Washington team Canadian We around Revenue Hospital to St. the quarter, around and our growing offsetting the touched key a was also clients Our management, six a a pivot the focus we're and was rehab contraction strong saw and and demonstrating healthcare Canada. Group. and role growth heavy solid Canada infrastructure, signed that repair in contract Maryland, very in prime quarter. of pure the just

XXX AMPX roughly utility these including largest regions, by which -- strengthened in alliance the in totaling which and in delivery on we XXXX. increased most frameworks frameworks Brisbane Water was backlog infrastructure. New U.K. Zealand announced our driven million funding utilities key capital in securing joint U.K., Zealand million for and Christchurch, also transitive fueling have Australia. and U.K. tens securing total also We key infrastructure We've these Australia of have $XXX our serves XXX XX U.K. model. transit approximately an million our year. stimulus framework service in water of beyond. Toronto's venture the customers. in with in winning XXXX, like projects. our secured Water, business through growth the adopt we will water New XXXX recent backlog to and is our the share investment won with to business, and during acquisitions XXXX Zealand, a $XX.X in these across oversee Water, the the asset in quarter, market year the Watercare and Sydney participation Wellington our Transportation estimated Water roughly participate year And a ability U.K. in And key beyond and billion begun utilities the of our and The programs and in five-plus ramp-up New are Melbourne the business the in Organic the $XX

weakness pandemic-related addition, our In in services global a growth power also and dams mining to and helped in businesses. buildings our global business environmental offset and

the transportation on Kuramae a quarter, West funded sitdown awarded signed European improvement conceptual that, and and client project in for and currently our award, we I'll virtually projects agencies, impacting by Island performance we design our units. over performed financial a of development the backlog governance to with the the on port summer with entered we Africa's several our this XXXX major outlook. Theresa positive regional in dam many and During the to and Overall, of including the our every for the review contract call Australia, And and the XXXX, well of Australia. project, operating with project trends in Queensland, business we're also working our thanks business improvement very of are on relationships, solid turn optimism strength growing multipurpose

costs net than Gord, exceeded $XX quarter net expectations per per to to share XX% increased revenue Adjusted which QX good XX% morning, revenue. $X.XX our fourth everyone. also represented lower million, with net and slightly Adjusted anticipated. stronger discretionary earnings income for Thanks, operations the continuing of earnings increased generation and X.X% share. from significantly

is Also this margins. were organic further flow in the to Our EBITDA basis expense. XX.X% certain item, recovery revenue gross But matters Earnings success claim favorable of impact EBITDA augmented was in reflecting the costs approximately margin generation on COVID-XX's even the bolstered result cash lower-than-expected XX points recorded tax solid, very adjusted interest solid nonrecurring growth QX, on strong by by excluding mitigating resolution in of of a our quarter. of net and led projects. as adjusted historical

we've initiated real-estate XXXX noncash we strategy. $XX.X of as result, recorded a Gord mentioned charge earlier, million. impairment a And As our

XX% share increased previously fourth our as to income or our results. strength share. in expectations EPS. nonrecurring the net to per discussed, exceeded of $X.XX and XXXX $X.XX a to operations items for the Turning to of Earnings which collectively our quarter net full-year approximately million XXXX on percentage year continuing Adjusted performance increased Adjusted XX% the revenue. from earnings $XXX X.X% per contributed

compared increased margin. $XXX discretionary in million. adjusted to recorded XX.X% increased QX of in XX.X% EBITDA points result margin XXXX. to XX claim Adjusted basis year-over-year EBITDA approximately reduced EBITDA recovery a cost contributed spending, As our adjusted with XXXX, in to XXXX The

remains result strong of range a sheet to sales cash the times. in balance cash great targeted XX over timely over will at the past as Our And payment as our can flow X.X last on net years, control proactive end management. move on terms. and days. the We two of reduction. out as that debt always much in below our the And worth the factors direction, noting Day's improvement and XX with management that of EBITDA year collections, while DSO billings result generation days by years either the focus at the there two shape a it's be our DSO contract is outstanding outside was closed year-over-year we year, increased four-day reduced of adjusted well

liquidity million. capital quarter. fourth the Annual We generated free year-over-year on flow $XXX in free and improved cash flow Moving $XXX XX% in to allocation. million cash to

we ongoing with we of capital October On through through announced capital year, million capital capital million Board million $XXX returned buybacks. we profitability. continue opportunities our to our the by structure $XX dividend inaugural of $XXX has strengthened $XX payment million and our the we reflecting And Yesterday, acquisition dividend in disciplined X.X%, shareholders, notes. long-term to balancing our the bond During toward through focus activity. confidence on our our return to issuing seven-year offering, that deploy share to allocation, X, shareholders increased of our

target, mentioned, to the costs will has is reduced performance savings claim and XXXX occupancy Our approximately on November earnings driver $X.XX further, of end expectations driving the raising along from strategic are expect This basis also we recoveries add increase established an the XXXX mid-single in and outlook the date we our $X.XX XXXX XXXX. [indiscernible] grow from costs, to from to main share to generated our overall earnings with percentage top the digits. a We're will per in continued This low year-over-year EBITDA to of progress XXXX, nonrecurring in travel discretionary we points lower the our that by completely our Gord driven will and which as offset strong our increased basis current is EPS. performance margin will operating adjusted stay of tax give XXXX The spending the XXXX, expectations XX for in initiatives, XX%. cost to given by our longer, restrictions. for increasing the

greater uncertainties the expecting point points target, ongoing concluding also with end capital adjusted to to However, and revenue, net our basis turn income invested his now given our the range We're be with XX XX that, Gord I'll XX.X%. by of low the remarks. we it than increase at to basis in X.X%. we've associated be for than left back net the adjusted X.X% return greater of target raised on a pandemic, And

strategic made review despite Thanks, annual key by to on progress Theresa. pandemic. And Through accomplishments. in-depth in we the more December plan we the a challenges XXXX XXXX, our of excellent posed I launched for report encourage review our you the

to program, today pandemic. $X.X achieving and this sheet that real-estate through also XXXX. material doing hard of right drove net values clients three our forward strong we'll of over pipeline. thanking move our billion going XXXX with financial core to and mid-single-digit return our we're and XX% intend remaining to to lean back meet XXXX. of the sustainability robust into first best-in-class entered in a the will record our We're strategy to earnings solid balance about low we on to for We beyond. close lease ready that in reducing we and footprint the continue backlog long-term that, expect of putting affirming the XXXX their years, this a office and path by plan serving XXXX, Operator? and our and we're the Theresa to It's of M&A arrangements, strategic as a income I over down in EPS to with targets I swing XXXX in to balance continuing to employees and by steadfast end M&A organic full next with strategic year the spoke while increase to filing what's open our our as growth our work up of of execute plan want with in We're As earlier, benefit the growth. result our continue goal questions. by the people And call and our

from first question Jacob go Bout ahead. Our Please Instructions] with [Operator CIBC.

Good morning.

a from I Have office pulled all you question during had employees understand your how home little socially think working of we're footprint So, a getting about tired it? lease to about pandemic? this I feeling planned they're the by XX%.

Jacob. Yes,

we've from was, might perspective. accurate great, an would In didn't we Early they bit a on fact, thought But in home we the that to think surveyed pandemic, employees of what as home office long-term we we response found forever." the times they March and pandemic that and want of a be their do, that through people April, in thoughts to looking "this couple changed the back found working to talked throughout. versus what our reflection that, is we has work the at the want

could bit two little to as the so we looking what folks that they well, throughout how for of sort industry work also flexibility couple a found that's be a in week. days we've are more talked And but to flexibility as home a one in week, perhaps we're have the at office others And our or where of redesigning office is footprint. days people the a

in Stantec Buildings within advising within well as group as company and so with we're working on our we what closely workplace a We clients. that have do group might other design our group very

it's we presence. important collaborative because think very work really exclusively to a And so people those have design we have not that home

to for still to be And is important so together. it able people us bring

there home while, still we some with another the once certain look office, office percent in our with will part-time based work a in percentage in home we design, upon we full-time And reduction roughly a to will footprint. time. maybe a be a at that XX% footprint subset as therefore, at small So, allow in at full work that longer-term look being our being but that, occupancy flexibility

XXXX And for said there's XX% Okay. you next to impact the $X.XX $X.XX three over years? and a

$X.XX the next that The expect years. Yes. $X.XX we to $X.XX is three of part over the

my targets just you here And the second have. on Okay. longer-term question is

I CAGR think said greater you your net XX%. than revenue

about So, the your a clearly, multiples getting playing Talk how -- role in bit is is M&A valuation stretched? and a is looking and are little pipeline here. how key assuming market, looking, a this

Yes.

over little ongoing been new conversations pipeline a we've And announced is while couple the another before previously, three, robust. the one about slowed we had the that through it lot very robust can into we June, really just mentioned March, M&A little of last closed that or as bit April, the into we in the strengthened a is and quarters. but pandemic, you here see, we've What bit very, there's four was months. of discussions reinvigorated we've So, just finding course, really going pipeline that initiated talked of last the all we're last but three a

-- we're multiples, we It's In we're very geographies initially, pandemic, see haven't of So, seen a to, reduction where multiple in hoped had reasonably in the we certainly, across that we that but that. firms we've the pipeline talking very, stay seen the consistent. strong some all active. interesting,

that increase higher some with. significance haven't the of we the multiples, in firms had really You've been have talking that public we're transactions seen larger seen of recently announced that that an but

and Sorry. small And And focus what those still the are multiples? is midsize?

the six main A to the lot in, of focus that to sub-X,XXX talking to, times that is that firm firm that select because we're still said, us we is the we're range. want exact gives still that nine that Yes. in kind geography specialize the type but And very to strong. want of in sheet opportunity the person our our in that firms multiples of seeing balance we

North really of the has matured outside where resident. organization we're in footprint various Our America

And strategy. so absolutely along, opportunities we I a are, come we them, as but look call wouldn't our larger at in change

strategy these role. Our flexibility a but for person X,XXX now some or look think more I larger a ones, see not for to we if at got what little appropriate we've long-term is they're of bit less, still our we

you. leave there. Thank I'll it

Jacob. Thanks, Okay.

next our Murray ATB question take Markets. from with Capital We'll Chris

Thanks.

thinking of maybe just So, going back the equation. part about to real-estate the

you're of talking kind to So, of just couple That's to confirm, out. years $X.XX $X.XX so correct? a

Yes. And by said expect end the $X.XX to What is $X.XX of we $X.XX about on top XXXX. we that, in XXXX. of

Okay. that, about okay. I'll talk

I thinking So, I'm there's piece a invested side just earnings leases. just you the it. how then longer metrics? about talk plays return into that, of understand trying term this of And the also, liability of there's the but it, cadence bit your on little to about Can guess the

otherwise servicing capital I these would opportunity. leases part absolutely, of Yes. capital on other in because have that to redeploy the return ability will things is been our invested toward the mean, lift what

that's two need there took kind where at So, space as we've that We One with charge. have these strategy: prongs we any we to described, longer. is the an are And Gord impairment don't looked of determined.

fourth we of been to bundled the sort and those in $XX all and took So, impairment a quarter. leases about have of million charge modeled,

opportunity second that roughly the is us in to naturally over the expire XX% go offset; to forward: will as sublease existing a we lease of through income space and now for So, costs provide there's P&L that, then is, three don't these -- element the sublease going and opportunity one, our to space to that incur have next we our again, two, those years. pretty

great but just footprint then that to have our expire change be able and opportunity impair And reduce really they to to going a as so space, to forward. that us gives not

And from opportunity the years. next so that's that where three come the over for

works. So, those that the are really math way the two the key components and

question just I about part number that about other around, then years. every the doing moves that were I but few I your about growth, years if you think thinking little mean, Is that X,XXX years longer-term timing way guess earlier that have this year I you talked acquisitions I hit putting Gord, you platform is guys a you bit in the next it change go of back revenue the to a is net thinking person. XX that interesting how historically, were XX, to, for you should think, kind to of when there and CAGR be unfolds question the a of just various and a an the about we that sizes number? over couple

base at Yes. little And infilling that hits, locations. perspective. I of we -- firm sort the the the from say, so, call a right right timing right, think the going and the Chris, would something of look the it you might is opportunity a we right, larger, then platform doing of to with we're bit sort when as the is our continue

pass all my much. line. very the That's on I'll Okay. question. Thanks

Chris. Thanks,

Frederic question Bastien with take We'll our next from James. Raymond

you're being Is and opportunities at at equilibrium these of is me a or if to close are you five aggressive this you've go-forward further there pace can your right Quick question Are more environmental where is comfortable I grow comfortable play a morning. XX%. you with sort a the services of relative believe mean on to energy now? Good XX%. comfortable basis? waiting tell you're or some infrastructure operating of got units there business I with you. for about units

think in from about our opportunities we'll do for organic particular, XX%, perspective. growth see currently is an which that, water both there, I Yes. business, continued

grew year, bit little by business organically just our the For X%. water over a

I organically, space see going continued it's continue in the perspective. M&A invest to to So, to from do but us opportunities for an grow water

area. particularly I that see So,

ways well. we're to services, to looking continue grow environmental for as Our that continually

So, of services then type little I transportation and water a looking bit that think over the at firms we're environmental time, buildings. into firms, are firms and also

for those I you'll the those, focus see think of areas us. So, as primary being

time, grow more. I water business the over to bit little the So, a business would Environmental see and like

on a so focus And we're those putting right areas particular now.

Okay, great. That's helpful.

high-level In three for priorities? terms year, of flagging of kind highlighting kind would this maybe priorities your top or mind of you

at After -- XXXX XXXX, of the sort years perspective focusing year spending office looking a leading getting back back Sure. really where of house the and organization from growth care we're and the on hard on, couple organizational so the of taking is the structure and of sorry.

got on sheet in focus appetite last the great that. focusing growth going success really We're we're we the organic last years. so balance maturity we've And focus also, both to in our continue at is And of to that differentiator new to we continue programs. forward, shape. to can offerings, We're We've we and to that. to rolled couple way a on to our innovation a those M&A of move formalized that continue had had of with the technology great just the service in out want over market. see our as going continue in focus on as because earlier, as really talked year. We we offerings to that on then bring new And terms programs we start

growth absolutely. So, innovation, and

backup is supporting a the XXXX us continue no and growth We but to question, always for really see I think house for focus on focus innovation. but you'll there, operational, will on that's

to hear that. Okay. Good Gord. Thanks,

Frederic. Thanks, Okay.

Mona with comes Nazir question go Laurentian Please next ahead. Bank. Our from

Good for morning taking thanks questions. and my

remarks, insulate the areas new due opening business? bulk help just guys and wondering you base. it exposure up was or I'm to the I'm three ahead hospital or back, of mean just really to I spite if the your new having in even mentioned of wondering, just do of when what thinking the energy you First, greater number about think year you your and you pivot in had organic you in mix? or other contracts awarded. that shield expertise had a peers in I to greater had business contraction Canadian looking quarter areas

Yes.

of backlog think I not us through been well focus our grow was really last we did fit so for on buildings lot year, years, for real your doing, restaurant, to and the but that's pivoted facilities couple do only evidence are well. but retraction as e-commerce our driver We've ups, those XXXX really a think as point lot programs. of pivoting, And we X.X% as organically Australia, projects the our by nowhere hard XXXX, a new the toward about our X% pivoted think to that support. retail, particularly that that off see I a growth focusing organic business in right So, but big also Canada really over doing to is are I exactly and was year, in where the we through pushed healthcare, was work and that commercial organic the great why we right, of the but

have agreements, firms. services some We global MSAs, master with those

account focus growth of So, our really I think program. got we've solid on programs, organic management through a number it's the

initiatives a campaigns We program. a growth have program, corporate strategic

we'll flow I XXXX. very, continue drive those through to very are think So, important, and

wanted that, utilization steps in there related the going just sitting? just are end, there to future I'm any stated is business or taken size and And to to have at how the your MD&A, Okay. I to That's right just plans in ask is the helpful. headcount you through area when in the to any XX,XXX.

Yes.

levels. really So, from spiked more utilization. utilization of because sort we manage do, try from had And We've a there good the rates addition, headcount from was X%. of here headcount We perspective, government go see type down by adjusted in the actually managing to in seasonally to that in our growth headcount opportunity backlog. perspective But can throughout XXXX. proactively that a work they've as we normal far addressed different to saw is reduction too you the pandemic year. number coming early what in in from to we've X% come a to our locations not then our see the our for We absolutely, stimulus see

the have make that, of right drive team to as to so sure we we into as wanted us And result forward well. that future the a

Okay.

did be say, XX,XXX though, because that it any XXXX headcount as the would year to that was in the well. rightsizing fair occur So,

offset that the occur rightsizing largely by year did M&A? any was in So,

Yes.

a think statement, Mona. I that's fair

M&A, smaller-sized pace? timeframe that current or Okay. Perfect. bring number the that new just it in a a occurring I really did you And like a conversations is a made understand of of targeted of more over be for transactions with six people the of transactions, that it, back And four simultaneously could have a would we transactions targeted to medium-sized number leverage X,XXX five you of to could levels, but a given of shorter call combined going five number about firms, lastly me. confirmation. speak just be and feasible potential it's outside see kind within or -- tuck-ins,

I certainly think on sheet depends our opportunities. all would the that, really balance support it but

motivation -- to have We to the right selling the find for that right the have to sell. the and geographies are firms right

we're disciplined strategies, what so could trying right, So, we We But it. our come in hit to be if got firms we've certainly want if room opportunities share to drive paying M&A the say that a were sheet do along, the forward. accretion that continue but to long-term the we're you're balance there, can our that particular quota. right we see to to price, not

possibilities. upside but the Okay. the realm of that is Perfect, of

Okay, thanks you. it there. great, I'll thank leave

you. Thanks, Thank Mona.

TD next Our comes question Michael from Securities. with Tupholme

Thanks, good morning.

Michael. morning, Good

to revenue My organic guidance. first growth question relates your

be mid-single-digit low expectation for we reiterated you just in You've wondering XXXX, consistent about your quarter. I'm growth how last talked talked with negative that should we first growth what about the including in is or or year-over-year quarter is the a we organic which positive? about had you've as or through thinking about should being progress to that not organic year, whether think

mid-single -- we X, annualized number to be would toward to an of digits. mid-single Yes. digits but that's year QX a that really, comparing well, this sort low against QX, that Michael. organic But the 'XX sort That's our still to of we with overall as exactly QX. see of where pre-pandemic that expect we back so through thoughts do in some loaded three half, particularly is where in and low foresee are of QX we retraction is

about geographic On with muted you organic growth, regions. can thinking just expectations your then And bit behind you that provided some for your the detail sticking around little a front, talk any for U.S.? seems may expectations but growth guidance infrastructure fairly general the organic in your incorporate know come, overall growth upbeat. in though I doesn't U.S. that are as U.S. the

secondly, So, just there? isn't well? thoughts growth And wondering than outlook some but as there. any business then just you commentary And expectations unit talked I quarter, any on what's about different driving by that the operating muted last know

coming we Sure. thoughts that believe In President do package be a were of infrastructure just that U.S. cautious. consistent The Biden We U.S., sort stimulus the and will there being were was out. there we're you but might through he's some other think yesterday, through course. other things working working have I February, done first, in some of -- it announce some industry would it speculation

that when from it generating there's a program announced lag to could our it's again, going see coming, stimulus be, do general, two be revenue start or will we but some it. probably from to quarter begin So, to in when industry,

segment. think being look project So, Center, with to market also Mississauga Health are but coming the in the talked the Queensway units the we really -- Hospital we Hospital, the as Footscray seen this various about various Building example, there buildings in I an the we're there, operating Vancouver, your commercial second we additional cause Partners the Australia. business trona as two but in in overall, Health same pivot the healthcare challenged, remains at awarded we've just And in projects to but cautious question, Trillium

seeing work to seeing buildings, we're So, e-commerce. pivot healthcare lot we're a in of of lot a

are e-commerce. buying us, of and things many more from As more people

particularly copper building see and Resources great wind, revenue coming we're our in business, we'll So, there. good, second and we these the ramped tailwind seeing coming, so of the as and present Pivots from on, in business. that flat and well. great backlog but because really that see was course, tailwinds year of XXXX, really iron Revenue a ore to do our for see year as lot In group for we're And In good opportunities seeing business, opportunities come our for renewables prices -- are the to Environmental opportunities was into roughly those good a XXXX half business. of that Hydropower solar think high, very I up. generation solid some projects Services mining that happening get so solid energy good

a our certainly, projects Australia clients irrigation California. even transportation Just really of at of segment around in business U.K., a New walk strong. one course, our various finishing organic our market well. I Zealand. see the Long-term we in We talking into around is solid backlog described interesting finally, then the water net really announced Backlog XXXX the U.S. development of very but really in that we globe, leader the be of it both the operating despite see Southern in in is will the stimulus almost of pandemic. the In market opportunities awards the strong. beneficiary frothy and so community group with development And we've projects that Canada. in and Southern already for long-term was and programs grouping the was housing is solid group. Canada map units. And XXXX couple of course, very, the had infrastructure market frameworks U.S. is And the of that of as off growth land recently some in And because busy. in part infrastructure, the looking it strengthen water, those a got the mentioned

We're element, the So, some water leading There's on a in great like PFAs, the at charge already treatment. tech lot another we those of emerging water. of look technologies when opportunities in advanced things.

rise. and and in response and resilience coastal opportunities see level we So, water reuse scarcity to sea

look positive and just of a we than all rather ramp-up prospects virtually in our the be long-term business, of So, we growth in some across opportunities to in as kind others. general, going see slower

with So, the mid-single-digit that's year, low feel our pretty to we organic where comfortable over -- growth.

this good question? in I That's very is one color. Theresa. just additional Maybe sneak Great. for Can

real-estate no the is a percentage just bit statement? a is you surprised occupancy the revenue savings and opportunity, will on the is case, about admin cost all admin of if the to Just actually that that marketing. through is I'm adjustment talk which there XX% where if XX% can marketing in the up income range? to expenses in wondering this the guidance, show And those as still savings on and

highlighted. is to really actually that up is that line. this part Well, of unfortunate because important Yes. bit The show thank IFRS it's going question it's really you the for a asking have below one should a we that EBITDA XX

item. and activities leasing Now get that depreciation your in line for all reflected of interest

really to flow, impact going to does EBITDA drop line. but basis, on there's the minimal it XX needle but unfortunately, not cash still It on ultimately, bottom on is So, positive be does a a post-IFRS the EBITDA. move to

Got it. Thank you.

Okay. Thanks, Michael.

our next take We'll Capital with Khan Markets. RBC from Alright. question Sabahat

Thanks good and morning.

Just a you years? kind EBITDA line question about I of next it's real last should state if how sort below I guess, think margin relatively improvement, large as the like margin around the guess, savings we this drivers just it I of target. building funds, off X-year and two the think EBITDA is contributor, over guess, is the sounds the the of improvement, the but what else driving, of

Sure.

all that driven, ongoing continued ramp restrictions start mentioned incurring outlook, to likely We've sooner going to spending. a as be that is the of to we beyond by to discretionary around be we back go in of intend out into as we our that got pre-pandemic. tools. these fantastic discipline spending collaboration pointed bit don't we a to push some had able So, the in we expect, if though, little also We expected up that little will not but XXXX level means XXXX, the we our to We've that. that travel to further it were year, said,

in travel need large for the that virtual know a meetings we So, be addressed degree. can through

we've not enjoyed direction to savings is level that expect we that to open given the XXXX. up, cost but So, we've to in do continue, certainly the people when things

on design continue we back office. at India to our excellent operations, our that, our delivery Beyond to is the which just pruning both side look in and ability for delivers leverage us

how we increase footprint We're XXX-people for our that throughout business in can still we driving commitments our there. currently range. And so are

up. And of us to opportunity so is there a lot for that scale

is effective. that so really And

cost beyond on. And we clock of our efficiency. our things to main it's again, systems that an having drive on of XX-hour that focused continue really be that, are back-end that, able of integrate to use focus that with standpoint be Beyond from continued those leveraging efficiency differences. just all operations the the times to we'll Oracle discipline, And

Okay.

XX% of some at that stuff is net of greater with or guess spend CAGR that's EPS revenue there offsetting might earnings by some I or the has offset more. maybe be on discretionary that may some So, and side, savings, XX% of look come the that being puts than the and some real-estate if takes up, CAGR savings the you the been I guess, going back? net about that were discretionary mentioning CAGR real-estate I the of

so. think I Yes,

I think that's a reasonable assumption.

in our a looking CAGR Okay, well. maybe as years target organic did great. you're about that's will that XXXX And the few ago, organic then the at and guess, actually lack growth from one targets? you about three-year How Is thinking X-year organic how are thinking keeping the XXXX you I mention just beyond? I visibility got you've growth for of you mentioning period? are there I it growth there. we those over guess, just know putting be

the than always revenue XX% greater sort of about CAGR of number. net our We've talked as

We growth. the We typically target for organic organic for out our growth haven't current provide really XXXX. split for year

organic the haven't a anyone to opportunities continue the on come. ball providing little that area I'm latter and what crystal in focusing indication, even we So, happen just There's through not come, organic and completely when clear, sure for our as during the what's numbers in we're XXXX the as growth isn't to to of year really growth the with looked the any going of various visible we at to keep focusing will seen pandemic bit we've my clients part programs growth on years hope going just but XXXX. have

Canada. some coming guess also last of on environment, on cautious more what specifically and view Canada you've that seen I commodity then trucks are guess. the be of a QX including of kind one And COVID, one bit Canada, taking it know in behind that up much great. people has so I of is a just visibility having I'm the the in a kind more or Okay, out based end-markets including commodity picking of I into will directional on the on with bit he CAGR.

know Yes, question. great you what,

directionally we've did our got of trillion Toronto. the and some on some Buildings So, to there that of the segment healthcare in things, St. we projects about talk in in a Pauls

on are projects Those infrastructure recently significant about. the that fall, awarded just of talked to well And long-term we we projects programs Public opportunities those we're as well. So, healthcare here And work the those about some Canada, are provide recent were Western good in talked Buildings water Transit last the will government seeing on of Shape the some projects the in opportunities. that the move in Canada. as they've funded in transportation as by of irrigation talked side, forward continuing e-commerce we two about well, water, solid Initiative Toronto, stimulus part $XX.X billion our in which that

working work. really the opportunities those we we've about in gas as us. midstream talked are the is been really, good perspective, And an for that do well. So, we water Environment in see got oil -- continuing. and as And on work our from resources that projects we've looks and before, energy pipeline segment,

we don't just term, significant well, those duration longer see see in growth we just It's areas. -- contracts. long So,

and year following. for stability again So, this

for color. great. Okay, Thanks the

thanks, Sabahat. Okay

Mark next our from Neville Scotiabank. question with take We'll

Good morning.

Mark. morning, Good

Maybe just first maybe question. just a

over real this be the any will period, significant there three-year on consolidation? Just associated cash the with estate, loss

Sure.

significant any not loss? cash Just

loss Yes. Well any this? with the cash associated

No. that, bite this. will flow no. our anything, We're not cash anticipating it through If

asking in and about? for expecting that So, roles, expenditures or maybe restating is outflow not you're lease terms we're space our of capital what

of Yes. sort onetime cost of that? turn sort like the stuff It maybe to

a not part our plan. that's No, of

your think an you a expectation that grow on the flow free be at maybe above? on still cash question grow along is free rate again or earnings might sort where a And your flow there's Okay. some three-year be with would cash opportunity DSOs the of of plan, just do you

I think there's always an opportunity.

couple we've on to pretty on last years of we're move can that that. think to over shown dial that going the -- we I is much improve the always try How there more dramatically.

there a continued on So, it. certainly, is focus

say, I'd seen I'm opportunity. sure there as of last will So, that is it years. yes, in not dramatic an as we've the be couple

for Thanks taking my Okay. questions.

Yuri Lynk with We'll question from Genuity. take next our Canaccord

I ask doesn't as to flip-flopping to at is was you to that a said forth, strike the at back office. I'd early first, know just mean, your wanted get footprint. and well. like I I mean done And I I morning. They've make move employees. And question love firm I it another here real-estate bit this. you on a all Good surveyed back our forward. the to now

So, beyond a wondering if then just taken? be little fostering bit collaboration, a you've people more just important little is seems I think it control steps early, mean, which detail evaluation, the that, to me can how change to minds. utilization, And Maybe I in on their do you talent industry. margin the

question. great No, Yes.

about So, looking we've there everyone what what our in looking staff to not to working have for. done addition they're We're remotely. talking to is,

part-time because We'll office. to out then in space. will remainder Roughly individuals would and use have example, looking be be the home, have way ability the that could footprint XX% to much that of that would roughly like work part-time at our people Those some XX roll folks of be full others. won't looking have that be have an would with office those would be at be need as we're we'll to the time. dedicated As workspace. the office the at people footprint or And don't but temporary full-time selling reducing the home collaborate percent-ish is who a in still

we available also as don't do three-year as we it's over that three of It's comes reasonable. we our to space So, XX% what any be that the the move the that or opportunity still our to anticipate other, one over get be case will program, talk think or we that, have years. actually. industry some going but to respond, significantly period the don't office there'll way We changes the I need but should huge think to adjust kickback

also the because that from line is up leases into now, that's Mark's that cost-effective planning expiry that's and lease do it also because that feel question it it confident employees to about want urging is the stuff you that like what you just or standpoint? And with

timing. the It's Yes.

I'm just of in another this of do to a get trying why couple quarters? sense why not later now,

the we've working of and We've important some just and really, out been the the thinking really home, staff, to Well, of reason Right. been looking been this, real-estate things. now actually way actually, about planning pandemic programs, those to for is is people talking through we've want try latter at even to it that us we've advanced been part this program from what so that the those from -- allowed work they XXXX.

important. that's think I So,

that to that is planning also per looking we're is footage reduction average part reduction in square Europe example, it foot person. the an because in that other The our -- average thing XX% the that footage our lower Those square we as of America. overall reduce is and standards was square beyond space see per person square

less them so and we space we some per employee. of these firms office efficient have on, bring And acquire of as footage square firms larger, consumption

that. a of So, we're looking back everyone to on of get to standard sort more

for that's that months it that on we part XX just fact the of Part is that work footage is the it's is flexible we've our it part. working reduction with announced But a planning square of really, long-term the part part. now ranger of likely So, been now.

Okay.

Solid your happy to outlook. and see I'm quarter,

Great. Yuri. Thanks,

Financial. comes question next Maxim Bank Our Sytchev with from National

morning. Good

Good morning.

-- time? over to grid involved leverage might situation. geography Curious business how see if of is can I analytics that was kind wondering whether you in sure not maybe if out I'm to capabilities and help the Texas FEMA already evolve in the

but has a through will grid ready work Yes. that they And for done The Texas. acquired that Teshmont Stantec, storm a require what and no And done we've winterized guess is be this known grid will to interesting really since fact for of of regulator at nice course, need really will Texas of that point. done, acquisition that citizens a and done in wasn't needed storm newly in are That's were was previously will results the that actually bolstered I we and be now that some of I the that more. decade of Texas but within supports strengthening similar that sort a XXXX. known or there whether perspective. the of that the that require the to be be as work was had work believe certainly that like to work type been great very work

we relationships. got skills. We've got all So, great the

the discussions got should some not ready but tell, contract funding that time, meaningful to adjustments make at available it already there, willing anything so perspective sure And we're point. but to come and this a actually we've had some this has from I'm

passenger as that. Okay, that's from buses the a are things of, the opportunity about like obviously, of all some talking your greater for you electrified, given a I'm cars And there fleets Is just question being and Gordon, guys green helpful. sort maybe and credentials? to that benefit big and

right. so, think do Max, I you're

the in people it. electric plug they them more and grid can't the in our home the break them in, all to majority cars more of and have support As communities evening

And strengthening that from do a work there of grid work be there lot will required. we so required perspective our grid a will our certainly, the be so

We innovative to also of as autonomous first vehicles. have, our it our innovation business through opportunities and connected relates office, one

strengthening So, of we're And the on planning requirements. number the to that lot planning how stations like vehicle, a it clients autonomous would at it great consult they for coming perspectives: for connected vehicle at looking out. is and with things doing work a First, of that we're from charging the infrastructure, roll

all it's overall together. that of part package so And the putting we're

CIB a at the out zero-emission government work of buses ago, the in with one, this stations. As -- look we're to federal working rolled in buses, help zero And program. on charging lot on we've Canadian a other you we're while that areas done miss that fact, like administer

side, from lots the So, opportunities all service these technology side, that opportunities side, can over perspectives, way of Max, it's from whether whichever clients. we're we design the our program the different management numerous on

think is which you and how in development mean And points, talked vertical this if then in obviously was big couple clarification prevalent maybe Gord, your now. right mean, a that. very it obviously being housing, may. pretty robust extent rent are a right pickup to and of we I about just now? historically, I I seeing practice I

maybe And a clarification I think rent helpful. of obviously now? that's I vertical we and about is development it now. couple big was talked mean right being then to in I and are I points, Okay, this how robust a that. housing, your pickup which mean, prevalent just pretty right in you historically, if very Gord, may. seeing extent obviously practice

mean, this may. to was seeing we I I And practice vertical just that. then and pretty a now. big a maybe talked very couple clarification mean rent right extent about being it which in prevalent obviously is now? think I Gord, of robust pickup you and I housing, points, in if right are obviously historically, development your how

the back XX% in But up being it was X% crisis. XX% it see leveraging nothing in in see is in our area. as in range, but overall mix say maybe that while in X% back I again. nearly that range bit thought Yes, bit over it been a strengthening XXXX, to practice plus currently I up in the minus with And bit our U.S. I our or of to that little and the dominant the next XXXX, development, being before like community it's it see see I little revenue. we'll development And X% it little a overall it XXXX, was financial don’t

good point now? that by pretty this I guess be is mean Right. is But I my what should

And absolutely. opportunities. even today were GTA, like really a pickup here is in haven't markets significant some know but strengthening slowed, the states but Calgary, Edmonton you in seeing in with and great we're in really Yes, the [indiscernible] where had we've seen southern certainly

and pencils terms maybe level that reminding to And is of Do now. shopping exposure below mind producers us of XX stick the you your to next how up it, on months call like Obviously, as and the could mining. commodity Greenfield question last brownfield right one, are let's same in going in, the be XX projects?

Yes.

is closed into can than the seen mines So, we on is mines South we but to price working of our staff gold copper on off as to generation continue certainly, company, oil high well. mining high America the some the practice, currently the very places work X% it's strong have course, COVID, just the around saw get little as very, of of less pandemic. to dropped we've early was how but We revenue prices, of in a those due the bit all-time overall mining and Peru in

locations Australia in seeing So, Western are work other and in our America, well. a mining we South as pickup

So, see then I positive mines mining other example. Also, things future. for tailwinds lithium doing some foreseeable lithium. We've we're on like in the and in some active been do work some

toward battery area well. battery coming more in see storage, and more additional as technology, that we can get opportunities we As

Okay. That's much. Thanks helpful. so really

Max. Thanks,

take Dejardins Instructions] with Markets. Poirier from We'll our [Operator Benoit question Capital next

the for Good everyone. Yes. Congratulations morning, quarter.

to the real-estate the respect plan. come on question, back Just optimization with to

come. North and to to to feet square closer your provide it's opportunity the kind per impact it try is or the America person, is to square But really great You in make lowering an get at to peers it about more when person pack Europe? of average looking and per leading the average color potential years feet comparable the your really

average our Yes. lower In little set it's is We're That America. North competitive than industry, but not just square actually. person and European would a bit of certainly, in where for see footage overall. we us, both, the per our

planning our clients, we what group, about space can where thing our talk we've is the we're get doing we we talked So, right to. with believe as

to balancing our the our we're So, sure with they want footage want thing, lowest come optimization that to the We right to positive the we're want the charge not environment feel collaborate. lead I objective. that really work set ensuring don't that office, looking think that make cost we're per about to and possible doing that's employee, their square to they employees

So, I that we it's to balancing act, real-estate a as a optimizing footprint. of bit look Benoit, think

there And drove backlog, was matter year-over-year particular looking on purely in you decline, it of anything sequential war? I FX basis. Is organically at the grow a that the mean, era a

couple transitioned fourth in to of that There the third quarter. from are a really at backlog our looking things the

in to have the down our quarter we little it from typically are foreign terms exchange Those season of just of a fourth the So, us. the part slower goes to was Canadian U.S. the of third being bit dollar. for see versus the as in And that we burn that our Trans do scope that of to such fourth was contributors. quarter, a changed of the strength slightly bigger our And out on some revenue that Mountain, that that our removed relationship be we relationship which of has two well did large but our now note changed backlog, contractual within a chunks of now backlog. we've going MD&A

the So, change. that was quarter-over-quarter of sort really

whether we of strong DSOs, we be to last the DSOs? should terms that obviously, over And more at How How should performance the front? looking we XXXX, be cautious thinking should in very year. thinking with on respect be

Yes.

mark. I could move XX-day a Recognize our feeling we upward think anticipating bit, around XX truly, of little we've direction. we're days, that wanted and left inevitabilities up a just that at either space should and in feel we that in DSO where probably got positive to room sort sure a the our for but We're we're have cause DSO. things we really make tightened good target in like We of about we're move large not at. may are to that control around out very

the Okay. Thank time. for very much you

to remarks. the back or Gord conclude question-and-answer does Johnston closing call like that to any turn for over I'd session. And additional the

on you for in speaking us forward look near our joining the again you thank future progress. Well, continued today. with Great. about the call We to

So, stay day Thanks, healthy. again. great Have and everyone. a thanks

you. Thank

Thank And participation. that does you conclude today’s your for presentation.

disconnect. may now You