Black Diamond Group Q3 2023 Earnings Call Transcript

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Provided by Quartr
November 3, 2023

Key Takeaways

  • Consolidated Q3 results: Rental revenue was C$39.5 M (up 25% YoY) and adjusted EBITDA reached C$36.6 M (up 41% YoY), backed by C$129 M of contracted future rental revenue.
  • Dividend boost: Management announced a 50% increase to the quarterly dividend, supported by FCF of C$30.6 M and a payout ratio below 10%.
  • MSS segment milestone: Modular Space Solutions set record rental revenue of C$22 M (up 19% YoY) and record adjusted EBITDA of C$22.2 M (up 18% YoY), with contracted future revenue up 54% to C$100 M.
  • Workforce Solutions update: Q3 utilization hit 68% (highest since 2015), rental revenue rose 35% to C$17.5 M, and adjusted EBITDA climbed 49% to C$21.8 M; sequential rental revenue may be flat into early 2024 before resuming growth.
  • LodgeLink growth: Crew travel tech gross bookings grew 27% to C$20.8 M and net revenue rose 50% to C$2.7 M, with 110 k room nights sold and nearly 14 k properties listed.
AI Generated. May Contain Errors.
Earnings Conference Call
Black Diamond Group Q3 2023
00:00 / 00:00

There are 9 speakers on the call.

Operator

Thank you for standing by. This is the conference operator. Welcome to Black Diamond's Third Quarter 2023 Conference Call. As a reminder, all participants are in listen only mode and the conference is being recorded. After the presentation, There will be an opportunity to ask questions.

Operator

I would now like to turn the conference over to Jason Zhang, VP, Capital Markets. Please go ahead.

Speaker 1

Thank you. Good morning, everyone, and thank you for attending Black Diamond Group's 3rd quarter 20 Sir, of Modular Space Solutions, Ted Redmond, COO of Workforce Solutions Mike Ridley, COO of Lodgelink, Kevin Lo and Chief Information Officer, Patrick Melanson. I'd like to provide forward looking statements regarding Black Diamond's future results. We would like to caution everyone that forward looking Statements are subject to a number of risks and uncertainties and that actual financial and operational results in the future may differ materially from these forward looking expectations. Management may also make reference to various non GAAP financial measures in today's call such as adjusted EBITDA or net debt.

Speaker 1

For more information on these terms and others, Please review these sections of Black Diamond's Q3 2023, management's discussion and analysis entitled forward looking statements and uncertainties and non GAAP financial measures. This quarter's MD and A, financial statements and press release may be found on both the company's website at www.blackdiamondgroup.com and also on the SEDAR website at www.sedarplus. Ca. Dollar amounts discussed in today's call are expressed in Canadian dollars unless noted otherwise and may be rounded. I will now turn the call over to Trevor Haynes to review this quarter's operational highlights.

Speaker 2

Good morning and thank you for joining us today to discuss our Q3 results. We are very pleased with the strong results for the quarter As the company continues to benefit from the strategic framework initiated a number of years ago, we are well positioned across the business for continued growth into 2024 within our specialty rental platform as well as our crew travel tech division. Given the strength of our recurring cash flows Management's constructive view of ongoing growth and performance, we have announced a 50% increase to our quarterly dividend. Specific to the quarter, a few notable highlights include MSS setting a 14th consecutive quarterly record high in rental revenue, WFS generating multi year high EBITDA and rental revenue resulting in ROA or return on asset of nearly 57% and LaunchLink's continued rapid scale up resulting in annualized net revenue in excess of $10,000,000 On a consolidated basis, Q3 2023 rental revenue of $39,500,000 And adjusted EBITDA of $36,600,000 increased 25% and 41% respectively over the comparative quarter. With nearly $129,000,000 in contracted future rental revenue, We believe the quality of our revenue and cash flow stream is as high as it has ever been.

Speaker 2

We are seeing continued opportunities to compound growth at Tractive returns and expect the cadence of organic capital deployment to remain consistent into 2024 With particular strength in education, key infrastructure expansion in North America and in Australia, where we are seeing robust demand across numerous verticals. In MSS, rental revenue set an all time quarterly high of $22,000,000 up 19% year over year. Average rental rates excluding the effect from an acquisition in 2022 We're up 13% year over year, while utilization remains stable across the platform. Adjusted EBITDA of $22,200,000 was also another quarterly record And was positively impacted by a $2,100,000 item related to the settlement of a previous project dispute. Adjusted for this item, EBITDA for the quarter was up just over 18% year over year, consistent with the growth in core recurring rental revenue.

Speaker 2

MSS exited the quarter with contracted future rental revenue of Approximately $100,000,000 a 54% increase over the comparative quarter. We are continuing to See a strong pipeline of opportunities across all geographies in which we operate for ongoing organic growth. Our WFS business continues to benefit from strategy to diversify and broaden our customer base. Consolidated utilization in the quarter of 68% is the highest utilization seen since 2015 and is being driven by customers across varying industries and geographies. In the quarter, WFS rental revenue of $17,500,000 increased 35% From the comparative quarter, while adjusted EBITDA improved 49% from the comparative quarter to $21,800,000 Australia remains an area within WFS with ongoing opportunities for organic expansion as we continue to deploy capital in this region at some of the highest returns across the entire company.

Speaker 2

As noted in our previous Quarterly call, management is anticipating a moderation in WFS rental revenue on a sequential quarterly basis Into early 2024 as certain assets are redeployed from previous contracts. This is expected to result in a relatively flat rental profile When comparing the first half of twenty twenty four to the first half of twenty twenty three, the bid and sales pipelines remain robust And management anticipates a return to sequential growth in WFS in the latter half of twenty twenty four As assets are redeployed in a higher rental rate environment. Watch Link, our disruptive digital Marketplace offering for crew travel continues to scale with nearly 110,000 room nights sold in the 3rd quarter, up 16% from the comparative quarter. Gross bookings of $20,800,000 grew 27%, While net revenue for the quarter of $2,700,000 increased 50% from the comparative quarter as higher average room rates And increasing margins bolstered revenue growth. At the end of the Q3, LodgeLink had just under 14,000 properties listed, representing nearly 1,400,000 rooms to serve our corporate customers and their thousands of crew members.

Speaker 2

LodzLink's positive trends around growth in booking volumes and revenues are expected to continue with significant opportunities in the U. S. And related to transportation and resource service sectors. The long term upside potential of LaudgLink continues to be enticing And remains a focus area for our team as we look to build on our successes, while pursuing an addressable North American market of approximately $70,000,000,000 per year. In summary, we think the 3rd quarter results had yet another very strong dataset showcasing the strength of our specialty rental businesses and upside potential of our platform travel tech business.

Speaker 2

We remain optimistic regarding the future growth potential across all of our segments and expect to continue building on the positive momentum of the last several years. I will now turn the call over to our CFO, Toby Labrie, For a closer look at Black Diamond's 3rd quarter 2023 results and the company's current financial position. Toby? Thanks, Trevor. As mentioned, 3rd quarter results continue to demonstrate the strength and diversity of our growing recurring revenue streams.

Speaker 2

We would also highlight that the existing capital structure and strength of our balance sheet has played a key role in financing our growth and allowing the company to capitalize on acquisition opportunities, while also deploying organic investments across the business. Platform has shown us stability, we have the ability to quickly pay down debt while continuing to grow the business. In year to date 2023, we have invested over $55,000,000 into organic CapEx, while also repaying over $20,800,000 of debt, which stood at $206,100,000 at the end of September and net debt has also decreased and was just over $200,000,000

Speaker 3

at quarter's end.

Speaker 2

Following on this quarter's debt repayments, our current net debt to trailing 12 month adjusted leverage EBITDA ratio sits at 1.9 times, Just below the low end of our targeted long term range of 2 to 3 times. We attribute the pace of our debt repayments to the platform's ability to generate The average cost of debt in Q3 2023 was 5.71%, Up from 3.8 percent in Q3 'twenty two as interest rates have continued to move higher. Presently, the Company has $126,000,000 of available liquidity on our asset base lending facility, allowing for ample dry powder to continue growing our business, both organically and through selective tuck in acquisitions that meet hurdle rates that are well in excess of our cost of capital. From a cost and efficiency perspective, administrative costs as a percentage of gross profit remain consistent with the comparative quarter. That said, administrative costs rose almost $3,500,000 or 25 percent from the comparative quarter to $17,500,000 driven primarily by increased personnel costs related to acquisitions and a higher provision for profit incentives due to strong business performance.

Speaker 2

Stock based compensation of $1,600,000 during Q3 2023 increased 39% over the comparative quarter, driven in large part by increased share prices.

Speaker 3

The net result was 3rd quarter

Speaker 2

net profit of $13,600,000 Up 51% from the comparative quarter, which generated diluted earnings per share of $0.22 up $0.07 or 47% from the comparative quarter. Free cash flow of $30,600,000 was 28% above Q3 2022 and supports management and the Board's confidence in a sustainably growing dividend, which was increased by 50% this quarter. Net CapEx during the quarter was $17,100,000 a 76% increase over the comparative quarter, driven by a combination of higher capital $20,100,000 this year versus $15,100,000 last year and a decrease in used fleet sales. As we've mentioned in the past, our conservative capital deployment strategies remain highly flexible and generally discretionary. That said, we are seeing ongoing opportunities for organic capital deployment at or above our internal hurdle rates and to date I've primarily been adding to our fleet on the back of longer term contracts, which we expect will result in continued growth of our core recurring rental revenues into 2024.

Speaker 2

Ultimately, to echo Trevor's comments, our outlook remains highly constructive across the business, And we believe the company is well positioned to continue growing our diverse and recurring rental revenue across both MSS and WFS, While driving attractive upside value creation potential through our rapidly growing digital travel tech platform in Lodgelink. With that, I'd like to turn the call back over to the operator for questions.

Operator

Thank you. We will now begin the question and answer session. The first question comes from Matthew Lee with Canaccord Genuity. Please go ahead.

Speaker 4

Good morning, guys. Pretty exciting quarter. So maybe I'll start on the Workforce Solutions side. Just thinking about rental revenue shifting up here from $14,000,000 per quarter cadence and $17,000,000 That was a bit of a surprise to us. Are there any one timers in there and maybe where do you see the sustainable level of recognizing the impact of the pipeline projects coming off?

Speaker 2

Yes. Thanks, Matt. Mike Ridley, you want to? Yes, you bet. Yes, there's a little bit of one timer From a disaster relief side of it, as it relates to the pipelines coming off, we're seeing both CGL and TMX projects come to conclusion in Q4.

Speaker 2

This is not a surprise to us. They've been amazing projects But the good news with it is we've built a really good strategy to not only backfill that, but over time exceed where we're at. And it's Industry and geographic diversity, a lot of what I've been telling the past many, many quarters, the mining sector, construction homelessness, disaster relief, Australia, with growth in education, our space rentals business, as well as our accommodation business is strong. And we will see some operations revenue off of those two projects for this quarter and into next Q1 of next year. And in fact, we're also seeing while some of these assets have come off, right, we've already gotten contracted to go to new projects.

Speaker 4

Okay, that's helpful. And then maybe on the MSS side, demand here still remains on fire. How do you think about fleet growth, Going to 2024, should we perhaps expect you to upsize your CapEx to add units at a faster rate, maybe take advantage of some of this event?

Speaker 2

Yes, thanks, Matt. I'll get Ted Remington to take that one.

Speaker 3

Yes, we're seeing continued strong demand and We're working to increase our market share in the various markets we're in. So, we put to work A significant amount of capital already this year and we believe we can continue to put additional capital to work In the business, so organic growth is our main focus and then there's dry powder for acquisitions if the right opportunities

Speaker 4

Right. But if you wanted to accelerate the fleet growth, would that be possible just given your suppliers?

Speaker 3

Yes. The backlogs are still reasonably strong in our suppliers, but they have shortened A little bit. So they're probably in the 2 to 4 month range now, down from the longer 4 to 6 month range.

Operator

The next question comes from Frederic Bastien with Raymond James. Please go ahead.

Speaker 5

Good morning, guys. Apologies, I'm taking this as I'm driving into the office. So Unusual, but anyway, awesome results guys. Toby, One for you. You mentioned that you had opportunities to invest capital at or above the hurdle rate.

Speaker 5

Now I've heard you before having moved up. So can you confirm which one Which is it 15% or 20%? What kind of hurdle rate are you referring to?

Speaker 2

Yes. Thanks, Fred. We do

Speaker 6

kind of adjust our hurdle rates depending on the type of equipment And markets in which we operate, depending on the risk profile and market dynamics, but our kind of Average hurdle rates are right in around that 20% mark.

Speaker 5

Okay. Thank you. I think we heard Mike discuss a number of end markets and regions for Where he was pretty excited for Workforce Solutions. I was wondering if you could do the same on the MSS side. Where do you see the best opportunities to deploy that capital?

Speaker 2

Thanks, Brett. Go ahead.

Speaker 3

Yes. We're our traditional segments of where we're seeing good demand, education, We're seeing really strong continued demand in the Northeast and Southwest U. S. Where we operate and then Also in Ontario, as a result of our acquisition there, so we put a lot of units, new units on rent in September, The start of the new school year, especially in Ontario and we continue to see Good demand and we're just gearing up for our 2024 school year. We lock in a lot of our sales in sort of the Q4, Q1 and we do the installations in Q3 and the rent those units start going on rent in August, September, October.

Speaker 3

So we're seeing a little bit of the 2023 New rentals in September, but most of those units will be on rent for Q4. So that should help our rental revenue in Q4. The other infrastructure still remains strong as well. Infrastructure spending in both Canada and the U. S.

Speaker 3

Are both being funded by the government and we're seeing strong demand there. So those are, I guess, the 2 main industries. So, our other industries are pretty steady as well.

Speaker 5

Thanks for that. Just want to maybe take a step back. I mean, you had a very tough Q3 comp from a year ago and you just You know, blew the lights out here. Is there anything that you highlighted a $2,000,000 impact that was beneficial to MSS. Anything that was sort of unusual that you would say, hey, I would have been super happy with It's a $30,000,000 EBITDA quarter, but there you go, you did almost $37,000,000 So wondering if you could just maybe Feel the onion and a bit say, hey, this is what we would have been quite happy with and this is what's sustainable on a go forward basis.

Speaker 2

Yes. I mean, the downside is now we have to perform against this in Q3 next year and thus we're beginning at. But Well, I think the way to look at it is the other way around instead of peeling the onion, let's Build the onion from the inside out. I mean, we have been very steadily executing against a strategy for building up Our core business and we think of our core business as the recurring rental revenue off of our fleets of multiple buildings And the ability to gain scale in key markets, the discipline We increased prices, in line with other macro dynamics like inflation, etcetera, And our ability to build ancillary revenues around those core rental streams. So if you look at 14 quarters in a row Growth for MSS, you look at what the WFS team has been able to do In terms of redeploying excess capacity into multiple different end markets and showing The ability to generate recurring revenue streams and increasing utilization Around those markets with those assets and you've just been steadily building up towards these type of quarters, Augment that with some really good acquisitions over the last several years, one of which was a year ago and now we're seeing Sort of the full year year over year comps with the CL Martin business, for example.

Speaker 2

So I think when you build it out from there, you can say the core of the business is very healthy. I think the trends that we're seeing in terms of the returns we can get on these This asset class, the diversity, the advantages of scale in key markets Are all contributing. On top of that, there are a couple of one time we were successful in Using the tools and enforcing our contracts in the case with the recovery for MSS of about $2,000,000 I mean that's A project from about 4 years ago and we got the recovery now. That's a one time for sure. Mike touched on around disaster recovery.

Speaker 2

There was Staff Recovery is a recurring revenue stream across our platform, but Not as predictable within our business in Q2 and Q3, So a reasonably high amount of demand for remote accommodation related to Firefighting and some other disasters, etcetera, shows how we can utilize our capacity in various ways. So I would look at it that way, Frederic. Just from the inside out and say, yes, there's a couple of pieces, sort of on the outside layer, but the Core is really solid and what you're seeing here is the result of a very intentional strategy and work in some Excellent execution by the teams within the business here. And just one other point, The

Speaker 3

$2,100,000 adjustment was not to rental revenue. It was to sales revenue and legal feesSG and A. So, it did not increase our monthly rental revenue and MSS.

Speaker 5

That's good color guys. No, that actually makes me a lot more excited about the next three quarters rather than being worried about next year. I have more questions on lodging, but I'll let others ask them. I'm sure there are some. So thank you for now.

Speaker 2

Thank you.

Operator

The next question comes from John Gibson with BMO Capital Markets. Please go ahead.

Speaker 1

Good morning and congrats on the strong quarter and continued nice run here. In terms of the workforce business, obviously, you've had some larger or you're going to have some larger jobs coming offline in Q4. Can you maybe talk about what the pro form a workforce business Looks like in terms of average bed size and duration of projects.

Speaker 2

Yes, that's a good question, because what we're seeing It's different than what we would have the type of projects that we would have been undertaking 5 or even 10 years ago, and we're excited about it. They tend to be the smaller sized gas With multiple different end markets as Mike touched on and across lots of geographies, We have assets crossing into the U. S. And being able to operate on various projects there related To many of them, I think Mike related to the IRA, the Inflation Reduction Act, we're seeing Social housing using this capacity, which is very interesting that we can participate in some Solutions around a significant problem in pretty much every city in North America, but the size of These facilities or the number of assets being deployed per contract are smaller. And so we think that informs More consistent utilization and turnover of the fleet in a beneficial way rather than These really large deployments on mega projects.

Speaker 2

Maybe add some color there, Mike. Yes. I mean, Canada is in a tough jurisdiction to operate from a resource sector standpoint. So the large projects like the CGLs and the TMXs of the world, they're the few and far between quite frankly. But as Trevor touched on, if you did step back for a minute, if you sort of heat mapped, Black Diamond 10 years ago would be one Sort of green dot over Western Canada.

Speaker 2

If you looked at it today, it would be many, many, many green dots across all across Canada and down into the U. S. So the wild size of the projects are not as large as we saw 10 years ago or even a CGL or TMX where There are many opportunities of smaller projects that will take this gear in all different regions and all different industries As Trevor touched on, so we're super excited about that. Our pipeline is strong. Our contracted revenue going forward is strong.

Speaker 2

And I think the opportunities will continue to be strong as a result. Another way to look at it, John, at our peak, we had about 16,000 rooms of capacity. We had forecasted the balance point of supply and demand would have been somewhere around 7,000 or 8,000 for our platform. What we're seeing is changing our view and we're probably at or near where we think the balance point is, which is Closer to 9,000 to 10000 rooms. So that's an interesting inflection point for our platform as well As we look at demand, so even though these big pipeline casts are coming off, which is something We would have been concerned about 2 years ago as we look at our opportunity set and what you're seeing in the quarter, some of those new projects That started even before the pipeline caps have come off.

Speaker 2

And so you've got a little bit of over layering, But we're really quite bullish on the workforce business based on what it looks like today and what we're seeing in the marketplace.

Speaker 1

Okay, great. Second one for me. This is more of a modeling question, but over the last few years, Q3 and Q4 have Seem to be higher in terms of sales and non rental revenue. Wondering if you're seeing any seasonality or am I reading too much into

Speaker 2

There's definitely a trend. Years ago, it was always resource driven winter drilling work. Now Q3 is definitely a stronger quarter and it has to do in reasonable part to the education business the way that Ted Schools position new classrooms or reposition classrooms through the summer months and they go on rent in the fall And you tend to get a lot of operations around the movement of assets, etcetera. And so we think That will be part of our annual trend given the weighting of education and Our positive view of continuing to invest around education, that's primary driver and maybe Toby add to that if I'm missing something.

Speaker 6

So I think that captures it. As you mentioned, both the rentals and the sales Tend to peak in that start of

Speaker 2

the school season. Into Q4 and a

Speaker 6

little bit into Q1, we have a little bit of that effect. In Australia

Speaker 2

as well, the start of their school season.

Speaker 6

But yes, we see it most pronounced in Q3 for sure.

Speaker 1

Got it. Last one for me. We're basically here to the day in terms of The C. L. Martin acquisition, historically, it's every 12 to 18 months, BDI announces some type of Acquisition, I guess, how do you rank the M and A picture now versus organic Earl, particularly in MSS, Just given the strength that you're seeing.

Speaker 2

We're getting really good rates of return over Our hurdle, as Toby pointed to a couple of minutes ago, and we are able to lock in contract term as you see by Sort of the magnitude of current contracted rental revenue. And so it gives us a very Controlled CapEx or cadence of CapEx with very minimal risk against it. So Organic CapEx for sure is the preferred route in terms of a really nice compounding model with Really good risk characteristics. So that is our primary. And it's hard to predict When acquisitions come up, there's still a couple of assets that we think would meet Our standard of quality and that we think would fit really nicely into the Black Diamond portfolio, But you can't always time nor predict that you'll be able to come to an agreement on value.

Speaker 2

So I think what you can plan around for our business is that we'll continue a similar or slightly stronger cadence of organic CapEx. So we've got ample liquidity. We've got great cash flow available to us and we've got really good pipelines of Demand to match up with our CapEx. I think we can show good growth on the business with organic And we hope we'll be able to augment that with some more really well executed good quality inorganic growth.

Speaker 1

Got it. That's it for me. Congrats again on the quarter. I'll turn it back.

Speaker 2

Thanks, Joe.

Operator

The next question comes from Trevor Reynolds with Acumen Capital. Please go ahead.

Speaker 7

Good morning, guys. Just wondering if you could provide some color on where we sit in terms of the contracts and Contract re pricing and kind of where we sit in that cycle?

Speaker 2

From a rental rate perspective?

Speaker 7

Yes, that's

Speaker 2

right. Brent, to rate growth. Why don't we start with MSS then?

Speaker 3

Sure. As we reported in the MD and A, we're up on an acquisition adjusted basis. We're up 13% year over year on our rates and 11% in constant currency. So we're still seeing good rate momentum. We've been increasing rates over the last 3 years.

Speaker 3

So, if we renew a contract that was signed 3 years ago, we sort of have 3 years of rate increases To catch up on, we're really trying hard on all of our renewals to get increases and also just new contracts are going out at higher rates. In terms of further rate increases, we're kind of monitoring that. We do them As we can, but I think the primary engine behind that rate growth is just Bringing expiring contracts onto our new rates. And we see that Great momentum continuing as we go forward, because again, we have quite a few long term contracts that as they come off, we renew them at higher rates.

Speaker 7

So I guess, yes, we're not seeing any we're not coming up on any tough Comps or anything in terms of being able to push those price increases through?

Speaker 2

No,

Speaker 3

because the market the overall rates across our industry have increased Significantly over the last 3 years.

Speaker 2

Got it. And the market's

Speaker 3

The market is kind of holding steady at current rates, I guess is another way to say that.

Speaker 7

Okay, great. And then on WFS?

Speaker 2

Yes. In the MD and A, our contractor revenue actually increased 42% quarter over quarter and that's in spite of the fact that these large projects have been running off over time. And as I think I touched on our sales pipeline is strong. And as these some of on CGL, for example, it Contracted in 2017 at probably less desirable rates than what we're getting today. So we are seeing some rate improvement as well as new assets go out.

Speaker 2

The spot rates in North America are higher than where these assets are coming off rent. But Australia, we're seeing See some rate traction with high utilization there as well, right Mike? Yes, for sure. We're in all sectors on the education sector, The Space Rundles business, we always are really good. And then on the workforce side, we're getting really nice contracts So that we're able to deploy capital that's underpinned by good term and good clients and really good contract coverage.

Speaker 7

Perfect. And then in terms of the dividend, are you guys do you guys have a targeted payout ratio? Or how are you guys balancing kind of the organic Seeing kind of the organic investment outlook versus increasing the dividend.

Speaker 2

Yes, thanks, Karru. We do look at our payout ratio. We have

Speaker 6

a lot of demand for New capital deployment, that's our primary focus for our free cash flow. And so with the new dividend increase, Keeps us below 10% payout ratio, which we're quite comfortable with and gives us still Ample free cash flow to reinvest into growing the business. Obviously, in MSS, as Mike pointed out, Some increasing opportunities in WFS as well, both in Australia, but also in North America. And so, yes, kind

Speaker 2

of Maintaining it at

Speaker 6

a fairly modest level at that kind of 10%

Speaker 2

or below level It's where we feel comfortable.

Speaker 7

Great. And then just one last one on LodgeLink. Just maybe an update on kind of what the you added a bunch of unique customers this quarter and have continued to do that. Like What does the customer breakdown or diversification kind of look like or concentration, I guess, would be kind of the question?

Speaker 2

Dan, Lowy, you want

Speaker 8

to answer that? For sure. Thanks for the question. The team has worked hard to diversify our business away from the energy sector as well as Canada. From a sectorial standpoint, we were close to 75%, 8% energy last year And we're probably close to about 50% to 60% energy this year.

Speaker 8

And the rest of it now is spread amongst construction, transportation And few other different types of industry. So we really diversify on that front. We've also increased our exposure to the U. S. Market And have increased our customer count in our business on that side as well.

Speaker 7

Great. Thanks. Thanks for taking my questions.

Speaker 2

Thanks, Trevor.

Operator

This concludes the question and answer session. I would like to turn the conference back over to Trevor Haynes for any closing remarks. Please go ahead.

Speaker 2

Thank you and thanks everybody for joining this morning and participating in the conference call. Look forward to updating you on next quarter and hope everybody has a great day. Thank you.

Operator

This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.

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