Concrete Pumping Holdings, Inc. Q3 FY2020 Earnings Call

Thanks, everyone. I want to remind you that during this call, we will be making certain forward-looking statements to enhance your understanding of our operations. These statements may be influenced by various risks and uncertainties that could lead to actual results differing significantly from these statements. For details on these risks and uncertainties, please consult Concrete Pumping Holdings, Inc.'s publicly available filings with the SEC. The company does not intend to update or revise any forward-looking statements based on new information, future events, or otherwise. Today, we will also cover adjusted EBITDA and net debt, which are non-GAAP financial measures. Adjusted EBITDA refers to the adjusted reported EBITDA for certain items. We believe that presenting this non-GAAP financial measure is beneficial, as it provides investors and industry analysts with the same insights that we rely on internally to evaluate our core operating performance. Net debt accounts for all outstanding principal amounts under debt agreements minus cash. Cash is removed from the GAAP measure because it cannot be used to lessen the company's debt obligations. We think this non-GAAP measure gives useful insights to management and investors regarding the company’s leverage and aids in evaluating the company’s consolidated balance sheet. For a reconciliation of these measures to their closest GAAP financial measure, please refer to today's press release or the investor presentation available on our website. I’d like to remind you that this call will be available for replay later this evening. A webcast replay will also be accessible via the link in today's press release and on our website. Additionally, we have uploaded an updated investor presentation on the same website. Now, I’ll turn the call over to Bruce Young, the CEO of Concrete Pumping Holdings. Bruce?

Thank you, Cody, and good afternoon, everyone. Our third quarter results show that we continue to manage COVID-19 from a strong position, thanks to our exceptional employees, the resilience of our business model, and our flexible cost structure. Our team has displayed outstanding leadership, resourcefulness, and teamwork as we navigate this unprecedented situation. I am very proud of the morale among our employees as they adapt to new health protocols and stay focused on serving our stakeholders. They demonstrate a high level of engagement and empathy for our clients during these uncertain times. The proactive safety measures I discussed in our last earnings call are still in effect and have been effective, allowing us to minimize disruptions in our operations. Looking at our Q3 performance, revenue and EBITDA were largely unchanged, even with COVID-19-related shutdowns in the U.K. and some weakness in a few markets. Our concrete waste management services business performed exceptionally well, growing by double digits. I am truly proud of our team for maintaining consistent year-over-year operating performance despite the significantly tougher economic conditions in 2020. To summarize our revenue performance, our U.S. Pumping business held up well in the third quarter, especially in markets like Seattle, which had seen a major revenue decline in our second quarter but quickly rebounded to pre-COVID levels for most of Q3. We saw increased demand in our residential market and expect that to keep improving in the near future, supported by strong housing start data across most of our geographic areas. Our Eco-Pan business, which refers to our U.S. concrete waste management services, was a highlight of the quarter, achieving 18% organic revenue growth and 34% adjusted EBITDA growth. This growth is driven by solid organic performance and enhanced operational effectiveness, alongside the launch of roll-off services in several locations. This service uses a larger container than our previous offerings and is designed for larger pickups where there is ample space. While it's not the traditional route density model of Eco-Pan, it allows us to enhance our revenue with a complementary concrete waste removal solution that outperforms other options contractors had before Eco-Pan. We are very satisfied with Eco-Pan's performance and believe the market conditions will remain favorable. During the quarter, we invested additional capital to ensure we have the necessary equipment to meet demand. Iain will cover CapEx later, and we are excited to have the resources to pursue this promising market. Conversely, we faced ongoing challenges in our U.K. market due to the prolonged effects of COVID-19, which led to significant reductions in business operations during April and May. In the last earnings call, we noted that the U.K. was operating at about 60% of normal revenue capacity. That improved to approximately 80% in Q3, showing sequential progress but still room for additional recovery. We don't foresee any long-term structural demand issues that concern us; we just see a market that is taking longer to bounce back from COVID-19 compared to the U.S. We have started some work on the HS2 project, but it won't significantly affect our revenue soon. Nonetheless, it remains a significant opportunity for us, and we are well-prepared to take advantage when work ramps up, which we expect to happen in the first half of fiscal year 2021. In our U.S. Pumping business, some projects experienced delays due to COVID-19, particularly in retail and hospitality. We are confident that most of these projects will resume. The diversity of our revenue is beneficial during uncertain times, and we are witnessing that currently. Overall, we believe flat revenue growth is a solid outcome in a difficult market environment. I am also pleased to share that our roughly 70% variable cost structure has proven valuable, notably in sustaining a 39% adjusted EBITDA margin. This was further supported by proactive measures taken across the organization to manage variable expenses. We achieved all of this while continuing to reinforce our balance sheet. We reduced net debt by $17.5 million during Q3 and have $43.5 million in total liquidity as of July 31. Our strong operating cash flow and absence of near-term debt maturities leave us feeling secure regarding our liquidity during these uncertain times. Now I will turn the call over to Iain for a detailed overview of our Q3 financial results. I will return later to discuss our market expectations for the rest of the year.

Thanks, Bruce, and good afternoon, everyone. Moving into our third quarter 2020 results, we generated Q3 revenue of $77.1 million compared to $78.7 million in the same year ago quarter. The slight decline was largely due to lower revenue in our U.K. segment, as a result of the continued market softness from COVID-19. This was offset by the strength of our 18% organic growth in Eco-Pan and resiliency in our U.S. Concrete Pumping operations. In the third fiscal quarter, revenue in our U.S. Concrete Pumping segment, mostly operating under the Brundage-Bone brand, increased slightly to $58.6 million from $58.4 million in the same year ago quarter. On an organic basis, which removes the results from capital in both periods, revenue in Q3 was consistent year-over-year. Q3 2020 revenue in our U.K. operations, operating largely under the Camfaud brand, was $9.2 million compared to $12.5 million in the same year ago quarter. Construction volume reduction due to a slower recovery from COVID-19 was a driver of the decline. As Bruce mentioned, the U.K. is currently running at approximately 80% of our pre-COVID revenue run rate. As we anticipate a temporary return to full revenue capacity in the U.K. region, we believe we have ample runway for long-term market share expansion, including the multi-decade high-speed rail project, HS2. Revenue in our U.S. Concrete Waste Management Services segment, operating under the Eco-Pan brand, increased 18% to $9.4 million in the third quarter. This was driven by robust organic growth in the majority of our markets and high utilization of our assets. We also experienced strong growth in our next tier markets, as we continue integrating the Eco-Pan service into our Concrete Pumping footprint. At the end of Q3 2020, pans in the field, which is a leading indicator for future pickups, were 11% higher when compared to the same year ago quarter. As Bruce referenced, our Eco-Pan operations benefited from the continued investment and growth in roll-off services in several locations, which allows us to service larger volumes than our established small and large pan services. Turning back to our consolidated results. Gross profit in the third quarter was $37.8 million compared to $39 million in the same year ago quarter, and gross margin declined 60 basis points to 49%, as improved revenue pricing, more favorable fuel costs, and continued improvement in our supply chain procurement costs did not fully offset the slight decline in revenue. General and administrative expenses in Q3 were $27 million compared to $28.2 million in the same year ago quarter. The 4% cost reduction was largely due to lower amortization of tangible asset expense and reduced variable G&A expenses, such as travel costs. Net income available to common shareholders in the third quarter of fiscal year 2020 was $2.5 million, or $0.04 per diluted share, compared to $2.3 million, or $0.05 per diluted share, in the third quarter of fiscal year 2019. Finally, adjusted EBITDA in the third quarter was $30 million compared to $30.6 million in the same year ago quarter. Adjusted EBITDA margin remained consistently strong at 39%. In our U.S. Concrete Waste Management business, adjusted EBITDA improved 34% to $4.8 million on the back of 18% organic revenue growth. In our U.S. Concrete Pumping business, adjusted EBITDA was marginally down 4% to $21.2 million on slight revenue growth. And in our U.K. business, adjusted EBITDA declined by $0.9 million against approximately $3 million drop in revenue. Despite the lower trends, we are proud of the cost containment and margin control coming out of the U.K. during a slower demand environment. The healthy and consistent consolidated adjusted EBITDA margin in Q3 and EBITDA margin improvement year-to-date demonstrate the ability of our team to move proactively and with agility to successfully navigate through challenging times. Turning to the balance sheet, we continue to prioritize our liquidity and cash preservation. Compared to Q2 2020, net debt in the third fiscal quarter was reduced by approximately $17.5 million to $395.3 million. This was comprised of $399.4 million in debt principal and $4.1 million in cash. We have no near-term debt maturities and as a reminder, our five-year ABL revolver is in place until December 2023, and our seven-year term loan facility matures in December 2025. These debt instruments are also covenant light. We have no financial covenants on the term loan, and our ABL has a springing one-to-one fixed charge ratio based on total excess availability. And based on our improving liquidity position, we believe we have significant headroom. Cash preservation initiatives implemented since the onset of the coronavirus have helped us build approximately $43.5 million of total available liquidity as of July 31, 2020, which includes cash on the balance sheet and availability from the ABL revolver. As a reminder, our business generates healthy operating free cash flows as we invoice our customers daily for the work we perform. We have minimal working capital requirements, as we do not take ownership of the concrete we place. We believe our ability to generate strong operating free cash flows along with our strong margins provides us with the ability to delever and strengthen our balance sheet over time, even in the current environment. We suspended uncommitted 2020 CapEx investment for a brief period during the height of the COVID-19 pandemic. However, as Bruce mentioned, the continued growth momentum in our Eco-Pan business supported strategic CapEx investments to fulfill demand. With the continued strong performance of U.S. Concrete Pumping, we also took the opportunity to selectively improve the age of our concrete pumping fleet. We will continue to apply prudent capital deployment and remain opportunistic with other CapEx investments in our fourth quarter. With our cash and liquidity focus, we are pleased that we've been able to reduce our net debt position by approximately $38 million over the past two quarters, while being able to strategically invest in equipment to position our operations for growth. The resiliency of our business, the highly variable component of our costs, and our revenue diversity are also strong components of these results. We continue to believe we are well positioned to navigate the evolving impacts of the COVID-19 environment, and we are fully prepared to leverage an economic recovery. However, given the lingering uncertainty about the duration and timing of the economic recovery associated with the COVID-19 pandemic, we are not currently prepared to provide guidance for the last quarter of 2020. The combination of our healthy operating cash flow, highly variable cost structure, and ample liquidity with no near-term debt maturities puts us in a position of strength, as we manage the business through the pandemic, while opportunistically investing for growth. With that, I will now turn the call back over to Bruce.

Thanks, Iain. I now want to make some broad statements about how we view the remainder of our fiscal year playing out and how CPH will leverage its strength to succeed moving forward. We remain cautiously optimistic about the demand environment for the remainder of our fiscal year. Our diversified revenue and customer base create opportunities for growth, particularly in areas where we're currently experiencing incremental market share gains like Eco-Pan and residential construction. We look forward to our continued execution in these markets, while appropriately balancing debt paydown and investment opportunities to support the long-term growth of the business. While some projects are experiencing delays, for the most part, our projects are expected to move forward and the bidding environment is still relatively healthy. However, we are taking a cautious approach to our growth expectations while still remaining optimistic. We still expect to report year-over-year revenue growth in our U.S. concrete pumping, but at a lower rate than originally contemplated in our full-year revenue outlook earlier this year. However, given the strength in Eco-Pan, we now expect our waste management services segment to actually grow faster than the 11% to 17% top-line rate contemplated in our original outlook. For perspective, the segment is up 21% year-to-date. In our U.K. market, the pace of recovery has turned out to be slower than the U.S. As such, we now expect this market to continue to recover into our fiscal year 2021. And while it's difficult to know when normalized business returns throughout the world, we remain confident that our company is well-positioned for the recovery. We have strengthened proactive measures to enforce our variable expense structure and remain focused on managing cash flow. Our highly variable cost structure makes us well-positioned to accelerate growth and drive profit when conditions stabilize. We also have a solid balance sheet and improved liquidity, no near-term debt maturities, and covenant-light debt facilities. Our healthy cash flow characteristics position us well to safeguard liquidity and to service our debt obligations. We have an unrivaled geographic footprint in the U.S. and the U.K. as well as highly diversified end market exposure. In closing, we wish you, your colleagues, and everyone's family the very best during these trying times. We are living through complex and dynamic times, and our entire team is highly committed to maximizing shareholder value, supporting our talented employees and our partners in the coming months ahead. With that, I'd now like to turn the call back over to Kevin for Q&A.

Thank you. We will now begin the question-and-answer session. Our first question today comes from Sam Kusswurm from William Blair. Your line is now open.

Hey Bruce, hey Iain, I hope you both are doing well.

Hi Sam.

So can you guys update us on how the current backlog looks relative to pre-COVID levels? And if it is pretty stable at this point or if it has trended higher as the quarter progressed?

Yes. So, what we're seeing, Sam is things are very stable, not really growing, fairly consistent. The bidding activity is similar to what we had seen a year ago. And so that's where our outlook for the remainder of the year is to remain flat and then we'll continue to watch it as we go into next year.

Got you. Thanks. And then maybe pivoting to Eco-Pan, you mentioned the new roll-off options within the Eco-Pan business. Can you expand on the market opportunity for this larger bucket and the margin profile it has compared to the business's original offering?

You may have noticed in our investor presentation that if every concrete placement utilized a concrete washout system, it represents a market opportunity of approximately $850 million. Our Eco-Pan solution, which we offer at most of our locations, consists of smaller containers designed for tight and congested job site areas, mainly to clean out concrete pumps, ready-mix trucks, and other tools while containing the water. The roll-off containers we have used in other markets are larger and capable of handling greater volumes of debris. Unlike our pan service, which operates like a route density business where more pickups and drop-offs improve our margins, the roll-off service involves handling one large container at a time. However, it serves the same customer base that requires both service types. We are actively working to introduce this in as many markets as possible, and it has been performing quite well for us.

Great to hear. And then maybe just one follow-up. Do you have plans to open additional Eco-Pan branches over the next few periods here? And if so, are there any areas you're hoping to target specifically?

We haven't announced any new areas we're going into. We've spent the last year. We had moved into a lot of new locations in 2019. And we've spent the last year refining and building up those locations, and that's where you've seen our margin improvement as we've created that density in those areas. We still believe there's a lot of room in those current markets, and we are contemplating other new markets, but we're not ready to release those areas yet.

Okay, perfect. Thanks, guys.

Thank you.

Thanks. The next question is coming from Andrew Wittmann from Robert W. Baird. Your line is now live.

Great. Thanks. I was wanting to just dig in a little bit to the end markets, particularly in the U.S., it sounds like there's a little bit of a dynamic happening here that's pretty well-known to the investment community about residential markets being very strong. In commercial, I think there's some concerns in the investment community about the strength of the commercial market. So, Bruce, I guess, the question is this: is the growth rate that you're seeing for your residential business, which is about half the size of your commercial business, sufficient to offset any declines that could occur or maybe are occurring from the delays that you're seeing today in the hospitality and retail markets? In other words, do you think the growth rate in residential could be 2x that of commercial?

I believe that next year there will be more opportunities in residential. Currently, the percentage of revenue from our residential sector hasn't changed much from quarter to quarter. Our commercial markets remain strong, and the infrastructure sector also shows resilience. We see potential for increased revenue in residential as that market heats up in many of our locations, and we are focusing on it. However, the key aspect we are monitoring is the direction of the commercial market, which has remained relatively stable for us.

I wanted to focus next on the U.K. business. It seems like the recovery from the COVID impact there is slower than what we've seen in the U.S. Could you provide more context on this and discuss the marketplace dynamics that support your view? Is there potential long-term economic damage from COVID, or is it simply a matter of the reopening process taking longer? Understanding your perspective on this would be helpful.

So currently, we're seeing things reopening slower. Scotland has been slower to reopen, and the city of London itself has been a little slower to reopen. The market seems fairly strong for next year. We've talked about HS2 and the impact that will have. Hinkley Point has still been a very good project for us there. I think once London and Scotland are opened up to their full capacity, I think our revenue should get back to what our normal expectations would be.

Okay. That's helpful. Sorry, I've got one more kind of big-picture question than a technical one. Just on the infrastructure side of the business, there's been a lot in the popular press about state and local budgets. You mentioned the infrastructure segment for you guys is anything that's publicly funded. I was wondering what you're hearing from your customers and what your customers are hearing from their budgetary folks as to what the impacts are today or could be in the future from the potential decline in tax receipts? And if there's any impact on your business that you're seeing today or likely to see in the next few months?

Again, our infrastructure revenue as a percentage of the total is still fairly consistent with what we would have expected. We're bidding a lot of infrastructure work in certain areas. We're following them just state by state, just as you are, thinking about a federally-supported fund that would come in, which would fund that package into the future. Clearly, we're following that as closely as we can in every city and every state. And while it's not a really big part of our business, it could be impactful in the states that are better funded with receipts.

That's all helpful. I don't want to forget about Iain. So the last one is for you. I noticed in the EBITDA reconciliation bridge, there were $3.1 million of other adjustments. Given that there are other, I thought it would be worth giving you an opportunity to comment on what those were. Thanks.

Yes, hi. I mean the way that we look at the other adjustments on EBITDA, really anything that's nonrecurring or nonoperational. So those are consistent with other adjustments in prior periods, but it's largely around any sort of restructure or nonoperational costs that are coming through the business.

Thanks.

Thanks. Our next question today is coming from Brent Thielman from D.A. Davidson. Your line is now live.

Hey, great. Good morning. Iain, could you comment on the net CapEx expectations for this year? I think originally, it was $35 million to $38 million. And then I think you thought that you might fall somewhere below that. So I just wanted to see where you thought that would stand at this point?

Yes, throughout the current year, we are monitoring the free cash flow of the business. Given the unexpected strong momentum, this is influencing our capital allocation decisions. Year-to-date, the free cash flow is approximately $30 million, and we have not provided guidance for the fourth quarter. However, as mentioned in our prepared remarks, we will continue to explore strategic investment opportunities to foster the growth of the business, as long as those investments align with our expectations for free cash flow.

Okay. And then as a follow-up to that and with, I guess, these larger buckets in Eco-Pan. Could you comment on the need to continue this pace of CapEx within that business in order to sustain this growth you've seen in that segment?

Yes, considering it is the highest margin and highest growth segment of our business, we will certainly explore all opportunities in that market, as long as the returns on investments justify it. We are very pleased not only with the margin performance in the third quarter and year-to-date but also with the year-over-year expansion, which indicates a strong payback and healthy cash flow from this area of our business. Additionally, as Bruce mentioned, as we integrate that service into our Concrete Pumping operations and achieve some operational efficiency, it presents a solid investment opportunity and aligns with our strategic goals for the business.

Okay. I appreciate that. Bruce, wondering if you could elaborate on the market share gain opportunities you mentioned that you're seeing in the residential construction business. What exactly are you seeing that?

Yes. So we provided very good Concrete Pumping service. And we think it's second to no one else. And so, as we slowdown in certain markets, it's up to us to go and improve our value to other end markets. It comes down to being available when they need us, being reliable so that when they have concrete there, they know that it's going to go into the forms and they won't have issues with the equipment. And if they do, we have the backup, having the specialty sizes of equipment that sometimes become advantageous to them in unusual circumstances. As we have that capacity, we'll drive that message hard with residential customers and even try to gain share in the commercial market.

And Bruce, is that across the country where you operate or is it specific areas you're really targeting?

That's across the country. In every one of our locations, we have targeted end markets and targeted customers. We work on those things weekly. This isn't a new thing. Now when markets slowdown, we accelerate that. And that's really where we're at right now with the uncertainty about where next year's markets will be.

Okay. Great. Thank you.

Thank you.

Thank you. Your next question today is coming from Steven Fisher from UBS. Your line is now live.

Thanks. Good afternoon, guys. So I know there's enough uncertainty to prevent you from giving guidance, but can you just maybe give us a sense of the visibility that you do have in your various businesses at this point relative to the visibility you would typically have at this point? I don't know if that's sort of expressed in kind of months of opportunities or backlog or work. But just kind of curious how you feel your visibility is today versus typically at this point and kind of where those core uncertainties really lie. Because it sounds like a number of your businesses still sound like you feel pretty confident about them?

We do. We feel like the remainder of this year will go strong into next year. We are watching to see which projects get funded of the projects we're bidding right now, whether it's federally or state-funded jobs, or whether it's privately-funded jobs. We do have some concerns there, but our activity levels still seem relatively stable.

Okay. And, I guess, within your flattish revenues, let's call it in the U.S. Concrete pumping, how would you characterize for the quarter what the market was versus market share, to get to that flat? And what was volume versus price, if I missed it?

Yes. We didn't provide specific figures on volume compared to price. Our rates have increased significantly this quarter. The markets were softer. Some of the revenue we generated was due to better rates on many of our projects, particularly those requiring specialty equipment. However, we continue to focus on price and value, which is what our customers expect from us.

Okay. Any way to sort of bracket what that pricing was, kind of like low single-digits? Is that kind of what we should assume?

Yes, Steven. I mean, that's typically what we see on the pricing is low single-digits year-over-year and then almost an equal amount on volume as well, but obviously, we haven't broken out for the current quarter. But, yes, low single-digits on prices is fair for where we are.

Okay. And then just lastly, can you just clarify what's implied by your comments for U.S. concrete pumping for Q4? I thought you said that you're now looking at revenues, sort of, flattish for the year, which I think, presumably, if I heard that right, implies a decline in Q4, but maybe I didn't hear that right. Can you just clarify what you're implying there?

Yes. I mean, what we were talking about for the third and fourth quarter, if you look at the seasonality of our business, I mean, Q3 and Q4 are considered relatively comparable. Now, looking at what we mentioned on the flatness was actually year-over-year for the third quarter. But looking forward to the fourth, if you look at the seasonality of our business, typically, Q4 is relatively similar to Q3.

Okay. Got it. Thanks very much.

Thank you.

Thanks. Your next question today is coming from Alex Rygiel from B. Riley FBR. Your line is now live.

Thank you. Lots of questions here so far taken, but can you comment on how the competitive environment has changed at all following COVID?

Alex, it's a little bit market by market. Some markets really haven't changed that much with COVID, others have. And so, we look at the different geographies in the different end markets, and it's a little bit all over the board.

And then, as we think about Eco-Pan, how should we think about the growth rate in 2021? The growth rate in 2020 is moving along very, very well. How should we think about modeling that for 2021?

Well, we really aren't giving any guidance right now for 2021, although, we're very bullish on the opportunity.

And as you look at the M&A environment, coming out of COVID, how has that changed, or how has your view on M&A activity and how can acquisitions on near-term changed?

Going into COVID we had a large backlog of opportunity for acquisitions. It hasn't really changed through COVID. Now as you know we've been focused on delevering, improving the balance sheet, which we've done a fairly good job of this year, and we'll continue to do. We will start looking at acquisitions more seriously and grading them on where the best opportunities are.

Great. Thank you very much.

Thank you.

Thanks, Alex.

Thanks. The next question is coming from Stanley Elliott from Stifel. Your line is now live.

Hi. Thanks, guys. Good afternoon. Thanks for taking the questions. Bruce, in terms of M&A, what sort of leverage do you want to get to? Do you have a bogey in mind before you'd start to look at M&A, or is it just going to be more opportunistic on a go-forward basis?

We've certainly worked hard to get our leverage down to around 3.5 times. We'd like to get it a little bit below that. But there are some opportunities out there that actually could help us delever the business at the same time. And so we're looking at those types of opportunities as well.

Did you notice any disruptions from weather during the quarter or in August that may have affected some of the U.S. numbers?

We have seen some weather and we'll continue to see weather with the geographic footprint we have in the U.S. and the U.K. We're going to have weather similar all the time. We try to factor that into our budgets. And we believe that because of that geographic footprint, it doesn't affect us as much as it might with a regional player.

You all mentioned some uncertainties in the marketplace. Iain, could you remind us when you need to commit your CapEx for next year? It seems like a long time since you committed a lot in terms of CapEx this year before the dramatic shutdown. What kind of flexibility do you have in terms of spending for next year? First. Then I’ll have a follow-up.

Yes. Regarding our equipment orders, we usually focus on current needs. It's important to clarify the commitment aspect; until the equipment is actually delivered, we can collaborate with manufacturers due to our scale to ensure we achieve our goals. This is the strategy we pursued this year. I would say we have some flexibility regarding commitments, but we generally start assessing our equipment needs around this time for the future.

And do we think about the capital spent for the Eco-Pan business and the roll-off trucks, do we think of that as you pulling ahead CapEx, or is this incremental CapEx because this is a new opportunity for you? Just trying to balance that and free cash flow expectations?

Yeah. I mean, what I would say, the spend on Eco-Pan, I mean, is all growth. I mean, it's a growth part of our business. We're not really in this out of replacement cycle yet in terms of the life cycle of that business. So it would all be growth CapEx for that business as it moves forward.

Perfect. And then lastly, have you noticed any changes in your receivables? Anything just curious, kind of, the financial health of some of your contractor base, how those guys are looking out?

No, we have not. I mean, the team have collectively done an exceptional job on accounts receivable, and really staying ahead of it. We've got quite sophisticated signals in our business and it's something that we stay very close to. So, even through our cash and liquidity focus that's something that got, I would say heightened attention, but I would say is performing very well through this period, and even better than prior to COVID.

Great. Thanks, guys. Appreciate it.

Thank you.

Thank you. We reached the end of our question-and-answer session. Now, let's turn the floor back over to management for any further or closing comments.

Thank you, Kevin. We'd like to thank everyone for listening to today's call and we look forward to speaking with you again when we report our fourth quarter and full-year fiscal 2020 results in January. Thank you.

Thank you. That does conclude today's teleconference. You may disconnect your line at this time and have a wonderful day. We thank you for your participation.