Custom Truck One Source, Inc. (NYSE:CTOS) Q3 2022 Results Conference Call November 8, 2022 5:00 PM ET

Company Participants

Brian Perman - VP, IR

Fred Ross - CEO

Ryan McMonagle - President and COO

Chris Eperjesy - CFO

Conference Call Participants

Nicole DeBlase - Deutsche Bank

Justin Hauke - Baird

Stefanos Crist - CJS Securities

Noelle Dilts - Stifel

Scott Schneeberger - Oppenheimer

Operator

Greetings. And welcome to the Custom Truck One Source Inc. Third Quarter 2022 Earnings Conference Call. [Operator Instructions]

It is now my pleasure to introduce your host, Brian Perman. Thank you, Mr. Perman. You may begin.

Brian Perman

Thank you, and good afternoon. Before we begin, we would like to remind you that management’s commentary and responses to questions on today’s call may include forward-looking statements, which, by their nature, are uncertain and outside of the company’s control. Although these forward-looking statements are based on management’s current expectations and beliefs, actual results may differ materially. For a discussion of some of the factors that could cause actual results to differ, please refer to the Risk Factors section of the company’s filings with the SEC. Additionally, please note that you can find reconciliations of the historical non-GAAP financial measures discussed during the call in the press release issued today.

The press release we issued this afternoon, and the presentation for today’s call are posted on the Investor Relations section of our website. We will be filing our third quarter 2022 10-Q with the SEC this evening. Today’s discussion of our results of operations for Custom Truck One Source Inc., or custom truck, is presented on a historical basis as of or for the 3 months ended September 30th, 2022, and prior periods. While our reported results can only include Custom Truck One Source LP for the period since the April 1, 2021 merger date, we have presented and will be discussing today pro forma combined results as if Nesco and [Custom] Truck had operated together for all periods. We believe such combined information is useful to compare how the combined company has performed over time. Joining me today are Fred Ross, CEO; Ryan McMonagle, President and COO; and Chris Eperjesy, CFO.

I will now turn the call over to Fred.

Fred Ross

Thanks, Brian, and welcome, everyone, on today’s call. I’d like to begin by thanking all of our employees, customers and suppliers who support our business and are helping us navigate the challenges our industry continues to face. The entire team continues to work tirelessly to maintain record levels of production so we can fulfill our goals of providing unrivaled service to our customers, growing our market share and creating value for our shareholders. Compared to the prior year quarter, we delivered strong gross profits and adjusted EBITDA gains as well as modest revenue growth. We delivered $91.6 million of adjusted EBITDA and up 9% versus the prior year, while at the same time, Q3 revenue was up slightly versus Q3 of 2021. Supply chain issues continued to impact us in the third quarter, but we were able to deploy $97 million into our rental fleet in the quarter, which is the most sense the merger.