Enerflex Ltd. (ENRFF) Q2 2022 Earnings Conference Call August 11, 2022 10:00 AM ET

Company Participants

Stefan Ali - Vice President, Strategy and Investor Relations

Marc Rossiter - President and Chief Executive Officer

Sanjay Bishnoi - Senior Vice President and Chief Financial Officer

Ben Park - Vice President, Corporate Controller

Conference Call Participants

Tim Monachello - ATB Capital Markets

Aaron MacNeil - TD Securities

Andrew Bradford - Raymond James

Michael Robertson - National Bank Financial

John Gibson - BMO Nesbitt Burns

Operator

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

Stefan Ali

Thanks, operator. Good morning, everyone and thank you for joining us on our second quarter 2022 earnings conference call. With me on the call today are Marc Rossiter, President and Chief Executive Officer; Sanjay Bishnoi, Senior Vice President and Chief Financial Officer; and Ben Park, Vice President, Corporate Controller. During this call, we will touch on highlights from our second quarter 2022 results, comment briefly on the performance of our three business segments, and then provide an update on the proposed acquisition of Exterran.

Before I turn it over to Marc, I will remind everyone that today’s discussion will include non-IFRS and other financial measures as well as forward-looking statements regarding Enerflex’s expectations for future performance and business prospects. Forward-looking information involves risks and uncertainties, and the stated expectations could differ materially from actual results or performance. For more information, please refer to the advisory comments within our news release, MD&A and other regulatory filings, which are available on our website and under our SEDAR profile. All dollar amounts discussed today are in Canadian dollars unless otherwise stated.

With that, I’ll turn it over to our President and CEO, Marc Rossiter.

Marc Rossiter

Thanks Stefan and good morning everyone. Enerflex posted another strong quarter, building on the momentum we established in the first quarter as we continue to recover from the lows of the pandemic. Reflecting the underlying strength of our base business and our ability to capitalize on improving market fundamentals, we increased our revenues, grew our margins and reduced our net debt balance.

Driven by North American activity, our Engineered Systems business continued its recovery. Quarterly bookings of $313 million doubled from the second quarter of 2021 and increased by 32% from the first quarter of 2022. Continued bookings momentum generated an Engineered Systems backlog of $737 million at June 30. This is our largest backlog in 3 years, providing Enerflex with a clear line of sight to value creation over the coming quarters. Our teams have been working hard to capture expanded margins on these new bookings compared to the lower margin work we secured during pandemic.