Enerflex Ltd (EFXT) 2023 Q3 法說會逐字稿

Thank you for standing by, and welcome to Enerflex Third Quarter 2023 Earnings Conference Call. (Operator Instructions). Please be advised that today's call is being recorded.

感謝您的耐心等待，歡迎參加 Enerflex 2023 年第三季財報電話會議。 （操作員說明）。請注意，今天的通話正在錄音。

I would now like turn the call over to your host, Mr. Jeff Fetterly, Vice President, Corporate Development and Investor Relations. Please go ahead.

現在我想將電話轉給東道主企業發展和投資者關係副總裁傑夫費特利 (Jeff Fetterly) 先生。請繼續。

Thank you, Valerie, and good morning, everyone. Welcome to our third quarter 2023 earnings call. With me today is Marc Rossiter, President and CEO; Preet Dhindsa, Interim CFO; and Ben Park, Vice President, Corporate Controller. During today's call, we'll touch on highlights from our third quarter results and provide an update on guidance and how we are progressing on our near- and long-term strategic priorities.

謝謝你，瓦萊麗，大家早安。歡迎參加我們的 2023 年第三季財報電話會議。今天和我在一起的是總裁兼執行長 Marc Rossiter； Preet Dhindsa，臨時財務長； Ben Park，副總裁兼公司財務總監。在今天的電話會議中，我們將討論第三季業績的亮點，並提供有關指導的最新資訊以及我們在近期和長期策略重點方面的進展。

Before I turn it over to Marc, I'll 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, refer to the advisory statements within our news release, MD&A and other regulatory filings, all available on our website and under our SEDAR+ and EDGAR profiles. All dollar amounts discussed today are in Canadian dollars, otherwise started.

在將其交給 Marc 之前，我要提醒大家，今天的討論將包括非 IFRS 和其他財務指標，以及有關 Enerflex 對未來業績和業務前景的預期的前瞻性陳述。前瞻性資訊涉及風險和不確定性，所陳述的預期可能與實際結果或表現有重大差異。欲了解更多信息，請參閱我們的新聞稿、MD&A 和其他監管文件中的諮詢聲明，所有這些都可以在我們的網站以及我們的 SEDAR+ 和 EDGAR 配置文件下找到。今天討論的所有美元金額均以加元計算，否則開始。

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

接下來，我會將其交給我們的總裁兼執行長馬克‧羅西特 (Marc Rossiter)。

Thanks, Jeff, and thank you all for joining me on this morning's call. Last night, Enerflex reported its third quarter 2023 results, which reflect the significant progress we're making in advancing our strategic priorities, including the continued integration of Exterran.

謝謝傑夫，也謝謝大家參加今天早上的電話會議。昨晚，Enerflex 報告了 2023 年第三季業績，反映了我們在推動策略重點方面取得的重大進展，包括繼續整合 Exterran。

Our recent results and progress to date also underscore that we have more work ahead of us to unlock the full potential of our combined company. Our global footprint, expanded product offerings and deepened ability to serve the energy value chain is generating operational results that are less influenced by the economics, rig counts and commodity prices of any single region or producing basin.

我們最近的業績和迄今為止的進展也強調，我們還有更多工作要做，才能釋放合併後公司的全部潛力。我們的全球足跡、擴大的產品範圍和深化的服務能源價值鏈的能力正在產生較少受到任何單一地區或生產盆地的經濟、鑽機數量和商品價格影響的營運結果。

During the first 9 months of 2023, approximately 60% of Enerflex's gross margin was generated from recurring sources, and markets outside North America contributed 43% of the company's total gross margin during the same period. I'm pleased to report that we delivered strong operating results across all of our geographies.

2023年前9個月，Enerflex約60%的毛利率來自經常性來源，同期北美以外的市場貢獻了該公司總毛利率的43%。我很高興地報告，我們在所有地區都取得了強勁的經營成果。

Integration and synergy realization activities related to the Exterran acquisition remain on track. Since close, Exterran has captured approximately $50 million -- sorry, Enerflex has captured approximately USD 50 million of annual run rate synergies and expect to realize the remaining USD 10 million for a total of USD 60 million of anticipated synergies within the next 6 months.

與 Exterran 收購相關的整合和協同實現活動仍在按計劃進行。自交易結束以來，Exterran 已獲得約5000 萬美元——抱歉，Enerflex 已獲得約5000 萬美元的年度運行率協同效應，並預計在未來6 個月內實現剩餘的1000 萬美元，從而實現總計6000 萬美元的預期協同效應。

In addition, the company continues to review opportunities to optimize its geographic footprint and business platform. To this end, we are in the process of consolidating our global manufacturing facilities from 5 to 3 and, in the early part of the fourth quarter, completed the sale of 2 noncore assets for gross proceeds of approximately $40 million. We expect these actions, combined with additional optimization efforts, will drive cash flow, enabled long -- enable continued debt reduction and enhance our ability to generate shareholder returns over the mid and long term.

此外，該公司還將繼續尋找優化其地理足跡和業務平台的機會。為此，我們正在將全球製造工廠從 5 個整合為 3 個，並在第四季度初完成了 2 個非核心資產的出售，總收益約為 4000 萬美元。我們預計這些行動，再加上額外的優化工作，將推動現金流，實現長期目標——持續減少債務，並增強我們在中長期創造股東回報的能力。

Touching briefly in the quarter, Enerflex delivered adjusted EBITDA of $122 million and operating cash flow of $71 million, demonstrating the strength and continued momentum from our recurring businesses as well as the North American Engineered Systems product line.

在本季度，Enerflex 實現了 1.22 億美元的調整後 EBITDA 和 7,100 萬美元的營運現金流，展示了我們的經常性業務以及北美工程系統產品線的實力和持續發展勢頭。

We recorded strong Engineered Systems bookings in the quarter of $560 million, bringing our year-to-date total in the first 9 months of 2023 to $1.4 billion, an increase of approximately $500 million year-over-year.

我們在本季度實現了 5.6 億美元的強勁工程系統預訂，使我們 2023 年前 9 個月迄今的總預訂額達到 14 億美元，同比增長約 5 億美元。

Our bookings reflect demand originating from 3 continents and highlight robust customer activity levels, particularly in North America and notably for cryogenic and low-carbon solutions. Our bookings during the first 3 quarters of 2023 include $153 million for cryogenic projects outside of North America and USD 111 million related to projects that advance our energy transition business strategy. Our record Engineered Systems backlog of $1.6 billion provides strong visibility into revenue generation and business activity levels for 2024.

我們的預訂反映了來自三大洲的需求，並突顯了強勁的客戶活動水平，特別是在北美，尤其是低溫和低碳解決方案。我們在 2023 年前三個季度的預訂包括北美以外低溫項目的 1.53 億美元以及與推進我們的能源轉型業務戰略的項目相關的 1.11 億美元。我們的工程系統積壓訂單達到創紀錄的 16 億美元，為 2024 年的收入產生和業務活動水準提供了清晰的可視性。

Energy Infrastructure contributed approximately 40% of gross margin during the quarter. This business is generating stable results, and we continue to evaluate opportunities to maximize performance across our geographic platform.

能源基礎設施貢獻了本季毛利率的約 40%。該業務正在產生穩定的業績，我們將繼續評估在我們的地理平台上最大化績效的機會。

Our U.S. contract compression fleet is operating at high utilization rates of 93% in the quarter. The After-market Services business is benefiting from increased activity levels, inflationary price adjustments and continued strong demand for spare parts.

我們的美國合約壓縮機隊本季的利用率高達 93%。售後服務業務受益於活動水準的增加、通貨膨脹的價格調整以及對備件的持續強勁需求。

We remain committed to enhancing our financial position and repaid $41 million of long-term debt in the quarter, which is consistent with our focus on strengthening the balance sheet and enhancing the company's financial flexibility. However, our reported long-term debt declined by only $5 million in the quarter due to the negative impact of a strengthening U.S. dollar versus Canadian dollar.

我們仍然致力於增強我們的財務狀況，並在本季度償還了 4,100 萬美元的長期債務，這與我們加強資產負債表和增強公司財務靈活性的重點是一致的。然而，由於美元兌加幣走強的負面影響，我們報告的長期債務在本季僅減少了 500 萬美元。

On today's call, I also have the pleasure of introducing Preet Dhindsa, who announced -- who we announced as our Interim CFO last month, and Jeff Fetterly is our new VP of Corporate Development and Investor Relations.

在今天的電話會議上，我還很榮幸地介紹 Preet Dhindsa，我們上個月宣布他擔任我們的臨時財務官，而 Jeff Fetterly 是我們新的企業發展和投資者關係副總裁。

Preet is a seasoned financial leader with more than 25 years of experience, primarily in the energy and financial service industries. He brings a proven track record of leading large international finance organizations, including through post-merger integration activities. Jeff is well known to many listeners as a well-regarded thought leader in energy equity analysis. I'm excited to be working with Jeff and Preet at this important time for our company, and I'm confident that their experience will serve Enerflex shareholders well.

Preet 是一位經驗豐富的金融領導者，擁有超過 25 年的經驗，主要在能源和金融服務業。他在領先的大型國際金融組織方面擁有良好的業績記錄，包括透過併購後的整合活動。傑夫是許多聽眾所熟知的能源公平分析領域備受推崇的思想領袖。我很高興能在我們公司的這個重要時刻與 Jeff 和 Preet 合作，我相信他們的經驗將為 Enerflex 股東提供良好的服務。

Before I turn the call over to Preet, I'd like to emphasize that the underlying macro drivers for our business are robust. With the ongoing focus on global energy security, the growing need for low-emissions natural gas, resulting in a strong demand for Enerflex's energy infrastructure and energy transition solutions. As customers aim to decarbonize their operations, Enerflex is poised to capitalize on the growing demand for sustainable energy infrastructure through our vertically integrated natural gas, produced water treatment and energy transition offerings.

在將電話轉給普雷特之前，我想強調我們業務的基本宏觀驅動力是強大的。隨著全球能源安全的持續關注，對低排放天然氣的需求不斷增長，導致對 Enerflex 能源基礎設施和能源轉型解決方案的強勁需求。隨著客戶致力於實現營運脫碳，Enerflex 準備透過我們的垂直整​​合天然氣、採出水處理和能源轉型產品，充分利用對永續能源基礎設施不斷增長的需求。

With that, I'll turn it over to Preet to speak to the financial highlights of the quarter and provide an update on Enerflex's outlook for the balance of 2023 and 2024.

接下來，我將把它交給 Preet，介紹本季的財務亮點，並提供 Enerflex 對 2023 年和 2024 年剩餘時間展望的最新情況。

Thank you, Marc, and good morning, everyone. I am excited to step into the CFO role during this pivotal time for Enerflex. I've hit the ground running to support the strong global finance team as we work to ensure the company has financial stability and flexibility through industry cycles.

謝謝你，馬克，大家早安。我很高興能在 Enerflex 的這個關鍵時期擔任財務長。我已立即行動起來，為強大的全球財務團隊提供支持，努力確保公司在整個行業週期內保持財務穩定性和靈活性。

Our consolidated third quarter revenues of $778 million were driven by continued strong performance from Enerflex's recurring businesses and North American Engineered Systems product line.

我們第三季的綜合營收為 7.78 億美元，這得益於 Enerflex 經常性業務和北美工程系統產品線持續強勁的業績表現。

Enerflex's gross margin was $146 million or 19% of revenue comparable to Q2 2023. Energy Infrastructure gross margin decreased quarter-over-quarter to 30%, primarily related to higher depreciation. Engineered Systems, our gross margin improved to 15% as we execute on higher-margin backlog. Our After-market Services gross margin was 17% in Q3 2023 compared to 20% in the prior quarter, reflective of the sales mix that included a higher proportion of part sales compared to most recent quarters.

與 2023 年第二季相比，Enerflex 的毛利率為 1.46 億美元，佔營收的 19%。能源基礎設施毛利率季減至 30%，主要與折舊增加有關。在工程系統方面，由於我們執行利潤率較高的積壓訂單，我們的毛利率提高到了 15%。 2023 年第三季度，我們的售後服務毛利率為 17%，而上一季為 20%，這反映出與最近幾季相比，零件銷售比例更高的銷售組合。

Enerflex's SG&A of $115 million increased by $15 million over the second quarter, which was largely driven by a onetime bad debt recovery of $12 million that was recognized in the second quarter. Transaction, restructuring and integration costs were $6 million in Q3 compared to $12 million in Q2. We do expect to see additional cost for restructuring and optimization, although, as Marc mentioned, integration and synergy realization activities remain well on track.

Enerflex 的 SG&A 為 1.15 億美元，比第二季增加了 1,500 萬美元，這主要是由於第二季確認的 1,200 萬美元的一次性壞帳回收所致。第三季的交易、重組和整合成本為 600 萬美元，而第二季為 1,200 萬美元。我們確實預期重組和優化會產生額外成本，儘管正如馬克所提到的，整合和協同實現活動仍然順利進行。

This brings me to our adjusted EBITDA of $122 million in the third quarter. Included in adjusted EBITDA are foreign exchange losses of $17 million during the quarter related to the devaluation of the Argentine peso. We continued to actively manage this exposure and generate $11 million of offsetting gains from associated instruments. The majority of this amount is reported in net finance cost and excluded from the adjusted EBITDA number we reported.

這讓我想到第三季調整後的 EBITDA 為 1.22 億美元。調整後的 EBITDA 包括本季與阿根廷比索貶值相關的 1,700 萬美元外匯損失。我們繼續積極管理這項風險，並從相關工具中產生了 1,100 萬美元的抵銷收益。其中大部分金額以淨財務成本報告，不包括在我們報告的調整後 EBITDA 數據中。

Excluding the impact of foreign exchange, our business in Argentina continues to perform well and generate strong operating cash flow for the company. Enerflex also continues to manage foreign exchange volatility, with the majority of exposure to the Argentine peso offset by associated instruments.

排除外匯影響，我們在阿根廷的業務繼續表現良好，為公司產生強勁的營運現金流。 Enerflex 也持續管理外匯波動，大部分阿根廷比索風險被相關工具抵銷。

Cash provided by operating activities was $71 million in the quarter, which included a working capital recovery of $15 million. Comparatively, in the second quarter, cash used in operating activities was $4 million. A $75 million positive swing Q-over-Q.

本季經營活動提供的現金為 7,100 萬美元，其中包括 1,500 萬美元的營運資本回收。相比之下，第二季經營活動使用的現金為400萬美元。環比正向波動 7500 萬美元。

We invested $26 million in capital expenditures, including $8 million of maintenance capital across the global Energy Infrastructure fleet and returned $3 million to shareholders through dividends. Enerflex's primary focus for 2023 is to progress the integration of Exterran and strengthen our financial position.

我們投資了 2,600 萬美元的資本支出，包括全球能源基礎設施艦隊的 800 萬美元的維護資本，並透過股息向股東返還 300 萬美元。 Enerflex 2023 年的主要重點是推動 Exterran 的整合並增強我們的財務狀況。

During the third quarter, we repaid $41 million of long-term debt, although reported long-term debt declined by only $5 million, including the impact of a strengthening U.S. dollar. We reduced our bank adjusted net debt-to-EBITDA ratio to 2.7x at the end of Q3 from 3.3x at the end of 2022. And we are on track to achieve a ratio of slightly less -- or less than 2.5x by year-end 2023.

第三季度，我們償還了 4,100 萬美元的長期債務，儘管報告的長期債務僅減少了 500 萬美元，其中包括美元走強的影響。我們將銀行調整後的淨負債與 EBITDA 比率從 2022 年底的 3.3 倍降低到第三季末的 2.7 倍。我們預計今年將實現略低或低於 2.5 倍的比率- 2023 年底。

We are reaffirming all of our full year 2023 financial guidance as last provided with our second quarter results. We anticipate adjusted EBITDA as currently reported to be at the low end of this guidance range, inclusive of the impact from volatility to foreign exchange markets, specifically Argentina. Please note, foreign exchange losses of $41 million during the 9 months ended September 2023 related to devaluation of the Argentine peso is included in our adjusted EBITDA.

我們重申第二季業績中最後提供的所有 2023 年全年財務指引。我們預計目前報告的調整後 EBITDA 將處於該指導範圍的低端，包括波動對外匯市場（特別是阿根廷）的影響。請注意，截至 2023 年 9 月的 9 個月內，與阿根廷比索貶值相關的 4,100 萬美元外匯損失已包含在我們調整後的 EBITDA 中。

We continue to target total 2023 PP&E and growth capital expenditures of USD 80 million to USD 90 million, which includes 2 large water projects that were commissioned in the first quarter and various small-scale, customer-sanctioned projects in the U.S., Latin America and Eastern Hemisphere.

我們繼續將2023 年PP&E 和成長資本支出目標定為8,000 萬美元至9,000 萬美元，其中包括第一季投產的2 個大型水利項目以及位於美國、拉丁美洲和加勒比地區的各種小型、客戶認可的項目。東半球。

Heading into 2024, we expect our performance to be underpinned by recurring Energy Infrastructure and After-market Services product line and a robust Engineered Systems backlog. Enerflex is targeting a disciplined capital program in 2024. Consistent with our current focus, we will continue to prioritize debt reduction, synergy realization and operational efficiency. The company continues to review its target long-term capital structure and capital allocation parameters, and we expect to provide more clarity in the coming months.

進入 2024 年，我們預計我們的業績將得到經常性能源基礎設施和售後服務產品線以及強大的工程系統積壓的支撐。 Enerflex 的目標是在 2024 年實施嚴格的資本計劃。與我們目前的重點一致，我們將繼續優先考慮債務削減、實現協同效應和營運效率。該公司繼續審查其目標長期資本結構和資本配置參數，我們預計在未來幾個月內提供更清晰的資訊。

Finally, Enerflex is committed to delivering a sustainable dividend to shareholders, with our Board declaring a quarterly dividend of $0.025 per share. The dividend is payable on January 10 to shareholders of record on November 21.

最後，Enerflex 致力於向股東提供可持續的股息，我們的董事會宣布季度股息為每股 0.025 美元。股利將於 1 月 10 日支付給 11 月 21 日登記在冊的股東。

Before I turn it over to Marc, I will conclude by saying that within the support of Enerflex's strong leadership team and talented employees, we are improving the profitability and resiliency of the global business, with an objective to generate sustainable cash flow. I am excited to have joined this team and to help unlock the business' full potential for the benefit of our shareholders, customers, employees and stakeholders.

在將其交給 Marc 之前，我最後要說的是，在 Enerflex 強大的領導團隊和才華橫溢的員工的支持下，我們正在提高全球業務的盈利能力和彈性，目標是產生可持續的現金流。我很高興加入這個團隊，幫助釋放公司的全部潛力，造福我們的股東、客戶、員工和利害關係人。

With that, over to you, Marc, for closing remarks.

現在，馬克，請您致閉幕詞。

Thanks, Preet. Enerflex's third quarter financial and operating results highlight our continued ability to successfully execute against our strategy across our 3 core businesses around the world. Our commitment to our key priorities remain steadfast as we work to maximize free cash flow generation, strengthening our financial position, realize the benefits and synergies from the acquisition and continue to offer best-in-class natural gas, produced water and energy transition solutions to our customers across the globe. I look forward to building on our progress to create significant value and optionality across geographies, customers and product lines.

謝謝，普雷特。 Enerflex 第三季的財務和營運表現凸顯了我們在全球 3 個核心業務中成功執行策略的持續能力。我們對關鍵優先事項的承諾仍然堅定不移，我們致力於最大限度地產生自由現金流，增強我們的財務狀況，實現收購帶來的效益和協同效應，並繼續為客戶提供一流的天然氣、采出水和能源轉型解決方案。我們的客戶遍佈全球。我期待著在我們取得的進展的基礎上，在各個地區、客戶和產品線中創造顯著的價值和選擇性。

I will now hand the call back to the operator for questions.

我現在將把電話轉給接線員詢問問題。

(Operator Instructions) Our first question comes from the line of Aaron MacNeil of TD Cowen.

（操作員說明）我們的第一個問題來自 TD Cowen 的 Aaron MacNeil。

Can you give us a sense of the spending for working capital, work in progress, asset sales and any other discretionary cash flows for Q4 so we get a sense of conversion rates of EBITDA into cash? And maybe if you have any preliminary thoughts on 2024 for these types of flows, that would also be very helpful.

您能否讓我們了解第四季度的營運資金、在製品、資產銷售和任何其他可自由支配現金流的支出，以便我們了解 EBITDA 到現金的轉換率？如果您對 2024 年此類流量有任何初步想法，那也會非常有幫助。

Yes, sure. Aaron, this is Marc. And I'm going to ask Jeff to answer that with a little bit more specificity, but we did confirm guidance, and guidance goes into a fair amount of detail on some of those cash flows. And I don't think we're in a position right now to provide any more guidance on specific areas of cash flow in Q4.

是的，當然。亞倫，這是馬克。我將要求傑夫更體面地回答這個問題，但我們確實確認了指導意見，並且指導意見詳細介紹了其中一些現金流量。我認為我們現在無法就第四季度現金流的特定領域提供更多指導。

Jeff, do you have anything to add to that?

傑夫，你還有什麼要補充的嗎？

Yes. Just to reiterate, Aaron, we talked about, from a capital expenditure standpoint, including contract assets, a target range of USD 160 million to USD 190 million for 2023. And the other nondiscretionary expenditures, which is composed of the working capital, finance costs, cash income taxes and dividends of between USD 180 million and USD 210 million. And as Marc said, we reiterated those, and we remain on track to meet those targets for this year.

是的。亞倫，我們重申一下，從資本支出的角度來看，包括合約資產，2023 年的目標範圍為 1.6 億美元至 1.9 億美元。其他非可自由支配支出，包括營運資金、財務成本、現金所得稅和股息在1.8 億美元至2.1 億美元之間。正如馬克所說，我們重申了這些目標，我們仍然有望實現今年的這些目標。

Going into 2024, as we said in the script for the prepared remarks, we're targeting a disciplined capital program for the year. And we'll continue to prioritize debt repayment.

進入 2024 年，正如我們在準備好的演講稿中所說，我們今年的目標是製定嚴格的資本計劃。我們將繼續優先考慮債務償還。

Okay. Can you speak to the types of energy transition-related bookings in the quarter? Is it predominantly electric drive compression? Or is there any other carbon capture or biofuels or other projects in there?

好的。您能談談本季與能源轉型相關的預訂類型嗎？主要是電力驅動壓縮嗎？或者有其他碳捕獲或生物燃料或其他項目嗎？

The majority of the bookings is electrification.

大部分預訂是電氣化的。

Our next question comes from the line of Keith MacKey of RBC Capital Markets.

我們的下一個問題來自加拿大皇家銀行資本市場公司的基斯‧麥基 (Keith MacKey)。

First wanted to just start out on the margin profile in Energy Infrastructure. I noticed it's trended down a little bit in this quarter. It's just a snick below the 55% to 65% target range or approximate range on a cash basis. Can you just speak to the factors behind where margins are in that business now? I noticed the U.S. contract compression utilization trended down slightly. So can you just speak to the factors behind where margins are now and hopefully where we should be thinking about margins going over the next 3 to 4 quarters?

首先想從能源基礎設施的利潤狀況開始。我注意到本季略有下降。這僅略低於 55% 至 65% 的目標範圍或現金基礎上的近似範圍。能談談目前該業務利潤率背後的因素嗎？我注意到美國合約壓縮利用率略有下降。那麼，您能否談談目前利潤率背後的因素，以及我們應該考慮未來 3 到 4 個季度的利潤率？

Keith, it's Ben. Yes, those margins are kind of well within expectations for that business on a run rate basis. If you take a look back to Q2, I think we're closer to that than we were for last quarter -- than we were last -- sorry, Q1 than we were in Q2. But it's well within the range there.

基思，是本。是的，從運行率來看，這些利潤率完全符合該業務的預期。如果你回顧第二季度，我認為我們比上個季度更接近這個目標，比上個季度更接近，對不起，第一季比第二季度更接近。但它完全在這個範圍之內。

Got it. Okay. And Preet, since you joined the organization just recently, certainly, as you mentioned at a pivotal time, can you just speak to -- as you've kind of gotten into the company and seeing people and operations, can you just speak to some of the -- maybe some of the strengths in the organization that you've seen and your first impressions as well as some of the areas where you think there could be optimization for the future?

知道了。好的。 Preet，由於您最近剛加入該組織，當然，正如您在關鍵時刻提到的那樣，您可以與一些人交談嗎？因為您已經進入公司並了解人員和運營情況，您可以與一些人交談嗎？也許是您所看到的組織中的一些優勢和您的第一印象，以及您認為未來可以優化的一些領域？

Sure. Thank you. Thank you for that. And so I've been here just under 4 weeks of total time, and it's a great place to be. Very happy to be here, a wonderful group of people. I think the executive team, good interaction with the Board this week, and my global finance team is fantastic. So good group of folks all around, and I like the scale and scope of the organization, and we're working through integration. And some of our priorities are where my focus is, is integration. It's clearly important. We put a milestone out there, 12, 18 months to complete most of it.

當然。謝謝。謝謝你。我在這裡待了不到 4 週的時間，這是一個很棒的地方。很高興來到這裡，這是一群很棒的人。我認為執行團隊、本週與董事會的良好互動以及我的全球財務團隊都非常棒。周圍都是一群優秀的人，我喜歡這個組織的規模和範圍，我們正在透過整合進行工作。我們的一些優先事項也是我關注的重點，那就是整合。這顯然很重要。我們設定了一個里程碑，12、18 個月來完成大部分工作。

Number two, free cash flow generation, debt reduction is a very important vehicle, and we have committed we will be under 2.5x the key leverage metrics by year-end. And then going forward, the long-term capital structure and the capital allocation priorities, we're working towards that to find out how we should be structured as a combined global entity post acquisition given the mix of our business tied to recurring revenues and also the other side of the business. So we're working on that carefully, and dividends fall into this, leverage metrics fall into this, optimal debt amounts.

第二，自由現金流產生、債務削減是一個非常重要的工具，我們承諾到年底我們將把關鍵槓桿指標控制在 2.5 倍以下。然後，展望未來，長期資本結構和資本配置優先事項，我們正在努力找出收購後我們應該如何建構為一個合併的全球實體，因為我們的業務與經常性收入相關，而且業務的另一面。因此，我們正在仔細研究這一點，股息屬於這個，槓桿指標屬於這個，最佳債務金額。

So those are some of my priorities, I would say. And you know what? I look forward to working with the team, and very pleased to be here.

所以我想說，這些都是我的優先事項。你知道嗎？我期待與團隊合作，很高興來到這裡。

Our next question comes from the line of Tim Monachello of ATB Capital Markets.

我們的下一個問題來自 ATB Capital Markets 的 Tim Monachello。

Can you hear me?

你聽得到我嗎？

Yes. We're here.

是的。我們到了。

First, just on the Engineered Systems margins, you'd seen this picking up a little bit. You booked, I think, 5 cryo plants in 2023. And that's just a little bit longer lead build, but you've got the $1.2 billion of Engineered Systems backlog you're expecting to recognize over the next 12 months. Can you talk a little bit about how that margin -- the embedded margin in that backlog compared to where you are today?

首先，就工程系統的利潤而言，您已經看到這種情況有所回升。我認為，您在 2023 年預訂了 5 個低溫工廠。這只是領先建設時間稍長一點，但您已經獲得了 12 億美元的工程系統積壓訂單，預計在未來 12 個月內會得到認可。你能談談這個利潤——積壓訂單中的嵌入利潤與你今天的情況相比如何嗎？

It's in line with what we're executing right now, Tim. And I think we've been pointing to a mid-teens sort of targeted minimum margins in that business, and we definitely would like to move it up higher through operational execution. But knowing the embedded backlog and what we're booking things at. It gives us a lot of visibility to revenue stream from that business line going all the way out through the end of 2024, and that mid-teens target for operating margin is pretty close to where we're going to be in my expectation.

這與我們現在正在執行的事情是一致的，提姆。我認為我們一直在指出該業務的目標最低利潤率是十幾歲左右，我們肯定希望透過營運執行將其提高到更高水平。但要了解嵌入式積壓訂單以及我們預訂的內容。它讓我們對從該業務線一直到 2024 年底的收入流有了很大的了解，而且營業利潤率的 15% 左右的目標非常接近我們的預期。

Okay. That's helpful. And then in the Energy Infrastructure business, revenue is down a little bit quarter-over-quarter, not much. But I would have expected to see some growth in that revenue line just given those water projects coming on through the first half of the year. Was there any movement in your contract book there?

好的。這很有幫助。然後在能源基礎設施業務中，收入環比略有下降，但幅度不大。但考慮到今年上半年這些水利工程的進展，我預計該收入線會有所成長。你的合約書裡有什麼動靜嗎？

So Tim, it wasn't that -- we expected the revenues to be pretty stable in -- from Q2 to Q3. The water projects, some of them started in Q1 and Q2. So yes, it's not surprising that it is stable quarter-over-quarter.

所以提姆，事實並非如此——我們預計第二季到第三季的營收會相當穩定。水務項目，其中一些是在第一季和第二季啟動的。所以，是的，季度環比穩定也就不足為奇了。

Our next question comes from the line of Jamie Kubik of CIBC.

我們的下一個問題來自 CIBC 的 Jamie Kubik。

I've got 2 here for you. Just on the Engineered Systems bookings, can you just talk about maybe the split between Canada and the U.S. and if you've seen much recovery on the Canadian side, given the agreement in BC between the First Nations and government to start the year?

我這裡有 2 個給你。就工程系統預訂而言，您能否談談加拿大和美國之間的分歧，以及考慮到原住民與政府在年初達成的不列顛哥倫比亞省協議，您是否看到加拿大方面有很大復甦？

Yes, the bookings in the quarter, they were very international. We had orders from Latin American segment. We had orders in from U.S. customers, Canadian customers and, indeed, from customers in the Eastern Hemisphere. A lot of those Engineered Systems orders go through the U.S. and Canadian shops. So -- but yes, a very, very broad base of orders.

是的，本季的預訂量非常國際化。我們有來自拉丁美洲部分的訂單。我們收到了來自美國客戶、加拿大客戶以及東半球客戶的訂單。許多工程系統訂單都透過美國和加拿大的商店進行。所以——但是，是的，訂單基礎非常非常廣泛。

To go to Canada specifically, we've seen an increase in inquiry levels. And I think a lot of our midstream customers have been looking at projects for some time, and it feels like the conversations we've been having, there's an increased conviction to start moving on adding natural gas processing and liquids processing infrastructure in the Northwestern Alberta, Northeastern BC area.

具體到加拿大，我們發現詢問量增加。我認為我們的許多中游客戶已經關注該項目一段時間了，感覺就像我們一直在進行的對話一樣，人們越來越相信開始在艾伯塔省西北部增加天然氣加工和液體加工基礎設施，BC省東北部地區。

Whether that's a direct result of the Blueberry First Nation agreement or not is difficult to say. But we do expect bookings in Canada in 2024 to be more robust than we saw in 2023. And the most obvious macro drivers for that expectation really is the Blueberry First Nations and the LNG Canada, the 2 big drivers. And I think a lot of our -- a lot of the producers in Canada and a lot of the midstreamers are pointing to those same macros for why they see some continued positivity in the Canadian market for next year.

這是否是藍莓原住民協議的直接結果很難說。但我們確實預計 2024 年加拿大的預訂量將比 2023 年更加強勁。而這項預期最明顯的宏觀驅動因素實際上是藍莓原住民和加拿大液化天然氣公司這兩個主要驅動因素。我認為我們的許多人——加拿大的許多生產商和許多中游企業都指出了同樣的宏觀因素，解釋了為什麼他們認為明年加拿大市場將繼續保持積極勢頭。

Okay. That's helpful. And then second question for me is a bit along the same line as what Aaron was asking and respect if you don't want to provide more granularity on this, but I'll ask it anyways.

好的。這很有幫助。對我來說，第二個問題與亞倫所問的問題有點相似，如果您不想提供更多細節，請尊重，但無論如何我都會問。

But just with respect to 2024, you indicate you're targeting a disciplined capital program for next year. Can you just outline a bit what that ultimately means? Does it mean less capital spending than this year? And then you do talk about evaluating a target long-term capital structure and capital allocation parameters. Just what does that mean? Should we think about 2.5 turns of debt relative to EBITDA as sort of the high watermark for where you want debt to be? And then should we think about shareholder returns increasing at levels below that? Can you just touch on those items a bit further if you're willing to?

但就 2024 年而言，您表示明年的目標是嚴格的資本計畫。您能簡單概述一下這最終意味著什麼嗎？這是否意味著資本支出比今年減少？然後您確實談到了評估目標長期資本結構和資本配置參數。這到底是什麼意思呢？我們是否應該將債務相對 EBITDA 的 2.5 倍視為您希望債務達到的高水位？那麼我們是否應該考慮股東回報以低於該水準的水平成長？如果您願意的話，可以進一步談談這些內容嗎？

Jamie, it's Jeff. From a capital spending standpoint, Marc's talked about this in recent calls. After heavy investments in 2022 and '23, the expectation is that the capital spending will come down and be lower in 2024. We are still in the process of evaluating our capital program for next year and expect to provide clarity to the market in coming months on that specifically. But from a directional standpoint, I think that's reasonable to see.

傑米，是傑夫。從資本支出的角度來看，馬克在最近的電話會議中談到了這一點。經過 2022 年和 23 年的大量投資後，預計 2024 年資本支出將下降並更低。我們仍在評估明年的資本計劃，並預計在未來幾個月向市場提供清晰的信息。但從方向的角度來看，我認為這是合理的。

In terms of the debt and the leverage side, as Preet said in his prepared remarks, we're on track to reach a leverage ratio of under 2.5x by the end of 2023. Debt repayment will remain a priority for the company in 2024, both in absolute terms and on a relative leverage ratio basis. And we also continue to evaluate what the optimal capital structure and long-term ratio is for the company, and we expect to provide more clarity on that in coming months as well.

在債務和槓桿方面，正如普雷特在他準備好的演講中所說，我們預計在 2023 年底前達到 2.5 倍以下的槓桿率。債務償還仍將是公司 2024 年的首要任務，無論是絕對槓桿率還是相對槓桿率。我們還將繼續評估公司的最佳資本結構和長期比率，並預計在未來幾個月內提供更清晰的資訊。

(Operator Instructions) Our next question comes from the line of John Gibson of BMO Capital Markets.

（操作員說明）我們的下一個問題來自 BMO 資本市場的 John Gibson。

Most of my questions have been answered, but I've got one here. Just I guess, more high level, we're just over a year post closing of the Exterran transaction, and obviously, we've seen some delays in the early part of the year. I guess how close are you to getting the pro forma entity to one in terms of like your facility footprint cost in the system, et cetera? And what surprised you the most as you've worked through the integration over the past year or so?

我的大部分問題都已得到解答，但我這裡還有一個問題。我想，更高層次的是，我們在 Exterran 交易結束後才一年多，顯然，我們在今年早些時候看到了一些延誤。我猜想，就係統中的設施佔地面積成本等而言，您距離準備考試實體有多近？在過去一年左右的整合過程中，最令您驚訝的是什麼？

John, we are pretty much complete on the vision of what we want Enerflex to be long term. We've executed on 90% of the people-related streamlining. We've got work to do on the processes and systems, and that's going to be a big part of the effort through 2024.

約翰，我們對 Enerflex 的長期願景已經基本完成。我們已經執行了 90% 與人員相關的精簡工作。我們在流程和系統方面還有工作要做，這將是 2024 年工作的重要部分。

Going into 2025, I want the company to be integrated, streamlined, all operating in the same processes and systems. But what you'll see from us operationally in 2024 is very close to the long-term Enerflex with respect to the markets we address, the geographies we're present in and our emphasis on our 3 core business lines of Engineered Systems, Energy Infrastructure and After-market Services and our sort of big macros of natural gas, produced water and energy transition.

進入 2025 年，我希望公司能夠整合、精簡，並在相同的流程和系統中運作。但就我們所涉足的市場、我們所處的地理位置以及我們對工程系統、能源基礎設施這 3 個核心業務線的重視而言，您將在 2024 年看到我們的營運情況與長期 Enerflex 非常接近售後服務以及我們的天然氣、採出水和能源轉型等大型宏觀政策。

So we're kind of there. We're going to be getting out of the 2 shops that we're closing by the end of this year, early next year. And the cost to complete some of those exits has been better than we anticipated. If I want to flip to some of the things that were a little unanticipated, we do want to exit a lot of countries that we don't view as core and move on. The cost to exit some of those countries was a little bit higher than we thought, and we'll be putting some more thought into that.

所以我們就在那裡。我們將在今年年底明年初關閉兩家商店。完成其中一些退出的成本比我們預期的要好。如果我想談談一些有點出乎意料的事情，我們確實希望退出許多我們不認為是核心的國家並繼續前進。退出其中一些國家的成本比我們想像的要高一些，我們將對此進行更多考慮。

Additionally, making sure that the company's stock's compliant in accordance with our SEC filing and our NYSE listing. That's a lot of work, and that's something that our employees have been working really hard on all year to achieve that SOX compliance, and that's something that will require the focus of Preet's team and a lot of operational folks into -- to close out the year and into the first quarter of 2024.

此外，確保公司股票符合我們向 SEC 提交的文件和在紐約證券交易所上市的要求。這是一項艱鉅的工作，我們的員工全年都在努力工作，以實現 SOX 合規性，這需要 Preet 團隊和許多營運人員的關注——以結束到 2024 年第一季。

Our next question comes from the line of Nick Corcoran of Acumen Capital.

我們的下一個問題來自 Acumen Capital 的 Nick Corcoran。

Most of my questions have been answered, but I think in the prepared remarks, you mentioned a noncore office sale after quarter end. Can you give a little bit more color on what that was and whether there's any other assets (inaudible)?

我的大部分問題都已得到解答，但我認為在準備好的發言中，您提到了季度末後的非核心辦公室出售。您能否詳細說明一下它是什麼以及是否還有其他資產（聽不清楚）？

Sure, Nick. We sold a set of assets in Latin America and a set of assets in North America. And in both instances, we had the counterparties we sold to approach us and had thoughtful discussions about those sales. So it's good in a way that we sold one of the packages to an existing customer. And the positive is that they agreed to have a long-term O&M contract with Enerflex to keep those assets running.

當然，尼克。我們出售了拉丁美洲的一組資產和北美的一組資產。在這兩種情況下，我們都讓我們出售的交易對手與我們聯繫，並對這些銷售進行了深思熟慮的討論。因此，我們將其中一個軟體包出售給現有客戶，這在某種程度上是件好事。積極的一面是，他們同意與 Enerflex 簽訂長期營運和維護合同，以保持這些資產的運作。

So it's good news. It helps us reinforce our debt reduction priority. The noncore assets don't have material EBITDA that we'll be taking off from our forecast because of the sales. And it's -- in my opinion, it's a bit of a win-win story that we were able to achieve those sales subsequent to quarter close.

所以這是個好消息。它有助於我們加強減債優先事項。非核心資產沒有實質的 EBITDA，我們將因銷售而從預測中扣除。在我看來，我們能夠在季度結束後實現這些銷售，這是一個雙贏的故事。

And just a related question on your other assets that you're monetizing (inaudible).

還有一個關於您正在貨幣化的其他資產的相關問題（聽不清楚）。

Well, we're always open to conversations with customers and business partners. And if our customers and business partners see significant value in some of our assets and it makes sense for us and our shareholders, we would have those conversations.

嗯，我們始終願意與客戶和業務夥伴進行對話。如果我們的客戶和業務合作夥伴看到我們的某些資產具有重大價值，並且這對我們和我們的股東有意義，我們就會進行這些對話。

I wouldn't say that we're actively out looking to pare back our business or make any significant transactions. But we're always in the market. We're always looking for thoughtful conversations with counterparties to make sure that we maximize Enerflex shareholder value long term.

我不會說我們正在積極尋求削減我們的業務或進行任何重大交易。但我們始終在市場中。我們一直在尋求與交易對手進行深思熟慮的對話，以確保我們長期最大化 Enerflex 股東價值。

That's good color. And then I think you kind of touched on this in the split between U.S. and Canada, but there's recent consolidation in the Permian. Are you expecting that to have any impact on your business?

這顏色真好啊然後我認為你在美國和加拿大之間的分裂中談到了這一點，但最近二疊紀盆地出現了整合。您預計這會對您的業務產生任何影響嗎？

I think it's going to have a positive impact, Nick. We -- I think that since the whole industry came out of COVID, the consolidation theme has been a theme in the service sector, in the midstream sector and in the E&P sector. The Enerflex-Exterran situation was part of that consolidation theme. One of the reasons we consolidated is that our customers are looking for solutions to bigger, more complex, more long-term problems. And to that end, a bigger Enerflex is better able to serve bigger customers.

我認為這將會產生正面的影響，尼克。我們——我認為，自從整個產業走出新冠疫情以來，整合主題一直是服務業、中游業和勘探與生產業的主題。 Enerflex-Exterran 的情況是整合主題的一部分。我們整合的原因之一是我們的客戶正在尋找更大、更複雜、更長期問題的解決方案。為此，更大的 Enerflex 能夠更好地服務更大的客戶。

One of the things I like is as an industry participant with the consolidation in the Permian and the Montney is that you've got a fewer number of players that have very long-term sustainable outlook on developing the overall basin. And so if we could get more stability and less boom-bust cycles in the market through this consolidation, that would be wonderful.

我喜歡的一件事是，作為二疊紀和蒙特尼盆地整合的行業參與者，對整個盆地的開發具有非常長期可持續前景的參與者數量減少了。因此，如果我們能夠透過這種整合獲得更多的穩定性並減少市場的繁榮-蕭條週期，那就太好了。

Enerflex's ability to respond to these bigger, more sophisticated customers has always been where we position ourselves. And so I do think it does play into our strategic positioning in the market, and it also plays into a more long-term sustainable development of those assets.

Enerflex 應對這些更大、更複雜客戶的能力一直是我們的定位。因此，我確實認為這確實有助於我們在市場中的策略定位，也有助於這些資產的更長期永續發展。

Our next question comes from the line of Cole Pereira of Stifel.

我們的下一個問題來自 Stifel 的 Cole Pereira。

Some good color on how you're thinking about 2024 CapEx and can appreciate that it's still a work in process. But high level, should we assume that your 2023 maintenance capital guidance is kind of a reasonable run rate for the business going forward?

關於您如何看待 2024 年資本支出的一些很好的信息，並且可以理解它仍在進行中。但從高水準來看，我們是否應該假設您的 2023 年維護資本指引對於未來的業務來說是合理的運作率？

That's a reasonable starting point, yes.

是的，這是一個合理的起點。

Our next question comes from the line of Tim Monachello from ATB Capital Markets.

我們的下一個問題來自 ATB Capital Markets 的 Tim Monachello。

Just a follow-up. On that noncore asset sale, can you quantify what the proceeds might be? And then I mean we're kind of half-way through the quarter here. How should we be thinking in terms of the direction of long-term debt from September 30 to year-end and net debt?

只是後續行動。對於非核心資產出售，您能否量化收益可能是多少？我的意思是，我們這個季度已經過半了。我們該如何思考9月30日至年底的長期債務和淨債務的走向？

In -- the noncore asset sales, Tim, are going to generate roughly $40 million in cash proceeds to Enerflex.

Tim 的非核心資產出售將為 Enerflex 帶來約 4000 萬美元的現金收益。

And the second part of your question, where do we see total debt going for the balance of the year, Preet?

你問題的第二部分是，我們認為今年剩餘時間的債務總額在哪裡，普雷特？

Yes. I think we talked about the paydown this quarter, CAD 41 million. But we got the offset on the U.S. dollar strengthening FX impact as we discussed. But I think Q4, think about something similar. We're continuing to focus on debt repayment, maybe a little bit more than where we're at today.

是的。我想我們討論了本季的付款，4,100 萬加元。但正如我們所討論的，我們抵消了美元走強對外匯的影響。但我認為第四個問題，想想類似的事情。我們將繼續關注債務償還，也許比今天的情況要多一些。

However, the key metric will be -- we're targeting under 2.5x, and just be sensitive to the U.S. dollar continuing to strengthen as at now versus quarter end Q3 and just keep an eye on the U.S. dollar exchange, but that may also offset or temper our debt reduction. So we'll be breaking those out also at the end of the year.

然而，關鍵指標是——我們的目標是低於 2.5 倍，並且對美元目前與第三季末相比繼續走強保持敏感，並密切關注美元匯率，但這也可能抵消或緩和我們的債務削減。因此，我們也將在今年底將這些內容進行分類。

I'm showing no further questions at this time. I'll turn the call back over to Marc for any closing remarks.

我目前沒有提出任何進一步的問題。我會將電話轉回給馬克，讓他發表結束語。

Thanks, operator. I'd like to thank everybody for dialing in today. To reiterate, our strategic priorities for the close of 2023 and into 2024 is having a disciplined capital program through 2024, focusing on generating free cash flow, repaying debt and setting Enerflex up for the future.

謝謝，接線生。我要感謝大家今天撥電話。重申一下，我們 2023 年底和 2024 年的戰略重點是在 2024 年之前製定嚴格的資本計劃，重點是產生自由現金流、償還債務並為 Enerflex 的未來做好準備。

I would like to take this opportunity to thank all current and former Enerflex teammates that serve their companies in uniform as we prepare to remember those on Remembrance Day in the Commonwealth and Veterans Day in the United States. Thank you for your service.

我想藉此機會感謝所有身著制服為公司服務的現任和前任 Enerflex 隊友，我們正準備在美國英聯邦陣亡將士紀念日和退伍軍人節紀念他們。感謝您的服務。

We look forward to talking to our investors and stakeholders again when we report Q4 earnings in February. Thank you.

我們期待在二月份報告第四季度收益時再次與投資者和利益相關者交談。謝謝。

Thank you. Ladies and gentlemen, this does conclude today's conference. Thank you all for participating. You may now disconnect. Have a great day.

謝謝。女士們、先生們，今天的會議到此結束。感謝大家的參與。您現在可以斷開連線。祝你有美好的一天。