FirstService Corp (FSV) 2023 Q3 法說會逐字稿

Good day, and thank you for standing by. Welcome to the third quarter investors conference call. Today's call is being recorded. Legal counsel requires us to advise that the decision scheduled to take place today may contain forward-looking statements that involve known and unknown risks and uncertainties. Actual results may be materially different from any future results, performance or achievements contemplated in the forward-looking statements.

美好的一天，感謝您的支持。歡迎參加第三季投資者電話會議。今天的通話正在錄音。法律顧問要求我們告知，計劃於今天做出的決定可能包含涉及已知和未知風險和不確定性的前瞻性陳述。實際結果可能與前瞻性陳述中預期的任何未來結果、績效或成就有重大差異。

Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the company's annual information form as filed with the Canadian Securities Administrators and in the company's annual report on Form 40-F as filed with the U.S. Securities and Exchange Commission. As a reminder, today's call is being recorded. Today is Thursday, October 26, 2023.

有關可能導致實際結果與前瞻性陳述中的結果存在重大差異的因素的更多資​​訊包含在公司向加拿大證券管理局提交的年度資訊表以及公司向加拿大證券管理局提交的40-F 表格年度報告中。美國證券交易委員會。提醒一下，今天的通話正在錄音。今天是 2023 年 10 月 26 日，星期四。

I would like to turn the call over to Chief Executive Officer, Mr. Scott Patterson. Please go ahead, sir.

我想將電話轉給執行長史考特·帕特森先生。請繼續，先生。

Thank you, Michelle. Good morning, everyone, and thank you for joining our third quarter conference call. Jeremy Rakusin is with me, and we're pleased to be on the line with you today to report on the strong Q3 results we released this morning.

謝謝你，米歇爾。大家早安，感謝您參加我們的第三季電話會議。傑里米·拉庫辛 (Jeremy Rakusin) 和我在一起，我們很高興今天與您在線報告我們今天早上發布的強勁的第三季度業績。

Results that reflect solid performance across each of our brands. We're very pleased with how the quarter played out, trends and momentum that drove the last several quarters for us continued into Q3 despite increasing headwinds relating to a challenging macroeconomic environment and softening consumer demand. Organic growth during the quarter was 10% on a consolidated basis. We're taking market share, and that is a tribute to our operating teams and their relentless focus on customer experience. We're growing organically while many of our markets and competitors are flat to down over the last quarter.

結果反映了我們每個品牌的穩健表現。我們對本季的表現感到非常滿意，儘管宏觀經濟環境充滿挑戰和消費者需求疲軟帶來的不利因素不斷增加，但過去幾季推動我們發展的趨勢和動能仍持續到第三季。本季綜合有機成長率為 10%。我們正在佔領市場份額，這要歸功於我們的營運團隊以及他們對客戶體驗的不懈關注。我們正在有機成長，而我們的許多市場和競爭對手在上個季度卻持平或下降。

Total revenues for the quarter were up 16% over the prior year, with the organic revenue growth, as I just said, at 10%, balanced about evenly between our two divisions. EBITDA for the quarter was $112 million, up 17% from 2022, reflecting a margin of 10%, approximately the same level as prior year. And earnings per share were $1.25, up 7%. Jeremy will dive into the profitability metrics in more detail in a few minutes.

該季度的總收入比前一年增長了 16%，正如我剛才所說，有機收入增長為 10%，我們兩個部門的收入基本上持平。本季 EBITDA 為 1.12 億美元，較 2022 年成長 17%，利潤率為 10%，與上年水準大致相同。每股收益為 1.25 美元，成長 7%。傑里米將在幾分鐘內更詳細地探討獲利指標。

Looking now at high-level results for our divisions. Starting with FirstService Residential, where revenues were up 12%, with the organic growth over 9%. Results in this division were right on expectations. Top line growth was broad-based with solid contribution from each of our 6 regions in North America. Organic growth was driven by continued strong net new contract wins, leading to higher management fee and labor-related revenue.

現在看看我們部門的高水準成果。首先是 FirstService Residential，營收成長了 12%，有機成長超過 9%。該部門的結果符合預期。營收成長基礎廣泛，北美 6 個地區均做出了堅實貢獻。有機成長是由持續強勁的新合約淨贏得推動的，導致管理費和勞動力相關收入增加。

Looking to the fourth quarter at FirstService Residential, we expect to again show low double-digit revenue growth with organic growth at a mid- to high single-digit level.

展望 FirstService Residential 第四季度，我們預期營收將再次呈現低兩位數成長，有機成長將達到中高個位數水準。

Moving on to FirstService Brands. Revenues for the quarter were up by 20%, with organic growth at 11%, driven by strength at our restoration brands and Century Fire. Our restoration brands, Paul Davis and FIRST ONSITE together recorded revenues that were up by about 25% versus the prior year, with 1/3 of the growth generated organically.

轉向 FirstService 品牌。在我們修復品牌和 Century Fire 實力的推動下，本季營收成長了 20%，有機成長 11%。我們的修復品牌 Paul Davis 和 FIRST ONSITE 的收入合計比上一年增長了約 25%，其中 1/3 的增長是有機增長的。

We booked approximately $25 million from named storms during the quarter, including continuing work from Hurricane Fiona, Hurricane Ian and Winter Storm Elliott. This compares to a negligible amount from named storms in the prior year quarter. Excluding storm work, we had a solid quarter and are pleased with the day-to-day activity levels across our branch network at both brands.

我們在本季度從命名風暴中預訂了約 2500 萬美元，包括颶風菲奧娜、颶風伊恩和冬季風暴埃利奧特的持續工作。與上一季命名風暴的數量相比，這一數字可以忽略不計。排除風暴工作，我們度過了一個穩定的季度，並對兩個品牌的分支機構網絡的日常活動水平感到滿意。

During the quarter, we added to our footprint in restoration with 3 announced tuck-unders. First, on site acquired Case Restoration based in Nashville. Case is a full-service commercial restoration company with specific expertise in large loss claims. This acquisition significantly enhances our capability and client coverage in Nashville, which is an important market for us long term.

在本季度，我們透過 3 次宣布的折邊活動增加了我們的修復足跡。首先，現場收購了位於納許維爾的 Case Restoration。 Case 是一家提供全方位服務的商業修復公司，在大額損失索賠方面擁有特定的專業知識。此次收購顯著增強了我們在納許維爾的能力和客戶覆蓋範圍，而納許維爾對我們來說是一個長期的重要市場。

At Paul Davis, we added to our company-owned platform with the acquisitions of our franchised operations serving Richmond, Virginia and Reno, Nevada. The Richmond branch complements our previously acquired Raleigh, North Carolina operation, expanding our footprint in the Mid-Atlantic region. Similarly, the Reno location augments the scale and service capabilities of our existing Nevada and Utah company-owned operations and the branches will operate collectively as 1 region.

在保羅戴維斯，我們透過收購為維吉尼亞州里士滿和內華達州里諾提供服務的特許經營業務，增加了我們公司擁有的平台。里士滿分公司補充了我們先前收購的北卡羅來納州羅利業務，並擴大了我們在大西洋中部地區的足跡。同樣，裡諾辦事處擴大了我們現有的內華達州和猶他州公司擁有的業務的規模和服務能力，並且分支機構將作為 1 個地區共同運作。

Looking forward, we expect our revenues for restoration in Q4 to be down from a year ago, up to 10% based on current backlog and trends. We generated $85 million in Q4 last year from Hurricanes Ian and Fiona, which led to an outsized result for us in a tough comparison. We continue to work through the remaining backlog from Ian, Fiona and Winter Storm Elliott and expect to generate revenue from named storms at a similar level to this past quarter in the $25 million range.

展望未來，根據當前積壓訂單和趨勢，我們預計第四季度恢復後的收入將比一年前下降 10%。去年第四季度，我們從颶風伊恩和菲奧娜中獲得了 8500 萬美元的收入，在嚴格的比較中，這為我們帶來了巨大的成果。我們將繼續處理 Ian、Fiona 和 Winter Storm Elliott 剩餘的積壓訂單，並預計從命名風暴中獲得的收入將達到與上個季度類似的水平，約 2500 萬美元。

As I mentioned earlier, we're very pleased with current activity levels. And outside of named storms, our backlog from day-to-day activity is strong. We expect to have a solid Q4 in restoration.

正如我之前提到的，我們對目前的活動水平非常滿意。除了指定的風暴之外，我們的日常活動積壓量很大。我們預計第四季將出現強勁的復甦。

Moving now to Century Fire, where we had a very strong Q3 with record revenues. It was similar to Q2 with almost all our 30-plus branches growing sequentially and versus the prior year. We expect another strong quarter upcoming with growth in the 10% range against a very strong Q4 last year that was up 20% organically versus 2021.

現在轉向世紀火災，我們的第三季非常強勁，收入創紀錄。與第二季類似，我們幾乎所有 30 多家分店都在連續成長，並且與前一年相比。我們預計另一個強勁的季度即將到來，與去年非常強勁的第四季相比，成長率將達到 10%，去年第四季與 2021 年相比有機成長 20%。

And I'll finish with our home improvement brands where we saw our growth slow during Q3, up mid-single digit year-over-year in total with organic growth at a low single-digit level. Higher interest rates, record low home resales and a challenging macroeconomic backdrop has significantly impacted consumer demand.

最後，我將介紹我們的家居裝修品牌，我們在第三季度看到成長緩慢，整體年成長中個位數，有機成長處於較低個位數水準。利率上升、房屋轉售量創歷史新低以及充滿挑戰的宏觀經濟背景嚴重影響了消費者需求。

Our leads are off 10% versus a year ago. As I mentioned last quarter, we continued to drive growth through improved lead conversion and close ratios. We expect a similar result in Q4. Our teams believe we will continue to drive single-digit growth against the prior year comp that was relatively weak.

與一年前相比，我們的領先優勢下降了 10%。正如我上季度提到的，我們透過提高潛在客戶轉換率和成交率繼續推動成長。我們預計第四季會出現類似的結果。我們的團隊相信，與去年相對疲弱的業績相比，我們將繼續推動個位數成長。

Let me now call on Jeremy to review our results in more detail.

現在讓我請傑里米更詳細地審查我們的結果。

Thank you, Scott. Good morning, everyone. As you just heard, FirstService delivered strong financial results for the third quarter on both a consolidated and segmented basis. For the quarter, we recorded consolidated revenues of $1.12 billion, up 16%, and adjusted EBITDA came in at $111.9 million, a 17% increase relative to the prior year period. Below the operating line, our adjusted EPS was $1.25, up a more modest 7% quarter-over-quarter, reflecting the higher interest rate environment this year compared to 2022.

謝謝你，斯科特。大家，早安。正如您剛才所聽到的，FirstService 第三季的綜合和細分財務表現均表現強勁。本季度，我們的綜合營收為 11.2 億美元，成長 16%，調整後 EBITDA 為 1.119 億美元，較去年同期成長 17%。在營業線以下，我們調整後的每股盈餘為 1.25 美元，比上一季小幅成長 7%，反映了今年與 2022 年相比更高的利率環境。

Highlighting our consolidated performance for the 9 months year-to-date, we have delivered revenues of $3.26 billion, up from $2.73 billion in the prior year period, an increase of 19% and which includes 14% organic growth. Adjusted EBITDA sits at $312.4 million, a 25% increase year-over-year with our overall EBITDA margin at 9.6%, up 50 basis points versus a 9.1% margin for the prior year period.

突顯我們今年迄今 9 個月的綜合業績，我們已實現營收 32.6 億美元，高於去年同期的 27.3 億美元，成長 19%，其中有機成長 14%。調整後 EBITDA 為 3.124 億美元，年成長 25%，整體 EBITDA 利潤率為 9.6%，比去年同期的 9.1% 成長 50 個基點。

And lastly, our adjusted EPS year-to-date is $3.56, an increase of 18% over the $3.02 reported for the same period last year, even in the face of a more than doubling of our interest expenses. Our adjustments to operating earnings and GAAP EPS and providing adjusted EBITDA and adjusted EPS, respectively, are disclosed in this morning's earnings release and are consistent with our approach in prior periods.

最後，我們今年迄今調整後的每股收益為 3.56 美元，比去年同期的 3.02 美元增加了 18%，即使我們的利息支出增加了一倍多。我們對營業收益和 GAAP 每股收益的調整以及調整後的 EBITDA 和調整後的每股收益分別在今天上午的收益報告中披露，並且與我們之前期間的方法一致。

I'll now walk through the third quarter segment results for our two divisions. At FirstService Residential, we generated revenues of $537.8 million, a 12% increase over Q3 2022. The strong top line performance drove EBITDA of $56.6 million, representing 14% year-over-year growth. Our current quarter EBITDA margin yielded 10.5%, relatively in line with the 10.4% in last year's Q3. The broadly distributed growth across our markets and service offering has also driven balanced profitability for the year, with our year-to-date EBITDA margin sitting at 9.6%, again relatively comparable to 9.8% in the prior year.

我現在將介紹我們兩個部門的第三季業績。 FirstService Residential 的營收為 5.378 億美元，比 2022 年第三季成長 12%。強勁的營收業績推動 EBITDA 達到 5,660 萬美元，年成長 14%。我們目前季度的 EBITDA 利潤率為 10.5%，與去年第三季的 10.4% 基本一致。我們的市場和服務產品的廣泛成長也推動了今年的獲利平衡，我們年初至今的 EBITDA 利潤率為 9.6%，與去年的 9.8% 相當。

Within our FirstService Brands division, we generated revenues of $579.3 million during the current third quarter, up 20% versus the prior year period. Our Brands EBITDA increased by 24% to $60.7 million with a 10.5% margin, up 40 basis points from a 10.1% margin in last year's third quarter. Our brands margin improvement reflected operating leverage benefits derived from the strong division top line performance, particularly at our Century Fire Protection and restoration service lines.

在 FirstService Brands 部門，我們第三季的營收為 5.793 億美元，比去年同期成長 20%。我們品牌的 EBITDA 成長了 24%，達到 6,070 萬美元，利潤率為 10.5%，比去年第三季的 10.1% 提高了 40 個基點。我們品牌的利潤率改善反映了部門強勁業績帶來的營運槓桿效益，特別是在我們的世紀消防和修復服務領域。

With the quarter-over-quarter margin improvement at both of our operating divisions, our consolidated margin ticked up slightly to 10% flat, notwithstanding higher corporate costs in the current quarter due to foreign exchange fluctuations. The strength in our operating and financial performance across our businesses also extended to a very strong cash flow conversion during the quarter. We delivered $84 million in cash flow from operations without any additional working capital as accounts receivable collections offset other operating requirements.

儘管本季因外匯波動導致企業成本上升，但隨著我們兩個營運部門的季度利潤率均有所改善，我們的綜合利潤率小幅上升至 10%。我們各業務的營運和財務業績的強勁表現也體現在本季非常強勁的現金流轉換。我們在沒有任何額外營運資金的情況下交付了 8,400 萬美元的營運現金流，因為應收帳款收款抵消了其他營運需求。

Our 9 months year-to-date operating cash flow of $170 million is up more than threefold versus the prior year period. Capital expenditures during the quarter totaled $23 million with the year-to-date tally sitting now at $68 million. For the full year, we expect to be at or slightly lower than our previous targets of $80 million in maintenance spending and $100 million of all-in CapEx.

今年迄今 9 個月的營運現金流為 1.7 億美元，比去年同期成長了三倍多。該季度的資本支出總額為 2,300 萬美元，而年初至今的資本支出總額為 6,800 萬美元。我們預計全年維護支出將達到或略低於先前 8,000 萬美元的目標，總資本支出將達到或略低於 1 億美元。

Acquisition investment during the quarter was modest, reflecting the completion of a few restoration tuck-under transactions that Scott referenced. Year-to-date, we have deployed over $110 million in acquisition capital and we are pleased with our tuck-under program activity in contributing over and above our strong organic growth. We also continue to advance our deal pipeline to surface additional attractive investment prospects across our service lines.

本季的收購投資不大，反映出史考特提到的一些恢復性隱藏交易的完成。今年迄今為止，我們已經部署了超過 1.1 億美元的收購資本，我們對我們的隱藏計畫活動為我們強勁的有機成長做出的貢獻感到滿意。我們也繼續推進我們的交易管道，以在我們的服務領域展現更多有吸引力的投資前景。

Our balance sheet at quarter end included net debt of just over $640 million, computing to leverage at 1.5x net debt to trailing 12 months EBITDA, down slightly from the 1.6x level for both the previous second quarter and 2022 year-end and relatively consistent with longer-term historical trends.

我們季度末的資產負債表包括略高於6.4 億美元的淨債務，計算出過去12 個月EBITDA 淨債務槓桿率為1.5 倍，略低於前一第二季度和2022 年年底的1.6 倍水平，且相對穩定具有更長期的歷史趨勢。

We also have approximately $450 million of total cash on hand and undrawn availability under our credit facility. We are well positioned with our conservative and flexible capital structure and ample liquidity to aggressively deploy capital towards future opportunities as they may arise.

我們的信貸額度下還有約 4.5 億美元的手頭現金和未提取的可用現金。我們憑藉著保守而靈活的資本結構和充裕的流動性，處於有利地位，可以積極地將資本部署到未來可能出現的機會。

In terms of our outlook for closing out 2023, our consolidated revenues for the fourth quarter will likely see more tempered mid-single-digit growth. As Scott noted, Q4 2022 included $85 million in revenues from Hurricanes Ian and Fiona late last year. Without any similar pending storm-related events as we sit today in the current fourth quarter, we expect that revenues from our restoration operations will be down year-over-year with all of our other brands growing at high single digit to low double-digit percentage ranges.

就我們對 2023 年結束的展望而言，我們第四季的合併收入可能會出現較為溫和的中個位數成長。正如斯科特指出的那樣，2022 年第四季包括去年年底颶風伊恩和菲奧娜帶來的 8500 萬美元收入。在當前第四季度，如果沒有任何類似的未決風暴相關事件，我們預計恢復業務的收入將同比下降，而我們所有其他品牌的收入將以高個位數到低兩位數的速度增長百分比範圍。

In terms of profitability, we expect that Q4 consolidated EBITDA will be roughly in line with last year's fourth quarter due to a year-over-year decline in restoration profitability driven by both lower revenues and a margin decline without the benefits of storm-related work. We anticipate continued strong and profitable growth across our remaining operations.

在獲利能力方面，我們預計第四季度合併 EBITDA 將與去年第四季大致持平，因為收入下降和沒有風暴相關工作帶來的利潤率下降導致恢復獲利能力同比下降。我們預計剩餘業務將持續強勁且獲利的成長。

With this outlook, combined with our 9 months year-to-date results, we will deliver 2023 annual total revenue growth in the mid-teens percentage range with a similar level of consolidated EBITDA growth. Very impressive performance for the year.

根據這一前景，結合我們今年迄今 9 個月的業績，我們將實現 2023 年年度總收入增長在中位數百分比範圍內，並實現類似水平的綜合 EBITDA 增長。今年的表現非常令人印象深刻。

During our next earnings call in February, covering off our year-end results, we will also provide a high-level 2024 outlook encompassing upcoming budget and strategic planning reviews with our brands.

在 2 月的下一次財報電話會議上，我們還將提供 2024 年的高水準展望，其中包括我們品牌即將進行的預算和策略規劃審查。

That concludes our prepared comments. Operator, please open up the call to questions. Thank you.

我們準備好的評論到此結束。接線員，請打開電話提問。謝謝。

(Operator Instructions) The first question comes from Faiza Alwy with Deutsche Bank.

（操作員說明）第一個問題來自德意志銀行的 Faiza Alwy。

I wanted to follow up on the comments you made around the home improvement brands, where you saw growth slow I mean, it sounds like it was still pretty reasonable at mid-single-digit year-over-year growth and you're indicating that it would be low single digit next quarter. How much of a lag is there as it relates to consumer demand. And you mentioned leads are off 10% versus a year ago. How should we think about this business in 2024, assuming current conditions persist. And I'm curious if you think of this business as a leading indicator to any other part of your business, whether it's on FirstService Residential or I feel that there isn't that much of a macro component elsewhere in your portfolio, but curious how you think about it.

我想跟進您對家居裝修品牌的評論，您看到增長緩慢，我的意思是，聽起來中個位數的同比增長仍然相當合理，而且您表示下個季度將是低個位數。與消費者需求相關的滯後程度有多大。您提到，與一年前相比，銷售線索下降了 10%。假設目前的情況持續下去，我們應該如何看待 2024 年的這項業務。我很好奇你是否認為這項業務是你業務任何其他部分的領先指標，無論是 FirstService Residential 還是我覺得你的投資組合中的其他部分沒有那麼多宏觀組成部分，但很好奇如何你想想吧。

Right. Okay, Faiza. There's a lot there. So let me start to work through it. Definitely, consumer demand for home improvement is down. We see it -- there are a number of industry research groups and indicators that point to it being down, and we don't expect the environment to improve over the next several quarters. But you've heard me say before that our teams are very resilient and focused on growth, and these markets are very large.

正確的。好的，法伊札。那裡有很多東西。那麼讓我開始解決這個問題。毫無疑問，消費者對家居裝修的需求正在下降。我們看到了這一點——許多行業研究小組和指標都表明它正在下降，而且我們預計未來幾個季度環境不會改善。但你之前聽我說過，我們的團隊非常有彈性並且專注於成長，而且這些市場非常大。

And our teams -- the belief system is that we can scratch out growth even in a down market. We've proven that over the last few quarters, with a focus on close ratio and lead conversion. And we've also been more aggressive, I think, in terms of marketing with some utilization of discount and promotion. There is not much of a lag in this business. Our backlog is measured in weeks. And so changes in consumer demand will impact us pretty quickly, one way or the other.

我們的團隊的信念是，即使在低迷的市場中，我們也能實現成長。我們在過去幾個季度已經證明了這一點，重點是緊密比率和潛在客戶轉換率。我認為，我們在行銷方面也更加積極，並利用了一些折扣和促銷。這項業務沒有太大的滯後性。我們的積壓工作以週為單位。因此，消費者需求的變化將很快影響我們，無論怎樣。

In terms of it being a leading indicator, it's not a significant leading indicator for any of our other businesses. I mean most of -- our 2 largest businesses for FirstService Residential and restoration are both really agnostic to consumer demand and more driven by weather in the case of restoration and in the case of FirstService Residential, I mean, the communities need to be managed in good markets and bad markets. So we don't see it as a significant indicator for us. I'll leave it at that. I'm not sure I answered all your questions.

就其作為領先指標而言，它並不是我們任何其他業務的重要領先指標。我的意思是，我們最大的兩家FirstService 住宅和修復業務都與消費者需求無關，而且在修復方面更多地受到天氣的驅動，而就FirstService 住宅而言，我的意思是，社區需要在以下方面進行管理：好的市場和壞的市場。因此，我們不認為它是我們的重要指標。我就這樣吧。我不確定我是否回答了你所有的問題。

No, that's very helpful. And I just have a separate question, if that's okay. And that's just around some of the acquisitions that you've made, particularly on the restoration side or the fire side. I'm curious how you think about synergies or the benefits of scale? Like it seems like there's still a lot of white space opportunity. So maybe talk a little bit qualitatively or if you can add some numbers to it, that would be helpful in terms of what you're seeing. Is there a synergistic benefit? And should we expect higher margins as you grow in scale and when does that happen.

不，這非常有幫助。我只是有一個單獨的問題，如果可以的話。這只是您所做的一些收購，特別是在恢復方面或火災方面。我很好奇您如何看待綜效或規模經濟？看起來似乎還有很多空白機會。因此，也許可以進行一些定性的討論，或者如果您可以添加一些數字，這對您所看到的內容會有幫助。有協同效益嗎？隨著規模的擴大，我們是否應該期望更高的利潤率？這種情況何時會發生？

Yes. Both of the businesses you mentioned, we're filling out our footprint. And the biggest benefit is that we are better positioned and better able to respond to our national accounts. In restoration, we have between both brands over 400 branches, and we're very well positioned to respond to our insurance carriers and our national commercial accounts. And in Century, we continue to build out primarily the Southeast and Mid-Atlantic regions. And again, that national account program, the more that we can self perform, the more we keep for ourselves because we do use a vendor network elsewhere.

是的。您提到的這兩項業務，我們都在填補我們的足跡。最大的好處是我們處於更好的位置並且能夠更好地應對我們的國民帳戶。在復原方面，我們在兩個品牌之間擁有 400 多個分支機構，我們非常有能力回應我們的保險公司和全國商業帳戶的需求。在世紀，我們繼續主要建造東南和大西洋中部地區。再說一次，在國民帳計畫中，我們能夠自我執行的越多，我們為自己保留的就越多，因為我們確實在其他地方使用了供應商網路。

So that it's not a significant level of efficiency that's created from scale. It's more of a positioning in the market and with our clients because both businesses are local service delivery. And so we're adding labor when we add branches.

因此，規模化並不能帶來顯著的效率水準。這更多的是在市場和客戶中的定位，因為這兩家公司都是本地服務交付。因此，當我們增加分支機構時，我們就增加了勞動力。

The next question comes from Stephen MacLeod with BMO Capital Markets.

下一個問題來自 BMO 資本市場的 Stephen MacLeod。

Just a couple of questions that I wanted to follow up on. Just on the residential side. I mean, Scott, I think you sort of covered it off in your prepared remarks and the Q&A. But just curious, can you just confirm, are you seeing any macro impact to the residential business as it relates to residents' ability to pay fees or cost pressures you're seeing -- pricing pressures you're seeing on contracts, things like that.

我想跟進幾個問題。就在住宅區一側。我的意思是，斯科特，我認為你在準備好的發言和問答中已經涵蓋了這一點。但只是好奇，你能確認一下，你是否看到了對住宅業務的任何宏觀影響，因為它與居民支付費用的能力或你所看到的成本壓力有關——你在合約上看到的定價壓力，諸如此類的事情。

There's two different things there. We're not seeing any pressure on monthly management fees and delinquencies as it relates to the residents. But certainly, budgets are increasing at communities in terms of -- primarily through increased in insurance premiums. And I would say, particularly in the risk areas, Texas and Florida, but generally in the high-rise environment. And so the increasing inflation across their cost structure is certainly put pressure on budgets. And put pressure on us around pricing, which is -- Stephen, you followed us for a long time, I mean, that's nothing new in this business for us.

那裡有兩個不同的東西。我們沒有看到與居民相關的每月管理費和拖欠費用方面的任何壓力。但可以肯定的是，社區的預算正在增加——主要是透過保險費的增加。我想說，特別是在德克薩斯州和佛羅裡達州等風險地區，但通常是在高層建築環境中。因此，成本結構中不斷上升的通膨無疑會對預算造成壓力。並在定價方面向我們施加壓力，這就是——史蒂芬，你跟隨我們很長時間了，我的意思是，這對我們來說在這個行業並不是什麼新鮮事。

Yes, I know. That's great, Scott. Yes. I mean pricing pressure is always there. That's helpful. And then just as you think about the brands business in Q4 with the restoration business, we did see a couple of storm, we did see some storm activity in -- earlier this fall. And I'm just curious, are you seeing any backlogs building from those storms? And then secondary to that, just when you think about Q4 and the comp organic growth sort of slowing against the tough comp. Can you just talk a little bit about what kind of margin impact that might have on Q4?

是的，我知道。太棒了，斯科特。是的。我的意思是價格壓力始終存在。這很有幫助。然後，正如您考慮第四季度的品牌業務和修復業務一樣，我們確實看到了幾場風暴，今年秋天早些時候，我們確實看到了一些風暴活動。我只是很好奇，您是否看到這些風暴造成了積壓？其次，當你想到第四季時，公司的有機成長在艱難的情況下有所放緩。您能否簡單談談這可能對第四季的利潤率產生什麼樣的影響？

Right. Okay. I'll deal with the first part of the question. We didn't see a significant pickup in our backlog related to some of the regional events you spoke about in Florida, that storm really hit an area that wasn't heavily populated or did not have much of a footprint as it relates to our national accounts. And then in the Northeast, again, similarly, it didn't lead to a lot of mitigation and restoration work. Jeremy, over to you on margin.

正確的。好的。我將處理問題的第一部分。我們沒有看到與您談到的佛羅裡達州一些區域性事件相關的積壓工作有顯著增加，那場風暴確實襲擊了一個人口不稠密或沒有太多足蹟的地區，因為它與我們的國家有關帳戶。同樣，在東北部，它也沒有帶來大量的緩解和恢復工作。傑里米，保證金交給你了。

Yes. Thanks, Scott. Steve, yes, the lack of comparable weather-related activity means that margins will be down at restoration and that obviously impacts the overall FirstService Brands division. Again, we see that being down year-over-year. Probably relatively similar coming in relatively similar sequentially to the current third quarter for that division.

是的。謝謝，斯科特。史蒂夫，是的，缺乏可比較的與天氣相關的活動意味著恢復時的利潤率將會下降，這顯然會影響整個 FirstService 品牌部門。我們再次看到這一數字逐年下降。可能與該部門目前第三季的連續情況相對相似。

Okay, I see. So you would expect Q4 margins to be similar to what they were in Q3, on the Brands...

好吧，我明白了。因此，您預計品牌第四季的利潤率將與第三季度相似…

In the both -- I mean obviously moving (inaudible) but directionally, yes.

在這兩者中——我的意思是顯然在移動（聽不清楚），但有方向，是的。

The next question comes from Stephen Sheldon with William Blair.

下一個問題來自史蒂芬·謝爾頓和威廉·布萊爾。

Really nice job in the quarter. First, on the organic revenue growth in residential, I mean, it continues to be outstanding. I think you've historically said that sourcing labor for contracts is usually the biggest impediment or limited to growth. So curious what you're seeing on the labor side right now? Is it getting any easier to source labor? And have you changed anything materially on the execution side to allow you to better recruit and retain labor?

本季的工作非常好。首先，就住宅領域的有機收入成長而言，我的意思是，它仍然表現出色。我認為您歷來說過，為合約採購勞動力通常是成長的最大障礙或限制。很好奇您現在在勞工上看到了什麼？尋找勞動力變得更容易了嗎？為了更好地招募和留住勞動力，您是否在執行方面進行了任何重大改變？

The labor market continues to improve for us, and we're really seeing it across all the brands. FirstService Residential may be the best example because you've heard from us over the last few quarters that we've been filling our open positions and we're sort of back to historical levels. And I think the market has certainly eased. We're seeing more applications. We're filling more jobs more quickly. Our turnover has improved.

我們的勞動力市場持續改善，我們在所有品牌中都看到了這一點。 FirstService Residential 可能是最好的例子，因為您在過去幾個季度中聽說我們一直在填補空缺職位，並且我們已經回到了歷史水平。我認為市場確實已經放緩。我們看到了更多的應用。我們正在更快地填補更多職位。我們的營業額有所改善。

But at the same time, the second part of your question, Stephen, we have certainly invested in resources and technology around recruiting and also onboarding. And so it's hard to discern or put a pin on the improvement, whether we've been the architect of that or whether the market has come back to us, but it's -- yes, I think it's a little of both.

但同時，史蒂芬，你問題的第二部分，我們確實在招募和入職方面投入了資源和技術。因此，很難辨別或確定這種改進，無論我們是這項改進的設計者，還是市場是否已經回到我們身邊，但它是——是的，我認為兩者兼而有之。

Got it. And has that -- I guess, is that -- you typically talked about 3% to 5% organic growth in that business? Given your -- some of the way -- the changes that you've been able to kind of push through with the improvement on the execution side and maybe some (inaudible). Has your thought process there changed on what the organic -- the right organic growth profile to think about that we should be thinking about for the...

知道了。我想，您通常談到該業務的有機成長是 3% 到 5% 嗎？考慮到你——在某種程度上——你已經能夠透過執行方面的改進來推動一些改變，也許還有一些（聽不清楚）。您的思考過程是否發生了變化，也就是我們應該考慮的有機成長—正確的有機成長概況？

Yes. It's been much stronger this year. Definitely, we're getting a little more price. We continue to carry some momentum from strong sales late last year and early this year. That's starting to normalize. So it's easing its way back down. Mid to high, I would say, I'm comfortable with right now. So tick higher. Yes.

是的。今年已經強很多了。當然，我們的價格會更高一些。我們繼續從去年年底和今年年初的強勁銷售中獲得一些動力。這開始正常化。所以它正在慢慢回落。我想說的是，我現在對中到高感到滿意。所以勾選比較高。是的。

Got it. That's helpful. And then just on Century Fire, given that half of that business seems tied to new construction activity for installations. Just curious about the subsector exposure there. Is Century Fire is more exposed to certain subsectors for construction, thinking about office versus industrial versus multifamily, more exposed to certain of those versus others? And how are you thinking about the growth outlook there given any visibility you have into new construction over the next few years.

知道了。這很有幫助。然後是世紀之火，因為業務的一半似乎與新的安裝施工活動有關。只是對那裡的子行業風險感到好奇。世紀之火是否更多地接觸到某些建築子行業，考慮辦公大樓、工業和多戶住宅，是否更多地接觸其中某些子行業而不是其他子行業？考慮到您對未來幾年新建築的了解，您如何看待那裡的成長前景。

Right. I mean Certainly, in terms of our backlog, we feel very good about Q4, and I think it will carry into Q1. But as you suggest, the commercial real estate market is less than robust right now. So we're keeping a very close eye on backlog. We do have strong presence in multifamily and distribution warehouses, office retail across the board. But I think generally, if commercial real estate, new construction slows dramatically, we would -- at some point, we're going to see that. The 50% of that business would be a new install, and 50% is recurring service inspection repair.

正確的。我的意思是，當然，就我們的積壓而言，我們對第四季度感覺非常好，我認為它將延續到第一季。但正如您所說，商業房地產市場目前並不強勁。因此，我們正在密切關注積壓情況。我們確實在多戶住宅和配送倉庫以及辦公零售領域擁有強大的影響力。但我認為，總的來說，如果商業房地產、新建築大幅放緩，我們會——在某個時候，我們會看到這種情況。該業務的 50% 是新安裝，50% 是定期服務檢查維修。

The next question comes from Michael Doumet with Scotiabank.

下一個問題來自豐業銀行的 Michael Doumet。

Scott, you started off with, I think, some comments on market share. So I just want to kind of get a little bit more detail on this. But for the home improvement, and the Century Fire business. Is it possible at all to break down what you think is market share growth versus industry growth? And then in your view, do you still think you have the levers to continue to push maybe a similar market share gain for those two segments into the 2024?

斯科特，我認為您一開始就對市場份額發表了一些評論。所以我只是想了解更多細節。而是為了家裝，還有世紀之火的生意。是否有可能將您認為的市場份額成長與行業成長進行分解？然後，在您看來，您是否仍然認為自己有能力在 2024 年繼續推動這兩個細分市場實現類似的市佔率成長？

It's easier to create clarity in the home improvement business because there are a number of research groups that follow it pretty closely. And -- so we feel very confident that we're taking share in closet organization space, painting, the significant brands we have, floor coverings. Tougher at Century Fire, but the organic growth we're seeing is quite strong. And I think that we're driving a lot of it as we've made acquisitions, we're adding services, we're necessary to ensure all our branches are full service.

由於有許多研究小組密切關注家居裝修行業，因此更容易明確家居裝修行業的情況。而且——所以我們非常有信心，我們在壁櫥組織空間、油漆、我們擁有的重要品牌、地板覆蓋物方面佔據份額。世紀火災的情況比較艱難，但我們看到的有機成長相當強勁。我認為，隨著我們進行收購，我們正在增加服務，我們正在推動很多工作，我們有必要確保我們所有的分公司都提供全方位服務。

And adding alarm to sprinkler businesses and vice versa, adding service to primarily installation businesses. And it's been a significant growth driver for us to add services to the existing customer base. And so we're taking wallet share in that instance, but it's definitely a higher number of organic growth than the market. But it's not crystal clear. And in terms of driving this into '24. I think we'll continue to take share. The question is the market -- what kind of support we get from the market.

並為噴水滅火業務增加警報，反之亦然，為主要安裝業務增加服務。為現有客戶群增加服務一直是我們重要的成長動力。因此，在這種情況下，我們會佔據錢包份額，但這絕對是比市場更高的有機成長。但這還不是很清楚。就推動這一趨勢進入 24 世紀而言。我想我們會繼續分享。問題是市場——我們從市場得到什麼樣的支持。

That's helpful. And then maybe for a bit over restoration. I think previously, you talked about making investments in that business, if that once completed, would drive eventual margin expansion, I think, over several years. So just curious on how those investments are progressing timelines on potential margin expansion for that business. Obviously, recognizing that storm impact aside as it relates to these investments.

這很有幫助。然後可能會有點過度恢復。我認為之前，您談到對該業務進行投資，如果一旦完成，我認為將在幾年內推動最終的利潤率擴張。因此，我只是想知道這些投資在該業務的潛在利潤擴張方面的進度如何。顯然，除了與這些投資相關的風暴影響之外，還要認識到它。

Michael, yes, it's Jeremy. Investments on track, we're probably 2/3s of the way now in terms of onboarding our branch network. We said this would carry on through this year and likely into part of '24. And then after that, we'll evaluate the opportunity for reaping the benefits of that investment. So I suspect at some point in '24 and into the later years, we will see that. And we'll get greater clarity as we go through budget and strategic planning reviews in the next couple of months with both restoration as well as all of our other businesses, clarity on '24 and beyond.

邁克爾，是的，是傑里米。投資步入正軌，就加入我們的分支機構網絡而言，我們現在可能已經完成了 2/3。我們說過，這種情況將持續到今年，並可能持續到 2024 年的部分時間。然後，我們將評估獲得該投資收益的機會。所以我懷疑在 24 年的某個時候以及以後的幾年裡，我們會看到這一點。當我們在接下來的幾個月內進行預算和策略規劃審查時，我們將獲得更加清晰的信息，包括恢復以及我們所有其他業務，24 小時及以後的清晰情況。

The next question comes from Tom Callaghan with RBC CM.

下一個問題來自 RBC CM 的 Tom Callaghan。

Maybe just one on my -- couple of my questions were asked, but maybe if you could just some comments on the acquisition pipeline you guys alluded to prepared remarks there. I know you're a little more active towards the end of last year and early this year. But kind of where it stands right now maybe relative to last year. And is there a specific focus? Or is it kind of broad-based across the restoration and residential side of things.

也許只是關於我的幾個問題，但也許您可以對收購管道發表一些評論，你們提到了那裡準備好的評論。我知道你在去年年底和今年年初更加活躍了一些。但現在的情況可能是相對於去年而言的。還有具體的重點嗎？或者說它在修復和住宅方面具有廣泛的基礎。

The pipeline is solid. Relative to last year, your -- I mean, I'm just thinking back, we did close some fourth quarter deals last year. So we -- it's I think it would be close to where we were last year at this time. But it's generally in line with where we've been. And Jeremy talked about our spend this year. We're very comfortable with what we've accomplished so far. It's right in line with where we've been in the last few years. And our pipeline is in decent shape. I don't know whether we'll close in the fourth quarter or whether that will leak into next year. But we've got activity and it's balanced across both divisions.

管道牢固。相對於去年，我的意思是，我只是回想一下，去年我們確實完成了一些第四季的交易。所以我們——我認為這會接近去年這個時候的水平。但它總體上與我們去過的地方一致。傑里米談到了我們今年的支出。我們對迄今為止所取得的成就感到非常滿意。這與我們過去幾年的情況相符。我們的管道狀況良好。我不知道我們是否會在第四季關閉，或者是否會延續到明年。但我們有活動，而且兩個部門的活動是平衡的。

Got it. That's very helpful. And maybe just one follow-up piece on the residential side. You've talked about the success with the repricing there on the renewals. Just curious, has that impacted retention rates at all? Or are those held in -- or holding pretty steady?

知道了。這非常有幫助。也許只是住宅方面的一個後續作品。您已經談到了續訂重新定價的成功。只是好奇，這會影響保留率嗎？或者那些是否被控制住了——或者保持得相當穩定？

No, retentions at our long-term historical rate, it's about the same as it has been in the last several years.

不，按照我們的長期歷史比率計算，保留率與過去幾年大致相同。

(Operator Instructions) The next question comes from Frederic Bastien with Raymond James.

（操作員說明）下一個問題來自 Frederic Bastien 和 Raymond James。

Scott, you've been -- just a follow-up really on the M&A questions here. You've been quite active and successful at consolidating restoration and fire protection in recent years. As you look forward, how far are you from where you'd like to be? I mean, just wondering if you can continually double perhaps triple the size of these businesses in the next 5 years or so.

斯科特，您只是對併購問題進行了後續跟進。近年來，你們在鞏固修復和消防方面非常積極並取得了成功。當你展望未來時，你離你想要達到的目標還有多遠？我的意思是，只是想知道在未來 5 年左右的時間內，您是否可以繼續將這些業務的規模擴大一倍甚至三倍。

In the case of restoration, I would say that our activity would be slowing. Our footprint is starting to fill out. And we will become more of an organic growth engine as we have been and are at FirstService Residential. We still have white space that we're focused on. But I'd see the next few years won't be as active as we have been the last 3. Century Fire, we still got lots of lots of white space and regions to grow into. So I see that being -- continuing to grow sort of at the same pace as we have been. But in both cases, Frederic, you know that our first focus is on organic growth. Are we winning day-to-day at every branch. That's our first priority, and it will continue to be that.

在恢復的情況下，我想說我們的活動將會放緩。我們的足跡開始填滿。我們將像 FirstService Residential 一樣成為一個有機成長引擎。我們仍然有我們關注的空白區域。但我認為未來幾年不會像過去的 3 世紀火災那樣活躍，我們仍然有很多空白和區域可以發展。所以我認為這種成長速度與我們過去的成長速度相同。但在這兩種情況下，弗雷德里克，你知道我們的首要重點是有機成長。我們是否在每個分支機構都取得了日常勝利？這是我們的首要任務，並將繼續如此。

I show no further questions at this time. I would now like to turn the call back to Mr. Scott Patterson for closing remarks.

我目前沒有提出任何進一步的問題。現在，我想將電話轉回給斯科特·帕特森先生，讓其致閉幕詞。

Thank you, Michelle, and thank you all for joining us today. We look forward to our Q4 and year-end report in early February. Take care.

謝謝米歇爾，也謝謝大家今天加入我們。我們期待二月初的第四季和年終報告。小心。

Ladies and gentlemen, this concludes the third quarter investors conference call.

女士們先生們，第三季投資人電話會議到此結束。