FirstService Corp (FSV) 2024 Q2 法說會逐字稿

Good day and thank you for standing by. Welcome to the FirstService Corporation second quarter 2024 earnings conference call. (Operator instructions) Please be advised that today's conference is being recorded.

美好的一天，感謝您的支持。歡迎參加 FirstService Corporation 2024 年第二季財報電話會議。（操作員說明）請注意，今天的會議正在錄製中。

Legal Counsel requires us to advise the discussion 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.

法律顧問要求我們告知，計劃於今天進行的討論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 differ materially from those of 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 US Securities and Exchange Commission.

有關可能導致實際結果與前瞻性陳述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美國提交的 40-F 表格年度報告中證券交易委員會。

As a reminder, today's call is being recorded today, July 25, 2024.

謹此提醒，今天的通話錄音已於今天（2024 年 7 月 25 日）進行。

I would now like to hand the conference over to Chief Executive Officer, Mr. Scott Patterson. Please go ahead, sir.

我現在將會議交給執行長史考特·帕特森先生。請繼續，先生。

Thank you, Liz. Good morning, everyone. Thank you for joining our Q2 conference call. I'm on today with Jeremy Rakusin. I'll kick us off with some high-level comments, and Jeremy will follow with more detail. We were pleased with the results we posted this morning. Solid performance that in aggregate was better than expectation.

謝謝你，莉茲。大家早安。感謝您參加我們的第二季電話會議。今天我和 Jeremy Rakusin 一起直播。我將首先發表一些高層評論，傑里米將隨後提供更多細節。我們對今天早上發布的結果感到滿意。整體表現穩健，優於預期。

Total revenues were up 16% over the prior year. Again this quarter, driven entirely by acquisitions, primarily the addition of Roofing Corp of America in Q4 last year. Organic growth was again flat this quarter with solid gains at FirstService Residential offset by declines in restoration within our brands' division.

總收入比上年增長 16%。本季再次完全由收購推動，主要是去年第四季美國屋頂公司的收購。本季有機成長再次持平，FirstService Residential 的強勁成長被我們品牌部門內恢復的下降所抵消。

EBITDA for the quarter was up 12% to $132 million, reflecting a consolidated margin of 10.2%, which we're very pleased with. Jeremy will spend time on the margin detail in a few minutes.

本季 EBITDA 成長 12%，達到 1.32 億美元，綜合利潤率為 10.2%，我們對此非常滿意。傑里米將在幾分鐘內花時間討論邊緣細節。

Looking at our divisional results, FirstService Residential revenues were up 8% with organic growth close to 7%, which is trending in line with expectation. During the quarter, we announced the acquisition of CitiScape, one of the leading property management players in San Francisco. CitiScape has a healthy high-rise portfolio and strengthens our leadership position across the Bay Area.

從我們的部門績效來看，FirstService Residential 營收成長了 8%，有機成長接近 7%，趨勢符合預期。本季度，我們宣布收購舊金山領先的物業管理公司之一的 CitiScape。CitiScape 擁有健康的高層建築投資組合，鞏固了我們在灣區的領導地位。

We've been developing a relationship with the team at CitiScape over the last number of years and are excited that we were able to complete a partnership agreement. We see a continuing significant opportunity in Northern California, and the CitiScape leadership team will help us capitalize. Looking forward at FirstService Residential for the back half of the year, we're confirming our expectation for organic growth to continue to trend to the mid-single digit range.

在過去的幾年裡，我們一直與 CitiScape 團隊建立了合作關係，很高興我們能夠完成合作協議。我們看到北加州持續的重大機遇，CitiScape 領導團隊將幫助我們抓住機會。展望今年下半年的 FirstService Residential，我們確認了自然成長將繼續保持在中個位數範圍的預期。

Moving on to FirstService Brands, revenues for the quarter were up 23%, driven primarily by the acquisition of Roofing Corp of America, but also several tuck-unders across our restoration and roofing segments. Organically, revenues were down 6% versus the prior year, driven by declines at our restoration brands. Very similar to our last two quarters.

接下來是 FirstService Brands，該季度的營收成長了 23%，這主要是由於收購了 Roofing Corp of America，以及我們的修復和屋頂領域的一些折衷舉措。從有機角度來看，由於我們的修復品牌銷售下降，營收比前一年下降了 6%。與我們過去兩個季度非常相似。

Revenues for our two restoration brands, Paul Davis and FIRST ONSITE were down in aggregate by about 5% and off organically by over 10%. For the third consecutive quarter, we continued to experience mild weather patterns across North America. Industry data points to claim activity up 20% to 30% year over year, depending on geographic region. For our brands, we were up against a reasonably tough comparative quarter of 2023 that saw us execute on over $30 million of Hurricane Ian backlog. In this year's quarter, we generated only a nominal amount of revenue from named storms, really the remaining tail from Hurricane Ian.

我們的兩個修復品牌 Paul Davis 和 FIRST ONSITE 的收入總計下降了約 5%，有機下降超過 10%。北美地區連續第三個季度持續經歷溫和的天氣模式。行業數據顯示，索賠活動年增 20% 至 30%，具體取決於地理區域。對於我們的品牌來說，2023 年是一個相當艱難的季度，我們執行了超過 3000 萬美元的颶風伊恩積壓訂單。在今年的季度中，我們僅從命名風暴中獲得了象徵性的收入，實際上是颶風伊恩的剩餘收入。

Looking forward to Q3 in restoration, we expect a similar quarter sequentially to Q2, which would put us up modestly compared to the prior year. If we experience a weather event, it will go up from there. Turning to Roofing, we had a strong quarter that as expected was sequentially stronger than Q1, primarily due to seasonality. We generated solid results across almost all our branches and are pleased that the first six months has played out in line with their due diligence expectations.

展望第三季的復甦，我們預計季度將與第二季類似，這將使我們的業績與去年相比略有上升。如果我們經歷天氣事件，它就會從那裡開始上升。談到屋頂，我們有一個強勁的季度，正如預期的那樣，比第一季更強勁，這主要是由於季節性因素。我們幾乎所有分支機構都取得了紮實的成果，很高興前六個月的表現符合他們的盡職調查預期。

We were also pleased to have made real progress in adding to our roofing platform during the quarter with the acquisitions of Crowther Roofing and Hamilton Roofing, two Florida based contractors, Florida as one of the largest roofing markets in North America and was our highest priority whitespace geography.

我們也很高興在本季度收購了Crowther Roofing 和Hamilton Roofing 這兩家位於佛羅裡達州的承包商，在增加我們的屋頂平台方面取得了真正的進展，佛羅裡達州是北美最大的屋頂市場之一，也是我們最優先考慮的空白區域地理。

Crowther primarily in the Southwest and Hamilton on the Space Coast provide us with an immediate significant presence in Florida, and it's a region that we expect to further add to. Looking forward in Roofing, our backlogs are stable and we expect another solid quarter in line with Q2 plus the boost we will get from the Crowther and Hamilton additions.

主要位於西南部的克勞瑟和位於太空海岸的漢密爾頓為我們在佛羅裡達州提供了直接的重要影響力，我們希望進一步擴大這一地區的影響力。展望屋頂業務，我們的積壓訂單穩定，我們預計另一個季度將與第二季度保持一致，加上克勞瑟和漢密爾頓的加入將為我們帶來提振。

Onto our home improvement brands, which as a group were down modestly for the quarter by a low single digit percentage. The weak housing market, higher interest rates, and general economic uncertainty negatively impacted the home-improvement market since early last year. We're flat year over year for the first six months and are generally pleased with our performance given current market conditions. We believe we continue to take share.

我們的家居裝修品牌，作為一個整體，本季小幅下滑，下降幅度為較低的個位數百分比。自去年初以來，疲軟的房地產市場、較高的利率和總體經濟不確定性對家居裝修市場產生了負面影響。前六個月，我們的業績與去年同期持平，考慮到當前的市場狀況，我們對我們的表現總體感到滿意。我們相信我們將繼續佔據份額。

That said, we definitely continue to face headwinds and don't expect activity levels to improve through the third quarter. Looking forward to Q3, we expect our home improvement revenues to be down modestly compared to prior year, similar to what we experienced this past quarter. We're hopeful that interest rate reductions may spur increased activity later in the year.

也就是說，我們肯定會繼續面臨阻力，並且預期第三季的活動水準不會有所改善。展望第三季度，我們預計我們的家居裝修收入將比去年小幅下降，與上個季度的情況類似。我們希望降息可能會刺激今年稍後的活動增加。

And I'll finish my comments with a look at Century Fire, which had a very strong quarter, up sequentially over Q1 and up organically over the prior year by a high single digit percentage. The results were right in line with our expectation that we communicated on last quarter's call. Looking forward to the back half of the year, we expect more of the same, continued strength with high single digit year over year growth at Century.

最後，我將透過觀察 Century Fire 來結束我的評論，該公司的季度表現非常強勁，比第一季連續成長，並且比上一年有機增長了很高的個位數百分比。結果與我們在上季度電話會議上溝通的預期完全一致。展望今年下半年，我們預計世紀將繼續保持強勁的單位數年增長。

With that, I will now hand over to Jeremy.

現在，我將把工作交給傑里米。

Thank you Scott, and good morning, everyone. I'll lead off with a summary of our consolidated second quarter financial results, which delivered year-over-year growth higher than the indications provided on our Q1 call in April. Revenues for the quarter were $1.3 billion, up 16% year over year, and we reported adjusted EBITDA of $132.5 million, up 12% versus the prior year. Adjusted EPS came in at $1.36 versus $1.46 in Q2 2023. Our six-months year-to-date consolidated financial performance included revenues of $2.5 billion, an increase of 15% over the $2.1 billion last year.

謝謝斯科特，大家早安。首先，我將總結我們的第二季度綜合財務業績，該業績的同比增長高於我們 4 月份第一季電話會議上提供的指標。本季營收為 13 億美元，年增 16%，調整後 EBITDA 為 1.325 億美元，年增 12%。調整後每股收益為 1.36 美元，而 2023 年第二季為 1.46 美元。我們今年迄今 6 個月的綜合財務表現包括 25 億美元的收入，比去年的 21 億美元成長了 15%。

Adjusted EBITDA of $216 million, representing 8% growth over the $200 million last year with a margin of 8.8%, down 60 basis points year over year and a more modest decline of 40 basis points when normalized for the significantly higher FX related corporate costs in the current year to date period. Adjusted EPS for the first half of the year sits at $2.3 compared to $2.31 per share reported during our same six month period last year.

調整後EBITDA 為2.16 億美元，比去年的2 億美元成長8%，利潤率為8.8%，年減60 個基點，由於2019 年外匯相關企業成本大幅上升，正常化後下降40 個基點，幅度較為溫和。今年上半年調整後每股收益為 2.3 美元，而去年同期的 6 個月期間報告為每股 2.31 美元。

Our adjustments to operating earnings and GAAP EPS to calculate our adjusted EBITDA and adjusted EPS, respectively, have been summarized in this morning's release and remain consistent with our disclosure in prior periods.

我們對營業收益和 GAAP 每股收益進行的調整分別用於計算調整後的 EBITDA 和調整後的每股收益，已在今天上午的新聞稿中進行了總結，並與我們之前期間的披露保持一致。

Regarding our earnings per share performance, as similarly noted, during our previous Q1 call, the year-over-year decline compared to 2023 is attributable to almost a doubling in our interest expense, reflecting both higher interest rates and a larger debt balance on the heels of our large Roofing Corp of America acquisition at the end of last year.

關於我們的每股盈餘表現，正如我們之前提到的，在先前的第一季電話會議中，與2023 年相比，同比下降的原因是我們的利息支出幾乎翻了一番，反映出利率上升和債務餘額增加。

Focusing now on our operating financial performance for the second quarter, I'll start with our FirstService Residential division. Quarterly revenues came in at $558 million, up 8% over the prior year. EBITDA for the quarter was $59 million, a 6% year over year increase with a 10.6% margin, down 20 basis points from the 10.8% margin in Q2 of last year.

現在重點關注我們第二季的營運財務業績，我將從我們的 FirstService 住宅部門開始。季度營收為 5.58 億美元，比上年增長 8%。本季 EBITDA 為 5,900 萬美元，年增 6%，利潤率為 10.6%，較去年第二季的 10.8% 下降 20 個基點。

For the six months year to date, our division EBITDA margin sits at 9% even comparable to the 9.1% level for the equivalent prior year period. We continue to expect margins through the balance of the year in line with 2023 and consistent with our 9% to 10% annual EBITDA margin performance band over the past several years.

今年迄今的六個月，我們部門的 EBITDA 利潤率為 9%，甚至與去年同期的 9.1% 水準相當。我們繼續預計今年剩餘時間的利潤率將與 2023 年保持一致，並與過去幾年 9% 至 10% 的年度 EBITDA 利潤率表現範圍一致。

Within our FirstService Brands division, we reported second quarter revenues of $740 million, a 23% increase over the prior year period. EBITDA for the quarter came in at $78 million, up 18% year over year. Our margin during the quarter was 10.5%, down 40 basis points versus the 10.9% during last year's Q2. The quarterly margin decline was confined to our restoration businesses, which were operating against higher prior-year storm-related activity levels.

FirstService Brands 部門報告第二季營收為 7.4 億美元，比去年同期成長 23%。該季度 EBITDA 為 7,800 萬美元，年增 18%。本季我們的利潤率為 10.5%，比去年第二季的 10.9% 下降了 40 個基點。季度利潤率下降僅限於我們的恢復業務，這些業務的運作與上年風暴相關活動水準較高有關。

These headwinds moderated compared to the first quarter, however, and were a key reason behind the improved year-over-year margin comparisons sequentially compared to Q1. The second contributing factor to the sequential margin improvement was the tempering of promotional initiatives within our home improvement brands. Scott noted earlier the mild top line decline in home improvement during Q2, tipping down from the modest top line growth in the prior first quarter.

然而，與第一季相比，這些不利因素有所減弱，這是年比利潤率較第一季連續改善的關鍵原因。利潤率較上月提高的第二個因素是我們家居裝修品牌內促銷活動的調整。史考特稍早指出，第二季家居裝修業務的收入略有下降，較上一季的小幅營收成長下降。

Nevertheless, during the current quarter, we achieved superior profitability and an improved year-over-year margin profile from this segment compared to our Q1 metrics. We have spoken about being assertive in balancing our growth and margin objectives in the face of the challenging macro remodeling environment, and we are pleased with what our home improvement businesses have delivered to the bottom line year to date.

儘管如此，在本季度，與第一季的指標相比，我們在該領域實現了卓越的獲利能力和年比利潤率的改善。我們已經談到，面對充滿挑戰的宏觀改造環境，我們要堅定地平衡我們的成長和利潤目標，我們對我們的家居裝修業務今年迄今實現的盈利感到滿意。

In the back half of the year, with the continued easing of storm driven year-over-year comparisons and restoration and the added mix of our roofing operations, we expect brands division margin improvement in the third and fourth quarters compared to their respective prior year periods.

今年下半年，隨著風暴驅動的同比比較和恢復的持續緩解以及我們屋頂業務的增加，我們預計品牌部門的利潤率在第三和第四季度將比去年同期有所改善期間。

In terms of our cash flow profile, we delivered over $130 million in operating cash flow during the second quarter, up 52% over the prior year quarter and almost matching our consolidated EBITDA during the period with the benefit of favorable working capital utilization.

就現金流狀況而言，第二季我們實現了超過 1.3 億美元的營運現金流，比去年同期成長 52%，幾乎與我們同期的合併 EBITDA 持平，並受益於良好的營運資金利用率。

Our capital expenditures during the quarter were just under $30 million and our year-to-date total of $54 million is pacing with our previously targeted full year CapEx of approximately $115 million. Acquisition spending during the quarter was significant at more than $120 million and the year to date investments in our tuck-under acquisition program exceed $150 million.

我們本季的資本支出略低於 3,000 萬美元，今年迄今的資本支出總額為 5,400 萬美元，與我們先前約 1.15 億美元的全年資本支出目標持平。本季的收購支出超過 1.2 億美元，年初至今我們的隱藏收購計畫投資額超過 1.5 億美元。

As a result, we ended the quarter with $1.1 billion of debt on our balance sheet, net of more than $200 million in cash on hand. Together with undrawn availability under our bank revolving credit facility, our liquidity for any potential immediate capital growth requirements exceeds $300 million. Leverage as measured by net debt to EBITDA sits at 2.3 times remaining in line with the prior first quarter as we were able to fund the higher than typical acquisition spending with our strong quarterly cash flow.

結果，本季結束時，我們的資產負債表上有 11 億美元的債務，扣除超過 2 億美元的手頭現金。加上我們銀行循環信貸額度下的未提取可用資金，我們滿足任何潛在的即時資本增長需求的流動性超過 3 億美元。以 EBITDA 淨債務衡量的槓桿率為 2.3 倍，與上一季持平，因為我們能夠利用強勁的季度現金流為高於典型的收購支出提供資金。

In terms of outlook, taking into account our reported year-to-date results and the second quarter tuck-under additions in our roofing operations, we are modestly increasing our indicated financial targets that we laid out at the beginning of the year. For 2024 we are now forecasting that consolidated annual revenue and EBITDA will both achieve mid-teens percentage growth over our 2023 annual results.

就前景而言，考慮到我們報告的年初至今的業績以及第二季屋頂業務的增加，我們正在適度提高年初制定的財務目標。對於 2024 年，我們現在預測，合併年度收入和 EBITDA 都將比 2023 年年度業績實現中位數百分比成長。

That now concludes our prepared comments. Operator, please open 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)

（操作員說明）

Stephen MacLeod, BMO Capital Markets.

史蒂芬‧麥克勞德（Stephen MacLeod），蒙特婁銀行資本市場部。

Thank you. Good morning, guys. Just a couple of questions specifically around the restoration business. I know you gave some guidance around sort of Q3 and expectations on that. Can you talk a little bit about what your pipeline potentially may look like with Hurricane Beryl having come through and hit ground? Just curious if you have any indication on what that might mean in terms of large loss restoration activity?

謝謝。早安，夥計們。只是關於修復業務的幾個問題。我知道您就第三季提供了一些指導以及對此的期望。您能否談談颶風「貝裡爾」襲擊地面後您的管道可能會是什麼樣子？只是好奇您是否有任何跡象表明這對於巨額損失恢復活動可能意味著什麼？

Yes, Stephen Beryl will not be a significant event for us or market for that matter. Quite localized to Houston. We've definitely seen an increase in claims in that market, but they're more related to residential water mitigation. So certainly our Paul Davis business in that market has seen increased activity. But not as much commercial or large loss commercial claims have come through in general.

是的，史蒂芬·貝裡爾對我們或市場來說不會是一個重大事件。非常本地化於休斯頓。我們確實看到了該市場索賠的增加，但它們更多地與住宅用水緩解相關。因此，我們的保羅戴維斯業務在該市場的活動肯定有所增加。但總體而言，商業索賠或巨額損失商業索賠的數量並不多。

Okay. That's helpful. Thanks, Scott.

好的。這很有幫助。謝謝，斯科特。

And then just turning to the outlook for the brands business. You're guiding to some margin improvement in the back half of the year, which is which is great. Wondering if you can talk a little bit about the organic or maybe total growth on the revenue lines. Just thinking about the comps you had some last year. Q3 seems like a tougher comp on the organic side, Q4 a bit of an easier comp. Just wondering if you can sort of frame how that will impact the back half of the year.

然後轉向品牌業務的前景。您預計下半年的利潤率會有所改善，這非常棒。想知道您是否可以談談收入方面的有機成長或整體成長。想想你去年的比賽。從有機方面來看，Q3 似乎是一個更艱難的比賽，而 Q4 則是更容易的比賽。只是想知道您是否可以大致了解這將如何影響今年下半年。

Let me start, Jeremy, and then you can jump in. I mean, we do expect organic growth within our restoration business. Century Fire, as I said, will be down modestly at home improvement. But it's not a significant part of the division. And then and then roofing is a new business for us. So in aggregate, Jeremy, can you jump in and--

傑里米，讓我開始，然後你就可以加入了。我的意思是，我們確實期望我們的修復業務有機成長。正如我所說，世紀之火將在家居裝修方面小幅下滑。但這並不是該部門的重要組成部分。屋頂對我們來說是一項新業務。總而言之，傑里米，你能加入進來——

Yeah, I'll give some indications just brands division, I'll speak to Q3, including the fact that we've still got, albeit moderating headwinds in restoration from last year, $25 million in Q3 and a bit more in Q4, $40 million in the back half of the year. Expect brands division, at least in Q3 to be to be flat, including that. And excluding those restoration headwinds, we are closer to mid-single digit organic growth as a portfolio. So hopefully that gives you a bit of indication metric wise, Stephen.

是的，我會給出一些品牌部門的指示，我會談到第三季度，包括我們仍然有的事實，儘管去年恢復的阻力有所緩解，第三季度為2500 萬美元，第四季度更多，為40 美元下半年達萬元。預計品牌劃分至少在第三季將持平，包括這一點。排除這些復甦的阻力，我們的投資組合更接近中個位數的有機成長。因此，史蒂芬，希望這能為您提供一些指標方面的指示。

Then plus roofing.

然後加上屋頂。

Yes, sorry. I was speaking to the organic.

是的，抱歉。我正在對有機物說話。

So organic kind of flattish in Q3, including the $25 million headwinds from last year?

第三季的有機表現如此平淡，包括去年 2500 萬美元的逆風？

Yeah. Correct.

是的。正確的。

Okay. No, that's super helpful. Thanks, guys. Appreciate it. I'll get back in queue.

好的。不，這非常有幫助。謝謝，夥計們。欣賞它。我會回到隊列中。

Frederic Bastien, Raymond James.

弗雷德里克·巴斯蒂安，雷蒙德·詹姆斯。

Good morning, guys. You highlighted in your prepared comments that Florida was a priority area for the roofing business. I was wondering if you care to share if there are other areas of focus that you can turn to next?

早安，夥計們。您在準備好的評論中強調佛羅裡達州是屋頂業務的優先區域。我想知道您是否願意分享接下來您可以轉向的其他重點領域？

Well, Florida remains a priority area for us, Frederic. We covered a couple of regions within Florida with these recent tuck-unders, but it is a huge roofing market. So we expect to add to it in time. But to answer your specific question, Texas, Mid-Atlantic, California would be priority regions for us, but we do have a fair bit of white space so we're looking at opportunities sort of across the US, I would say, right now.

弗雷德里克，佛羅裡達州仍然是我們的優先地區。我們最近涵蓋了佛羅裡達州的幾個地區，但這是一個巨大的屋頂市場。所以我們希望及時補充。但要回答你的具體問題，德克薩斯州、大西洋中部、加利福尼亞州將是我們的優先區域，但我們確實有相當多的空白區域，所以我想說，現在我們正在美國各地尋找機會。

And would you say, given what you're seeing out there in the markets that we're seeing will be your primary engine for inorganic growth on a go-forward basis? Or that's other platforms that could come in a way in and balance?

您是否會說，考慮到您在市場上看到的情況，我們認為這將成為您未來無機成長的主要引擎？或者其他平台可以以某種方式介入並實現平衡？

Did you say organic growth?

你說的是有機成長嗎？

Inorganic M&A.

無機併購。

Inorganic. Sorry. Certainly roofing is consolidating quickly. So it's very active, right now, but we have opportunities really across all our platforms, I would say. I would expect that we'll continue to add and restoration and fire and FirstService Residential (multiple speakers) --

無機。對不起。當然，屋頂正在迅速鞏固。所以現在它非常活躍，但我想說，我們在所有平台上都有機會。我預計我們將繼續添加、恢復、消防和 FirstService 住宅（多位發言者）——

Great to hear. Awesome Thanks. That's all I have a good result guys. Thank you.

很高興聽到。太棒了謝謝。這就是我取得好成績的全部。謝謝。

Tom Callaghan, RBC Capital Markets.

湯姆‧卡拉漢 (Tom Callaghan)，加拿大皇家銀行資本市場部。

Thanks, morning guys. Maybe just to follow up on that line of questioning with respect to roofing, obviously, the deals done this quarter were maybe a little larger than kind of your traditional tuck-in. Is that a function of maybe market structure? Or is it really just a function of wanting to establish a good base right off the bat in those core areas? And how should we think about kind of sizing of those roofing deals going forward?

謝謝各位早安。也許只是為了跟進有關屋頂的問題，顯然，本季完成的交易可能比傳統的交易更大。這是市場結構的功能嗎？或者這真的只是想在這些核心領域立即建立良好基礎的功能嗎？我們該如何考慮未來屋頂交易的規模？

I think that deals would generally be smaller, Tom, going forward and maybe more in line with the size of tuck-under that we normally do when we enter a market. I mean those were true two attractive companies that we had really dialed in on Crowther being the larger and being the dominant player in Southwest Florida is a big move for us. On average, they will be smaller going forward.

湯姆，我認為未來的交易規模通常會更小，並且可能更符合我們進入市場時通常進行的折邊規模。我的意思是，這確實是兩家有吸引力的公司，我們確實在克勞瑟的幫助下成為規模更大的公司，成為佛羅裡達州西南部的主導企業對我們來說是一個重大舉措。平均而言，未來它們會變得更小。

Okay, thanks. Thanks for that.

好的，謝謝。謝謝你。

Maybe just separately on Century Fire, strong results continue there. And I'm just curious when you look at the opportunity set there, like you specifically talked a bit in the past about bringing all the branches towards full service providers. So sprinkler to alarm or vice versa. And just wondering from that angle, how much running room is left in terms of that growth opportunity.

也許只是在《世紀之火》上單獨進行，強勁的結果仍在繼續。我只是很好奇，當你看到那裡的機會時，就像你過去專門談到的那樣，將所有分支機構都轉向全方位服務提供者。所以噴水器要報警，反之亦然。只是想從這個角度來看，就成長機會而言還剩下多少運行空間。

Certainly it's still an opportunity, but the surge we saw, I think, particularly in '23, where we grew organically over 20%. We really made some strong headway through that period. So we're in a period of sort of mid to high single digit organic growth. That's going to be more typical for us moving forward with Century.

當然，這仍然是一個機會，但我認為我們看到了成長，特別是在 23 年，我們的有機成長超過 20%。在那段時期我們確實取得了一些重大進展。因此，我們正處於一個中高個位數有機成長的時期。對於我們與世紀一起前進的人來說，這將是更典型的。

Okay. I'll pass it back.

好的。我會把它傳回來。

Stephen Sheldon, William Blair.

史蒂芬謝爾頓，威廉布萊爾。

Hey, thanks for taking my questions. First, with some of roofing business. Great to hear that it's tracking to your expectations, but can you just remind us of the rough seasonality and whether that was any different than you would have thought initially. Seems like the acquired roofing assets maybe contributed a lot more than we at least had modeled in the quarter. But that may just reflect on normal seasonal trends that we didn't fully capture. So any detail on kind of seasonal patterns you're seeing?

嘿，謝謝你回答我的問題。首先是一些屋頂業務。很高興聽到它符合您的期望，但是您能否提醒我們大致的季節性以及這是否與您最初想像的有什麼不同。看來收購的屋頂資產的貢獻可能比我們至少在本季建模的要多得多。但這可能只是反映了我們沒有完全捕捉到的正常季節性趨勢。那麼您所看到的季節性模式有什麼詳細資訊嗎？

Yeah, it's Jeremy, Stephen. First quarter's definitely seasonally weaker than Q2 and Q3, and then it tails off a little bit in Q4. So through Q2 and Q3 are the seasonal peaks for most of the businesses. We'll see with the Florida-based businesses, that's probably more of a year-round, just given the geography that it sits in the climate. So yeah, sequentially, more contribution from roofing than in Q1 plus also the month of as Scott said, this tuck-under was particularly the other one was larger than typical and we got a one of the three months in the quarter contribution from that business.

是的，是傑里米，史蒂芬。第一季的季節性肯定弱於第二季和第三季度，然後第四季略有減弱。因此，第二季和第三季是大多數企業的季節性高峰。我們將看到佛羅裡達州的企業，考慮到其所處的地理位置和氣候，這可能會是全年的情況。所以，是的，屋頂的貢獻比第一季更多，而且正如斯科特所說，這個折邊尤其是另一個比典型的要大，我們從該業務中得到了本季度三個月的貢獻之一。

Got it. Okay. That's helpful.

知道了。好的。這很有幫助。

And then just some residential, it sounds like you're optimistic. Scotty, kind of about the growth potential in Northern California market. Can you just talk about what those opportunities look like? Is it more master-planned communities or just generally, where do you see your opportunity to grow in that market?

然後只是一些住宅，聽起來你很樂觀。Scotty，關於北加州市場的成長潛力。您能談談這些機會是什麼樣的嗎？是更總體規劃的社區還是只是一般性的，您認為您在該市場中的成長機會在哪裡？

Yeah, master plan, primarily, a high rise and large master-planned communities are our sweet spot for us. And the addition of this team, I think, strengthens our presence and strengthens our positioning in the market.

是的，總體規劃，主要是高層建築和大型總體規劃社區是我們的最佳選擇。我認為，這個團隊的加入增強了我們的影響力並加強了我們在市場上的定位。

Great. Thank you.

偉大的。謝謝。

Tim James, TD Securities.

提姆詹姆斯，道明證券。

Thank you. Good morning. Just one question here. I'm wondering if you could talk about the -- we've been indicating there're promotional investments or expenses being undertaken for the home improvement business. I'm just wondering, give us a bit of an update on how that is going. Are you seeing evidence of success from those investments? And just remind us of the catalyst or the reason behind that push?

謝謝。早安.這裡只有一個問題。我想知道您是否可以談談 - 我們一直在表明正在為家居裝修業務進行促銷投資或支出。我只是想知道，請給我們介紹一下進展。您是否看到這些投資成功的證據？只是提醒我們這種推動背後的催化劑或原因？

Well, we had been dialing up our marketing spend and our discounting sort of through the end of '23 and into Q1, but we pulled back this last quarter, Tim and sort of tweaked our balance between focus on market share gains and bottom line. And so as Jeremy indicated, the top line came off modestly, but our margins increased this past quarter. And we feel we're more in a sweet spot for us in the right spot and we'll likely maintain our current spend through Q3.

嗯，從2023 年底到第一季度，我們一直在加大行銷支出和折扣力度，但我們在上個季度縮減了開支，蒂姆，並在某種程度上調整了我們對市場份額增長和利潤之間的平衡。正如傑里米（Jeremy）指出的那樣，營收略有下降，但上個季度我們的利潤率有所增加。我們覺得我們處於正確的位置，我們可能會在第三季度保持當前的支出。

And really effectively take what the market gives us in terms of revenue and make sure that we're executing and delivering on our service promise with a real focus on driving repeat business and word of mouth referral when the environment becomes more favorable. So strategically, we made a decision to dial down that spend really not seeing the same results in Q1 that we were in the last part of '23.

並真正有效地利用市場為我們帶來的收入，並確保我們執行和兌現我們的服務承諾，並在環境變得更加有利時真正專注於推動回頭客業務和口碑推薦。因此，從策略上講，我們決定減少支出，但在第一季並沒有看到與 23 年最後一部分相同的結果。

Okay. That's very helpful. Thank you.

好的。這非常有幫助。謝謝。

Himanshu Gupta, Scotiabank.

希曼舒古普塔，豐業銀行。

Thank you and good morning, everyone. So on FSB margins, I think they were higher than our expectations in Q2. Was there any particular segment which lead to better margins?

謝謝大家，早安。因此，就 FSB 利潤率而言，我認為第二季的利潤率高於我們的預期。是否有任何特定的細分市場可以帶來更好的利潤？

No, Himanshu. it was really -- the sequential improvement quarterly from Q1 that I spoke about was really around less headwinds in restoration what Scott just touch on, and what I said in my prepared comments, reduced discounting and promotional activities in home improvement. So sequential margin improvement profile in Q2.

不，希曼舒。我談到的第一季以來的逐季度連續改善實際上是圍繞斯科特剛剛提到的恢復方面的阻力減少以及我在準備好的評論中所說的減少家居裝修方面的折扣和促銷活動。因此，第二季的利潤率連續改善。

And then you do have the added mix of spoke to it on earlier question, roofing coming in seasonally higher in Q2 than in Q1. So those would be the three factors that would have contributed to tighter margin gap in Q2 on a year-over-year basis than in Q1.

然後，您確實在先前的問題上談到了更多的內容，第二季的屋頂季節性高於第一季。因此，這三個因素將導致第二季的利潤率差距比第一季縮小。

Got it. That's helpful. And then sticking to the roofing, probably margins. I mean, obviously to recent further acquisitions as well. So as you build scale in the roofing business, do you think margins can improve over a period of time?

知道了。這很有幫助。然後黏在屋頂上，可能是邊緣。我的意思是，顯然也包括最近的進一步收購。那麼，當您在屋頂業務中建立規模時，您認為利潤率會在一段時間內提高嗎？

No. I mean, at this juncture, it's a very decentralized structure with roofing, individual brands, operate in the local markets, getting local regional business. There are some benefits of scale, but they are not about cost reductions and margin enhancement. What I articulated when we invested and partnered with the Roofing Corp acquisition as well as with the tuck-unders, they'll be a little bit higher than 10%, but we don't see any line of sight to significant margin improvement at this juncture.

不。我的意思是，在這個時候，它是一個非常分散的結構，有屋頂、個人品牌，在當地市場運營，獲得當地區域業務。規模化有一些好處，但它們與降低成本和提高利潤無關。我在投資 Roofing Corp 收購以及與 tuck-unders 合作時表示，它們的利潤率將略高於 10%，但我們認為目前利潤率不會有任何顯著改善契機。

Got it. And maybe the last question is on Century Fire. I mean, obviously very strong. You mentioned high single digit for the second half of the year, very similar to Q3 as well. Any thoughts into the next year? I mean, given, will be facing tough comps. Do you see further easing as well in that business?

知道了。也許最後一個問題是關於世紀之火的。我的意思是，顯然非常強大。您提到下半年的高個位數，也與第三季非常相似。對明年有什麼想法嗎？我的意思是，考慮到，我們將面臨艱難的比賽。您認為該行業還會進一步寬鬆嗎？

I think we would expect to continue to grow at a single digit level for '25, but we'll certainly update that as we get closer to year end.

我認為我們預計 25 年將繼續以個位數水準成長，但隨著接近年底，我們肯定會更新這一點。

Absolutely. Okay. Thank you guys. I'll hand back.

絕對地。好的。謝謝你們。我會還手的

Daryl Young, Stifel.

達裡爾楊，斯蒂菲爾。

Hey, good morning, everyone. And congrats on a good result. Just with respect to the residential division, I mean the market share gains have continued to be extremely strong. I know you've added some new service lines within there. But can you just give us a bit of color on maybe which markets are particularly strong and what's been driving that? And also, is labor availability helping you with your cited labor contracts?

嘿，大家早安。並祝賀取得了好成績。就住宅部門而言，我的意思是市場份額的成長仍然非常強勁。我知道你們在那裡添加了一些新的服務線。但您能否向我們介紹哪些市場特別強勁以及推動這一趨勢的因素是什麼？此外，勞動力可用性是否對您所引用的勞動合約有幫助？

Certainly labor is much better than it has been over the last few years. I mean, it started to improve in late '23, I would say. And it continues to be much better. Our turnover is certainly down and in line with our experience from pre-COVID 2019. So in general, we're able to attract talent and keep it, which does help us at FirstService Residential certainly. It's a very labor-intensive business.

當然，勞動力狀況比過去幾年好得多。我的意思是，我想說，它在 23 年末開始有所改善。而且情況還在持續好轉。我們的營業額肯定有所下降，這與 2019 年新冠疫情之前的經驗相符。所以總的來說，我們能夠吸引並留住人才，這對 FirstService Residential 確實有幫助。這是一個非常勞力密集的行業。

And our contracts require, in many cases certain headcount. And so keeping -- maintaining that headcount in line with our contractual obligations, maintains our revenue, and we struggled with that in '22. Generally, solid across North America at FirstService Residential, no markets necessarily stronger than others other than I would just reiterate the verticals that remain strong for us, high rise and then the larger lifestyle and master-planned communities. I hope I answered your question.

在許多情況下，我們的合約要求一定的員工人數。因此，保持員工數量符合我們的合約義務，可以維持我們的收入，而我們在 22 年為此苦苦掙扎。總體而言，FirstService Residential 在北美地區表現穩定，沒有哪個市場一定比其他市場更強大，除了我只想重申對我們來說仍然強勁的垂直市場，高層建築，然後是更大的生活方式和總體規劃社區。我希望我回答了你的問題。

Yeah. No, that's helpful color.

是的。不，這是有用的顏色。

And then maybe just one quick nitty-gritty one, sorry for a [split], but debt of the minority interest share of earnings as we go forward, just with some of the acquisitions you've done recently, how should we look at that, Jeremy, for the remainder of the year?

然後也許只是一個快速的細節，抱歉[分割]，但是隨著我們前進，少數股東權益份額的債務，只是你最近完成的一些收購，我們應該如何看待這一點傑里米，今年剩下的時間？

Yeah. As I've indicated to most of you, 9% to 10% is a good number. It's tracking lower year to date. But that's often a function of mixed performance amongst the businesses that we're partnered with. I would still stick with that 9% to 10% conservatively.

是的。正如我向你們大多數人指出的那樣，9% 到 10% 是一個不錯的數字。今年迄今為止，該指數正在走低。但這通常是我們合作的企業績效參差不齊的結果。我仍然會保守地堅持 9% 到 10%。

Good. Thanks for that.

好的。謝謝你。

That concludes today's question-and-answer session. I'd like to turn the call back to Scott Patterson for closing remarks.

今天的問答環節到此結束。我想將電話轉回給斯科特·帕特森，讓其致閉幕詞。

Thank you, Liz, and thank you, everyone, for joining and enjoy the rest of your day. We will reconvene at the end of October for Q3.

謝謝你，莉茲，也謝謝大家的加入，祝你有個愉快的一天。我們將於 10 月底再次召開第三季會議。

Ladies and gentlemen, this concludes the second quarter earnings call. Thank you for your participation and have a nice day.

女士們先生們，第二季財報電話會議到此結束。感謝您的參與，祝您有美好的一天。