Q3 2020 WSP Global Inc Earnings Call
[music].
Most of the times next year, good morning, ladies and gentlemen.
Yeah look at home they fund it seemed like they ticked up female see what's in peanuts predicts a fixed dividend rate, but because we see.
Welcome to double the third quarter.
<unk> results conference call.
I like to think that meeting over to Quentin Weber Investor Relations.
Hi, Please go ahead mr. another.
No see good morning, we hope that you'll see it's been doing well. Thank you for taking the time to join the call today during which we will be discussing our Q3 2020 performance followed by a question and answer session.
Yesterday, our unlike Sullivan, our president and Chief Executive Officer and.
Sure our Chief Financial Officer. Please note that this call is also accessible on our website via webcast.
On the call we may be making some forward looking statements and actual results could be different from those expressed or implied we undertake no obligation to update or revise any of these statements relevant factors that could cause actual results to differ materially from those forward looking statements are listed in our most recent management discussion and analysis.
Also during the call we may refer to certain non <unk> first measure.
These measures are defined in our management discussion and analysis for the third quarter EPS 2020, as well as her management discussion and analysis for the year ended December 31st 2019, both of which can be found on see dark and on our website.
And they also includes reconciliations of non ferrous measures to the most directly comparable I guess first measures.
<unk> believes that these non.
First measures provide useful what's your useful information to investors regarding the corporations financial condition and results of operations as they provide additional metrics its performance.
No no tourists measures are not recognized on the right. So it did not have any standardized meaning prescribed right for us and may differ from similar similarly named measures as reported by other issuers and accordingly may not be comparable these.
These measures should not be viewed as a substitute for that really differential information prepared in accordance with <unk> with that I will now turn the call over to let itself.
Thank you kind of thing and good morning, everyone. Thank you for joining us today, and I hope that you and your family or staying safe and good health.
As we navigate does these unusual times I continue to be extremely proud of what we've achieved as an organization. Thanks to our employees around the globe.
Like a resin Leiden sorry to the challenges.
Missing a beat both individually and collectively.
We continue to demonstrate their passion for client services and I'm truly grateful for their adaptability and dedication.
During the quarter, we continue to adopt a response to depend dynamic with a flexible approach as regional sanitary commendations ball.
After a gradual and partial reopening of some of our offices increased an infection rates across many parts of the world.
Employees resuming work remotely.
Although the situation remains fluid most of our employees continue to work remotely something which has become somehow the new normal that being said our common common focus working remotely or not remains on collaborating to deliver projects and pursue new assignments fulfilling commitment and growing.
Fine relationships.
Before I go over our recent wins and our regional financial performance for the third quarter I would like to take a moment to discuss the important leadership announcement, we made yesterday.
Dalton, our Chief operating officer has decided to leave the organization at the end of the year to pursue new professional and personal opportunities.
All that's been a key member of our leadership team for the past eight years.
She Oh has been responsible for the execution of our pre oppression an operating plan.
Among his many accomplishments has overseen the successful integration of the numerous companies we acquired during the summer and train common purpose share values and a unified corporate culture.
Yeah for the board of directors and the entire global leadership team I would like to wish him all the best in the future endeavors. Thank him for his significant contribution to making WSP. The leader it has become today.
In terms of transition our intention is not to feel the CEO position.
Taking this opportunity to rethink our global operational structure and to review the roles and responsibilities of the current members of our global leadership team.
This approach will allow us to further our nest the strength of our leadership team and our continued quest to better leverage the depth and breadth of our capabilities across the organization.
I would now like to highlight a few of the major wins to treat showcasing a sample of our expertise from across the globe.
Starting with the city of Toronto WSP has been named Prime consultant on the significant travel trends of commission subway capacity enhancement program build.
Building on a long and successful client relationship with the P.T.C. diff.
WSP will provide consulting services for the capacity enhancement up the line one sub when travato over a period of 11 years.
Program will aim to improve customer experience and satisfaction improve safety and support.
And and support the broader economy benefits of a high performing transit system.
Moving to Illinois in the U.S. WSP will provide the full suite suite program management oversight services in support of the northeast, Illinois Regional commuter Railroad Corporation.
[music] billion capital program.
Working closely together, our national expert will support the growth of internal program management capabilities to set the framework for lasting success.
Across the Ocean and the UK WSP will act as a leader on planning environmental stakeholder and Len Advisory services for New Hydro James Pat that pipeline in the northwest supporting the UK target of a net zero greenhouse gas emissions by 2015.
The H. why not show two pipeline is the most advanced hydrogen and carbon capture utilization and storage project in the UK and represent the first piece of the U.K.C.C.U.S. infrastructure.
Justified by the committee on climate change as a vital technology for achieving the ambition ambitious I'm, sorry emissions savings needed to meet the 2050 carbon reduction targets.
One of her objectives, when we unveil our 2019 2021 strategic plan was to build a new.
Leading professional advisory firm, bringing together talents and professional globally.
We are experts provide strategic advice on sustainable solutions to help societies grow for generations to come.
Private enterprise and government must address their G. H G emissions in their journey journey to embrace the green transition.
And other pressing reasons to decarbonise is to maintain access to competitive capital.
However, they cannot do it alone and they need a leading expert to assist with this transition.
It's exciting projects in the UK is a good example of the work we do by partnering with our clients and building sustainable communities.
I would now like to turn to our regional performance starting with our Canadian operation.
In Q3, or Canada reportable segment posted organic contraction in net revenue of 7.1%.
Delivered adjusted EBITDA by segment, and adjusted EBITDA margin by segment of 51.5 million and 21.4% respectively. The.
The decreases in net revenue are mainly attributable to lower performance in Western Canada.
Affected by the depressed oil and gas industry, which impacted many market sectors.
Also lower volumes and the commercial property and building segment continued to adversely affect.
Formats during the third quarter.
The impact of the depressed oil and gas downturns, but present that more than half of the contraction in net revenues in the quarter and nine months period.
Our Americas reportable segment posted organic contraction net revenue of 3.8% over Q3.
The Q3 2020 were delivered a solid 8.2% organic growth.
The regions delivered adjusted EBITDA by segment adjusted EBITDA margin by segment of hundred 20, 22.4 million and 21 person.
The organic revenue contraction in the quarter was felt in both the U.S. and Latin American operations.
The decrease in the U.S. is mainly due to timing of revenue recognition on certain large projects recognizing true treat 2019 and to lower volumes in the commercial property 10 buildings and power and energy market sectors due to the pandemic.
Yeah, adjusted EBITDA margin for the Americas segment was stable as compare to to the same quarter last year as the impact of lower revenues was mostly offset by cost containment measures and cost savings stemming from office lock down and travel restrictions.
Next our email reportable segment posted organic contraction in net revenues of 5.1%.
In both the Treme the trend the nine months period that you can't felt the largest negative impact on net revenues as it experienced lower volumes in the transportation and then for off market sector, largely due to delays on some public sector projects.
Also softness in the private sector affected our planning and advisory services and commercial property and building market sector.
Do you mean operation posted adjusted EBITDA by segment and adjusted EBITDA margin by segment of 79.6 million.
14.4%, respectively, an increase when compared to the same period in 2019 and <unk> as the impact of lower revenues was more than offset by cost containment measures and cost savings stemming from office, Mcdonald's and travel restrictions and the receipt of covenant government subsidies.
Lastly, our Asia Pac reportable segment delivered organic growth in net revenues of 4.5% organic growth was led by solid results in New Zealand and Asia, While Australia remained relatively stable.
The regions delivered adjusted EBITDA by segment and adjusted EBITDA margin by segment of 61.5 million and 20%.
Adjusted EBITDA margin by segment increased mainly due to strong performance in Australia, New Zealand, including the benefit of cost savings stemming from office like them and traveled restriction as well as the receipt of government subsidies in Asia.
Overall, we are very pleased with our performance in true tree, which again demonstrates the resilience of our platform and that indication of our people and.
And I will now review our financial results in more detail followed by the updated outlook.
All right. Thanks, Alex Good morning, everyone, Let's first discuss our topline revenues and net revenues for the quarter reached 2.1 billion and 1.7 billion down, 3.8% and 0.4% respectively compared to Q3 2019 organically net revenue contracted 3.4.
Two cents for the quarter the good organic growth in the Asia Pac portable segment was offset by organic contraction in the other segment. Please.
Please note that the third quarter of 2020 had one less billable day compared to Q3 2019.
Backlog remains very healthy at 8.5 billion, reaching a record high of 11.6 months with revenues up 4.6% from December 2019 at 7.6% from September 2019.
Backlog organic growth reached 3.6% compared to December 19, and 5.2% compared to September 19th we continue to be very pleased that our backlog.
Let's move on to profitability for the second quarter, adjusted EBITDA amounted to amounted to $297 million up 3.1% compared to $288 million in Q3, 2019, adjusted EBITDA margins for the quarter Beach, 17.6% compared to.
17% in Q3, 2019 improve margin than the Asia Pac and Amy reportable segments were partially upset by lower margins in the other segment.
Turning before net financing expenses and income taxes in the quarter reached $144 million down compared to Q3 2019, mainly due to increase in the acquisition integration and restructuring costs.
Net financing expenses for the third quarter was 39 million lower than 2019, mainly attributable to lower interest expense due to lower long term debt.
Unrealized foreign exchange gains from derivative financial instrument and higher non cash increases in the value of investments related to our U.S. employee deferred compensation plan.
Net earnings attributable to shareholders for the quarter was 104 million or 92 cents per share up 11.3% and 3.4%, respectively, when compared to Q3 2019 adjust.
Adjusted net earnings for the quarter reached $118 million or 1.0 for a dollar per share up 17.5 million, an eight cents per share respectively compared to Q3 2090.
I will now review a few cash flow metrics, our dsos as of June 27.
As of the end of Q3 stood at 72 days the same as last quarter and still at historical best compared to 80 days as of the end of Q3 2019 also for the trailing 12 months ended September 26 2020.
Free cash flow amounted to $779 million, representing 350% of net earnings attributable to shareholder we continue to be very proud of our cash flow generation.
Hi, or free cash flow in 2020 year and year to date was mainly driven by accelerated collection. During the first nine months of 2020 compared to the same period last year and the deferral of income taxes and other evidence in some jurisdictions of approximately $100 million from a modeling perspective approximately.
20% of this deferral will be repaid in 2020 with the remaining amount to be repaid 2021 and 2022.
The net debt to adjusted EBITDA ratio stood at 2.3 times. The racial significantly lower than 1.1 time as at December 31st 2019, mainly due to the repayment of a portion of our debt, resulting from strong free cash flow and the issuance of share capital in the second quarter EPS 2020.
We also declared a dividend of 37.5 cents per share for shareholders on record as of September Thirtyth 2020, which was paid on October 15, 2020, with a 54% <unk> participation. The Nash at cash outlay for the quarter was $19.6 million.
Finally, we're pleased to reiterate the financial outlook for 2020 issued in last August.
So the adjusted EBITDA is anticipated to skew towards the higher end of the range previously provided which was from 1 billion to $1.5 billion. This concludes my remarks, Alex back to you.
Yes.
[noise] [noise] [noise], Oh, sorry, the beauty of technology I was on mute. Thank you will and before we open up the line for questions I will wrap it up quickly by saying that we are pleased with our Q3.
Year to date performance, which confirmed the resilience and agility of our business model as such we are also very comfortable reiterating our financial outlook.
As we are slowly approaching Deanna 2020, we are devoting significant effort and planning for 2021. The current environment is not without challenges as we are entering this last year of our current strategic side cycle with a cautious cautiously optimistic mindset as.
As previously stated although the landscape has changed and they are more uncertainties. The underlying principles of our global global strategy remains very relevant and.
We are not ready to relent or give up on their stated strategic objectives.
We are continuing to explore opportunities to deliver on these ambitions now let's open the line for questions operator.
Thank you at this time you feel like that's a question press star one on your telephone to withdraw your question press accounts and again to ask a question press Star one.
Alrighty thinking about what what's next and our next strategic cycle and that's what we're gonna do in the next 12 months.
And as part of that obviously surely I I I spent some of my time talking to to a number of players and targets in relationships that I have.
Within the industry of course, you know, there's some uncertainties still in the marketplace.
And we are seeing I mean in our industry. We have <unk>, we have not seen a lot of deals taking place at this point in time, but that doesn't mean that this that that could not change it at some point in time Jacob a trip for the time being certainly we.
Where focus on delivering on our business and we said that if we had an opportunity to be opportunistic at some point in time, we wanted to have the tools in our toolbox to be able to do that and I think you know, having a strong balance sheet to certainly something that.
Yeah, it's good to have at this point in time.
Second question here is just an organic revenue growth you know improving in third quarter versus second quarter, but none that I can.
Have you seen steady improvement or or you know have you plateaued here you know with this with a second wave.
We have seen we have seen an improvement.
As an example, you look at the R. U K business hope, we have seen a stat stabilization of our of.
You know off of our business and that you can choose <unk> two I'm sorry, it was still.
No very challenging and and certainly at the beginning of two three we saw the market <unk>.
Being a bit more stable and and I also some more momentum in the proposal activities and and some of those countries that we're we're going through a rough patch.
So I I thought that you know the results in two or three were quite we're we're quite please with with them and and yes, we're down a bit more than 3% for the quarter, but as I said before I feel that this is an improvement on queue to our backlog is growing so so if if all bodes well obviously.
Two four I'm confident that we're gonna end or 2021, now and then a good place in house October shaping up.
October shipping up is expected when we provided the outlook and chew too.
We were looking at you know the month of August September being the the month, where things with stabilized.
N and September things with we were expecting September two to take off this is exactly what would happen in October right. Now is is as expected and performing is expected.
Okay.
Leave it there thank you.
Thank you.
And your next question comes from the lineup here I like like Kinda card. Please go ahead.
Hi, good morning.
<unk>.
Alex wanted to dig in a little bit on.
On the the opportunities that are out there for for bookings and bringing a new new projects. Okay. It looks like your your two three bookings were.
Uhm amongst the lowest we've seen in the last.
Two years or so and I understand these these can be lumpy, but.
You know just what what is the impact as the pandemic, having on an RFP activity or or bids or whatever you want to characterize it.
Yes, I said before the.
And the proposal activity is still in his his quite it's it's healthy I think we're or please with with the with that then.
Again.
I wouldn't use the COVID-19, as a as a as an excuse I I've I've used this argument in the past and many different occasions.
<unk> you you win and lose and then you're given water and I would not draw any conclusion on one quarter alone I think you need to look at this and it's it's more of a trend the backlog is more of a trend.
Then a you know the then the statement in any given quarter. So as I said to to Jacob's before I believe that the the proposal activities is still very good.
In many parts of the world we've seen it in the U K as I said before quite quite active.
Simon Canada, frankly of course, Western Canada is a bit more difficult, but the province of Quebec is our fastest groin region right now and in the country.
And then you have the you asked that is quite active.
So so I am not prepared to say that you know the the the the slight reduction and booking two three I should should rise concern.
If this was the case with three four quarters in a row of course, you know you look at the trends over a year <unk>. You then need to obviously to draw some conclusions, but but not on a corner. It's a lot of it. This often time some timing next quarter, we could win a major assignment and this would change the discussion we're having right now.
So.
That's why I wouldn't want I wouldn't want us to.
To jumped at a gun just with one quarter.
We're still growing and that's positive and that's what we need to remember.
Yep Yep.
Okay, Uhm, just shifting gears to Paul's departure, HM HM why wouldn't you refill see your overall I mean, it's it's worked really well for the last number of years I think your investors are comfortable with that what that set up so I mean, what what what would be.
The reasons for not reselling them.
Well, because I I, I truly understand and and I'm sympathetic to you know.
Obviously with with how are investors are feeling and and I totally realize that you know given the success that the firm has had in recent years that you would expect not to change anything.
This is certainly not one of our principles, we would like to challenge the status quo.
And what was working six seven years ago. Your <unk> is not necessarily a good predictor what will change what what were work in the future.
And I'm, a big believer in that we constantly need to rethink the way you upgrade to business and consequently thing rethink. How you think you can be more effective to win work and deliver projects and when you get 250 60000 people.
And on one week, you need to be in Santiago, Chile in the next you need to be in New Zealand and the week. After you need you've been stuck call more Helsinki.
You know from a distance you may not think that this this.
This is this is not a stretch but.
That's internally I can tell you that it could be in.
And my position on this is we have an incredible bench drink and the business you.
You all have <unk> some of our leaders in the past Mark Naismith manga Smyre in Sweden, Orange, a U K and.
And I wish I would have been in a position to introduce to you Oh this year and our new leader in the U S. For instance, when Canada in Asia Ivy Kong.
But I have not been in a position to do that and I hope to an investor day next year I will be able to to do that but you did come to realize the bench trained that we have.
And you also need to <unk> provide oxygen so our people to grow as a business and I believe that I am extremely well supported by those leaders and uhm, rather than putting uhm a layer between myself and those leaders I'd like and I prefer to give them added responsibility payment.
Parliament then and.
And and frankly, that's what made a successful in that genre organization.
We have don't have a big pyramid, we have we have a very shop a business.
I speak to our leaders on almost on a daily basis. So it's been working extremely well and and I believe that's the right way to go going forward. So we're not making changes to the principles.
Of our printing model and empowered model all I am saying is you know I want to provide additional responsibilities to people that I believe can take.
Yeah that that's it.
Okay.
Okay I'll turn it over thanks. Thank you.
And your next question comes on the line at one end up there with Laura that's in Bank. Please go ahead.
Good morning, and thank you for taking my questions.
So my first question just has to do with margin expansion. It looks like part of your strategic plan and your experts at target I'm, just wondering irrespective of Covid, you've managed to increase margins at least in this corner 60, b print here over here despite expectations for kind of similar contraction is that a trend that we can expect.
Can you or do you think it has something to do with the current mode reining in spending Apis Lockdown no travel reduced compensation.
I I think it's all of the above obviously, we've had some someone off that allowed us to.
Increase R X been our margins, having said all that I think we've I've I've said in my address stuff that we are nope, we're not prepared to amend or change our strategic ambitions, meaning that you know we <unk>, we have the ambitions to expand our margin pull phonics here as well.
And that's our goal with or without the Covid situation and and that's the goal of the business and if you all recall.
At the end of.
And two two and actually at the end of two one.
We were a bit more specific in the ambitions that we were setting for the business. We said first and foremost we need to defend and preserve this balance sheets and actually if you have an opportunity we need to make it stronger.
Second one is we need to continue to expand our margins and we need to demonstrate to investor base that we have a very agile and very flexible business now business structure.
And then you know for years I've been saying that are fixed cost structure was very low.
And I I set to to our people and our professionals that this was.
A real opportunity to demonstrate that.
Two two our investment community, so and and that's now surely what we wanted to achieve for this year, but it's certainly a gulf of next year as well.
So that that that those ambitions won't won't change going into 2021 Mona.
Perfect now that's very helpful and just secondly for me I mean, there's no surprised that their significant interest in your emanated plan to it.
Airplane three turns elaborate I'm just wondering if you could provide some clarification surrounding you are just emanate come in a few minutes ago I do understand that there are not a lot of transactions in this day and there's still a high level of uncertainty uhm just going back to last quarter. You stated that there were four emanate criteria that you look at but final appoint.
Which was the integration where they're waiting hammer uncertainty is it still that uncertainty that you're referring to or perhaps other areas.
No I think you know.
The first the first comment on on the loss criteria I'd say that things are improving.
Right, Yes, we have a second wave, but it's away if that's it in my mind, certainly companies and firms on more prepared to deal with so we are.
<unk> more comfortable with our our current setup, we are purely more comfortable with me you know the you know the the alternative ways of engaging with clients engaging with the professionals into technology that we're using in and so is the same for targets. So.
I think things are improving on the on the last criteria clearly mm.
Uhm, but also clearly you need to make sure that you you you fine you know.
Uhm, a place where where to sellers' expectations and buys expectation will meet meet that add a cross point and and obviously that take a bit.
<unk> for the expectations to meet you know at that that's in an inflection point essentially it's.
All you need this time.
Uhm and we've seen it in 2000, Nathan the back of a crisis uhm.
Uhm sellers' expectations I have to go down a little bit and and advise expectations Martha buyers have to be a bit more confidence in the in the future of of the economy. So that is only taking a bit of time, but I am confident that.
We'll see an increase pick up you know and the not so distant future assuming that.
We can be you know things are are going to wait things have been going for the last two or three months essentially.
But on our end I'm on we we want to be ready and you know I I've always been quite transparent.
With all of you that that our goal is is to have a strong balance sheet because when you have a strong balance sheet.
You are in a position to be opportunistic.
And I'd like to say to our people that now you can only be in a position to improvise when you're prepared.
But when you're unprepared, you can't improvise and I I feel now that you know.
Working on operating plan for 2021.
And delivering could chew three hopefully did a ring a good too for having a strong balance sheet sitting in a in an upward trajectory on our margin profile I think all of this point too you know too too good outcomes. So so of course, it's increasing our confidence that's a come.
<unk> two perhaps at some point in time be more opportunistic.
And do something that this you know in line with with our strategic ambitions.
Perfect. That's very helpful. Thank you.
Okay.
And your next question comes on line, that's spelled that had can I need to check on markets. Please go ahead.
Alright, Thanks, and good morning, probably some color earlier on how you think about the cost reductions that you've undertook and on when you think about maybe a bit longer term about some of the sectors that have become a little bit softer like property, maybe aviation. We made any me very perhaps permanent changes you know like headcount reduction maybe planning for the next few years or.
How are you doing about head count and more of those you know meaningful cause changes restructure business leather.
Yeah.
Well look it's it's it's a very valid questions you will have seen in an R. N do you need that you know our our headcount that's been reduced over the course of the last quarter.
So we continue to have an work job a a business that this fit for purpose.
And and also clearly you know it is our goal to be in a position to do more with with less that's that's a given you always want to improve the efficiency of the company and that's what we're trying to do.
Uhm right now do we have a significant a big plan to to make significant.
Cost reduction and our people at this point in time to answer is no we don't have.
That kind of plan I shield that we've put all of the measures.
A number of good measures in place that were temporary and chew too and now our permanent to be ready to face 2021, and that's what we're busy doing at this point in time and then we'll continue to that the two four.
To make sure that the when we get into 2021, and we have a business that is fit for purpose.
Okay, and then quite a little bit color on the continue to include in your soon in the U K market can you. Let me provide some color on you know some of the things that you were saying maybe on specific projects that slowed down or maybe in the pipeline that are driving some of the sequential improvement in that market.
<unk> and and planning and advisory.
For most of <unk>, it's been relatively quiet for a bit more difficult.
But the talking with our our leaders you know <unk>.
Does not paint that's operating plan for 2021, I think what I would say is that to you. This morning is.
The basis of operating planning 2021.
<unk>.
And where we started when we did lap and are developing just 2021 plan. This essentially a strategic.
A strategic plan that we have <unk> at the beginning of a team. We we haven't change we haven't changed your mind, we believe that it's R. A fundamental principle at the strategy are very relevant.
And we're gonna continue to execute from that plan.
And I don't expect a shift from what we said we would do going into 2021 will continue to exist pigs are cute as as we stayed with.
Okay, great. Thank you.
Okay.
And your next question comes online that's been authenticated with this all day. Please go ahead.
A good morning, Alex and congrats for the the resolve this especially in the current context, Alex with respect to defend it Mickey obviously, so you you mentioned some slowdown with the proper T M building, especially on the commercial I'll go where do you see the greatest a fortunate these going.
To get down there.
Not on the back foot.
But you know the front foot and Thats what were why we're developing our plan right now with this in mind and with our strategy in mind.
Making sure that we continue to execute on what we said we would do.
And then on on your first question.
I mentioned that I mentioned again.
If you take our us business for that matter over the last three four years, we significantly diversify.
But also from an end market point of view.
To create like strength, if you want and our service offering.
But also be in a position to sustain economic shocks like we're seeing right now.
Yes, Alex that's great color and when we look at 2021, obviously the infrastructure push across North America.
It's you on the solid foothold what are the key elements you monitor for assessing your outlook and 2021 and is there a risk about the timing of the infrastructure spending when about though when it will kick off.
Timing is always a risk you always want it for yesterday.
And I wish it was happening much quicker, but some government has been more proactive than others and.
And we're seeing it and stricken regions and the province, where we're both sitting today I think the government has been quite proactive.
We are seeing a high level of activity. So this is really positive we are seeing it in many other parts of the world.
And I am confident that.
When when things come down a little bit than thing settles that that we will see an increase pickup.
Often time, if you leave all of the capital in the regions.
What happens is they tend to give up at you know the service suffering perhaps in the region.
And in order to globalized that service offering you need to go an additional step and it's taken the additional step to get to to globalizing. The service so by having a having a small pool of capital and I'm not talking about the enormous amount of capital uhm that will be real here, but by having a small pool of capital.
We are able to be a bit more agile and dedicate some capital where we see fit. An example of that would be for instance, that's a strategic higher and the advisory space.
Somebody like we hired to not so long ago, you know a very strong resource in a time of change out of Toronto.
One staying safe kind of helps you.
Again, focusing the cold, yes, so let.
Let me return quickly to the year restructuring charges do you expect any meaningful or material restructuring charges.
In 2021 in the past 2020.
Look we disclose our outlook.
In the forefront in remainder of this year and we expect it to be at or lower than what we have projected.
We're not in a position at this point in time too.
Provide an outlook for restructuring charges.
Our environmental sector.
Thankfully, that's where we had set for our strategy.
Next to three.
For years has been our fastest growing segment.
Has been this year and last year. So we're extremely pleased about that.
You know.
We've seen this growing at that now.
No.
Including M&A, a double digit so we're quite the quite pleased about our performance and organically also we have grown the.
This year despite covance so.
So those that were quite concerned about.
The Calvert negotiation agenda, the climate change agenda the agenda.
You know should revisit their views around us.
Carefully process engineering first though to engineering not so much on the environmental side of oil and gas not at all because you know our level of activity activity on that front has been quite we've been quite active we continue to assist or inclined to Descartes decarbonization agenda in there too <unk>.
One of those sites and transforming <unk> and green zones assistance specialty so we haven't seen a slowdown in that but certainly around process engineering facility Engineering's you know our clients I've been found it quite difficult and and there's been a lot of pricing pressure. So that's why you've seen a <unk>.
Western genetic you need an operation.
You know suffering a little bit.
And and we hope that the you know a year from now this would be part of the past.
But but defending I think we feel that that the businesses is in a good position at this point in time.
Alright. Thank you much appreciate it.
And there are no further question at this time I will tend to call back okay could the presenters for clothing in mind.
Well I would like to thank you all for attending our calls. This this morning, we look forward to updating you on our two four results tend to leave I'm Gonna say this but have third after the holidays and at that point in time would be in a position to provide you with an outlook.
For.
2021 results and expectations again, thank you all and have a good day.
That concludes today's conference call Tonight.
[noise].