PGT Innovations, Inc. (PGTI) Q1 2021 Earnings Call Transcript

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PGT Innovations, Inc. (PGTI)
Q1 2021 Earnings Call
May 13, 2021, 10:30 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good morning, and welcome to PGT Innovations' First Quarter and Full Year 2021 Earnings Conference Call. [Operator Instructions]

I'd now like to turn the conference over to PGT Innovations' Interim Chief Financial Officer, Brad West. Please go ahead.

Brad West -- Senior Vice President and Interim Chief Financial Officer

Thank you, operator. Good morning, everyone, and welcome to the PGT Innovations' first quarter 2021 investor conference call. On the Investors section of our company website, you will find the earnings press release issued earlier today, as well as the slide presentation we have posted to accompany today's discussion. This webcast is being recorded and will be available for replay on the company's website.

Before we begin our prepared remarks, please direct your attention to the disclosure statement on Slide 2 of the presentation as well as the disclaimers included in the earnings press release and our SEC filings related to forward-looking statements. Today's remarks contain forward-looking statements, including statements about our 2021 financial performance outlook. Those statements involve risks, uncertainties, and other factors that could cause actual results to differ materially. Additional information on factors that could cause actual results to differ is available in the company's most recent Form 10-K. Additionally, on Slide 3, you should also note that we report results using non-GAAP financial measures, which we believe provide additional information for investors to help facilitate comparison of prior and present performance. Reconciliation to the most directly comparable GAAP measures is included in the tables attached to the earnings release and in the appendix of the slide presentation. I am joined on this morning's call by Jeff Jackson, PGT Innovations' CEO and President. After our prepared remarks, we will take your questions.

I will now hand this call over to Jeff for opening remarks.

Jeffrey T. Jackson -- Chief Executive Officer and President

Thank you, Brad. Good morning, everyone, and thank you for joining us on today's call. 2020 was a year full of challenges and opportunities. Our core markets continue to show growth in both the repair and remodeling, as well as in new construction markets. This growth has continued, and in certain aspects accelerated in 2021.

Our employees and our dealers and distributors have worked hard to services increase in demand, in an environment where, while we are all encouraged by the increased availability of vaccines, we are not yet back to normal. I continue to be extremely proud of our 3,500 plus team members for their dedication and servicing our customers over the past 15 months during these unique circumstances.

Turning to Slide 4. We start off the year by posting record sales for the quarter, with a 23% growth versus the first quarter of last year. We saw strong demand in both the Southeast and Western segments. Our organic growth came in at 15%. Additionally, February 3rd marked one year since completing the acquisition of NewSouth Window Solutions. The sales contribution for the quarter for NewSouth was $34 million, driven by strong sales growth in the direct-to-consumer Florida residential R&R market and our expansion efforts outside of Florida. Integration of NewSouth into our operations has added to our record level of production capacity in a tight labor market, and we expect continued growth from NewSouth's existing retail locations and additional store expansions outside of the State of Florida in 2021. Since the acquisition, we've increased capacity at NewSouth locations by 125% and we have opened three new showrooms. We plan to open three more this year, growing the footprint outside of Florida and increasing our investment in lead generation tools.

As previously announced, on February 1st, we acquired a 75% ownership stake in ECO Enterprises, which contributed $16 [$18] million of sales in the quarter. We are excited about ECO, as it accomplishes a number of strategic objectives, including providing an additional reliable source of glass and glass manufacturing capacity, diversifying our product lines into the high growth commercial market and creating new relationships with additional residential dealers. As we discussed over the past few earnings calls, we have put substantial efforts behind identifying and implementing operational improvements across the manufacturing processes at our Western business unit.

We have seen steady improvement in material cost, direct labor and distribution cost. These improvements generated a 70 basis point increase in consolidated gross margin for the quarter. While we strive for continuous improvement in our manufacturing operations, we are seeing cost pressures on a number of fronts. Increasing consumer demand and the need for restocking across all sectors of the economy has continued to cause labor constraints. These pressures have resulted in wage inflation as employers compete to attract and keep employees. This certainly affects us all and we will incur higher direct labor and overhead costs as we work to ramp up the production to meet increased sales demand.

Additionally, I have seen inflation in material cost, including glass and extrusion, which are major components of our product. Given the impact of all these factors, our adjusted EBITDA margin of 15.6% decreased 230 basis points versus prior year quarter. To offset our increased cost structure, we have enacted a number of price increases throughout the quarter. And as price increases take effect, we expect to see our margin improve throughout the latter half of the year. Margins will also improve as capacity is increased in our plants, allowing us to deliver higher sales and reduce our backlog.

Next, I would like to give an update on what we are seeing in incoming customer orders and how our backlog is developing. Our total backlog at the end of the first quarter, excluding NewSouth and Echo, has increased to $288 million, and has since grown to an all-time high of $343 million as of today. This is driven by longer lead times for most of our products as our operations teams work to meet rising demand in an environment where labor is tight in all our manufacturing locations, as well as for our key suppliers. Strong order entry in our Southeast business unit, up 34%, driven by continued strength in the new construction market, up 56%,and repair and remodeling market up 25%, and strong order entry at our Western business unit, as recoveries in Arizona and California pick up steam.

Within our two most recent acquisitions, we have seen impressive demand growth. For the first quarter, retail sales orders at NewSouth Window Solutions totaled $35 million, an increase of 42% year-over-year. ECO is off to an incredible start, with order entry up 69%. To meet growing sales demand and improved lead times to better meet customer's needs, we continue to focus on increasing production capacity in our Florida-based operations, while we continue to do everything in our power to promote employee health and safety is our top priority. Some of the actions we've taken include increasing starting wages, adding stay bonuses, as well as sign-on bonuses. Signing a lease in Southeast Florida to increase warehouse capacity, which will begin to favorably impact our operations in Q2. Signing a lease for a new facility, expanding our manufacturing capacity in Fort Myers, Florida, which we are currently staffing and will favorably impact our operations in Q3.

We have made capital investments to increase our vinyl window capacity by 20% in Q2 as well as frame capacity for our sliding glass doors by 30% in Q3. Additional steps are being taken increase vinyl window capacity by another 20% in Q4. These increases in capacity will be reflected in our results as we go through the back half of 2021 and will help us to accommodate a strong organic sales growth we are seeing in Florida and return the current robust backlog to normal levels later this year.

Turning to Slide 6. As we look ahead into 2021, there is no change in our framework for profitable growth, as we execute our strategic long-term value creation for shareholders, while servicing our customers and communities. Our first pillar is to maintain our focus on consumer-centric innovation. We strive to stay in front of challenging and changing builder and consumer preferences by bringing products to market that offer both performance and value our customers' demand. Our marketing strategies have enabled us to gain insight into the demand that is driving our sales in the R&R market, capturing more lead as consumers are spending more time in their homes. We will continue to evolve our innovative strategies as the overall economy improves further.

Our second pillar of attracting and retaining talent has been on the front in center as all businesses faced a very tight labor market in the U.S. We have always placed an emphasis on being an employer of choice. But we have had to go even further to build out our team of dedicated employees with the right skill sets. We work hard to maintain a safe workplace and a culture where employees know they are appreciated and we've recently implemented a long-term incentive program to help retention.

Our third pillar is investing in the business to increase manufacturing capacity and capabilities. We strive to continually improve operations to increase output, lower cost and improve quality, which will help us meet growing demand. I have highlighted our efforts to enhance efficiencies at our Western Window Systems facility to lower costs, while maintaining high quality standards. Additionally, we are continuing to deploy PGT Innovations best practices and other systems across operations at NewSouth and Echo.

Our fourth pillar is the allocation of free cash flow to achieve profitable growth through investing for growth through new product development and production capacity, paying down debt, or the right strategic acquisitions, all with the end goal of driving shareholder value consistent with our past execution.

Now I'd like to turn the call over to Brad to review the results in greater detail. Brad?

Brad West -- Senior Vice President and Interim Chief Financial Officer

Thank you, Jeff. Turning to Slide 7, we reported net sales of $271 million for the quarter, a 23% increase over the prior year quarter, which included a 53rd week. This includes 15% organic growth in part due to substantial growth within our NewSouth business, which continues to increase orders and installations. From a channel perspective, our repair and remodel sales benefited from our last two acquisitions, both of which focus mainly on Florida's R&R market.

In the first quarter, our sales break down finished at 53% R&R and 47% new construction. Organic R&R sales grew 19% during the quarter and organic new construction sales grew 10% from the strength of our legacy brand. Gross profit for the quarter was $94 million, a 16% increase, reflecting increased sales, partially offset by higher labor and materials costs. Gross margin finished at 34.7% for the quarter, a 220 basis point decrease from the prior year. This was the result of direct labor, which increased approximately 150 basis points. This was mainly due to increased wages and over time within our operations as we continue to compete for labor in a tight market, while serving an increased demand. In our Western markets, we did continue to see labor improvement, which partially offset the impact.

Second, our results for the quarter included $2.7 million of costs related to the exit of our commercial business acquired in the NewSouth acquisition. Adjusting for these charges, our gross margin would have been 35.7%. Higher input cost for wages and increased cost of materials such as aluminum, where the current price is up 52% compared to the average cash price we saw in Q1 of 2020, are expected to continue for the remainder of the year. However, to improvements discussed already and pricing actions already taken, we expect gross margins to improve materially in the back half of 2021. Margins in the second quarter, however, we'll only seen modest improvement due to the timing of the realization of the price increases.

Selling, general and administrative expenses for the first quarter increased by $16 million as compared to the prior year quarter, primarily reflecting higher selling costs as a result of increased sales, increased amortization expense related to our two most recent acquisitions, and a $1.5 million charge related to the exit of the commercial business acquired in the NewSouth acquisition. Additionally, we made some marketing related investments in our three NewSouth locations that have opened over the past 12 months.

Our adjusted EBITDA was $42 million, a 7% increase versus the $39 million in the prior year quarter. Our effective tax rate for the quarter came in at 24%, roughly in line with our full year modeling assumption of 25%. We reported adjusted net income of $16.5 million or $0.27 per diluted share in the first quarter of 2021 compared to $16.4 million or $0.28 per diluted share in the first quarter of 2020.

Turning now to our balance sheet. We ended the quarter with net debt or $420 million. Our only significant near-term debt maturity is our term loan of $54 million due in late 2022. As of year end, we had total liquidity of $133.2 million, including a cash balance of $59 million and $74.2 million of unused capacity on our revolver. As a result of the increased debt related to the ECO acquisition, we finished the quarter with net debt to trailing 12-month adjusted EBITDA ratio of approximately 2.6 times.

Next, on Slide 9, we have updated our historical net debt and leverage ratio to highlight our progress toward deleveraging following the completion of acquisitions as well as show our track record. On Slide 10, I would like to discuss PGT Innovations anticipated capital allocation priorities. Our first priority is to find internal investment opportunities and projects we expect to increase capacity, drive margin growth by reducing expenses or by increasing revenues through product enhancements. Another important priority is our commitment to maintaining a strong balance sheet and conservative capital structure by paying down debt after acquisitions. Our goal generally is to maintain a conservative leverage profile within a target range of 2.0 times to 3.0 times net debt to EBITDA, absent any large acquisition. Finally, we use capital for strategic acquisitions that are expected to be accretive, generate strong returns over the long-term. We look for opportunities that would allow us to expand into new regions, channels or products, such as new NewSouth, or that would give us access to technology-enhanced manufacturing or supply chain capabilities such as Eco. We will continue to carefully evaluate other possible acquisition opportunities as part of our overall strategic plan.

Moving on to Slide 11. We are raising our full year 2021 guidance ranges, which includes contributions of Eco for the partial low [Phonetic] period after the transaction closed on February 1st, 2021. This increased guidance reflects the stronger demand and related EBITDA dollars, albeit, with the flow impacted by few months delay and pricing impact as a result of longer lead times as well as previously discussed operational challenges in our Venice facility.

Our new sales guidance range is of $1.05 billion to $1.125 billion representing full year growth of 19% to 27%, and our adjusted EBITDA guidance range of $175 million to $200 million representing full year growth of 17% to 33%, reflects the higher sales and expected margin pressures that will continue into the second quarter longer than initially anticipated. For your reference, we have included additional modeling assumptions in the left hand column that are embedded in our 2021 guidance estimates and that can assist with your calculation of our estimated results. There are no changes to what we shared with you last quarter.

We have taken many pricing actions recently, on top of ones taken at the beginning of the year. These actions reflect higher input cost of materials, labor and fuel, as well as the continued unprecedented demand we are seeing, particularly in our Florida markets. These increases will likely result in modest margin improvement in Q2 with higher improvement in Q3 and Q4 as they begin to be realized.

And now, I would like to turn the call back over to Jeff for some closing thoughts. Jeff?

Jeffrey T. Jackson -- Chief Executive Officer and President

Thanks, Brad. I'll conclude with a summary of why I'm excited about our future and why we believe PGT Innovations creates long-term value for our shareholders. We are a national leader with strong brands, which have been further boosted by our recent acquisitions. Our products are in growing categories and in fast growing regions in the U.S. We have a long history of providing our customers with innovative products to meet their challenging needs and we intend to maintain our industry leadership through ongoing R&D, hiring and retaining the best talent, and making the right acquisitions.

Continuous improvement of our operations is how over time we can and have driven long-term margin expansion. Although recent challenges have surfaced as we emerged from our historic pandemic, while seeing impressive growth demands in both the new construction and repair and remodeling markets, we have shown an ability to make the improvements necessary to gain the required capacity. Lastly, we have a comprehensive strategy that we strive to execute to create long-term value for our shareholders and our customers.

At this time, let me begin the Q&A. Operator?

Questions and Answers:

Operator

Thank you. [Operator Instructions] And our first question will come from Phil Ng with Jefferies. Please go ahead.

Maggie -- Jefferies -- Analyst

Hey guys, good morning. It's Maggie [Phonetic] on for Phil.

Jeffrey T. Jackson -- Chief Executive Officer and President

Good morning, Maggie.

Maggie -- Jefferies -- Analyst

I know the past few quarters you've talked about some of those internal capacity constraints and supplier bottlenecks. And Jeff, it was helpful to hear you talk through the steps you're taking to improve there. But can you kind of talk about what inning you're end to bring that capacity online, more in line with underlying demand and what are the key opportunities you're looking to increase throughput going forward?

Jeffrey T. Jackson -- Chief Executive Officer and President

Yeah, that' s a great question. Yeah, I am more of football guy. So I'm going to say we just finished the second quarter and were in half time as we -- again order rates are incredibly strong and our teams are literally jumping through hoops to meet demand and increase capacity. I did layout some initiatives we've embarked on. Most recently, the expansion of our warehousing here in Venice to the East Coast, when we entered into the lease on the East Coast warehouse, we're stocking that and hiring folks there and actually shipping out of that location as we speak. I think the expansion down into Fort Myers, where not only will we be able to tap an additional labor force, which labor is probably been the number one constraint, not equipment but labor, we will be able to attract additional labor in Fort Myers. We're going to hire probably 240, 250 people in Fort Myers, and we're going to be eventually producing all our door panels and frames in that location. And that will start to trickle in, in June, we'll actually start producing frames in June with panels coming later on. So those are some examples of capacities we've added.

Trucking, to be honest, we repurchased, goodness we purchased 10 trucks at the beginning of the year. We actually leased another 18. And we currently just based off demand, have 50 rented, and we have one of the largest trucking fleets in the state. So trucks and trailers have been a constraints that we're attacking heavily to make sure we have that as well as the drivers, obviously CDL drivers are premium now.

In terms of actually product manufacturing line capacity, our main constraint is in vinyl at this point. Our aluminum lines are good. We are expanding, that's mainly labor-related. Vinyl, we're actually adding equipment. So if you look at our Q2 here, we have ordered another glazing line that will be our third vinyl glazing line. It will come in and order has been at the beginning of the year. It will come in in July. So, we'll have it up and running in July. I do expect to add anywhere from 2 to 250 vinyl units a day, starting, say in August. And then after that gets up and running, we're going to actually add some more fabbing equipment, Joseph's [Phonetic] Well there's, that sort of thing. And those -- that equipment has already been ordered and is going to be coming in September time frame. So if you look end of August or beginning of September. So it will impact the fourth quarter, I think anywhere from 2 -- again, 2 to 250 more units a day. So we're relatively quickly over the next few months. We're going to be adding almost anywhere from 4 to 500 units of vinyl windows a day in additional capacity.

A lot of this is planned by the way and a lot of the equipment was surely delayed, and we did get some equipment tied up in ports for up to four to six weeks, or we would have already had, for instance, that glazing line up and running. So a lot of it's delay, but we feel very good about the timing of the equipment arrival now and that coupled with all the initiatives we've had to bring on new folks into the organization on the job fairs we brand, both in Miami, in Hialeah, here in Venice, at Tampa, at Fort Myers, and in Phoenix. We're starting to bring on a lot more labor at this point. We probably hired over 100 people the last week alone. So, things are starting to starting to improve. And as they do, we add the capacity. We think, obviously, our performance will improve with it.

Maggie -- Jefferies -- Analyst

That's fine. Yeah, that really helpful. And then secondly on gross margins on -- the 1Q pressure was pretty much in line with what we were expecting based on inflation headwinds, but you've got price increase coming out later this quarter. So how should we think about that flowing through? And when do you expect to be fully caught up from a price cost perspective? And what kind of incremental inflation does that assume for the rest of 2021?

Jeffrey T. Jackson -- Chief Executive Officer and President

Yeah, I'll just speak in generalities. I'll get Brad cover the actual detail of it. But we look at pricing just to pass along our costs. We're comfortable with the margins we make in the market. We think our customers and dealer base are comfortable with those margins as well. So the cost inputs -- the headwinds we've talked about that impacted our Q1 that I mentioned is also going to have an impact our Q2, at least the first couple of months. We shouldn't start seeing that price impact from a positive standpoint until the last month of this quarter. It's surely because of this demand we continue to see -- in that backlog as I mentioned, we closed out Q1 at $288 million backlog, that's excluding Eco, our new acquisition. If you include Eco, today our backlog is $343 million. So again, orders are still coming even though the pricing is now in effect. So some of that backlog will actually have the improved pricing in it. But well over, call it half, probably doesn't. So it's still got to work through that piece of the backlog and that's what you'll see happen in May, the rest of May here. And then in June, we're going to start to get into the piece of the backlog that has embedded pricing in it. And then obviously, as we go throughout the year, the second half is going to be significantly impacted in a positive way by the pricing actions. But Brad, do you want to speak in detail?

Brad West -- Senior Vice President and Interim Chief Financial Officer

Yeah, I would say that we have a modest improvement in gross margin in the second quarter relative to the first, maybe cost, something like 50 bps. Obviously, with higher sales coming through, you also get some SG&A improvement as a percent, but we'll just stick to gross margin. And then in the back half of the year, it will probably start -- you'll get another 150 to 200. I would say that, I believe based upon is that if I model out the pricing and some of the inflationary challenges, I think Q4, that scenario will be better than Q3 by a little bit, just because some of the pricing actions we are taking a bit later in the first part than the beginning of the first quarter. So I actually think Q4 from a price and net cost perspective will be a little bit better than even Q3. But the big jump will happen as we go from Q2 into Q3 and the pricing keeps in that, Jeff just referred to.

Maggie -- Jefferies -- Analyst

Great, very helpful. Thanks, guys.

Jeffrey T. Jackson -- Chief Executive Officer and President

Thank you. [Operator Instructions] Our next question will come from Ken Zener with KeyBanc. Please go ahead.

Ken Zener -- KeyBanc -- Analyst

Good morning, everybody.

Jeffrey T. Jackson -- Chief Executive Officer and President

Hey, Ken.

Ken Zener -- KeyBanc -- Analyst

Lots of demand. It's kind of whack a mole here on cost, labor capacity coming on mind, but it feels like despite all the new platforms you've added to the business., West, NewSouth, etc., you have a lot better handle on it. Then I think the industry saw over well over 13 as demand was so painful to bring on new labor parts [Phonetic] obviously. And that's a big deal, obviously. I think that's a big credit for how your operations have improved a lot. So I wonder if you could be drill [Speech Overlap] Its all right, I got hard questions for you don't worry. The tough [Phonetic] glass, right? You bought some capacity, you kicked out some capacity a couple of years ago. How is it different than when you were getting 15% glass increases? Just talking about that part of the business at first, that affects you all over the country out this way [Speech Overlap] for the manufacturers? Just talk about that please first if you would.

Jeffrey T. Jackson -- Chief Executive Officer and President

Yeah, glasses, I would say is not an issue for us at the moment. Adding that capacity has definitely definitely helped us stay ahead of the game. The only thing and it's going to affect a lot of folks is inner layer capacity. There have been some inner layer suppliers that have issued letters that they're going to cut capacity or cut allocations. Our main glass supplier outside of our own sales, obviously its Cardinal. I know they received a letter from Eastman, who said they're going to basically reduce their capacity of laminating material to them in the inner layer. So that kind of constrained. We're talking.

Ken Zener -- KeyBanc -- Analyst

Jeff, would you say inner layer, that's the binding between the glass on your...

Jeffrey T. Jackson -- Chief Executive Officer and President

Yeah, that's what makes the Window impact, basically is that binders the inner layer between the two pieces of paint that makes it impact. So that from an industry material standpoint -- there is some capacity concerns out there. Will it will impact us?. I hope not. Our supply chain team has done an incredible job. We actually bought forward rolls of inner layer. Another reason is, by the way is our working capital is up. But we bought forward over 100 rolls of inner layers just in case something like that happen. So right now, for instance, we think mitigated that. But internally, our glass plants are running great. We could actually produce more of our own glass if we had to labor. Right now, we're using that labor when we can to make windows. So Cardinal is, obviously, still one of our major suppliers. They are doing well now. Quite frankly, they struggled last year. Their performance has improved dramatically into this year. And so glass is not an issue for PGT at this point.

Ken Zener -- KeyBanc -- Analyst

And then you talked about you the extrusion side coming in. I mean, how is that going forward? It seems to me like the industry is so tight, demand is high, supply lines are tight. So you're getting price, your supplier is getting price, everybody is getting price quickly. So 2Q will be a little light. Obviously, when I talked about the 3Q left from 2Q. But this pricing fuel is quite strong and what does that tell you about as you absorb past prices on in second half of this year and what does that mean about FY '22? I mean, it seems like demand is going to remain unseasonably strong in the 4Q and that -- if any of your input costs rollover, it seems like there could be some real net pricing gains next year that capacity comes on. Some people like yourselves could be in a very good net pricing environment. Is that something that you see potentially happening? Or it is aluminum, glass, extrusion all these things make you more cautious about that optimism?

Jeffrey T. Jackson -- Chief Executive Officer and President

Right. Ken, that's a very good insight, first of all. So there is still aluminum pricing up, pressures out there. Aluminum price is up and that's obviously industrywide. So we're going to have to tackle that into 2022. Now, do I think our pricing actions we've taken will help that? Most definitely -- and most definitely. And I think our pricing actions will actually benefit us eventually once they take hold. But as you look into 2022, I do think the market is going to continue to grow. I think this year its going to remain strong. We've raised our guidance. We hope it's conservative, by the way. We do like to be. So we've raised our guidance. And I think, 2022 you're going to see a continued strength in certain markets and then it gets back to our strategic platform is to be in destination states.

We want to be where people want to go to. Florida is hot. I mean, Arizona is growing. Texas is growing. Those are the three of our major markets. California is reopened. And while they may have people moving out, its like the fifth largest economy in the world. California is incredible place to be in. And we keep expanding there and keep making headways there. So I think we're in key areas of the U.S., that we'll continue to see growth when the other areas actually start to plateau and level out. So I think that will benefit us along with the pricing actions we've taken. Bret you haven't, do you want to add to that.

Brad West -- Senior Vice President and Interim Chief Financial Officer

No, I think, I think that covered it. And as we look forward for the back half of 2021, as we were thinking about these inflationary pressures and how it look, all that was taken into consideration. So I think Jeff covered all.

Ken Zener -- KeyBanc -- Analyst

Right. And then do you think your -- the thoughts around the back half, all the things Brad you just took into consideration. What does that say about, I mean, does that seem like a stable area where you'd be exiting the year into '22? All else equal or is there some initiatives that we might not necessarily know about? I mean, your access to labor is a lot higher, your margins are going to be a lot higher in the back half, and demand certainly seems to be there. It seems like a good lift-off point for '22, though?

Jeffrey T. Jackson -- Chief Executive Officer and President

Yeah, I think it will be, Ken. There, obviously, actions we're always doing to help drive sales and to expand our footprint profitably. And as we enter the back half of the year, there's various initiatives we've got going on here locally, with production expansion, capacity, capex investments. In our Western business unit, quite frankly, we're going to expand there as well. We've got some things in the pipe there that's going to be interesting for the investors, the market, in the back half of the year that will set us up very nice for 2022. So, but I do think we have a good platform to go off of, yes.

Ken Zener -- KeyBanc -- Analyst

Thank you.

Jeffrey T. Jackson -- Chief Executive Officer and President

Thank you, Ken.

Operator

And this will conclude the question-and-answer session. I'd like to turn the conference back over to Brad for any closing remarks.

Brad West -- Senior Vice President and Interim Chief Financial Officer

Thanks for joining us on today's call and certainly if there are further questions, don't hesitate to give me a call and we can follow up after this call. Thank you.

Operator

[Operator Closing Remarks]

Duration: 36 minutes

Call participants:

Brad West -- Senior Vice President and Interim Chief Financial Officer

Jeffrey T. Jackson -- Chief Executive Officer and President

Maggie -- Jefferies -- Analyst

Ken Zener -- KeyBanc -- Analyst

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