Boyd Group Services (OTCPK:BYDG.F) M&A Announcement Transcript

Boyd Group Services Investor Call Summary Company Overview - Company: Boyd Group Services Inc. - Industry: North American collision industry - Market Position: Third largest player in a $50 billion industry with over 1,000 locations and $3 billion in revenue for the trailing twelve months ended June 30, 2025 [4][5] Key Acquisition Announcement - Acquisition Target: Joe Hudson's Collision Center - Purchase Price: $1.3 billion - Strategic Importance: - Increases Boyd's location count by 25% to 1,273 locations - Enhances operational margins and solidifies Boyd's market position [4][7][11] Financial Performance Highlights - Third Quarter 2025 Estimates: - Expected revenue growth of approximately 5% year-over-year - Anticipated same store sales growth of 2% to 2.5% - Projected adjusted EBITDA margin improvement to 12.3% to 12.5%, an increase of approximately 170 basis points year-over-year - Expected adjusted EBITDA growth of 21% to 23% for the quarter [5][6] Market Trends and Drivers - Used Car Prices: Rise in used car prices and moderation in auto insurance premiums are driving industry volumes - Repairable Claims Environment: Improvement in the repairable claims environment has contributed to positive same store sales growth [6][10] Joe Hudson's Collision Center Overview - Founded: 1989 in Alabama - Current Operations: 258 locations across 18 states, primarily in the Southeast U.S. - Growth Rate: 20% compounded annual growth rate in location count since 2020, with $722 million in sales and an adjusted EBITDA margin of 8.7% [8][10][12] Strategic Rationale for Acquisition - Market Position: Solidifies Boyd's position in the North American market with a combined estimated revenue share of only 7.6% - Synergies: Expected synergies of $35 million to $45 million, with 50% targeted for completion in the near term [11][18][20] - Operational Improvements: Enhanced density in key markets will provide opportunities for margin expansion and improved customer service [10][13] Financing and Leverage - Transaction Financing: Combination of equity, debt securities, and bank facilities to maintain a strong balance sheet - Leverage Ratio: Expected net debt to adjusted EBITDA ratio to increase to 3.4 times at closing, with a plan to reduce it back to current levels by 2027 [17][18] Future Outlook - Long-term Growth Strategy: Boyd aims to leverage the acquisition to accelerate profitability and solidify its market position - Ongoing Initiatives: Continued execution of Project 360 and other operational strategies to enhance growth and shareholder value [21]