Superior Plus Corp Stock

Good day, and thank you for standing by. Welcome to the Superior Plus 2026 Second Quarter Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions]

I would now like to hand the conference over to your speaker today, Chris Lichtenheldt, Vice President, Investor Relations.

Thank you. Good morning, everyone, and welcome to Superior Plus' Conference Call and Webcast to review our 2026 second quarter results. On the call today we have Allan MacDonald, President and CEO; Grier Colter, Executive Vice President and Chief Financial Officer; and Dale Winger, President of Certarus.

For this morning's call, Allan and Grier will begin with their prepared remarks, and then we'll open the call for questions. Listeners are reminded that some of the contents -- rather some of the comments made today may be forward-looking in nature and information provided may refer to non-GAAP measures. Please refer to our continuous disclosure documents available on SEDAR+ and our website. The dollar amounts discussed on today's call are expressed in U.S. dollars unless otherwise noted.

I'll now turn the call over to Allan.

Thanks, Chris. Good morning, everyone. Thanks for joining us today. Well, Q2 was another quarter of meaningful progress for Superior. We delivered year-over-year growth in adjusted EBITDA, driven by strong performance across the business, including a record second quarter for Certarus. Adjusted EBITDA was $36.8 million, up 10% and adjusted EBTDA per share grew by approximately 40% to $0.07, driven by higher EBITDA and lower shares outstanding. Grier will take us through the financial details here shortly.

Before I dive into the details of the quarter, I want to spend a moment on what's most important, the strategic priorities that continue to guide our decisions and shape the future of both Certarus and propane.

At Certarus, the strategy is straightforward and has two key pillars: first, defending our leadership position in the wellsite market by being the safest, most reliable and lowest cost operator; second, accelerating growth by expanding our hub network, entering new geographies and opening new verticals. We committed to that strategy when the wellsite market was under real pressure, and we did not waver.

In propane, the mandate is different. This is a mature seasonal weather-dependent business, where growth will come from execution rather than the market itself. Our priority is a systematic rebuild of the way we work, how we deliver, how we buy and how we retain and acquire customers. What I want to do this morning is walk through both businesses within the context of those commitments, what we said we would do, what we've done and what we stand and where we stand rather relative to our own expectations.

Now Certarus is the mobile gas solutions leader. Our value proposition is simple. We safely deliver reliable energy solutions that help customers maximize uptime and reduce operating costs. Certarus isn't just a gas transporter, it's a mobile energy infrastructure company. Whether it's fueling oilfield operations, truck fleets, industrial plants or AI data centers, the business model is the same: compress natural gas, transport it where pipelines don't exist or aren't available and provide the equipment needed to use it safely and reliably.

Starting with our first commitment to defend the wellsite, our strategy is paying off. We've maintained our market share and delivered record second quarter and first half volumes. Most importantly, we achieved this while delivering our best safety record in recent history. In terms of pricing in wellsite, while we've continued to face a year-over-year headwind in the second quarter, we've now had 4 quarters of stable pricing and our margins and returns in the business remain robust.

Our second commitment is accelerating growth, and the results this quarter are the clearest evidence yet that the strategy is working. Looking at the quarter, a key contributor to Certarus' outstanding results is the continued momentum we're seeing in the data center market. Industrial volumes increased approximately 50% in Q2. That growth is driven by a diverse set of customers, including not only new data center business, but also expanding work with other power generation customers and in existing markets such as mining.

Notably, this growth is occurring even before our most significant data center project comes online in the second half of next year. Now Certarus is a North American company, not a regional player, and we continue to expand the largest hub network in the industry, being the first to market for our customers. We now have 23 hubs across North America, with Utah recently coming online in May and already emerging as one of our highest volume locations. Houston will be opening this quarter, and California will follow later in 2026.

Each new hub expands the addressable market for our industry-leading fleet, further building our funnel of opportunity with modest incremental capital. Beyond the growth we're seeing today, the pipeline of prospective data center opportunities also continues to expand. It is substantially larger than it was a year ago, and we continue to see strong interest from prospective customers seeking scalable energy solutions. A number of our early data center projects have now extended beyond their original time lines.

This is creating longer duration work for Certarus and reinforcing the value of our ability to deliver reliable energy where and when customers need it and the widening gap between energy demand and the infrastructure expansion. We continue to win new business as well. Since the last quarter, we secured another data center contract, smaller than our largest award, but a further proof point of the demand we are seeing and our ability to convert the growing funnel of opportunities. To support the awarded data center projects, we also finalized agreements to secure the additional mobile storage units required to serve our contracted demand through 2030.

We believe we're at an inflection point for Certarus. We're seeing increased demand for CNG as a preferred energy solution across a broader set of industries. Infrastructure constraints, diesel price volatility and emission requirements are driving customers toward delivered energy, and our expanding hub network puts us in a position to serve them. That brings me to another significant announcement we made today, the launch of our mobile fleet CNG fleet fueling business.

Mobile fleet fueling is designed to help logistics companies and other fleet operators accelerate the adoption of CNG-powered trucking. It's a competitive solution offering both economic and environmental benefits. By bringing fuel directly to their fleets, we help customers avoid off-site refueling, materially lowering their operating costs, reducing emissions and increasing the time their drivers are on the road. And we are well positioned here given our focus on safety, reliability and operational excellence. We also announced our first mobile fleet fueling contract and the opening of a new CNG supply hub in Houston, Texas.

Under a 2-year agreement, Certarus will provide turnkey fueling services for a leading global logistics company, fueling approximately 100 Class 8 natural gas trucks from our new Houston hub. We expect Houston to commence gas flow in the third quarter of '26, providing a baseload volume for the facility from day 1. Now this is an important proof point of the value proposition of mobile fleet fueling and for the broader role Certarus can play as CNG adoption expands.

We believe CNG power trucking has significant long-term potential. Advances in technology are improving CNG engine performance and economics and expanding the addressable market, while customers are increasingly focused on operating costs, reliability and environmental benefits. For context, there are more than 3 million tractor trailers on the road in North America. Now we're not going to forecast how quickly that converts, but the market provides a long runway of opportunity. As a market leader across the continent, Certarus is well positioned to serve this sector in a way that's competitive, scalable and aligned with where we believe the industry is headed.

Moving now to the propane business. The business performed as expected during what is always a seasonally slower period. I want to be straightforward about where we are because this transformation is headed in the right direction. But as previously indicated, it's taking longer than we initially said it would. Our teams remain focused on improving service execution, customer retention and operational readiness ahead of the upcoming heating season. Against these 3 priorities, I mentioned how we deliver, how we buy and how we retain and acquire customers. Overall, we've made meaningful strides since last winter. Tank levels are healthy, supported by proactive fills throughout the year, and we've improved coordination across field operations, supply teams and customer service.

We also continue to strengthen forecasting, inventory management and delivery planning across our footprint. While we are pleased with the work our teams have done and continue to do, we remain focused on both customer retention and acquisition going into the second half of the year. The improvements we've made are real and permanent. We're continuing to drive progress, and success is not a matter of question of if, it's a question of when.

Now before I hand it over to Grier, a word on capital allocation. When we talk about our recent step-up in capital spending, I want to be clear about what this is. This is not maintenance or the obligatory cost of keeping the business running, it's growth investment, new mobile storage units and equipment being deployed for contracted work. We're investing in scaled capacity to serve demand we've already won, and it's being funded from the cash the business generates. We're also being selective. Growth for the sake of growth is not our objective. We're not increased -- we're not chasing every opportunity in front of us. We'll continue to allocate capital only where we believe it creates meaningful long-term shareholder value.

So with that, thank you. I'll hand things over to Grier.

Thank you, Allan, and good morning. Superior generated a solid quarter. Propane operations performed as expected during the slow season, and Certarus delivered record second quarter EBITDA on record volumes, driven by strong growth across our industrial and data center business. As Allan described, Certarus has reached an inflection point in its evolution, and we're very pleased with the financial performance and the outlook.

I'll now recap our financial results for the fourth quarter -- for the second quarter. Q2 adjusted EBITDA of $36.8 million increased approximately 10% compared to Q2 2025 as the growth in CNG and Canadian propane more than offset the decline in U.S. propane. In Q2, adjusted EBTDA per share was $0.07, an increase of 40% year-over-year, driven by higher EBITDA and lower shares outstanding. Adjusted net loss per share of $0.25 was consistent with the prior year quarter. Free cash flow of negative $35 million in the second quarter was $2.6 million lower than the prior year as higher adjusted EBITDA was more than offset by the step-up in capital that we are deploying against contracted data center work, along with the timing of taxes paid.

Turning now to the businesses. In Q2, adjusted EBITDA for U.S. propane was negative $5.1 million, down from a flat quarter in 2025. This decrease was primarily due to lower retail sales volumes as we exited Q1 with higher in-tank levels. Adjusted EBITDA for Canadian propane was $15.7 million, up 25% from last year, primarily due to favorable carbon credit pricing, strong market differentials and our improved procurement strategy.

Our propane transformation, Superior Delivers, contributed $5 million in Q2 and $17 million year-to-date, with a Q2 impact driven mostly by margin optimization within our customer growth pillar and more sophisticated supply management within our wholesale advantage pillar. Overall, our propane business performed as expected during this seasonally slow period, and we remain focused on executing our plans this upcoming heating season.

Moving now to CNG. Q2 adjusted EBITDA of $33.6 million was up approximately 23% compared to Q2 2025. The largest contributor to this growth was strong pricing and volumes in our industrial and data center business, and favorable commodity prices were also a contributor. Partly offsetting these benefits was a year-over-year decline in wellsite pricing, although it has remained stable throughout the past 12 months and a modest increase in unit operating costs as we relied more on third-party trucking services to manage the volume growth.

For the quarter, corporate operating costs were $7.4 million, which increased 14% compared to last year, and this was due to higher incentive plan costs and the timing of expenses. Consolidated CapEx for the quarter was $37 million, an increase of $6.9 million or 23%, mostly due to increased spending in our CNG and U.S. propane businesses, offset by a decrease in leased assets. The biggest driver of this increase relates to growth capital to take advantage of attractive return opportunities that we're seeing in CNG. Consolidated CapEx remains on track and in line with our 2026 expectations. Our leverage at the end of Q2 was 3.6x, down 0.3 of a turn compared to Q1 as we moved into our seasonally less intensive period from a working capital standpoint. Compared to Q2 2025, our leverage decreased by 0.2 of a turn, which was driven mainly by lower debt levels.

Since November 2024, we have repurchased approximately 34 million shares or 14% of our outstanding float for roughly $233 million at an average price below $7 per share. As a result, outstanding shares at June 30, 2026, were $214.6 million, which is down 4.5% from the prior year. We did not repurchase shares during the second quarter as our capital allocation priorities have shifted to high-return growth projects at Certarus.

Moving to 2026 guidance. We are reaffirming our 2026 EBITDA growth expectation of 2% as the business overall is performing in line with our expectations. We expect Certarus to grow for the remaining 6 months of 2026 and for the benefits of Superior Delivers to support propane results meaningfully in Q4 2026. With respect to CapEx, we are maintaining our plan to spend $230 million in total CapEx during the year and expect to ramp up the spend on CNG equipment in Q3 and Q4 to service the large data center contract expected to commence in 2027.

We expect leverage of 4.0x by year end as we increase our investment in growth opportunities in our CNG business, and we also expect leverage to increase slightly into Q3 as the business builds working capital balances heading into the heating season. We still expect year-over-year EBITDA growth of approximately 5% in 2027 as new data center work at the CNG side of the business begins to contribute. We will update our 2027 CapEx budget in February of next year. But at this point, we expect capital expenditures to remain elevated at similar levels in 2027 to facilitate the growth in CNG.

And with that, I'll turn it back for Q&A.

[Operator Instructions] Our first question comes from Ben Isaacson with Scotia Capital.

Allan, I was hoping you could talk a little bit more about this new fleet fuel program. And in particular, can you talk about the size of the market? And how will margins compare relative to the legacy wellsite business versus the data center business? And why does this need to be a new business segment? And how meaningful could it be in 4 or 5 years?

Let me -- that's a big question. And Dale is sitting right here next to me, so he's going to keep me honest. But let me start with why it's a new vertical. This is really -- it's a combination of an emerging business in that, and we think, as do many, that the business case for conversion from diesel-powered to CNG-powered tractor trailers is really compelling. And it's not a matter of if, but rather a matter of when. And there also exists a current fleet of CNG-powered trucks. And when you're fueling CNG-powered engines, you have kind of have 3 options. You can create -- you can build your own depot over top of a pipeline and have your own permanent fueling station at your location, which some companies have done.

You can -- the second option is you can refuel at a CNG fueling station that's off-site. And then the third option is really what we're bringing to market, and that's a mobile refueling facility that we install on your site. So rather than spending the money and all the permitting to build a permanent tap, we're bringing MSUs in along with our own CNG refueling capability to decompress and then compress into the tractors, which provides a capital-light alternative. In terms of the profitability, let me talk a little bit about the economics. We're going from a world where we had -- the wellsite business is quite transactional and short in duration. The data center world is, you can call it mid-temporary. It's not temporary of bridging power necessarily in every application, but it's much longer duration. And the fleet refueling is a permanent solution.

So it's quite a bit different there. And one of the reasons that it is a permanent solution is, from an economic standpoint, we initially believe we can be competitive with pretty attractive margins at providing refueling right on site. So we can compete with the retail offering, but we also offer the incremental benefit of the fleet productivity of not having to go off-site to refuel. Sitting in traffic, driving to a fueling station, driving back is really attractive for the customers that we've been talking to.

So to put it in context, the transition of diesel to CNG tractor trailers, depending on which case study you believe, and history will prove us all wrong, I'm sure, is in the mid-single digits to as high as 10% of new tractor trailers that are going into the market being CNG powered. For us, we've signed this initial contract, and we do have a funnel of more opportunities. But this first contract is only for 100 tractor trailers. We can profitably serve fleets much smaller than that. And we're talking an addressable market of 3 million tractor trailers on the road every day.

So we see this as being a really, really attractive evolution in the adoption of CNG. It fits our footprint really well because of our North American presence and the breadth and size of our fleet. And it adds an element of permanence that the sort of the genesis of the CNG adoption didn't have. So I hope -- I don't know if that answers your question, but on all rounds, we're really bullish on this. And I think we've talked about this on previous calls. We foresaw CNG refueling being a future state vertical for us. And the reason we're thinking of it as a vertical is it requires different equipment and different sales process, different -- very specific kind of customer base...

And does the margin sit somewhere in between the legacy wellsite and the data center business? I think on the last call, you said that data center-based CNG margins would be a little bit higher than wellsite.

It does. It does. It's more attractive than wellsite business for sure. And we're pricing this a little bit differently. It's a little bit less about -- we always have our cost of capital returns profile, but we're also pricing this to be competitive in the market, which we're really pleased about because we're offering a quite economically attractive solution for both the customers and the company.

Great. And then just my...

Yes, go ahead. Go ahead.

Sorry, my only other question was on carbon credits. It seemed like that was a nice tailwind in the quarter. Is that something that's temporary? Or how should we think about modeling that going forward?

Yes. Ben, it's Grier. It's -- I mean, it's not hugely significant. Like if you look at the year-over-year, it might have had a tailwind year-over-year of maybe $2 million. It's probably an off-line conversation. It's a little bit complicated, like there's -- there are federal credits, there's provincial credits and the programs are totally different. The life cycle of the program is different, then there's markets for these carbon credits. There's a lot in there. But I would say that I wouldn't expect the carbon credit benefit in total to increase. I think over time, it will kind of be flattish to maybe slightly declining.

And then there's an opportunity for us to hold credits and sell them in one quarter versus the other. So there is a touch of volatility in it. But I mean, if I was you forecasting the full year, I would just -- as I say, the benefit this year was really a tailwind because the carbon credit pricing was a little bit higher. It wasn't the number of credits. That was kind of the driver to say it was about $2 million. But going forward, there might be a slight decline in it as one of the 2 programs kind of becomes a little bit more stringent, I guess, the way I would say it. But as I say, we could take this offline and get into a ton of detail. It's a pretty...

Our next question comes from Nelson Ng with RBC Capital Markets.

So just a quick follow-up on Ben's question regarding the fleet fueling vertical. So can you just talk about CapEx? You mentioned that you are setting up the refueling station at the customers', I guess, truck depot. Like what's the -- is there any kind of material additional capital expenditures required? Or is this really parking 1 or 2 MSUs at site and adding a dec compressor?

So let me -- Dale is going to jump in on this, Nelson, but it'd be worthwhile, Dale, just to give a little bit of an overview of the compression required on site just for context.

Yes. Nelson, it's a highly configurable kind of application based off our existing infrastructure. So everything at the compression site and delivery will be the same. So we'll use our same MSUs. Typical fleet size will have 2 MSUs sitting at the customer's location. And then the -- as all of our jobs have a pressure reduction system of some sort today to move the gas from the MSU into the customer's application. Same thing, similar capital costs where we'll bring a piece of equipment with us that will move the gas from the MSU so the customers can do a fast fill and have an experience similar to the way that they fill diesel trucks in their yard today.

From a capital standpoint, Nelson, you're talking -- Dale, ballpark 20% of the cost of capital of a permanent solution.

Well, for the fleet owner, they would have no upfront capital...

Yes, that's fair, yes. But our cost versus a permanent TAF would be a fraction of what the fleet owner would have to invest. And of course, we incur the capital cost because it's mobile.

We see it as a great way to expand the market overall. I mean, there are a lot of Class 8 diesel tractors that have the fuel delivered to their yard today. A lot of those yards aren't on a pipeline or as Allan mentioned, don't necessarily want to use their own capital to invest in fueling infrastructure. And so we're excited. There's -- as was mentioned, there's been a technology change in the industry that enables the natural gas heavy-duty vehicles to close some of the horsepower and torque and efficiency gaps to diesel.

And we've had that experience with our own fleet. So about 10% of our own Certarus fleet today is CNG powered. And more than a handful of those are this new generation, this new class of natural gas vehicles, and we've certainly experienced firsthand the improved performance and the usefulness of that equipment. And so in our experience, others as they experience that will want to find ways to have exposure to the natural gas operating economics, and we can be a piece of the equation so that they don't have to change their existing fueling model.

And Nelson, it's Grier. Maybe I'll just say one last thing is that to get back to kind of the original question, this announcement on this customer that we've signed with this fleet solution did not change the amount that was required for overall capital. We can fit this within the existing envelope. So hopefully, that helps. I mean it's a little bit less impactful from a CapEx standpoint than some of these other jobs.

Yes. That's great. And then just another question regarding Certarus. So I think, Allan, you mentioned that you guys were awarded another data center contract this quarter. Can you just talk about the size and duration maybe in terms of like number of MSUs required and duration?

The one awarded in the quarter will start out with a less than 1-year term, and we've had others that started out as a less than 1-year term that ended up extending beyond this. So compared to other awards thus far, it's similar, a few MSUs. And we see the pipeline continuing to grow. A lot of the projects that we're working on are things that came to us for the first time in 2026 that are looking to flow gas either later in 2026, but actually more common sometime in 2027.

But the additional validation of being awarded another customer that is experiencing the pain point, I think it's important to keep in mind, a year ago, we had not been awarded any data center jobs. And our first award was in the third quarter of 2025. And one of our focus is there because we have the largest platform in North America, because we have the most experience, because we have the most mobile equipment, our focus was doing an excellent job on that first opportunity with a world-class hyperscaler, and we've done that.

Congratulations to the team that has collaborated very closely with the customer to ensure that their safety expectations are met. We've been 100% reliable with the flows of gas to that location, which is extremely important in that particular application, which has allowed us to build an outstanding reference case that we've now been able to add on to, to expand the aperture of other opportunities.

And importantly, I think one of the trends that's really important in the sort of the data center opportunity application standpoint, the behind-the-meter power projects, there were less than 5 gigawatts of those in 2024. In 2025, the amount of projects exceeded 50 gigawatts. And as we sit here kind of midway through 2026, that number is approaching 100 gigawatts, some estimates even higher than that. And so that is the situation where folks are doing behind-the-meter power projects that is populating our pipeline. And so we've been excited to add that on as a vertical. And as Allan mentioned, it contributed significantly to the industrial volume growth in the first half of the year.

That's great news. And then just switching gears to the propane side. So maybe it's for Allan. But in terms of your Superior Delivers initiatives, are there any large initiatives you're kind of implementing or finishing up this summer that should see a big contribution when deliveries increase in Q4?

No, not necessarily. I mean I would say it's more business as usual in the context of the transformation, not business as usual in a traditional sense. Really, our big priorities going into the winter are, first of all, being prepared for the winter season. And we've done a lot of work in our customer experience group and with our routing optimization to make sure we've got the right trucks, the right routing, the right number of drivers where we need them for the demand that we're likely to see in the winter and that we're answering the phones capably.

So it's been a lot of work on that things as straightforward as standard operating procedures and training for our call center staff that we didn't have a year ago and things like that. And then secondarily, making sure that our acquisition and retention programs are robust and online and that we're ready for for the fall season, which is where you typically see a lot of activity in terms of acquisition and retention opportunities.

And then third is the work we've been doing on our wholesale business to -- that's been busy over the summer as we're securing contracts and fuel supply going preparing for the winter season, and that's been going really well. So when I say business as usual, it's a lot of things we've talked about. It's the second stage of it where we're continuing to ramp up our -- at this stage, our preparedness for Q4 and Q1.

Our next question comes from Gary Ho with Desjardins Capital Markets.

Maybe to start off with the MSUs. I think you disclosed in your financials $28.2 million post quarter in MSU commitment. I know I think from Hexagon, there was a $100 million announcement from them as well. Can you maybe talk about the cadence here in terms of spend and how we should do the modeling side for the balance of this year and into early next year? And are there optionality to perhaps increase that order down the road?

Gary, it's Grier. Yes, what I would say is that we'll probably not get super specific on this because there is a -- there's some potential -- like the main order that we have here will come in kind of over the year-end, right? And so a couple of MSUs here or there. I mean, our interest actually is to get them a little bit earlier. We're pretty busy during the winter, and there's probably an opportunity to use some of this shipment where we would generally rent MSUs through the winter.

But what I would say is the increase in CapEx that we had told you about back in the spring, increasing from $160 million to about $230 million that increase was, call it, roughly half of the required MSU delivery that we needed. So if you kind of set up that half of it and then there's an equivalent number that would come in, in the first half of 2027, that's probably close. But as I say, there may be a little bit of a shift. That order, just to be clear, is completely done, okay? And there's a number of manufacturers, and we did our work to make sure that we have best quality product for best prices, and that work is complete. And then there is -- I don't know that we're going to get into specifics, but we do have some optionality on future MSUs, but that announcement that you're referring to, I guess, has a connection to what we've done.

Okay. Great. And then, Grier, while I have you, just wanted to pick your brain on the Brookfield prefs. We're a little bit closer to the redeemable date, I think mid next year. What are your thoughts on maybe perhaps prefunding that looking out?

Yes. So I think that the message will be very similar, I think, to what we've said in previous quarters, the default plan, depending on a few factors, you know the details of the instrument, but should it be a situation where we can redeem the preferred at par, our default plan is that we would replace it with high-yield debt, which obviously would be quite a lot cheaper, more efficient for us. So that's kind of the default plan. I don't know that we'll panic to do that too early, like we are -- there are other pieces of the capital structure that are pretty efficient.

The revolving credit facility, as you know, like it's drawing in Canadian, it's floating, it's secured. It's pretty attractive funding and some of those pieces will probably be refinanced at the same time and have more representative currency of the business that we've got. And so there's kind of a package of work to do here. We've got definitely some time to do it. But yes, the specific timing, like whether it's going to be Q3 or it's going to be Q4 or it's going to be Q1 of next year, I'm not going to get into specifics on that. We'll continue to look at it. But we know exactly what we're going to do. The direct answer, though, is that, that will likely be replaced with high-yield debt.

Our next question comes from Robert Catellier with CIBC Capital Markets.

Thank you for that description of the mobile fleet fueling business and the economics there. That leaves me with just one pointed question left on that one. I'm curious if it's going to be EBITDA and cash flow accretive immediately or if there's going to be some sort of drag as it ramps to the expected run rate capacity?

Don't expect any notable drag. Like we were talking about, I mean, the only kind of net new capital that we don't already have is the pressure reduction, the fueling dispenser equipment that sits on the customer location, which has a very similar capital profile to the pressure reduction system that's on all of our other jobs. And so -- and then the great thing about this business is we can -- we already have 22 hubs in North America with Houston that we announced yesterday, that's our 23rd.

And so we have lots of other volumes serving other verticals off those supply points and off that compression equipment and off those MSUs. And so no, you shouldn't expect kind of a build of capital ahead of demand on that. As we work the pipeline and we secure other contracts, we'll add capital and we'll, of course, make sure that the return profile of those agreements makes sense as we add the dispensing equipment into our fleet.

Okay. That makes sense. And then, Dale, since we have you on the line here, I just wanted to follow up on the data centers a little bit. And really, could you just provide more detail on how the size of the opportunity set has evolved since the last quarterly call in terms of expected timing of project commencement and the ultimate size of the funnel?

Well, as I mentioned, the size of the funnel is growing. A lot of the projects that we're working on now are things that we've learned about in this calendar year. And I think that just reflects this acceleration that we've seen of data centers recognizing that their path to grid power might be several years away, 3, 4, 5, 6 years, depending on what market we're talking about. And so then that has created more projects around behind-the-meter power, which then, of course, requires a fuel supply to get the behind-the-meter power online.

And so a lot of -- we have seen the pipeline has continued to grow and a lot of the opportunities that we're working on are things that have come to us recently. We have also seen that the #1 reason that a project in the funnel has not converted to revenue has had to do with something other related to the timing of the project. And so sometimes as they're reaching out and trying to secure a fuel supply, they may bump into other supply chain hiccups on like mechanical or electrical equipment. Sometimes their path to permitting for one or more aspects of the projects takes on a different timetable than what they previously communicated to us.

And so we want to be cautious about while we continue to engage in a lot of conversations and learn about large needs for natural gas, again, mostly starting in 2027 and beyond, that there's other -- we're also getting smarter about qualifying those prospects and kind of understanding if the financing piece is in place or the permitting piece is in place so that we have a real project.

But if what the customer needs is natural gas and everything else is on course, we have an excellent solution for them. We have a reliable economic solution that can help them get to what are really attractive compute revenues. And a lot of times, being able to pull those compute revenues into a nearer time period is really valuable for the economics of the data center operators project. And so that's what we're seeing, and that trend continues -- we continue to see new things come into the funnel as a result of that.

Our next question comes from Patrick Kenny with National Bank Capital Markets.

Just first on Certarus and looking at the wellsite side of the business, just given we're starting to see some production growth again on both sides of the border. Just wondering if you're starting to see any sustained recovery or upside either on the volume or pricing-wise relative to what was baked into your guidance coming into the year? And then if we do see, say, a lower natural gas price environment through the back half of the year, helping to improve margins as well, if there is a path towards full year performance from the CNG segment being perhaps more flattish or maybe even up a little bit relative to 2025 as opposed to original expectations of being down slightly year-over-year.

Pat, it's Allan. I just -- I want to offer a comment, and then I'll let Dale speak to the specifics. One of the things that when you think about the pricing stack, if you will, or the margin stack in the business, there are 2 elements. One is the segment, the verticals have much different characteristics in terms of duration, flexibility and competitiveness. So if you're in oil wellsite operations, your downtime is valuable, but it's a fraction of what you would see in a fleet refueling or in a data center.

So the economics, your ability to be flexible in terms of your suppliers is very, very different. And with that comes a different margin profile and different pricing. And you're also pricing it against different solutions. So first of all, you have the characteristics of the verticals. So as we continue to grow wellsite, that's good, but we're also diversifying into other verticals and geographies that have a different profile. Then underneath that, you have the volatility of the pricing within those segments and the commodity itself. But the real point I wanted to make is we're building the business in such a way that we're, first of all, insulating ourselves from the second element, which has had a much more impact in terms of the volatility in recent years than it will in go-forward years.

But Dale probably has a comment on the second part.

Yes. One thing that Allan spoke about in the opening remarks was we embarked -- recognizing the wellsite economics were not what they had been in previous years. We embarked on a strategy to defend our leading market share and the pillars to do that, one, advancing our safety leadership. And our teams, our field leaders, our team members, it's the safest trailing 12 months in the company's recent history. So record safety performance. And that, of course, matters to us and it matters to our customers as well.

Reliability improvements. And so at the end of the day, if we are the most reliable -- wellsite customers don't have a reason to change. There's all kinds of things going on in their operations, and they don't want to introduce reliability variability if they're getting a good value and they're getting uptime from us. And so that has been a big focus and then also being the lowest cost operator. And so we've been driving that forward as well. And so we have had record wellsite volumes in the first half of the year, so -- and record safety performance. So good indications of driving the strategy.

In terms of the outlook for that market, one of the kind of early signals that we haven't had, we have been through a period of 159 consecutive weeks of year-over-year rig count declines from kind of early 2023 into early 2026. And we have now enjoyed the first 9 weeks actually. We're into week 9 of year-over-year rig count increases. And so we're just starting to kind of climb off where we've kind of been declining to over the course of the last 3 years. And so that's a good indication.

I think a lot of the larger public operators have not made capital -- increased capital announcements or increased activity in any significant way yet. But an improving -- if the rig count continues to improve, if the commodity prices kind of stable out and a number in the 70s or in the 80s, that's higher than where expectations were 6 to 9 months ago. And so that will be a good sort of early indicator of additional completion activity.

And it stands to reason as new completion equipment comes to the market, it will increasingly be highly natural gas capable equipment. And so a lot of the equipment that's being retired is higher diesel consumption relative to natural gas. And that's actually one of the reasons why volumes continue to grow for Certarus in the wellsite despite not having like any kind of major upturn in activity trajectory. One is maintaining the market share, but the other is just the increased gas consumption on a per crew basis.

Okay. That's great color. I appreciate that. And then maybe just on the Canadian propane side of the business, particularly out west here. Curious as we start to see some of these major construction projects get off the ground, how you're positioned or how you're planning to position the business just to capitalize on what could be a multiyear step-up in customer demand and activity levels?

Well, the Western Canadian business, Pat, has been -- as I was listening to Dale, I was thinking the cyclicality of the oil and gas sector has really had a big impact on us both positively and presented its challenges because we were so heavily weighted in it. And over the last kind of 5 years, I'd say the propane business felt a similar impact. So as we're -- we've rebuilt our Western Canadian business from a business development and sort of revenue generation standpoint. Prior to my tenure, the business was really established through an acquisition, which took some work to realign and integrate.

I would say that coming into this cycle, we're much better prepared from a readiness standpoint. But probably more comforting for me is we're making really good decisions about the type of business that we want to pursue, the capital investment that's associated with it, the duration of the contracts. And we want to really guard against undue exposure to cyclicality just because you're being opportunistic. So similar to what we're doing with Certarus, we want to grow our share of the market in Canada and Western Canada specifically. I think there's a lot of opportunity there. And we're preparing to do that, but we're going to do it in a really measured and smart way.

I would now like to turn the call back over to Allan MacDonald for any closing remarks.

Well, thanks, everyone. We really appreciate your time and attention today. Always an interesting quarter when you have these smaller quarters and gave us a great opportunity to talk about some of the good work that's happening at Certarus. We're incredibly pleased with the progress we're making there. And I think more than anything, it's just a proof point that even through the more difficult period that we've had over the last couple of years, staying true to your strategy and believing in the sustainability of the markets you're in is really, really important to do. And we try to exemplify that in both parts of the business. So I appreciate your time and attention today, and we'll speak to you all in the coming weeks and months. Thanks very much.

Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.

Good day, and thank you for standing by. Welcome to the Superior Plus First Quarter 2026 Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Chris Lichtenheldt, Vice President, Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and welcome to Superior Plus' conference call and webcast to review our 2026 first quarter results. On the call today, we have Allan MacDonald, President and CEO; Grier Colter, Executive Vice President and Chief Financial Officer; and Dale Winger, President of Certarus.

For this morning's call, Allan and Grier will begin with their prepared remarks, and then we'll open the call for questions. Listeners are reminded that some of the comments made today may be forward-looking in nature and information provided may refer to non-GAAP measures. Please refer to our continuous disclosure documents available on SEDAR+ and our website. Also note that dollar amounts discussed on today's call are expressed in U.S. dollars unless otherwise noted. I'll now turn the call over to Allan.

Thanks, Chris. Good morning, everyone. Thanks for joining us this morning. Well, the first 3 months of 2026 saw our business evolve dramatically. A second winter of above-average cold weather challenged our propane business in the midst of a transformation, which is never easy. But it was the best way to stress test our operating models.

At Certarus, it was an interesting quarter as we saw subdued wellsite pricing despite volume growth and uncertainty arising from the conflicts in the Middle East, which so far has not increased activity levels in the oil and gas sector. At the same time, we saw a dramatic development outside our traditional markets with the announcement of a substantial expansion of our data center business.

Overall, we're pleased with the first quarter performance and encouraged by how the business is positioned as we move forward. Now looking at our consolidated performance in Q1 results tracked largely in line with our expectations, with CNG down due to lower utility work and lower wellsite pricing, while propane was up modestly as operational improvements continue to take hold.

Our share repurchases program continued during the quarter and has meaningfully contributed to our per share performance. Since prioritizing buybacks in the fall of 2024, we've repurchased approximately 14% of our outstanding shares as part of our commitment to enhancing shareholder value.

Turning now to propane. Operationally, while many of the pressures from the fourth quarter carried into the first, our team persevered, advancing our transformation efforts while also going above and beyond for our customers. Our frontline teams, particularly our drivers, technicians and customer experience representatives operated under significant pressure through the early part of the winter, and I want to publicly recognize their efforts. Our team members are at the heart of our brand, and their passion for our customers makes anything possible.

Coming out of winter, we've made significant progress in how we prioritize, plan and execute our deliveries to improve both efficiency and customer satisfaction, and we're feeling confident ahead of our next winter season, supported by better data, clear processes and execution discipline. Importantly, we remain committed to our strategy as our success depends on the ability to deliver to every customer safely, efficiently and on time. As the weather warmed into March, we also made strong progress restoring customer tank levels to more normalized ranges.

Moving through the year with healthier tank levels supports more predictable routing, reduces emergency deliveries and improves labor productivity while still allowing us to maintain a lean cost structure. Overall, Q1 was an important quarter for the business. We tested many aspects of our operating model under very intense conditions. We had some significant successes and some learnings, which are informing our plans as we advance the transformation of Superior into North America's most formidable competitor.

Now turning to Certarus. While Q1 profitability saw a decline versus 2025 due to reduced utility work and lower wellsite pricing, which, by the way, was fully anticipated in our guidance, I'm pleased to say that the team's efforts have had a positive impact on our organization, and we expect to resume quarterly growth beginning in Q2. Looking forward for Certarus, there are exciting times ahead. We've long said we believe in the future of over-the-road CNG and have purposely pursued a strategy of geographic expansion and business development in new and emerging verticals.

We planned on Certarus being there first and being the enabler of CNG adoption for all customers, big and small, in all geographies with a responsive, reliable and scalable value proposition across the continent. Since our last results release, we've seen the expansion of our total addressable market, driven by the explosion in demand for behind-the-meter power generation for hyperscale data centers.

The rapid growth in computing demand and the energy required to support it is outpacing traditional infrastructure expansion. Behind-the-meter solutions are a critical component in building and operating hyperscale data centers and Certarus' delivered energy has emerged as a credible enabling solution.

We're helping customers bring data centers online faster with an energy solution that is both operationally reliable and financially compelling. Since last September, we've signed 6 data center contracts totaling more than $350 million in revenue, including a new contract we announced yesterday, which will be supported by the opening of our new hub in Salt Lake City, Utah.

This momentum is changing the game for Certarus and proving the value of our continental coverage as well as our track record of delivering energy safely and reliably. Now 10 years ago, the Boom and wellsite conversion to CNG created an opportunity for Certarus to grow from a small company to build scale and a vision to be the leader in delivered energy.

This second wave of energy adoption behind-the-meter power generation is something very different. The scale of this opportunity is like nothing we've seen before. It's not taking place in a single market, it's across North America. And with each new customer we serve, we're building new hubs and the infrastructure to make CNG solutions available to other verticals from coast to coast. While the oil and gas boom brought truck CNG to life, the data center era will bring it to communities and businesses everywhere.

In terms of outlook, well, it's early days, but a lot has happened in a short time, and we expect the world to evolve at a very fast pace. I fully expect our data center and industrial verticals to account for approximately 60% of our CNG business within the next 24 months, and this is just the beginning. Our sales funnel continues to expand at an accelerated rate and this in other industrial verticals.

Looking to revised outlook and capital allocation. The business is well positioned to meet its growth objectives this year, and we are increasingly encouraged about what lies ahead for Superior Plus in the years to come. Due to the progress we've made within propane, along with the expanding market for CNG, we're increasing our adjusted EBITDA guidance for 2027 from 2% to 5% growth over 2026.

Now I want to be direct about something. We know our track record on guidance has been tested over the past few quarters. So you can appreciate the decision to revise guidance is not something we've taken lightly. The totality of the increase is the direct result of the contracted revenue we've secured within the data center vertical since our last update. This is a very dynamic market at the moment, and Certarus' ability to move incredibly fast, providing viable competitive solutions is a testament to our strategy to truly be the market leader in delivered energy. It's also important to note that we have seen this as just the beginning. We've not included future opportunities or adjusted our growth forecast since our last review for 2027.

These opportunities also mean we're investing in growth. We'll be increasing our planned capital investment for 2026, investing in new MSUs, tractors and compression equipment as we expand our capacity to fulfill the requirements of this increased volume. Grier will cover these details more in the financial review shortly.

And finally, on capital allocation, we've been disciplined buyers of our shares and remain confident in the long-term value they represent. As mentioned, since late 2024, we've repurchased approximately 14% of our outstanding common shares. However, as always, our priority is to allocate capital to the most accretive opportunities for our shareholders. While we continue to see exceptional value in our shares, the opportunity to invest in CNG at this time is extremely attractive and has compelled us to transition from share repurchases to new investments in CNG. We also want to be transparent about what this increased investment means for leverage. Grier will walk through the specifics, but at the high level, we expect leverage to move modestly higher in the near term before declining as contracted EBITDA flows through in 2027.

We're comfortable with this trajectory given the cash generative and predictable nature of our propane business. So to wrap up, we delivered a solid first quarter despite a challenging backdrop. Propane continues to progress as we modernize the business and Certarus is positioned for meaningful growth. We're allocating capital to the highest value opportunities to support long-term shareholder value.

And with that, I'll turn things over to Grier to walk through the financials.

Thank you, Allan, and good morning. It was a strong quarter for the business and a good start to the year. Our propane operations performed well, and Certarus is positioned exceptionally well to resume growth going forward.

I'll start by recapping our financial results for the first quarter. Q1 adjusted EBITDA of $245.9 million declined approximately 6% compared to Q1 2025 as the decrease in CNG more than offset the increase in propane. Adjusted EBITDA per share was $0.91, an increase of 2% quarter-over-quarter as our lower share count more than offset the change in adjusted EBITDA. Adjusted net earnings per share of $0.68 increased 2% from last year for the same reason.

We generated free cash flow of $188 million in the first quarter, about $32 million lower than the prior year quarter. Recall that Q1 2025 included a $20 million legal recovery and higher adjusted EBITDA. Turning now to the businesses. In Q1, adjusted EBITDA for U.S. Propane was $158.7 million, down approximately 3% from last year. This decrease was primarily due to lower sales volumes as we continued to adjust to reduce delivery capacity as part of Superior Delivers, partly offset by lower operating costs.

While we experienced cold weather in the quarter, it's important to note that Q1 2025 was similar in this respect and represented a strong comparative quarter. Adjusted EBITDA for Canadian Propane was $55.9 million, up 14% from last year. This was primarily due to higher average margins resulting from strong market differentials, improvements in procurement and the impact of a stronger Canadian dollar, partially offset by lower sales volumes.

Our propane transformation, Superior Delivers, contributed $12 million in Q1, having positive impact on our margins and costs, as I just outlined. Overall, our propane business had a strong quarter and continues to track with our expectations for the year.

Moving now to CNG. Q1 adjusted EBITDA of $38.4 million was down approximately 30% compared to Q1 2025, which is aligned with our expectations and the range we highlighted on our last conference call. Again, this decline was mainly due to lower ancillary revenue from utility winter standby services and lower wellsite pricing compared with a year ago.

Operating cost per MMBtu of $7.58 in Q1 increased 2%, primarily due to increased use of third-party trucking services, partially offset by reduced repair and maintenance costs. Our consolidated CapEx for the quarter was $26.6 million, roughly in line with last year and tracking within our expectations for 2026.

For the quarter, corporate operating costs were $7.1 million, down roughly 3% compared to last year due to lower incentive plan costs. Our leverage at the end of Q1 was 3.9x, down 1/10 of a turn compared to Q4, reflecting the lower net debt balances, partially offset by lower adjusted EBITDA. Compared to Q1 2025, our leverage increased by 0.2 of a turn, which is driven by lower LTM adjusted EBITDA.

During the quarter, we repurchased 4.2 million shares, as Allan said, or approximately 2% of our shares outstanding. From the time of our shift to share repurchases in November 2024 to today, we have now repurchased approximately 34 million shares or approximately 14% of the shares outstanding. This has been a meaningful driver behind our improved per share metrics. While we continue to see our shares as having compelling long-term value, we are pivoting our capital allocation focus away from share repurchases and toward high-return growth opportunities in our CNG business and improvement in balance sheet flexibility.

Our approach to capital allocation remains dynamic, and we believe this change will generate the highest long-term value for our shareholders. Moving to 2026 guidance. We are reaffirming our 2026 EBITDA growth expectation of 2% as the businesses are performing in line with our expectations. We expect Certarus to resume to growth for the remaining 9 months of 2026 and the benefits of Superior Delivers to our propane division will become more meaningful in Q4 of 2026. With respect to CapEx, as Allan mentioned, we are increasing our planned capital expenditures for 2026 as the opportunities for attractive returns in our CNG business have improved significantly.

We now plan to spend $230 million in total CapEx during 2026, up from our previous estimate of $160 million. We expect leverage of around 4x by year-end as we increase our investment in growth opportunities in our CNG business. It's worth noting we expect our leverage to increase into Q3 as the business builds working capital balances heading into heating season before coming back down into the year-end.

Regarding our multiyear outlook, we are incorporating the new data center work Certarus has recently been awarded. The growth rate in adjusted EBITDA implied by our previous multiyear outlook was approximately 2% from 2026 to 2027. We now expect year-over-year growth of approximately 5% into 2027 as this new work begins to generate earnings. We will update our 2027 CapEx budget in February of next year. But at this point, we expect CapEx to remain elevated at similar levels in 2027 to facilitate growth in CNG.

With that, I will turn it back for Q&A.

[Operator Instructions] Our first question comes from the line of Nelson Ng with RBC Capital Markets.

Congrats on the additional data center contracts. Just on the data center side of things. So am I thinking about it in the right way in terms of you're investing additional $70 million and you're getting an incremental 3% of EBITDA, which is like very roughly $14 million. I know there's a bit of rounding in there, but is that the right way of thinking about it?

Nelson, it's Grier. Yes, like the -- so the CapEx, yes, it is pretty clear. And then it looks -- you listen to what I said, it's probably a kind of similar elevation of CapEx in 2027. it's a bit of a timing like obviously, the capital is spent first and then the generation of earnings is kind of later. So you're right, the increase in 2027, but these -- the majority of these jobs that we're procuring equipment for are not kind of up and running for the full year of 2027. And so when you look at -- if you're trying to do kind of returns analysis and look at the earnings generation or EBITDA generation in 2027 and compare it to the CapEx, it's not going to give you a very good calculation because we really don't get into generating cash flow or earnings until the tail end of 2027.

I see. And I believe the targeted return is at least 15% for the data center business?

Yes. I mean you could assume that for sure. I mean we -- as Allan said, we believe in the value in repurchasing shares. And so I think you could assume that for us to make the decision to shift away that, yes, those returns would be at or better than that.

Okay. And then in terms of the one data center contract that was announced last month that we'll be using about 200 trailers starting mid next year. From your perspective, like what -- to what degree are you adding new trailers to meet that -- to meet those needs versus reallocating trailers from lower-margin sectors?

Nelson, it's Allan. Dale is on the line, but he's going to want to comment on this. I think we're looking at the fleet in the context of not just that one opportunity we had, but the continued sort of opportunities that we've already closed and when they're coming online and then what we have in the funnel. But Dale, you probably have some comments on that as well.

Nelson, we haven't taken a final determination. We would expect there would be substantial addition to the fleet. We're currently working through a competitive process on equipment procurement. But demand for the existing fleet is good, healthy and firm now. And so as we kind of evaluate as the pipeline unfolds, we do expect to make significant trailer purchases, but we haven't determined that exact amount yet.

Okay. And then just one last question on Certarus. So like a few years -- if we look back, I guess, 3 years ago when Certarus was acquired, growth was really strong, like a lot of capital was invested into the business to buy trailers and then things slowed down, margins were compressed, and I think CapEx slowed. And then now you're seeing like due to data centers, you're seeing this new opportunity and you're looking to ramp up growth again. So I guess, big picture, what's different this time? Like will it last? Obviously, the contracts seem longer than the typical contracts at the wellsite. But can you just talk about how this time is different in terms of the growth prospects for Certarus?

Yes. We're all going to have comments on this one because it's a great question. And you can imagine this is what we've been doing the work on over the last several months and why historically, we haven't sent very strong signals of aggressive growth in this segment because we're waiting for it to unfold, and it's unfolding obviously very quickly.

The difference with the data center piece, I think, is we're at the very early stages of a much bigger era of adoption. And it's doing a few things. It's not just the displacement of diesel. It's really augmenting in a more permanent way, we think, the energy infrastructure. So you got that piece. The second piece is the geographic diversity of the data center space. And the adoption behind-the-meter power generation really opens up other markets for us because if you think about going in this -- would we have been in Salt Lake City, Utah otherwise, maybe, maybe not. But now we have the ability to start to aggressively ramp up other industrial opportunities in those new geographies.

And the pressure that's being put on the energy space in general is really going to affect a lot of businesses, not just the data center piece. So when we talked about things like over-the-road trucking conversion to CNG-powered tractor trailers, well, the rollout of our network on the back of this opportunity in the data center behind the meter space really is a catalyst that makes that initiative a lot easier and then the next one after that.

So I think, as I said in my opening comments, I think oil and gas gave us a foothold to be able to create a viable business and a proven business model. And this new era with data centers is really the catalyst that's going to see delivered energy be much more readily available across the continent.

Now Grier or Dale, you may have a comment on that as well.

Maybe just a couple of quick ones for me. I mean, if you look at comparing it to oil and gas, Nelson, I mean, I think you've got -- I know we'll see how this all plays out, but the life cycle of this and the volatility of this will be 2 pretty key factors, right? And I think we can all make our own assumptions on that. You hit on it. I think the fact that there are longer contracts generally is what we're seeing is a big factor here.

And when you look at how we do our returns analysis, and obviously, the challenge with this is you're matching a very long-life asset with generally shorter term, but this is way more secure in terms of the contracting. I would argue that the volatility is different. I would argue that the life cycle is also probably different. We could argue with the puts and takes on that. But when you look at the discounting and how we look at like just basic DCF and that kind of analysis, obviously, when you get out, if you can get contracting that goes out 2 or 3 years or 4 years, the assumptions in the years when these units come off become a lot less sensitive to your overall return analysis as you can appreciate. And so that's a big part of this, right? And it gives you a lot more certainty. And then, of course, that really helped us in our conviction to determine that the return was sufficient to shift capital.

Thanks, Allan. I agree with all of that. The other thing that I might just highlight in terms of our Certarus' advantaged position to win in this space and be a preferred provider is really a testament to our team members. The experience and the talent that we have to engineer and rapidly deploy a new solution that involves kind of showing up with the hub network, with the mobile compression, with the fleet, with the experience, with the engineering capabilities. That level of safety and reliability is really important to this customer segment. And we come as the industry leader, we come to this space in a good position to be that solutions provider to help hyperscalers get their projects online more quickly.

Our next question comes from the line of Patrick Kenny with National Bank.

Allan, just back on your guidance of the CNG business becoming 60% industrial data centers within the next 24 months. Just wanted to confirm if that assumes any further attrition within the wellsite segment? Or are you assuming pretty stable, call it, flattish contributions from oil and gas customers, but just incorporating the growth from industrial and data center deals?

Thanks for asking that. That's on my mind a lot, and it's something we talk about -- to be very candid, we've had this strategy of maintaining our share in the oil and gas sector, and that was quite purposeful. I mean, it's a great business. And it's -- by its very nature, it's cyclical. And when you're in the downward tranche of the cycle, you think, wow, what a great opportunity to reallocate your fleet somewhere else. But we see the oil and gas segment as having longevity. And that's the last thing we want to do is start to wind down or to look for alternatives at the downward end of the cycle because we think it's going to return to better days.

So we want to maintain our foothold in that space. So this is really about new customer or new expansion as opposed to reallocation. The second thing I would say is the numbers I gave are reflective of where the oil and gas sector is now. Nothing would make me happier than to be wrong because we've seen a material rebound in completion activity, which caused us to have different economics and different demand coming into that sector. So -- but I think to get to the heart of your question, no, we're maintaining our presence in the oil and gas sector and intend to do so going forward.

Got it. And then I guess on the propane side, I mean, California appears to be short refined products here just given the conflict in the Middle East and lack of supplies coming in. Just wondering if you're seeing any incremental margin opportunities on the propane side, either wholesale or otherwise, which might represent some tailwinds through the back half of the year?

Nothing so far. Obviously, our wholesale team is -- and these things move in a different pace than the new cycle, as I know you already know. It's going to take a little bit of time for that to come to the fore. California is a net exporter traditionally of propane during the summer months and an importer during the winter. So we're keeping a really close eye on it. And we've got a great presence in our wholesale business in California. So we're continuing to be engaged. As it stands right now, we're not forecasting any tailwinds going into the back half of the year as a result of it, though.

Okay. Great. And last one for me, if I could. Just maybe a bit more color on the hub being set up in Utah and kind of the overall opportunity set there, what you're hearing from customers in the area just in terms of their access to gas supplies or power from the grid. How are you seeing this geographic market developing over the next few years?

Yes, that's a great one. And I want to -- I'm going to Dale's best person to answer that question, but I do want to qualify something I said in my prepared remarks and that each center -- I said with data center opportunities, we're opening new hubs.

And while that is generally true there, it's not linear. I mean we -- it's not a one-to-one just because we have a data center contract doesn't mean necessarily we're going to open a hub. Some will be served from existing hubs. And some will be insufficient to warrant that type of an expansion. But with that clarification, Dale, maybe, you can talk a little bit about what you're seeing in Utah.

Patrick, this is consistent with the strategy of growing the industrial business. CNG is a very competitive solution for not behind-the-meter power projects and other types of data center applications, but other industrial users.

And our ability to serve and proximity to serve is really essential to the value proposition. And so the having a large award such as the new 60-megawatt data center in the Salt Lake City area really provides a nice baseload volume to establish that local supply point near that market.

And there are other opportunities that we expect to be able to add to that business once -- as we get that local supply point established this month. And it's a growing market and just the continued demand for energy outpacing the ability of infrastructure projects to come online presents a great opportunity for us to be in that market and be able to offer the capabilities and kind of fast, flexible energy solutions those customers are looking for. So we're -- we've got a good outlook for that one and are excited about it, and it is part of the strategy of expanding the business to industrial customers, and we'll do it in other markets soon.

Our next question comes from the line of Robert Catellier with CIBC.

Just to follow up on the data centers. I was wondering if you could tell us about the margin structure for the data center contracts. So what risks have you agreed to? And what risks have you been able to transfer to the customer?

Well, that's a great question. And Robert, it's Allan. We're -- I'm going to be diplomatic here for obvious reasons because that touches on some fairly sensitive stuff that we aren't sharing publicly. But what I would tell you is that our strategy for all of our customers are we're -- it's incumbent upon us to make the investment to deliver their energy safely and efficiently. So we've long had a history of building an attractive value set, a value proposition that does that. We provide the compression, the decompression, the trucking and have pretty firm commitments when it comes to delivery uptime, safety and things like that. What we tend not to do is stray outside of our core competency, like things like taking risk on energy prices or anything like that. So we've had a history of sticking to what we do well. We don't lease the MSUs or operate other people's. We have our own. But we also don't stray into other areas that are in our core business for opportunistic purposes because it's -- frankly, it's not our core competency. And I can give you all the assurances in the world that our data center opportunities are very consistent with our historical approach to how we've managed our contracts. Now Dale, I don't know if you'd want to add any further color to that.

That's all well said, Allan. Our envelope is to compress the gas and deliver the gas and so that we'll be responsible for our scope of work. Obviously, we won't go into specific details on specific contracts, but Allan summarized it well.

Okay. That's helpful. And then just when you look at the opportunity that's in front of you and the cadence of contracts, how does that going to work going forward between contract CapEx and then contribution? So for example, should you be fortunate enough to secure contracts throughout the rest of '26, could we reasonably expect additional contribution to EBITDA in 2027? And I'll have one follow-up after that.

I think so. I mean, I'd love to give you a crisp answer, Rob. But as I said in my prepared remarks, this is all happening really quick. And we've got a -- there's a bit of a variety of customer types. We have new construction builds like the large hyperscale data center we talked about that are going to be some upfront capital with a longer contract and visibility into sort of 3 years of production. And then we've got data centers that are up and running that require energy augmentation because their capacity to produce energy, they've grown beyond and they need to augment that with some truck energy.

And then we've got some smaller projects. So there's a combination of smaller projects and larger projects, first of all. And with all of those, they're coming on at different times. So we're expecting to continue to see some smaller opportunities come in, in the next 6, 12, 24 months. And then I'd be surprised if there weren't larger opportunities in that time frame, although we have a lot more visibility to those in the longer term.

So we're going to continue to do what we do, and that's allocate the fleet in the best way that we can for opportunities that make sense financially. And with the longer-term projects, like the one we announced a month ago, we're going to have more visibility. And when we have it, we'll be able to share it with all of you. I'm not sure if that answers your question or not, but I'm happy to clarify anything.

Yes. No, it's going to depend on the type of work you win. But that does lead me to the next question here. There's at least a possibility that you have additional growth here of size. And so I'm curious, should that materialize, what flexibility do you have if that accelerates faster than anticipated? And I'm thinking about the balance sheet here, of course. And under what circumstances would you -- could your leverage targets be revisited to accommodate a faster pace of growth? Or in that case, would you lean more on redeploying parts of the existing fleet?

Well, I think at that point -- I mean, it's a good problem to have. I mean, at that point, you obviously put everything on the table. We haven't had any discussions about revisiting our leverage at this point with the fullness of time, we anticipate having enough visibility that we're able to be creative in how we capitalize on these opportunities.

And in an ideal world, you would continue to grow the business because you'd rather have net new infrastructure than reallocation. But you also have to work within the constraints of being responsible on the balance sheet that we have today. So more to come on that. But anything sort of material, I think we're going to have some pretty good runway in terms of timing and how we fund it.

Yes. Maybe it's a good question, Rob, for sure. I mean it really -- this depends on the quantum here, right? I mean this is really you think even in the last 6 months has changed quite drastically in terms of the opportunity to grow this business. It's quite remarkable. One of the reasons to shift the capital allocation, I mean, the business generally, propane and CNG, like we generate a lot of EBITDA and a bunch of cash flow and like the shifting of the cash flow away from share repurchase is a big part of this, right, to be able to finance the growth. But it's really a question of just how big is this going to be. As we've said, It's relatively early, I think, at this point to tell. But certainly, we can finance a lot of this growth through the cash flow in our existing business, and we'll just see how big this is.

Yes. And I think it's going to come down to how fast do you want to grow. We can certainly fund pretty substantial growth. And then the question will be, do you want to be able to grow even faster than that? And lots of solutions to be able to think about in that respect.

Our next question comes from the line of Gary Ho with Desjardins Capital Markets.

Congrats on the data center announcements. Allan, just wanted to clarify first, these multiyear contracts, they're still not permanent in nature. So they are multiyear, but they're used to get data centers up and running for early commissioning before they get connected to the grid. And then second, like what's the opportunity set here? How is the RFP pipeline conversations going? And do you see this perhaps as a bubble in terms of data center build-out near term? Or do you see this kind of continuing over the longer-term horizon?

Gary, another great question. It's interesting because on the face of it, it's not hard to cobble it together. A couple of facts that tell you this is a bubble. And when we're looking at it, so let me talk first specifically about our investments, and then I can talk to you about the general market. In our investment, we factor all that in.

And of course, we're doing the responsible thing and making sure that the capital investment in the business we're signing up for is in the best interest of the company and our shareholders, and we're not putting ourselves in a position where we're going to be in a place where we think we're going to have excess capacity.

So I can say that right out of the gate. In terms of the longer-term attractiveness of this space and the bubble comment, I think that there's going to be -- it's very, very early days, which is a good thing because it's not like we're halfway through the evolution of the data center build-out, and we're now seeing opportunities. So we're really at the -- in my mind, the first inning of this, and Certarus is becoming a material partner.

We originally were a little bit shy to put this at top of our mind for our thinking because we anticipated that the greenfield data center sites would be co-located with gas and power resources more than sufficient to satisfy their demands. What's kind of evolving is that the real estate requirements for these data centers is so significant that they don't necessarily have the luxury of being able to co-locate with the energy supply that is required. You're looking at some of these data centers occupying anywhere from 500 to 1,500 acres of land.

The second thing is that the value proposition in data center management is so substantial. If you think of the cost of the CNG in a completion operation versus the cost of the CNG in a data center operation, it's chalk and cheese. It's such a small part of their total overall kind of revenue stream or costs compared to the opportunity that there's very compelling financials to move these data centers forward and be creative in terms of how you generate the energy. So we think that gives us the combination of being very early days, just the sheer size of this gives us a really optimistic view.

And then the last piece is this is the catalyst that helps us very financially efficiently grow out our network and start to augment our capacity and expand into other verticals like refueling and so on. So I'm really -- if I thought this was going to be short term in a bubble, we probably wouldn't have made this investment, to be perfectly honest.

And then my next question, perhaps for Grier. Just on that MSU deployment, sorry, if I missed it in your comments. So $70 million increase in CapEx this year, did you say there's an additional similar $70 million so far for these contracts that you've won for 2027? And then perhaps for Dale, do you see an issue in getting these MSUs purchased and delivered to you? And has pricing for MSUs changed since maybe a couple of years ago? I think it has been probably less competitive. Just wondering how the pricing environment is.

Sure. So Gary, it's Grier. I'll go really quickly. I think you've understood it right. The contracts that we've seen so far, that's what's driving the increase in CapEx guidance for this year. And it's a similar delta for next year to satisfy the equipment requirement for those contracts. So yes, you got it right.

Gary, the only thing I might add, this -- I'd say the equipment manufacturers, whether we're talking about trailers or the other ancillary equipment to expand our business, compression, et cetera, are really excited about this new source of demand. And I think you had it right. There's a lot of demand for the equipment a couple of years ago. And then for over a year, the industry has been kind of working through sort of a leveling off period as there wasn't as much growth in the well site market in 2025.

And so what we're doing is we are running a competitive process with equipment manufacturers. The thing that we have on our side is the real pull on equipment will happen in 2027. And so that allows us to collaborate in an orderly process to kind of scale up, whether it's componentry, procurement, labor schedules, et cetera, to ensure that we are optimizing from a unit cost standpoint.

But yes, having a new end market and a new demand for the types of equipment that we use to support our operations is something the equipment manufacturers are excited to participate in, and we feel good both about being able to meet cost and schedule targets to deliver these projects and incremental growth.

Our next question comes from the line of Daryl Young with Stifel.

Just wanted to flip gears to the propane side. It sounds like the delivery route optimization has stabilized and things are functioning much better. Is there anything you can do across the summer months because we're obviously going through the seasonally slow period to just continue to test and solidify that the system can operate come next spring at scale -- or sorry, next winter at scale?

Yes. Daryl, it's Allan. Yes, yes, absolutely, there is. I mean we're coming from a pretty significant deficit of real-time insightful data that was a big hill to climb for us over the last couple of years. And today, we're in a much better position to have visibility into the fleet into the driver contingency we have into the types of customers. So all of that gives you a lot of clarity that we didn't have before. So that's a real big plus for us.

And while there's some noise in the summer months, the drops are a little bit smaller, obviously, and you don't have the consumption that you have in the winter. We look at it -- we're able to adapt our model sort of for a summer view. And of course, we fluctuate our driver staffing, too. So said really plainly, it's about almost replicating winter conditions with how you're loading trucks and how you're devising routes so that you're able to year-over-year look at the level of efficiency that's being contributed by the model versus your older way of doing it and almost forcing that efficiency despite the demand.

And then in terms of the customer churn dynamics, I know you've been doing a lot of work on that front. But what kind of proactive measures are you putting in place to prevent the tail risk come next winter because I know we've always talked about customer churn being a sort of 1-year delay type problem. So how are you feeling about customers that maybe had a challenging winter this year and might be at tail risk come next winter?

Well, I'm feeling really good about it. We -- I would have said to you guys 2 years ago, we didn't have a churn function really. It was just something that was done organically through the organization, which we've changed pretty dramatically. And when you have a winter like we did, even if everything goes swimmingly, you're under pressure. There were regions across North America where propane was being distributed on an allocation basis. So we weren't able to get all the fuel that we would have otherwise normally liked to get. There were lots of areas that trucks had to be off the road for 2 or 3 days at a time, which creates all kinds of havoc because with a lot of customers, especially in the call, they're nearing empty and then you have to take your trucks off the road for 2 or 3 days, that creates problems.

So in a winter like this, there's always issues. Of course, ours were complicated a little bit by all the changes we're making. But what we did proactively and with our new Chief Commercial Officer, Deena Piquion, had done a great job of actually developing a whole strategy around customer engagement and retention. And I would say the 2 biggest things that we did that we're really happy with is proactive outreach. So customers that may have had service interruption for a variety of reasons, we proactively reached out to explain the situation and express our concern and reassurance that, that wasn't going to happen again.

And the implementation of some retention incentives around customers that had a particularly challenging winter, along with our no runout guarantee has really minimized the impact of a tough winter relative to what the risk could have been. And for that reason, I'm pretty optimistic going into the rest of the year.

Our next question comes from the line of Ben Isaacson with Scotiabank.

Most of my questions have been asked. I just have 2 or 3 quick ones. Can you talk about the payback time to earn the minimum return on acquiring MSUs in advance of these data center contracts? Is the full return earned with the contract? Or is there a risk that you need new contracts to complete the return of the deployment of capital to make the acquisition?

Ben, it's Grier. As you can probably appreciate, we're going to be a little bit cautious about getting really specific about economics on these contracts. What I would say is that, of course, the length of the life of these assets is quite long. And the contracts that we're seeing in the data center world, as I said earlier, it's a lot longer than some of the traditional ways that we've used these.

But I think that the economics won't be completely guaranteed by the initial contract, but I think it gives us a huge amount of confidence on receiving adequate economics. And as I said, like when you get through to the other side of several of these -- most of these contracts and you're 2 years in or 3 years in, the value of those cash flows to determine your DCF they become way less valuable, right? And so whether you can redeploy them. And it might take a year to redeploy them or 2 years to redeploy them or the economics are 10% better or 30% worse because it's so far out, it has less impact on it.

And so that gave us a massive degree of confidence that we'll receive adequate or better than adequate economics. But as I say, I think like getting really specific about do you receive the full return and how much risk is on the tail end, I don't think we're going to be at liberty to share all that stuff. It's just is too sensitive.

Yes, I think that's fine.

And I would -- the only thing I'd add to that is our track record over the last couple of years of being cautious with capital and if you look at our sort of winding back our investment in additional MSUs or capital equipment in the oil and gas sector, specifically as we saw some margin compression. That is a proof point that we're cautious in terms of any expansionary investment, and we used the same caution in this deal.

My second question is, I know the sample size of data center contracts that you have available is small. But is it possible to describe whether the margin profile is different? Meaning is it bigger? And is there less volatility to the margin when compared to well site contracts? Or is the inherent volatility really the same?

So Dale will have an opinion on that, but the short answer is yes. Yes to your first part, that it's materially better and it's not as volatile. But Dale, go ahead.

Well, as you noted, Ben, it's early days, and we have a unique capability just in terms of the experience and the scale and the speed at which we can deploy. And so we're highly motivated to -- and these are really valuable projects, as you know. I mean, as Allan referenced earlier, the value of the enterprise revenue to get these megawatts online sooner is really important to the people involved in these projects.

And so if you can be part of that solution, that's valuable. And so it's our teams talent and experience and ability to kind of safely and reliably operate these that sort of puts us in a differentiated position to serve this market. And so when you have differentiation and the ability to bring a solution that others can't, certainly, that's accretive from a margin standpoint.

Great. And then just my final question. You talked about how the return is not fully there on the MSUs being acquired for the contracts that have been signed. And your confidence, I think, Allan, you said that you're quite confident that we're in the first inning. How do you know we're in the first inning? I mean why -- how do we know that this whole trend and theme isn't over in 3 or 4 years and the returns aren't fully captured by the incremental MSUs that you're buying?

Well, there's 2 questions there. I think one is the economics of the deals we've been signing. And at the risk of being a little vague, so forgive me, I have no concerns about our ability to make those accretive. In terms of how do we know it's not over, I think if we look at the sort of lead indicators, data center demand is continuing to grow from -- not just from a supplier standpoint, but also from a user standpoint.

So the data centers we're working with already are ramping up their capacities faster than they had originally anticipated they would. And then when we look at the sort of construction and management side, we're seeing more and more activity around companies coming in that are planning data center projects. And quite frankly, I think part of the frenzy is the ability to get data center projects to find the land and the energy to actually bring them forward along with what potentially could be other obstacles like delays in power generation equipment time lines.

So we're seeing more bottlenecks than we are a tapering of demand at this point. And it's really important to note, these are long-term projects. These aren't projects like a well site completion that might be 6 weeks in duration. These are decades-long projects. And the money that's being invested is not in the hundreds of millions. It's in the tens of billions. So you can rest assured that everyone involved in making these decisions has a pretty long-term view.

Great. And then actually, just one more question. You pulled free cash flow -- your free cash flow target for next year, but you provided more certainty on EBITDA. And so is the gap between providing more clarity on EBITDA and less on free cash flow, is that because you're unclear about the share count? Or how much CapEx is going to be going towards MSUs and so what's actually going to be free cash or the conversion rate? Or is there something else?

Yes. No, there's nothing more to it. I think it's more just obviously, this is just time back then, obviously, to our Investor Day where we communicated a number of targets. And really, it's just to get a little bit simpler. Obviously, free cash flow has got a whole bunch of different things in it. And the 2 biggest things here really, we think, are CapEx and EBITDA. And so we're just kind of trying to be more simple with it. That's all.

And I'm currently showing no further questions at this time. I'd now like to hand the call back over to Allan MacDonald, President and CEO, for closing remarks.

Thanks, operator, and thanks, everybody, for joining the call today. We threw a lot in this quarter in terms of the performance of the business and some changes to our outlook, but also it's always a great opportunity when you're trying to quantify an emerging growth potential or potential growth opportunity for the business and getting that right balance of being as transparent as we can with all of you with what we know today.

But what I will tell you is, in my tenure here, I've not seen opportunities at Certarus that rival anything close to where we are now. The dynamic nature of the space that we're in has just been fantastic. And Dale's point about the Certarus' value proposition, these are very, very different projects than what we would traditionally be up against.

If you think about assembling a fleet of 200 MSUs in a new geography for what I say mission-critical, I mean absolutely mission-critical operations like a hyperscaler data center. I'd like to believe that there's not a lot of companies that have our reputation and can mobilize at the speed that Dale and the Certarus team did. So we're really, really excited about what the future looks like for us. And hopefully, we'll have more news for you to come in the next few quarters. With that, thank you all very much for joining us, and we'll talk to you again soon.

This concludes today's conference. Thank you for your participation. You may now disconnect.

Hello, and welcome to the Annual Meeting of Shareholders of Superior Plus Corp. Please note that today's meeting is being recorded. [Operator Instructions] It is now my pleasure to turn today's meeting over to David Smith, Chair of the Board of Directors of Superior Plus. Mr. Smith, the floor is yours.

Ladies and gentlemen, good afternoon, and welcome to the 2026 Annual Meeting of the Shareholders of Superior Plus Corp. I am David Smith, and as Chair of the Board of Directors of Superior Plus, it is my responsibility and privilege to act as Chair of this annual meeting. Consistent with prior years and now common practice among other public companies in Canada, we are holding this meeting virtually via live audio webcast again this year. The virtual nature of this meeting has an impact on the way the meeting is conducted. Our goal is to preserve the rights of shareholders and proxy holders to vote on each of the resolutions before the meeting and to the extent possible, provide you with opportunities to participate in this virtual-only format similar to the way you would have at an in-person meeting.

As with any technology applications, unexpected issues may occur and Computershare, our service provider for this platform will help to resolve any issues that arise. I welcome our registered shareholders and all guests that are joining this meeting today through our virtual meeting platform. We're excited to have your participation in the meeting, and thank you for your interest in the affairs of Superior Plus.

There is also an accompanying presentation following the formal business of the meeting, which is viewable on the virtual meeting platform and on our website at superiorplus.com. Also joining me at this meeting is Allan MacDonald, President and Executive Officer; as well as Darren Hribar, Senior Vice President and Chief Legal Officer of Superior Plus, who will act as Secretary of the meeting.

The moderator of the meeting is Chris Lichtenheldt, Vice President, Investor Relations.

The Board of Superior Plus is responsible for overseeing the management and overall direction of the operations of Superior Plus. It is currently composed of 10 members. Accordingly, there are 10 nominees for election as directors of Superior Plus at this meeting. All 10 of the nominated individuals have extensive business and Board experience and Allan MacDonald is the only director who is also a member of management and therefore not considered independent under regulatory rules.

You will find information and disclosure on our corporate governance process in the information circular. Your Board is committed to ensuring that Superior Plus carries -- continues to carry out high stand of corporate governance.

The nominees standing for election or reelection at this meeting are as follows: Catherine Best, Christopher Folan, Jean Paul Gladu, Patrick Gottschalk, Jennifer Grigsby, Calvin Jacober, Allan MacDonald, President and CEO of Superior; Laura L. Schwin, William L. Yardley and myself, David Smith. Scrutineer for the meeting today is Kyle Gould of Computershare Trust Company of Canada.

Immediately following this formal meeting, Allan MacDonald will make a short presentation to review 2025 milestones. Note that the presentation contains forward-looking statements and the use of non-GAAP measures.

Turning to Slide 2, I would like to take a moment to comment on the voting procedures to be used at today's meeting. You should now see the agenda on your screen. Only a registered shareholder or a duly appointed proxy holder can ask a question or vote at the meeting. Most shareholders or duly appointed proxy holders would have voted in advance of the meeting using the 15-digit control number provided to them by Computershare. If you've voted in advance of the meeting or sent in your proxy and do not want to change your vote, no further action is required.

For those who haven't voted yet or wish to change your vote, all polls are open 15 minutes prior to the meeting. Please ensure to use the Vote tab to submit your vote. To vote selecting -- select from voting direction from the options shown. Your vote has been cast when a check mark appears. The polls will remain open for all matters being voted on until the last item of formal business has concluded.

After each motion, registered shareholders and proxy holders may ask a question related to that specific motion. Please note, we won't be addressing any general questions related to the business, financial results or outlook until the formal portion of the meeting is complete. We will do our best to respond to all of your questions related through the motions during the meeting. However, if a question or comment is not related specifically to the motion are more appropriately addressed during the more appropriately addressed during management's presentation, will be answered during the Q&A session of the management presentation if time permits.

If you have a question or comment on a specific motion, I ask that you use the Q&A tab. Please type your question or comment in the text box appearing on the screen. Once you have finished typing your question or comment, please select the send button to submit your question. Mr. Lichtenheldt will read your questions to the meeting and the appropriate person will address it. If we receive a number of questions on the same topic, we will group your questions together and provide a comprehensive response.

As noted, today's meeting is being held entirely by means of electronic communication facilities in accordance with our bylaws and applicable laws. Superior Plus used the notice and access process for provision of information circular and other meeting materials to shareholders for this meeting. I have received an affidavit from an official of Computershare the proper notice of the meeting has been given in the notice and form of proxy were mailed on April 8, 2026, to all shareholders of record as of March 30, 2026.

The 2025 annual report, which includes the audited financial statements for the year ended December 31, 2025, was also mailed to those shareholders who elected to receive it. I direct that the affidavit together with a copy of documents mailed to shareholders the annex to the minutes of this meeting. I'm advised by the scrutineer that there is a quorum present. I declare that this meeting is properly convened and regularly constituted for the transaction of business. Only a registered shareholder or a person appointed as proxy holder of such a shareholder is entitled to make or second motions or to vote at this meeting. In order to ensure that the meeting covers all the required business in an efficient manner, we have prearranged for Darren Hribar, who is a duly appointed proxy holder to move the motions of business.

I will now proceed with the formal business of this meeting.

Turning to Slide 3. I am now tabling the 2025 annual report, which includes the consolidated financial statements and the auditor's report thereon. The annual report was duly mailed to shareholders that had requested to receive it.

Turning to Slide 5. The number of directors to be elected at this meeting has been fixed at 10. It is now in order to proceed with the election and directors of Superior Plus Corp. The information circular lists the nominees for election for the ensuing year.

May I now have nominees -- nominations for the 10 directors to be elected.

I nominate each of the following persons for election as director of Superior Plus Corp. to hold office for the next annual meeting or until their successors elected or appointed. Catherine M. Best, Christopher T. Folan, Jean Paul Gladu, Patrick E. Gottschalk, Jennifer Grigsby, Calvin B. Jacober, Allan A. MacDonald, Laura L. Schwin, David P. Smith and William T. Yardley.

Under the bylaws of the corporation, advance notice is required for additional nominations to the Board. There were no other nominations received within the requirements of the advance notice bylaw, and therefore, I declare the nominations closed. The voting for directors is by way of individual director and not by way of slate vote and will be conducted by ballot. Each nominee will be elected only if the number of votes cast in their favor represents a majority of the votes cast for them by shareholders. May I have a motion to elect each of the nominees as directors of Superior Plus Corp. I hereby ask Darren to move the motion.

I move that each of the 10 persons who have been nominated be elected as a Director of Superior Plus Corp. to hold office until the next annual meeting or until their successor is elected or appointed.

Thank you, Darren. Chris, have any questions come in?

There are no questions related to this motion?

Voting is open. If you have already voted or appointed a proxy holder, no further action is required unless you would like to change your vote. If you are participating in the meeting through the virtual platform, please record your vote by using the Vote tab. Based on the preliminary voting results for this matter, it's expected that the resolution will be carried in respect of each nominee. We will continue with the meeting -- with the remainder of the business of the meeting while the scrutineer tabulates the results of the voting.

Turning to Slide 6. Our next item is the reappointment of Ernst & Young LLP as the auditor of Superior Plus Corp. I hereby ask Darren Hribar to move the motion.

I move that Ernst & Young LLP be reappointed auditor of Superior Plus Corp. to hold office until the next annual meeting or until their successors are appointed at such remuneration as may be fixed by the directors of Superior Plus Corp.

Chris, are there question come in.

No there are no questions related to this motion.

Voting is open. If you have already voted or appointed a proxy holder, no further action is required unless you would like to change your vote. If you are participating in the meeting through the virtual platform, please record your vote by using the Vote tab. Based on the preliminary voting results for this matter, it is expected that the resolution will be carried. We will continue with the remainder of the business of the meeting while the scrutineer tabulates the results of the voting. Our -- Superior commitment to good corporate governance, the Board has sought a nonbinding advisory vote to accept Superior's pay-for-performance approach on executive compensation as more particularly described in the information circular. I hereby ask Darren to move the motion.

I move that the formal resolution set forth in the information circular respecting the nonbinding advisory vote regarding Superior's approach to executive compensation be approved.

Chris, are there any questions to begin?

No, there are no questions related to this motion.

Voting is open. If you've already voted or appointed a proxy holder, no further action is required unless you would like to change your vote. If you are participating in the meeting through the virtual platform, please record your vote by accessing the Vote tab. We shall pause to allow voting before closing the polls.

Polls in respect of each matter of business are now closed. Ladies and gentlemen, I have received a preliminary scrutineers' report on the voting results. I have been advised by the scrutineer that based upon the proxy deposited for the meeting and the total votes received in advance of the votes entered through the virtual platform, each of the motions and resolutions for all matters to be voted upon at the meeting has been carried.

I declare each of the resolutions carried and direct the results of the poll and the votes entered through the virtual platform for all matters to be voted upon at the meeting be included with the minutes of this meeting. We will also press release the voting results as required by applicable securities laws. I direct that the final scrutineers' report on votes be filed with the minutes of this meeting.

That concludes the formal business of the meeting. If there are no other valid business to come before the meeting, I will entertain a motion to conclude the meeting.

I move that the meeting be concluded.

Ladies and gentlemen, I declare the meeting concluded. I will now move to a short presentation by Allan MacDonald, President and CEO of Superior.

Thanks, David. Good afternoon, everyone. Thank you for joining us today and for your continued support of Superior Plus. While 2025 was a pivotal year for Superior. We took deliberate steps to change how we operate and position the company for the future, not to chase short-term results but to build a stronger, more resilient business over time. It was not an easy year. We faced real tactical challenges and particularly -- in a particularly demanding operating environment. But as I've said before, it's important to view our progress through a multiyear lens. Transforming a business like ours requires foundational change, and the work is well underway. We made progress last year and just as importantly, gained insights that are shaping how we move forward. Across Superior, our focus is on building the capabilities required to compete and win over time. In propane, this has meant integrating the businesses, modernizing how we operate and improving consistency and efficiency that we can serve our customers better and grow at scale. At Certarus, it's meant staying disciplined through evolving market conditions, maintaining our leadership position, managing costs and pursuing attractive and growing end markets. These are intentional choices grounded in a very long-range view of the business. They reflect our commitment to setting Superior up for durable growth and resilience in the years ahead.

In our North American propane business, we continued advancing Superior Delivers, our strategy to modernize operations and improve service. In 2025, we introduced new systems, leadership structures and delivery methodologies. The pace and scale of this change created pressure during an implementation, but these challenges were not the result of a lack of effort by our teams. Rather, they reflect the complexity of carrying out an operating model transition in a seasonal business. This point is important. The lessons we learned in 2025 are being applied directly as we refine our approach and prepare for future winters. These lessons are improving consistency and predictability across our operations. Thank you to all of our customers for their patience and continued trust. We're focused on delivering the reliability and service they expect as we move forward. At Certarus, our CNG business also faced a challenging year. The downturn in oil and gas activity created pricing pressure in the well sites business despite record volumes. This represented a meaningful shift in the operating environment and required to reset in expectations. Team responded with discipline, reducing operating costs and continuing to advance opportunities in data centers, industrial and other end markets that improve long-term stability. These efforts have been paying off, including being award -- being awarded multiple contracts in the rapidly expanding market of hyperscale data centers.

From an enterprise perspective, Superior achieved modest organic growth in 2025, while overall adjusted EBITDA growth was moderate, adjusted EBITDA per share and free cash flow per share improved meaningfully, reflecting disciplined capital allocation and lower share count. Since November 2024, we repurchased nearly 15% of our outstanding shares, driving improvements in per share value while signaling our confidence in the business over the long term. Throughout the year, the Board remained actively engaged in overseeing the company's progress and ensuring that strategy, risk management and capital allocation remained aligned with shareholder interests. Board's broad and complementary experience across operations, markets, governments and risk oversight continues to support disciplined execution of our strategy.

In 2026, our focus is on implementation. Demonstrating the effectiveness of our operating model and continuing to improve how we perform through peak demand periods. We're still in the midst of meaningful change with a clear commitment to our strategy and confidence in the opportunities [indiscernible]. None of this progress would be possible without the dedication of our employees across North America. We Continue to serve customers safely and professionally during a year defined by change and adversely. I'm deeply, deeply, grateful for their commitment. I would also like to thank Superior's executive team for their leadership and expertise as well as our Chairman, David Smith and our Board of Directors for their guidance.

Finally, I would like to thank our shareholders for your continued confidence and support. We appreciate your trust and our journey to become recognized as Canada's best-in-class energy solutions provider.

And with that, I'll turn it back to Chris to address any questions that have come in.

Thank you. No questions have come in.

This concludes today's meeting. You may now disconnect.

Good day, and thank you for standing by. Welcome to the Superior Plus 2025 Fourth Quarter Results Conference Call [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Chris Lichtenheldt, Vice President of Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and welcome to Superior Plus' conference call and webcast to review our 2025 fourth quarter and full year results. On the call today, we have Allan MacDonald, President and CEO; Grier Colter, Executive Vice President and Chief Financial Officer; and Dale Winger, President of Certarus. For this morning's call, Allan and Grier will begin with their prepared remarks, and then we'll open the call for questions.

Listeners are reminded that some of the comments made today may be forward-looking in nature and information provided may refer to non-GAAP measures. Please refer to our continuous disclosure documents available on SEDAR+ and our website. Also note that dollar amounts discussed on today's call are expressed in U.S. dollars unless otherwise noted. I'll now turn the call over to Allan.

Thanks, Chris. Good morning, everyone, and thanks for joining us today. Well, 2025 was a year of significant transition for Superior Plus. Over the course of the year, we continued to reshape how we operate across North America, advancing our Superior Delivers transformation while maintaining operational continuity in a challenging environment. We made real progress and also learned some hard lessons, particularly as change met a difficult winter.

Superior Delivers has a clear purpose to build a propane business that operates at a lower cost, handles volatility better and performs consistently, especially in winter. As we integrated teams across the U.S. and Canada, implemented new systems and aligned leadership around a single operating model, the organization navigated a meaningful amount of change. While the pace and scale of that change created execution pressure at times, it also strengthened our foundation.

In CNG, Certarus operated in a difficult macroeconomic environment, driven by a downturn in oil and gas activity. Pricing pressure in wellsite created a $40 million gross margin headwind, which our team was able to largely but not entirely offset. Despite that backdrop, we maintained a strong operational discipline and continue to diversify the business. Overall, 2025 was demanding, but it improved our visibility into the business and sharpened our focus as we move into 2026.

To be clear, we are staying the course, maintaining our $75 million Superior Delivers target and managing what we can control. Turning to results. We delivered modest organic growth in both the fourth quarter and the full year, in line with our revised guidance. As we redesigned how we schedule, route and deliver propane, we are transitioning to a more efficient delivery model. Now that transition is still in progress, and this winter tested the system under very difficult conditions, including sharp localized demand, icy and snowy road conditions and a network that hadn't yet reached full optimization, adding complexity during peak period demands.

These challenges were not unique to Superior though. The broader propane industry faced elevated demand alongside supply constraints and extreme weather events across multiple regions. I want to recognize and thank our teams for their extraordinary efforts during this period. We expanded our driver base, increased call center capacity and applied every available short-term measure to support our customers. While the winter highlighted areas where execution can improve, we are on the right path and the network we're building is performing more consistently as optimization progresses.

As a result of strong winter demand, we expect higher-than-normal deliveries to continue into March and April as customer inventories are replenished. Based on what we've learned, Superior Delivers will require more time to fully realize its intended benefits than originally anticipated. This reflects executional complexity, but not a change in strategy. We were ambitious, and that's a good thing. It's now more likely a 3-year journey rather than 2. But that's because we want to get this right and take the time to build a truly transformational platform, and we are absolutely staying the course.

Superior Delivers contributed to propane growth in 2025 and is expected to contribute more meaningfully in '26. We also acknowledge that early iterations of our delivery tools did not perform as intended and contributed lower than optimal customer tank levels heading into winter. These issues have been addressed with updated tools and delivery methodologies now in place, we are seeing improved performance and better predictability through peak demand.

On the customer side, we continue to make progress. We've developed proprietary capabilities that allow us to precisely target attractive customer segments and allocate sales and marketing resources accordingly. Conversion rates are improving, and we are building the organizational capability required to scale this approach over time. Turning to CNG. 2025 was a challenging year for Certarus, especially in the wellsite business.

Early in the third quarter, wellsite pricing declined materially and has not yet recovered. This pricing pressure overshadowed several positive developments, including 2 new data center contracts and the opening of a hub in Florida to support industrial growth. Despite lower oil and gas activity, Certarus delivered record volumes, reflecting strong market share retention in wellsite and continued success with our industrial customers.

Wellsite remains the largest end market for Certarus and the current pricing environment represents a meaningful change. While pricing will improve over time as the cycle evolves, the timing and the extent of it remain uncertain. As a result, we're resetting our outlook for Certarus to reflect current market conditions, guiding to lower EBITDA in 2026 and adjusting our expectations for '27, and Grier will discuss this in more detail.

With that context, we're introducing 2026 guidance that reflects approximately 2% expected EBITDA growth. Increased contribution from propane is offset by lower earnings at Certarus, reflecting a full year of lower CNG pricing. Now while we remain confident in Superior Delivers and maintain our $75 million target, we are updating our '27 outlook to reflect the CNG market conditions and a slightly longer execution cycle for Superior Delivers. We believe this provides a realistic and transparent view of our path forward while maintaining confidence in the long-term potential of the business.

On capital allocation, we remain confident in the underlying value of Superior. In the near term, we expect to continue repurchasing shares. However, over the medium term, we anticipate shifting debt repayment -- shifting toward debt repayment, sorry, as we prepare for the potential redemption of our $260 million preferred shares in mid-2027 assuming, of course, our share price remains below the conversion price of approximately CAD 12.

Now while 2025 presented its challenges, it also strengthened our operating discipline and clarified our priorities. We're executing a more focused plan, building a more resilient platform, staying the course and managing what we control to position Superior to deliver sustainable value over the long term. So with that, thank you. I'll hand things over to Grier.

Thank you, Allan, and good morning. As discussed, 2025 was a year of significant change that brought both successes and some challenges across the business. Propane had a decent year and grew EBITDA modestly, but did not benefit fully from the cold weather in Q4, given we are in the midst of our transformation and still adjusting to our leaner operating structure and new delivery methods. In CNG, the factors within our control were managed well, but not able to fully offset the pricing pressure in the wellsite business.

I'll start by recapping our consolidated financial results for the full year and for the fourth quarter. Full year adjusted EBITDA of $463.5 million was up approximately 2% due to modestly higher adjusted EBITDA from U.S. and Canadian propane, which was up about 4%, partially offset by a decline in CNG, which was down about 4%. Q4 adjusted EBITDA of $161.9 million increased 2% versus Q4 2024, driven by higher contributions from Superior Delivers and propane, offset partly by pricing pressure in CNG. Full year adjusted EBTDA per share of $1.46 increased by 15% compared to 2024 due to lower average shares outstanding, higher adjusted EBITDA from North American propane and lower interest costs, partially offset by lower adjusted EBITDA from CNG.

Adjusted net earnings per share of $0.31 increased by 94% and free cash flow per share of $0.87 nearly doubled for the same reasons with lower CapEx also contributing to free cash flow growth. For Q4, adjusted EBTDA per share of $0.55 increased 12% due to the same factors driving the full year increase. Adjusted net earnings per share of $0.27 increased 17% from last year due to lower shares outstanding and higher adjusted EBITDA. Free cash flow per share of $0.37 increased 23%, again, driven by lower shares outstanding and higher adjusted EBITDA in addition to reductions in CapEx and interest expense.

Turning now to the businesses. For the full year, adjusted EBITDA in North American propane increased 4% to $346.7 million, driven by benefits from Superior Delivers as well as favorable weather. Looking into the regions. Full year adjusted EBITDA in U.S. Propane was $246.3 million, a 5% increase, driven by Superior Delivers and higher volumes due to colder weather. In the fourth quarter, adjusted EBITDA for U.S. Propane was $96.7 million, which was up 9% from last year. This increase was primarily due to the positive impact from Superior Delivers, which contributed to higher margins and lower costs, partially offset by a temporary reduction in capacity as the business adjusts to the new delivery methodology.

Full year adjusted EBITDA for Canadian Propane was $100.4 million, an increase of approximately 2%, primarily due to higher sales volumes and lower operating costs, partially offset by a stronger U.S. dollar and the sale of fewer carbon credits compared with the prior year. In fourth quarter, adjusted EBITDA for Canadian Propane was $36.2 million. This was relatively in line with Q4 '24 as the benefits from Superior Delivers and lower operating costs were offset by the sale of fewer carbon credits compared with Q4 2024.

In total, our propane transformation, Superior Delivers contributed $16.2 million to full year results and $11.2 million in the fourth quarter. Moving now to CNG. Certarus' full year adjusted EBITDA of $142.5 million was down 4% compared to 2024 primarily because of lower realized prices in the wellsite business, partly offset by growth in industrial markets and higher volumes across the business. Notwithstanding a more challenging marketplace, Certarus is making significant progress on factors within its control, including a 6% reduction in operating cost per MMBtu in fiscal 2025.

Our continued focus on capital discipline drove a 50% or nearly $50 million reduction in CapEx at Certarus, which contributed to a record year for free cash flow. Fourth quarter adjusted EBITDA in CNG was $34.3 million, down $4.9 million or 13% compared to last year. This was mainly a result of pricing pressure in the wellsite business. Consolidated capital expenditures for the year were about $140 million or 26% lower compared to 2024, driven mostly by lower spending in CNG.

Within the regions, CapEx in Canada increased to 11% as the company executed a significant fleet refreshment in order to reduce maintenance costs and optimize asset availability going forward. For the quarter and full year, corporate operating costs were $5.3 million and $25.7 million, respectively, which was in line with last year and also with our guidance. Our leverage at the end of 2025 was 4.0x, down about 1/10 of a turn compared to a year earlier due to higher adjusted EBITDA and to a lesser extent, lower net debt balances.

We continue to believe that share repurchases are an excellent use of capital. During the year, we repurchased 19.6 million shares or approximately 8% of our shares outstanding. From November 2024 until today, we have now purchased approximately 32 million shares or about 13% of our shares outstanding. And this has been a meaningful driver behind our improved per share metrics. As Allan mentioned, we are expecting adjusted EBITDA growth of 2% in 2026. In propane, the growth of 3% to 8% assumes warmer weather in 2026 versus 2025, in line with the 5-year average. It also includes a contribution from Superior Delivers of approximately $50 million, up approximately $16 million from 2025 -- in 2025, sorry, as the transformation continues to progress.

We have also assumed some continued customer attrition as our churn reduction and customer acquisition programs continue to ramp up. It's worth noting in propane, we expect the first quarter of 2026 to be modestly lower than Q1 2025 due to warmer weather and delivery capacity constraints. The remaining 3 quarters are expected to grow as Superior Delivers continues to provide benefit, including the peak shaving dynamic of our delivery methodology. In CNG, we have not seen a material reduction in pricing since Q3 2025 and are assuming relatively stable prices through 2026.

However, 2026 adjusted EBITDA at Certarus is expected to decline between 4% and 9% based primarily on realizing lower prices over the full year as well as a reduction in ancillary revenue from utility winter standby services. Notably, the expected decline in full year EBITDA in CNG is expected to take place entirely in the first quarter. Specifically, we expect Certarus' first quarter EBITDA to be relatively flat with Q4 2025 or down about 30% to 35% from Q1 2025, with growth expected in the following 3 quarters. This decline in first quarter EBITDA is due to the aforementioned reduction in ancillary revenue as well as well site pricing declines.

We expect overall CapEx, including lease additions of approximately $160 million in 2026, up from about $140 million in 2025 as we plan to invest in updating our U.S. propane delivery fleet to ensure optimal utilization and maintenance costs. We are also planning to modestly increase our investment in CNG. Regarding share repurchases, we continue to see a significant opportunity in repurchasing our shares at these levels. However, we may spend less on share repurchases during 2026 as we shift some of our capital to additional debt repayment.

As a reminder, we have a $260 million convertible preferred share instrument outstanding with a conversion price materially higher than where we are trading. These preferred shares are redeemable at par in mid-2027, if not converted. And therefore, we believe it's prudent to increase our financial capacity ahead of this potential redemption to partly offset the incremental leverage associated with taking out the preferred equity. Taking out these preferred shares also eliminates the potential $30 million common share dilution associated with this instrument and is, therefore, consistent with our capital allocation strategy aimed at reducing our common shares outstanding and improving per share metrics.

As Allan mentioned, we are revising our multiyear outlook. We now expect a 3-year CAGR on EBITDA of about 2% over the years from 2024 to 2027, which is down from about 8% previously. This reflects lower pricing at Certarus and a more gradual progression of our propane transformation with 2028 now expected to be the first full year of $75 million in benefits from Superior Delivers. With this extended time line to execute Superior Delivers, we are also tempering our customer growth expectations, which has contributed to our reduced outlook going into 2027. And with that, I will turn it back for Q&A.

[Operator Instructions] Our first question comes from the line of Aaron MacNeil from TD Cowen.

You said something to the effect of the original tools didn't perform as expected. I can appreciate that Superior Delivery is a work in progress. But how are you thinking about optimization of the business versus having redundancy and the ability to ensure you're actually able to deliver for your customers? And then also energy affordability is a bit of a hot button there is becoming a bigger hot button. You've had some negative press in terms of hiking rental fees. Do you see a scenario where public or political pressure could be a potential headwind to sort of enact some of your delivers agenda?

Aaron, it's Allan. Thanks for joining us. Thanks for the call -- for the question. So for the first thing in terms of coverage, I wasn't as -- taken a back by our coverage capability in terms of what our plans are at Superior Delivers. I think what really was challenging for us was we went in -- as you recall from our last quarterly call, we went into Q4 with a slight delay in the rollout of this tool. It doesn't take much in this industry to put you on your back foot. But that delay caused us to not be able to pull tickets forward out of Q4 and Q1 into our sort of slower season.

And that backlog that we went into with slightly lower tank inventories, coupled with really, really challenging weather was what got us. So we've got a couple of things that in terms of redundancy we're planning. One, full realization of the optimization capabilities is going to be a big one. Two, getting our tank inventories levels exactly where we want them to be going into the winter this year is going to be important. Three, having those once-a-year deliveries that happened in Q4 and Q1 pulled into the slower seasons is going to be really important for us.

And then finally, we've learned a lot, but one of the things we learned is that we have a whole contingency of staff propane specialists that work on things like service or tank setting that are also able to shift over to help us address peaks or demands that happen to be local. And that actually worked well for us through this year and helped us maintain our service to our customers. So the flexibility that we've built into the propane specialist role, I think, has proved itself to be really, really critical.

So I don't think that we're in no way creating an organization that's incapable of handling these peaks. It was just -- it was, to be honest, a bit of a perfect storm. In terms of the rental and regulation, I mean, never say never. That was less of us introducing anything untoward when it comes to pricing and more of us cleaning up contracts and customer agreements that were put in place that were, frankly, shortsighted, maybe misinformed. So we had customers that had, in some cases, no volume over a 2- or 3-year period, but had assets that we placed on site and that we were responsible to maintain from a regulatory standpoint.

Going forward today, if a customer come in and said, "Hey, we want propane storage on site, but we're not going to be a high-volume customer, " we'd be more than happy to accommodate them. But we do it via a rental agreement as opposed to a price per liter or price per gallon agreement. And what we were doing there was really just addressing some of the customer agreements that we had historically. Now that's totally understandable when you realize how many acquisitions we did. And through the course of acquiring hundreds of thousands of customers, you're going to have situations like this. So we don't think the pricing is in any way unreasonable. It's easy when you're talking about a new customer is sometimes a bit of a hurdle when you're addressing kind of sins of the past.

Appreciate that. I can appreciate it's a tough question as well. I'm not sure if Dale is on, but...

Sitting right next to me.

Perfect. Dale, I'm hoping you can speak to the magnitude of the pricing headwinds that you're facing relative to the prior quarter. And then maybe can you speak to the Florida opportunity specifically in terms of the types of volume you might see in a sort of non-oil and gas hub versus what you typically see in the more traditional business?

Aaron, thanks for the question. We'll talk about the wellsite pricing dynamic first. So as Grier mentioned, the pricing that we experienced in the fourth quarter was flat to the pricing we experienced in the third quarter. So the big pricing erosion that happened -- happened in the middle of the year, which creates some tough comps in the first part of this year. As Allan mentioned, we've had -- the overall 2025 impact was $40 million. And you can see based on our volumes, what the impact of $1 of price erosion means. And so overall, like over the last 2 years, we've seen the price to win in the marketplace decline by 25%, 15% decline overall 2025 versus 2024.

But we are encouraged that pricing has been stable over the last 6 months. Our guidance sort of incorporates the fact that we'll not -- we're not expecting to recover that in 2026. We're kind of expecting conditions to continue as we've seen over the last 6 months or so. And then over the Florida opportunity, we do have -- we're actually really excited about that. It signals like good demand that we opened that hub and immediately had customers that were interested in being able to provide the service.

I think it speaks to the dynamic that we're really seeing right now is access to energy is really important for lots of different types of industrial and utility customers and whether it's the speed or the reliability or the cost, sometimes they can't get those kind of on the time line or at the cost or the reliability that they want. And so we're excited about the start that we had in Florida. Right now, I mean, in the first quarter, it's going to represent like less than 1% of our volumes. But you can see the Florida represents our 21st hub.

So the volume that we generated in 2025, we did that off 20 hubs, and so you can kind of get a sense of the volume per hub. It can be a few thousand MMBtu per day. And of course, new hub development and expansion is a huge part of our accelerate growth strategy going forward. We're excited that we have signed an agreement for a property for a Houston location. And so we're actively driving forward plans to progress that and have gas flowing there serving customers in the Houston metro area by midyear.

Our next question comes from the line of Ben Isaacson from Scotiabank.

Just -- actually just one question on Certarus. I might not ask this correctly, but I'm trying to understand the cost curve. What is the marginal cost to deliver? And what is your kind of price point? I'm trying to understand how much downside is there in pricing when it comes to looking at some kind of cost curve, if that's even the right way to look at it?

Ben, it's Allan. You just cut out on us a little bit there, but you're talking about Certarus, right?

Yes, sorry. I'm just trying to understand the cost curve of Certarus.

No, it makes sense. Do you want to have a go at that? Or do you want me to?

Yes. Well, of course, we have disclosures on our kind of cost per MMBtu. And you can see that we improved that by 6% 2025 over 2024. We have continued plans to continue to advance that. I mean we are the market leader. And so of course, in an environment of increased price-based competition, having scale as it relates to driver utilization, the ability to employ internal drivers, some of the operating experience in terms of loading MMBtu per gas per trailer with compression technology to make sure that we're driving efficiencies on each load delivered, some new technology that we installed in 2025 called smart trailers. We've equipped 50% of our fleet that gives us real-time visibility into the trailer levels regardless.

Sorry. Can I just refocus the question? I guess what I'm trying to drive at is the current pricing environment, are those producers that are lowering prices right now, are they making money? And if they are, how much lower can prices go to the point where they become marginal and they start to exit the industry? I'm just trying to find out how much downside there could be to prices and kind of where you fit relative to that downside on the cost curve.

Dale is going to have a comment on this, but I'm going to -- I can't resist. I've got an opinion. I think you got to think about it in terms of 2 markets, Ben. In the wellsite business, especially in West Texas, you've got a very dense -- you've got a very dense customer base with high demand and a lot of capability, both on the vendor and the supplier side. So that's one microcosm, if you will. And then when you factor in what's the complexity of the job, what's the distance that is required to be traveled, what's the volume and in which geography, that's when the economics really change because this is like an airline business, and it's not obviously fully saturated the way the convenience store business is where there's one in every corner.

So the more you -- the bigger your fleet and the better your utilization, lower your cost base. And when you're starting with jobs big or small outside of West Texas, that's where we have a pretty strong advantage versus our competition because we've got the ability to handle complexity at a lower cost. We've got scale. And we can take on a small job in Florida because we've got other jobs to rationalize the fleet across in the same geography. So Dale, I'm going to something here, but maybe you'd like to.

The 2 other just things to think about, Ben, that we observed in 2025. Prior to that, 2023 and 2024, many companies were adding trailers to the fleet. And so some of the market pricing is going to be determined by supply of trailers versus demand for trailers, right? And we did not see that trend continue. There were not people adding trailers to the fleet in 2025. And so that's kind of a good sort of early indicator of sort of supply, we're now kind of in a window where demand can kind of catch up to supply.

And we have had a couple of small cases where people that were supplying mobile CNG exited basins either to shrink their footprint or to pursue other opportunities. And so those are both early indicators that the supply that we're in a situation where demand can catch up to supply. And some of these mobile power opportunities and getting energy to people in industrial markets are going to further help increase the demand and allow that to improve the market pricing levels as that equipment goes to serve that marketplace.

And then just quickly, have prices fallen to the point where some high-cost guys have exited the market? Or I guess they just don't participate in that particular contract. Is that right?

What we've seen is more local decisions to shrink footprint. So we haven't seen anybody exit the market entirely. What we've seen is maybe they were servicing a geographic area, now they're servicing fewer or a smaller geographic area.

And then just to flip to the Investor Day, the $1 to $1.10 target, is that pushed back? Or is that now off the table?

And just to be clear, are you talking Superior Delivers? Or what specifically?

I'm sorry, you had a target of USD 1 to USD 1.10 of free cash flow. I think that was the goal in '27 overall, I think, company-wide. And so the question is, is that target -- is that free cash flow target kind of set back? Or do you think that needs to be revisited?

Yes, certainly set back. I don't think we're going to get that specific about when exactly that free cash flow target would be, but yes, definitely pushed back. Like as we said, there's -- there are some differences here with the environment that we're operating in, in CNG. And of course, that's had some impact. That may turn, but our assumptions are that let's assume that this is the environment that we've got and this is what we're operating that's reflective of that. So that has an impact.

If that were to change, then it gets you a lot closer to that number or if not, then yes, it's going to take you quite a lot longer on the CNG side. Superior Delivers, I think we've been pretty clear that's just going to take a year longer, still $75 million. So that's pretty much intact. And then the third big factor is just like the longer it takes to kind of have the business, the platform or the foundation fully intact to go after new customer growth.

That's, again, delayed by about a year. And so there's kind of an impact on the overall customer growth. So I'd say, yes, that's a delay. To give you the exact numbers and when that cash flow target exactly would occur is pretty difficult for me to do, but hopefully, that is somewhat helpful.

Our next question comes from the line of Gary Ho from Desjardins.

Just wanted to dig into -- continuing with the Certarus discussions a bit, something that came up from your press release and comments this morning. So 2 things. First, I think you noted 2 new data center contracts. Was there a new one that was just one and how many MSUs are expected to deploy there and the duration? And then second, I think Grier, you mentioned the ancillary revenues from a utilities contract in your prepared remarks. Correct me if I'm wrong, I think that's the U.S. Northeast customer. Maybe can you elaborate on that a little bit more? And if I remember correctly, that contract goes from late fall into the winter. So will some of that negative impact flow through to 2027 as well?

Yes, I'll start. Thanks for the question, Gary. We're pretty enthused about early inning progress with the data center. I want to give our team a lot of credit for operating 100% safely and 100% reliably for our new customers in those segments as we've mobilized and helped bring them an energy solution that's really valuable for their business. We currently have -- the jobs are scaling up. And so there were 2 new that started in the fourth quarter, and those are approximately 30 to -- we'll probably get to close to 40 trailers for those 2 jobs.

And, yes, Gary, so on the second part of your question, just the ancillary revenue, yes, you're right. That's referring to the customer, the Northeast kind of utility customer. The way that I would think about it is we had several contracts with this customer. They got a number of sites, and we had a number of sites. And through this winter, we have fewer sites. And so the business actually from that customer right now is not nearly as large as what it was in previous winters.

And so the exposure, I guess, if we think about it this way, the exposure going forward for the kind of 2026, 2027 winter, if you will, I'd say is not that great because we have much less exposure to that customer today through this winter. And that's part of the impact that you're seeing to the Certarus numbers through Q4 and what we indicated would happen kind of Q1 of 2026. That's reflecting a big chunk of that business, well over half, actually, I'd say, of the business that's already out.

And so that's reflected in those numbers. So yes, the future potential. Now look -- and Dale can speak more to this. We'll continue to be competitive and participate in ongoing bids to keep business with what's a great customer and a great relationship that we've got. But the exposure certainly is not nearly what it was a year ago.

Yes. What's interesting, Gary -- what's interesting about that is we were talking about this yesterday, the dynamic nature of the contracts at Certarus means your contracts are almost always at market price because they tend to be short term in nature. When you have utility contracts that are multiyear, they're reflecting -- the impact of pricing changes over the course of that contract happen all at once. So some of that -- and of course, if you renew the contract, the pricing implications still happen all at once, but you go into a new contract at a lower price.

So part of what you're seeing in the Northeast is really moving to more market pricing. The second thing is our MSUs are overutilized right now. We've got every MSU that we own in production right now, along with some rentals. So it's not like this created debt capacity for us. It was really just more normalization of pricing in my mind. Having said that, a good customer, and we'll continue to work with them with every opportunity.

So I just want to put a finer point. So that the negative impact from that customer would be fully reflected in your '26 numbers?

Sorry, yes, I kind of whispered that, but yes.

Okay. Great. And then, Grier, maybe just on the revised buyback assumption, USD 50 million to USD 100 million and your 3.5x leverage target for 2027. Can you maybe walk me through how the Brookfield preps gets modeled into those numbers? The lower buyback still wouldn't get you to the full USD 260 million. So are you thinking of repaying the rest of that with incremental debt? I just want to pick your brain on that.

Yes. So a few things here. And if I don't answer what you're asking, just ask again. But the numbers we've assumed, so when you look at that 3.8x target and the -- that's assuming that we would shift, that's the lower end of the buyback range. So if you say like we will buy back $50 million to $100 million. If we buy back $50 million, that's how you get to the 3.8x. And then getting out to the 3.5x would assume that you continue to be shifted to debt reduction. There's various refinancing alternatives.

But if the thinking is if we could partially refinance this through rediverted share repurchases and ultimately, the extra liquidity will come from all likelihood, a public bond and the rates obviously are quite attractive, as you know. And so that's kind of probably the refinancing plan. A couple of things I'll say, though. Look, we have been buying back stock this year, and we are going to continue to buy back stock for the foreseeable future. That I just want to make clear.

We still think that this is an excellent use of capital. And really, this is an intention to add flexibility to shift to debt reduction in half 2 as our leverage is a priority. And we've been, I think, very consistent on that. The factors that will kind of dictate what we do will be cash flow EBITDA based, obviously, and we'll look at the share price and likelihood of redemption, those will be kind of the considerations. And then lastly, I just want to reiterate the point that while this is obviously a -- is important from a debt reduction standpoint, this preferred share instrument, we could keep in and it's got step-ups in coupon and other features.

This is an equity -- it has an equity component to it, right? And so our view is that if we're in a position to redeem this, that you're removing this potential for dilution of 30 million shares, which is like 12%, 13% of the equity. And so while it would be in one way, may be viewed as a shift from buyback to debt reduction, the intention here would be to shift to redeem an instrument that has equity in it. And you could very much view that as share repurchase as well as well as making sure that the leverage component is under control, which, as I said, is an important piece of this. So I just wanted to make sure that's clear.

Our next question comes from the line of Daryl Young from Stifel.

I wanted to talk a little bit about the propane business and the guide for 2026. If you strip out the incremental Superior Delivers contribution, it implies negative organic growth of sort of 3% to 5%. So I just wanted to get a sense of, is that a function of customers that would have left your platform last year because I know there's a big lag dynamic there? Or is that a function of customers that you expect to leave because of some of the challenges that have been incurred this winter? Any color there would be great.

Daryl, it's Allan. To be honest, it's a combination of both, primarily the first. We're not that bearish on churn going into 2026. But from the outset, we had built Superior Delivers in 2 stages. The first was getting the operational optimization done and dusted, which is, of course, delivery optimization and it's our wholesale network optimization and things like that. And then the second piece was frankly, a little more complex, and that's how do you manage churn in the propane space, which is very difficult to see.

As you well know, there's big lag times, and there's not a lot of predictive indicators. And then customer acquisition has been a challenge for us and a lot of majors because of the history of growth through margin expansion. So the good news is we're obviously well down the road on the first piece. On the second piece, we are starting to put tools in place or we've got tools put in place for predictive modeling on managing customer retention. We've developed marketing programs that are having a much higher success rate in customer saves, if you will, when we identify customers that are at risk of churn.

And we've got -- we're making good progress on a higher conversion rate of sales leads. So that's all really encouraging. It's harder for that to make a material impact when you're talking about quarter-over-quarter or even year-over-year because you don't get the full run rate benefit, obviously, of a new customer acquired in a given financial period. So we've always been of the mindset that, first, get the operational optimization under place and then second, start to build that commercial capability. So you're really just seeing -- I don't want to use the word delay, but we're still doing that in succession, but the extra work that was required on the first piece just means that the second piece is going to come in a little later. So that's probably the long and the short there, I think.

Okay. So it sounds like then as it relates to the $75 million of upside from Superior Delivers, you still feel confident and you're seeing regional examples of how the customer acquisition model can work, and that's what gives you the confidence to keep the $75 million target?

That's right. Absolutely, we are.

Our next question comes from the line of Nelson Ng from RBC Capital Markets.

So my first question just relates to propane. I wanted to better understand the tank inventory situation. So I think, Allan, you mentioned that you entered into Q4 with lower inventory than you'd hoped for. And then you ended Q4 with, I guess, low customer in tank inventory. Due to the cold weather in Q1, do you also expect -- has inventory continued to decline as you face some, I guess, delivery issues. And I know that you flagged earlier that you expanded your driver base to like help with the situation. But can you just talk about the in-tank inventory and when that would normalize? Like are we looking at March or sometime in the spring?

Yes. Nelson, Sure. Yes. Well, as we said, we went in with the launch of version 1 of our delivery optimization tool that caused us to go into Q4 with lower in-tank inventories than we traditionally would. Q4 and Q1 are really interesting because Q4 starts low in terms of demand and ends high. So you're ramping up. Q1 is the opposite. It starts high and you ramp down. So going into Q4 with a bit of a backlog, you've got demand coming. So you get that double whammy.

We've managed to obviously sustain our capacity through December and January. And as winter starts to look a little bit more like spring, it gives us the opportunity to recover some of that -- well, some or all of the in-tank inventory levels. In other words, to get the customers to the level that we think is optimal. So you got to remember, too, when we sit here in Toronto, sometimes you forget that we operate in everywhere from Southern U.S. to northern parts of Canada. So spring doesn't come in March and April in every part.

We're well into it in some parts of the U.S., and that's exactly what we're seeing is we're using that continued capacity that we've had through December and January to get our tank levels to where we want them to be. So it's my expectation that -- said simply, yes, we had a tank inventory challenge that complicated the winter. We maintained service through that. And coming out into the spring, you're going to see tank inventories normalize to where we think they should be.

And Nelson, maybe I'll just -- it's Grier. I'll tack on a little bit here. It is a bit tricky to estimate exactly when that's going to happen, like as you can probably appreciate, if you had a really cold January, February, March, pretty tricky to catch up inventory in March. If you had a cold January and a cold February and a warmer March, obviously, makes it a little bit easier to catch up the inventory levels. And so some of this is a little bit difficult to predict and will be somewhat predicated on what kind of weather you get, if that makes sense.

Yes. So does that mean we should generally see like with the cold weather we've seen to date, that volumes in the first half of this year should be looking pretty good as you push inventory back up? And then I just want to just clarify, given the -- some of the delivery challenges, have you been -- is that -- if that was a benefit, like is a lot of that benefit offset by maybe it's like paying overtime wages and things like that to meet customer demand?

Well, one of the important things to remember is we don't have unlimited capacity. So when you get to a point where it's so cold that you have opportunities outside your normal customer bank, customer-owned tanks or we'll call customers that deal with multiple companies, you don't have an unlimited supply to be able to capitalize on every opportunity in the market. So -- and I said otherwise, no matter how cold it is, we only have a finite delivery capacity, and that's dedicated to keeping our current customers fueled. In terms of -- sorry, the second part of your question was coming out of the volumes with getting tank inventories back?

Yes. Like are you seeing a benefit from moving inventories back up and have you been paying overtime wages? And are you going to see elevated costs in Q1, which might offset that benefit?

Yes. So I'm going to ask Grier to comment. The only thing I would say is our -- there's 2 kind of variables, our capacity and the customers' propensity to take deliveries. And the customers' propensity to take deliveries going into a warm season is not universally 100%. So we're going to be -- we have the capacity, and we're putting incentives in place to make sure that our customers are receptive to refills going into the lower season. But Grier will offer some comments with the cost piece.

Yes. So Nelson, what I would say is that when -- so when we're running at kind of full capacity and you push on overtime, yes, the overtime rate is a little bit higher. But you could still make really good economics on the delivery. If you draw also from what we would call like service or service staff who might be whatever, installing tanks, doing like regulatory work, if there are things that are movable, some are movable, some are not. But if some of these things are movable, I would view it as a delay.

So if you had service-related revenue where you've moved service people to delivery, you may not get that revenue in that quarter, but it wouldn't be necessarily lost. It would be delayed. And I think we talked about at third quarter, we kind of thought there was roughly $5 million, and we kind of thought it would be hard to get that back. The reason for that is we thought going into the fourth quarter, it's pretty difficult to get that back because you're getting busier. So for you to recoup that, it's pretty tricky.

The way I would think about the backlog is that, yes, the inventory levels are a little bit lower. We think we will get that back in 2026. As it sat kind of at end of third quarter last year, it wasn't a huge number, call it, maybe $5 million. That's a bigger number at the end of the year. If I said it's $10 million to $15 million, you're probably in the ballpark. As we ran into January, yes, January, you're right, was cold. Inventory levels, we've certainly not been able to gain ground on that. So like leaving the month of January, that number is probably even a little bit larger than that.

So do we think we'll get all that back? I think we'll get most of it back. And the reason is that even though they're using overtime, as I said, you can still make margin, maybe not quite as good, but pretty good. And the service revenue, it would just maybe come later in the year, right? So things that are as I say, nonemergency type service things, you do them a bit later. And so that revenue that you might have got from service through those people in February, you're using those people to help keep tank levels up and keep customers happy.

And those people can then do that service stuff that's noncritical in April, say, or May. And so you get that revenue within the year. It's much easier to see it like when you have a busy season and then going through the shoulder where you can catch up on some of the stuff and get that back, whereas in third quarter, that dynamic wasn't available, and that's why we kind of thought it would be tricky to get that $5 million back after third quarter. I said a lot of stuff there, but hopefully, that is somewhat helpful.

Yes, that's very helpful. And then just moving to Certarus. I had a few questions there. So I think, Dale, you mentioned that pricing kind of bottomed out in Q3 for MSUs and it's been pretty flat since then. But can you just talk about -- and that -- I think that was at the wellsite, but can you just talk about like MSU pricing outside of the wellsite? Because I presume like there's no longer any supply constraints to MSUs. So are the competitors out there like reducing pricing on areas outside of the wellhead?

Yes. It matters the most for us in the wellsite just because on a volume basis, wellsite is still 80%. But the oversupply of sort of the market sort of growing into the demand for the supply of trailers obviously does impact pricing in other segments. But it's been most severe on the wellsite, and that's been the big impact kind of in our financials and in our outlook.

Okay. And then I was just doing some rough math. And are you adding roughly 20 MSUs at Certarus this year? Is that the plan? And also, like are you seeing a big decline in the cost of purchasing MSUs?

Certainly, so the 23 MSUs to be added have been added. As Allan mentioned, our utilization through kind of winter demand, we were 100% utilized and we were renting trailers. And so we decided the trailers were most valuable to us to go ahead and bring those in. And so those were brought in. And yes, good news. I mean, as part of our overall kind of cost savings initiatives and capital efficiency initiatives, we were able to achieve meaningful reductions versus last price paid on the acquisition of that equipment.

Got it. And then just one last question for Grier. Just on the preferred shares, I think, obviously, you have the option to redeem the preferred shares, I think, starting in July of next year. So if -- I guess if your forecast -- your financial forecast doesn't turn out or if there's downside to your numbers, I guess this is an option at the end of the day, right? So you could potentially just delay the redemption. Can you just talk about that like optionality? Like your base case is probably to redeem the prefs, but it's -- you obviously have the optionality to let the coupon increase and redeem it at a later date, right?

Yes, you're right. There's a few options here. The base thinking is that, yes, we -- if we got to a scenario, and you're right, it's mid-2027, where if the equity price wasn't high enough such that the holder of the instrument was going to convert to equity that we would likely redeem it. The most likely source of that would be a combination of building up some extra cash as we talked about from shifting of the capital allocation strategy, but also high-yield bond, which would have a coupon lower than that. But that's one option. That's kind of the main line of thinking.

We would have -- we don't need to redeem, you're right. And so if the holder of the instrument doesn't convert to equity, there's 2 things we can do. One is redeem the other, you're right, we can leave the instrument in place. Currently, the coupon on it 7.25%, there are step-ups. I can't remember exactly how the step-ups work, but 7.25% goes to 7.75% and this kind of thing. And so it's not the most favorable coupon. But certainly, we do have the option to keep that around at those stepped-up coupons, and we can send you the detail on what those are.

I'm not sure if it's public, it might actually be public, but we can easily send you those. And then, of course, there would be -- depending on how you're trying to manage your debt and your rating agency equation, there's obviously like views that it's equity or part equity or whatever. So that is definitely an alternative that we have in front of us, not kind of the baseline thinking, but you're right, that would be something that we have at our disposal.

Our next question comes from the line of Patrick Kenny from National Bank.

Maybe just to continue on with the conversation on the prefs there, Grier. So you mentioned the likely refi with public debt. But just given the time you have between now and then, just wondering if you might be contemplating an asset sale program of similar size just to help shore up the liquidity position ahead of next summer or any other sources of funds that might help mitigate your exposure to the credit markets over the next year or so?

Pat, it's Grier. I don't -- I think that that's -- other than -- so I would say, as part of Superior Delivers, we have been kind of coming through and making sure that we don't have obviously excess assets. A decent example would be if you've got 2 bulk plants that through acquisition, we acquired and they're right next to one another. Obviously, those have been easy ones. And you see those kind of showing up in the proceeds. But meaningful businesses or geographies, that is not high on the list of things for us.

We think there's way more inherent value in keeping these businesses and running them better and driving more value out of them. And so the base thinking is that no, that would not be a focus for us other than what we would kind of call extra things like extraneous or surplus infrastructure that we've got, which a lot of that we've been through already. So no, that's not the base line of thinking.

I think, obviously, like there's a price for everything if there was some asset that attracted a bid that was too hard to refuse, obviously, we're always open. But I think we're not out looking to divest assets. We think that this company is probably better if it's bigger. It's better if it has more density. It's better if it's a bigger business. And so the baseline, I think, is not to get smaller.

Got it. And then just maybe to double-click on the buybacks versus debt repayment decision here over the medium term. So you touched on it, but can you just clarify your thought process here in terms of what the key macro or micro gating items might be over the next couple of quarters as you decide which path to take for 2026?

Yes, for sure. So as I say, I think like we've been buying back this year, we'll continue to buy back for the foreseeable future. This range we put out there really was to try to talk about what might happen in the second half. That would be kind of the timing like if we were to shift, we really would -- we wouldn't get at it at least until kind of halfway through the year.

What would be the considerations? It's going to -- it will be based on the winter cash flow that we're generating EBITDA as that becomes clearer for us, that will be a factor. And then, of course, the likelihood of redemption. So what happens to the share price will be an input. So those will kind of be what we'll look at. As I say, I think that we view the -- as I said earlier, we view these as -- if there is a redemption of preferred share, they're like -- it is a low delta call option in it right now, but it is equity and it has an equity element to it.

And so even if we were to shift, I think it's important that we view that as an equity-friendly or shareholder-friendly shift. And it is, as I say, like a synthetic or has similar elements of maybe I would say as a buyback. But anyway, that's kind of the way we're thinking about it. As I say, it would be -- it's watching the cash flow, watching the EBITDA, watching the share price and those really are the inputs, but we're not going to do anything probably until at least halfway through the year.

Our next question comes from the line of Robert Catellier from CIBC Capital Markets.

I just wanted to see if you could clarify what the key issues are on the reduced delivery capacity in the propane business. And more importantly, just confirm that the solutions and time lines required to resolve these issues have been identified.

Rob, yes, you know what, it's obviously been a challenging winter, but I don't think that it's necessarily the delivery capacity. I think it was a combination of us creating some headwinds for ourselves with in-tank inventories and coupled with what was a very, very unusual winter from a weather standpoint. So my confidence level in terms of our being able to meet demand, first of all, is very high going forward.

But secondly, coupled with that, we want to drive even really see those optimization savings coming through. So we're able to not only meet the demand of the customers, but also do it in a much more efficient way than we've done in the past. So a bit of a perfect storm coming through this winter. Some of it self-inflicted, unfortunately. But I don't see this as a trend, and it's not something I'm concerned about repeating.

So you think just the fullness of time and straightening out the inventory levels is going to resolve the challenges you've experienced?

Yes. Yes, 100%. I think where we to handle this -- have the same weather pattern next year, our positioning to be able to not only satisfy the requirements of our customers, but do it in a very efficient way, I think it would be dramatically higher.

Okay. And just turning to Certarus here. I'm wondering if you have a view on what has to happen to see more well site activity for Certarus in your opinion? Is it the oil price level or some other risk factor customers are dealing with, generally speaking?

Well, I mean, wellsite activity, volumes are very good. I mean we had record volumes in the fourth quarter. Certainly, we're in a lower oil price environment than where we were a year ago. And so -- but that's actually had more of an impact kind of on pricing than it has had on kind of overall activity. I visited with several customers to start the year. I would say, Rob, the median of those conversations, I mean, this is from all across North America is customers have spending plans somewhere between down low single digits to flat. So the range is larger than that.

Some are planning to have increased spending, some less than down low single digits. But kind of down low single digits to flat is the range with oil prices kind of in this mid-60s price environment. And so we continue to stay focused on offering the best value proposition to those customers. They care a lot about safety. They care a lot about reliability and between reducing our costs to be efficient and be competitive.

We feel good about our position. And then I think for sure, commodity prices would be the thing that could change the trajectory of those spending plans as the industry kind of works its way through cycles. And certainly, 2025 was a downward trajectory on that cycle. And for 2026, we haven't planned an inflection. We're planning to kind of compete in market conditions as they are. And certainly, we'll be encouraged as the cycle begins to turn.

What's interesting about that, too, Dale, and Rob, is -- the growth in our renewables and industrial business means as the biggest player in the market, we're not flooding West Texas with excess capacity. So that shift in strategy and the work that Dale has done has been a godsend because in some weeks, we're actually taking trailers out of West Texas, which is alleviating some pricing pressure. But certainly, that's caused us to not have to rely on the sort of traditional originating vertical and be contributing to oversupply.

So we're -- that's one of the reasons we're staying the course. And one of the reasons that we're optimistic that a recovery is going to be beneficial because we've got other options that are actually serving us really well. And the work that Dale has done on the operating leverage means that sort of pricing recovery goes right to the bottom line. So all that to say, yes, it's going to be activity for sure. But it's worth noting that we're also not contributing to an oversupply in that market right now.

At this time, I would now like to turn the conference back over to Allan MacDonald, President and CEO, for closing remarks.

Well, thank you very much for joining, everyone. It's good to talk to you all. We appreciate your questions, and we look forward to speaking to you in May. Thanks very much.

This concludes today's conference call. Thank you for participating. You may now disconnect.

Good day, and thank you for standing by. Welcome to the Superior Plus 2025 Third Quarter Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to turn the conference over to your first speaker today, Chris Lichtenheldt, Vice President of Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and welcome to Superior Plus conference call and webcast to review our 2025 third quarter results. On the call today, we have Allan MacDonald, President and CEO; Grier Colter, Executive Vice President and Chief Financial Officer; and Dale Winger, President of Certarus.

For this morning's call, Allan and Grier will begin with their prepared remarks, and then we'll open the call for questions. Listeners are reminded that some of the comments made today may be forward-looking in nature and information provided may refer to non-GAAP measures. Please refer to our continuous disclosure documents available on SEDAR+ and our website.

The dollar amounts discussed on today's call are expressed in U.S. dollars unless otherwise noted.

I'll now turn the call over to Allan.

Thanks, Chris. Good morning, everyone. Welcome to our Q3 call. Now my opening comments may surprise some of you, but let me start by saying I'm incredibly pleased with how far Superior has come in just 2 quarters. Changing an organization, in fact, reinventing an organization is very difficult. I'm pleased to say, at Superior, our reinvention is very much in progress. We've made permanent moves and abandoned old operating models, structures and tactics, which had us focused on surviving instead of thriving.

Now transformation isn't linear, and it's regrettable that our impressive progress isn't apparent in our Q3 results, but that has not dissuaded us in any way or tempted us to change course. Superior Delivers is a generational reinvention of our company, and I couldn't be more proud of what the team has accomplished so far.

At our Investor Day in April, we shared a plan to transform Superior's Propane business through 2027. We outlined our goal to serve our customers better by operating safely, never running people out of gas, delivering fuel at competitive prices in every market we serve, acquiring more customers and keeping them longer and using modern technology such as AI to better manage our business, predict trends and deliver more efficiently to our customers.

As we discussed at that time, this transformation would impact all areas of operations from our assets and locations to our distribution capabilities, pricing and organizational structure. An ambitious effort, yes, but the team here at Superior has remained committed to our goal, and as a result, we've changed the way we operate more in the past 2 quarters than the past 2 decades.

As of Q3, I can proudly tell you that we've changed how we deliver fuel, manage churn, set our prices, and we've restructured the organization. We've centralized functions and introduced advanced tools that allow us to operate more efficiently. We've restructured our teams and reduced headcount to remove duplication in the U.S. and Canada, and created key centers of excellence in pricing, marketing, distribution and service, to name just a few. And in keeping with our recognition that leadership is a key enabler of our future, we announced our new Chief Commercial Officer, Deena LaMarque Piquion, who joined on November 3. Deena most recently served as Chief Growth and Disruption Officer at Xerox. With more than 20 years of global leadership experience in marketing and operations, she shares our bold vision and recognizes the potential at Superior. I'd like to formally welcome Deena, who is here with us today as she takes on the challenge of advancing our commercial strategy and growth initiatives.

One of our biggest initiatives over the past 2 quarters was the introduction of a completely new distribution model, which moved us from local ad hoc scheduling using rudimentary tools to a single, optimized distribution approach based on AI-driven algorithms. We're now employing a company-wide tool, which has the ability to create tens of millions of potential routing combinations per day, allowing us to plan better routes, avoid low-fill volumes, predict customer consumption and ultimately deliver more fuel with fewer trucks and fewer miles driven. No small feat, especially in such a short period of time, and such change inevitably comes with some challenges, especially when we were restructuring the company at the same time.

But our team saw the bigger picture and took on this challenge, determined to build a new Superior, and I'm incredibly proud of their efforts. But as you'd expect, with change initiatives of this magnitude, not everything goes perfectly. We've had our share of missteps and have learned some valuable lessons along the way.

For example, as we sought to optimize Propane Deliveries, we had a period of several weeks where we avoided inefficient fills while still working through the rationalization of our fleet. This meant some underutilized capacity and deferred volumes. While not ideal, as it would impact our quarterly results, we stayed the course because it was the right thing to do for the long-term success of the organization.

These changes aren't about chasing short-term wins, they're about building a resilient, data-driven and customer-centric business that delivers sustainable shareholder value. It's a foundational shift. And while complex, we're confident the benefits will be enduring.

Before we dive into the numbers for Q3, I'll connect our transformation story to our current performance in propane. The changes we've made are starting to show up in how we operate. As I've stated, a key focus within Superior Deliveries has been improving delivery efficiency, specifically, increasing volume per delivery and decrease in reducing frequency. To achieve this, we deferred many deliveries that would typically occur in Q2 and Q3 to optimize efficiency for our upcoming peak season. Now part way through Q4, volumes are increasing in line with expectations. And while our business is well positioned to benefit from improved efficiency going forward, we likely won't recoup all of these deferred profits during 2025.

We appreciate that it's difficult to see these operational achievements based solely on our financial disclosures. So I'd like to share a few key performance indicators that demonstrate our progress. First, within our customer growth initiatives, so far in the fourth quarter, we are seeing more than a 300-basis-point improvement in the percentage of sales leads that we convert to new customers as our improved engagement and competitive pricing are gaining traction.

Second, within our cost to serve initiatives, we're also seeing a 5% improvement in the number of labor hours incurred per 1,000 gallons of propane delivered. Third, as I mentioned, we're seeing improvements in our fill rates as our new approach to scheduling deliveries is increasing the number of gallons delivered per stop, setting us up to benefit from a more efficient and cost-effective structure in the future, which will ultimately benefit the customers and the markets we serve.

Of course, there's still more work ahead of us. For example, in customer growth, we're now working to increase our total sales leads to capitalize on this improved conversion. With churn, our prediction tools are gaining traction, but customer attrition is inherently lagged. So it will take some time until the benefits of our new programs are fully realized. For cost to serve, while efficiency is improving, we continue to refine our models across our single North American delivery platform.

Finally, as noted in our press release, we reduced our non-field workforce by 12% during the quarter as part of Superior Delivers, realigning to 1 North American propane business. These changes resulted in some onetime costs, but will drive further benefit to our organization in the long run.

While the impact of transformative change takes time to become visible in financial results, especially with a seasonal weather-dependent business, we are on track. I am incredibly proud of this team. We're staying the course and not reverting to the sins of the past, pulling forward deliveries or raising margins to meet short-term pressures at the expense of the future.

Turning now to Certarus, our CNG business. Q3 reflected a challenging pricing environment with EBITDA declining relative to last year. Well site business activity remains subdued, and we recognize that the timing of a recovery remains uncertain. But Dale and the Certarus team have done an incredible job managing some very significant headwinds. Rather than speculate on market shifts, our focus is firmly on what we can control, driving cost efficiency, maintaining our market share, advancing opportunities in new markets and allocating capital with discipline. Despite these pricing challenges, we've maintained EBITDA Margins over 25%. We've reduced operating costs per MMBtu by approximately 5%, and we've increased free cash flow with our disciplined capital investments.

Certarus remains very profitable, and we're using this period of adversity to push ourselves so we exit the cycle stronger and more competitive. In September, we mobilized equipment for a data center project with a major hyperscale operator. Early commissioning of power generation equipment began on schedule, typically at a rate of 1 or 2 trailers per day. We are now ready and expect regular flows to commence later in Q4. This project highlights the unique capabilities of our team, including end-to-end project management and the flexibility of our equipment platform, notably, our ability to deploy dozens of mobile compression trailers with just a few weeks' notice.

In addition, we were awarded a standby supply for a second data center in a separate region and successfully mobilized in October. We also continue to expand our network. This quarter, we executed site and gas supply agreements for a new hub location in Florida, which is expected to be fully operational before year-end. Deliveries to our first customer have already begun, and we have opportunities with utility, pipeline and other industrial applications in the region.

In Houston, we've executed a letter of intent for a new hub site and are completing diligence and expect to have that location up and running in the first half of 2026.

Our commercial strategy for Certarus is delivering results. We remain disciplined in our capital allocation and confident in our ability to deliver sustainable value regardless of the pace of recovery in well site activity.

Industrial revenues were up 24% year-over-year, and renewable revenues grew 42%, reflecting the strength of our value proposition and Certarus' strategy to drive growth in these markets. Now despite the progress we've made this year, the pricing headwinds we faced within CNG, combined with additional costs associated with our new delivery technology and a wholesale supply disruption related to a refinery fire in California have caused us to lower our expectations for 2025.

However, nothing fundamental has changed in our business, and we remain well positioned to deliver our long-term goals for the company. As I've said, transformation isn't linear. In closing, I want to leave you with a few thoughts. Success depends on having the right people in the right roles, engaged, focused and energized. Our teams are embracing this challenge and leaning into change with a commitment to excellence. We're undertaking something truly complex at Superior.

Transforming a business model that's been in place for decades is no small task. It requires bold decisions and disciplined execution. The changes we've made are permanent. They're impacting our business positively and they will benefit us for years to come.

And finally, I'd like to thank our teams across North America who are helping us get there. Your resilience and dedication are the foundation of our progress and the reason we're so confident about the road ahead. Thanks very much. And with that, I'll pass things over to Grier.

Thanks, Allan, and good morning. I'll start by recapping our consolidated financial results for the first 9 months and the third quarter specifically. Year-to-date adjusted EBITDA was up 2% due to modestly higher adjusted EBITDA from U.S. and Canadian propane, partially offset by a small decline in CNG. Q3 adjusted EBITDA of $7.6 million decreased $9.8 million compared to Q3 2024, driven by lower volumes in U.S. propane and pricing pressure in CNG, partially offset by a $1.2 million reduction in corporate operating costs.

Year-to-date adjusted EBITDA per share of $0.91 increased by 15% due mainly to higher adjusted EBITDA, lower interest costs and a 7% decline in the diluted weighted average shares outstanding.

Adjusted net earnings per share of $0.04 increased by $0.11, and free cash flow per share of $0.51 tripled for the same reasons, with lower capital expenditures also contributing to free cash flow growth.

For Q3, adjusted EBITDA per share of negative $0.05 decreased $0.02 because of lower adjusted EBITDA from our propane and CNG operations, partially offset by lower interest costs.

Adjusted net loss per share of $0.41 was down $0.05 from last year due primarily to lower adjusted EBITDA. Free cash flow per share of negative $0.32 decreased by $0.03, driven by lower adjusted EBITDA and partially offset by reductions in CapEx and interest expense.

Third quarter is typically the lowest free cash flow quarter of the year due to seasonality in propane and in CNG. Turning now to the businesses. For the first 3 quarters of the year, adjusted EBITDA in our overall propane business increased 3% to $213.8 million, driven by strong volumes and favorable weather in Q1, followed by EBITDA declines in second and third quarters, as we had expected and we discussed on our last call.

Looking at the regions, in the first 3 quarters, adjusted EBITDA in our U.S. propane division increased by $4.0 million or 3% from higher volumes in Q1. In the third quarter, U.S. propane adjusted EBITDA was down $6.1 million from last year. The decline was driven by lower retail sales volumes as customer in-tank inventory levels continue to decline. We anticipate replenishing these volumes during the fourth quarter. However, doing so will bring added costs, which have been reflected in our revised guidance for Superior Delivers.

The U.S. propane business also continued to be affected by an outage at the Martinez Refinery in California, which also negatively impacted our margins. Canadian propane generated adjusted EBITDA of $64.2 million in the first 3 quarters, representing approximately 4% growth, primarily due to higher sales volumes benefiting from colder weather in Q1. In the third quarter, Canadian propane produced adjusted EBITDA of $2.5 million, a decrease of $0.3 million versus Q3 2024, primarily due to weaker economic activity and more competitive pricing within industrial and commercial sectors, particularly in Western Canada.

Like the second quarter, weather trends are not a factor in the third quarter as heating demand is essentially absent until colder weather returns in Q4. Our propane transformation, Superior Delivers, contributed $5 million to results in the first 9 months and is on track with our longer-term goals. However, Superior Delivers contribution to results in the third quarter was nominal after netting out the impact of declining customer and tank inventory levels. As I indicated, the reduction in inventory levels is temporary in nature and will normalize over time. This has caused us to lower our in-year forecast for Superior Deliveries from $20 million to between $10 million to $15 million.

During the quarter, we incurred approximately $20 million of restructuring and other costs related to Superior Delivers. The largest portion of this expense related to the 12% reduction in our non-field workforce that Allan had mentioned, resulting in one-time severance costs of approximately $11 million, and the balance of the costs are related to executing Superior Delivers, including third-party consulting costs. This workforce restructuring was not incorporated within our original Superior Delivers targets, and therefore, is incremental to the $10 million to $15 million of per year onetime cost we originally had expected.

Furthermore, we have increased our 2027 run-rate Superior Delivers target from $70 million to $75 million to reflect the incremental savings associated with this restructuring. Certarus adjusted EBITDA of approximately $108 million over the first 9 months was roughly in line with last year as increased activity in industrials and renewables, along with reduced operating costs were offset by lower prices in the well site business.

Notwithstanding these challenges, Certarus is making significant progress in several areas, including a 5% reduction in operating cost per MMBtu in the quarter and continued execution on its growth strategy in new markets. These achievements, coupled with our continued discipline on capital, drove significant free cash flow during the first 9 months of the year as EBITDA was stable while CapEx was down by more than $50 million compared with the same period last year.

We remain very focused on maximizing returns on our capital and positioning the business for long-term success. Third quarter adjusted EBITDA in CNG was down $4.6 million to $25.7 million, again, mainly driven by pricing pressure in the well site business.

Moving to guidance. As Allan mentioned, we are revising our 2025 expected adjusted EBITDA growth target from 8% down to 2%, driven primarily by lower well site pricing in CNG, the unexpected onetime costs associated with the implementation of our new delivery tools in propane and the temporary wholesale supply disruption.

Consolidated capital expenditures for the first 3 quarters were $76.7 million or approximately half of our full year CapEx guidance, largely due to the timing of receiving equipment in the propane business, but we continue to expect our CapEx to be approximately $150 million for the full year.

For the quarter and year-to-date, corporate operating costs were $6.6 million and $20.4 million, respectively, and were relatively in line with our expectations. Our leverage at the end of the third quarter was 3.9x, down slightly compared with the year ago quarter. We expect to finish the year with leverage around 4.0x, up from our initial target of 3.6x due to the downward revision of adjusted EBITDA as well as a stronger Canadian dollar, which has impacted our Canadian dollar debt.

We remain focused on reducing leverage and expect to achieve 3.0x by the end of 2027. We continue to believe that share repurchases are an excellent use of capital. During the quarter, we repurchased 1.8 million shares or approximately 1% of the outstanding common shares, below our run rate for the year as we ran through our NCIB. We have now repurchased over 10% of the company's equity and plan to renew our NCIB in the coming days, and plan to resume our repurchases in line with previously indicated plans of approximately CAD 135 million per year.

Despite some of the challenges we faced this year, we remain on track to deliver value to our shareholders through substantial growth in our per share metrics. While EBITDA growth forecasts for the year have moderated, we have maintained sharp focus on capital efficiency and have continued to benefit from what we believe is an exceptionally attractive share price by executing our repurchase program and maxing out our NCIB.

When factoring in our reduced share count, lower interest costs and growth in adjusted EBITDA, we expect 2025 EBITDA per share to grow by 15%. When adding this to our CapEx reductions, we expect free cash flow per share to grow by approximately 70% with 2024 -- compared with 2024. We continue to make progress in the transformation of our business and positioning the company for continued growth in the years ahead.

And with that, I will turn it back for Q&A.

[Operator Instructions] And our first question would be coming from Gary Ho of Desjardins Capital Markets.

Maybe just on the guidance change here. So I get the Certarus piece, which is due to softer pricing. But other reasons were kind of the onetime costs related to unexpected implementation of the new delivery technology. And then I think we already just mentioned the temporary wholesale supply disruption. Can you maybe elaborate on these 2 specifically? I would have thought kind of the onetime would be backed out of unusual costs. And also, are you able to kind of quantify each of these different components?

Gary, it's Grier. Let me take a shot at this, and maybe Allan will have some additional comments. So yes, we're looking at roughly a $30 million type adjustment. The vast majority of this or at least half of this is the Certarus. I think that's probably relatively clear. So just to be a little bit more helpful on the delivery tool technology. So if you think about this tool that we're implementing, it's obviously -- it's pretty sophisticated. It's got a lot of inputs like things we're trying to optimize and things we're trying to prioritize. So if you think of fill percentage on a tank, for example, it's a lot more efficient to go out and fill the tank 70% of the way versus 30% of the way. If you have more miles per 1,000 gallons, that's a bad thing. And so that's an input. There's capacity utilization, which is a circular thing, it's input. So I could go through this. There's a huge list of things that would impact your efficiency.

And as we fine-tune or calibrate the tool, what you're doing ultimately is kind of prioritizing or having what trumps what. It's very complicated. And so what we found in the third quarter is we didn't have it perfectly calibrated. As a result, some of the things that you might have prioritized were kind of not in the right priority and got more of a waiting. So we are really efficient in some categories and less efficient in other. Ultimately, what we did is we didn't utilize the capacity that we had, which probably should have had more weighting. And as a result, kind of had a lower in-tank inventory and lower margin. You could see it in the volumes as well in Q3, and that was largely due to the delivery tool calibration we are doing.

So you recalibrated in fourth quarter, we think we'll get the majority, if not all of this back in fourth quarter. So that's great. You get the margin back. The reason why the cost increase is because you're utilizing a much higher percentage of your labor capacity at that point. And obviously, demand for colder weather is also peaking up. And so you dip into overtime and some of the other categories of utilization of your labor force and that has a cost versus the capacity that you didn't use in Q3. And so that's -- so you'll kind of get back to the same inventory level, let's say, by the end of Q4. You'll get all that margin back. But as I say, the increase in the kind of cost per hour of labor is kind of where you lose that.

And we're not sure exactly what that will be. We've kind of said, hey, like maybe that will be $5 million, $6 million. And so that is the change in the estimate for Superior Delivers. So that's the second component. And then the third component, this is really in the base propane business is largely the Martinez issue, which so far this year has kind of cost us better part of $3 million, and we kind of think for the full year, it will be a $4-ish million type thing. So if you kind of -- and then there's maybe some other routes and miles there, but those are the main components. So hopefully, that helps you a little bit.

Yes. Can I -- Gary, it's Allan. This inventory question is a complicated one for sure. If I were to say it really plainly, as we went through Q3, we had -- we came out of Q3 with lower in-tank inventories at our customer premise. Now that meant fewer deliveries. We didn't lose those customers. We didn't lose that volume. We just didn't deliver it in Q3. And we'll regain that volume in Q4 and Q1. What we did do though is we incurred the cost of some latent capacity in our distribution network in Q3.

So when we talk about the cost, I mean, if you think about the volume, we'll recover the volume, we'll recover the gross margin that goes along with it. But we can't go back into Q3 and recoup the cost that we incurred for that excess capacity that we carried.

When you're making changes of this magnitude, as I said in my comments, while you're restructuring the organization, you're going to have lessons learned. And we're making changes to an organization. And because of the seasonality of our business, our window, our sort of, our go period to make changes in the company is actually really small. You can't make changes and you got to basically black out in Q4 and Q1. So that gives you 2 quarters to make changes. We -- a 3-, 4-week delay in these kind of initiatives is not unusual, but for us, it has an impact. And that's really all you're seeing here is just the variation of those tank levels. And -- but rest assured, we did not lose those customers. We did not lose that volume, and we'll recover it.

Allan, while I have you, you mentioned words like reinvention, transformation, et cetera, in your prepared remarks, hired a new CCO. Can you maybe talk about high level the culture change, what's been some of the challenges you faced and early successes you see internally? And I have noticed that several of these hires are outside the propane industry. So what's the trade-off between bringing perhaps a new perspective versus industry experience?

That's a really insightful question, Gary. The pre-work that we did for Superior Delivers really started with challenging convention. At its core, this is a business that's operated kind of in isolation. It hasn't really had a lot of external disruption. And I can tell you that we have -- the fundamental things you already know, we have low market share when you compare us to the entire addressable market, and our customers are incredibly profitable. Yet, we were working in a pretty dated operating model that was very local and very manual.

And you think where the benefit of scale was never really capitalized on. When you have a generation of employees that have worked in the propane business for 20, 25 years, trying to rally them to embrace the potential within this business is really hard because they know what they know, and they're really good at what they do. So I think the biggest first piece of the culture change was saying, look, if we start to look at the business a little bit differently, and we allow our colleagues to do complicated things like pricing once, do complicated things like route optimization once on behalf of the whole company, we can employ some really impressive tools that will get us some efficiency. That was a journey because that's like not dissimilar to all of you, that's a show-me story.

I can tell you that as we move through that, the shift that I've seen from anecdotes and legacy thinking to data-driven decision-making is pretty astonishing, really astonishing actually. And I can't give our team enough credit. And we've asked them to do all of these Superior Delivers initiatives when we were restructuring the organization and bringing all of these groups together to a single propane company. So in the disruption of having a new boss and having new responsibilities, we're also using new tools, and we're working in new geographies.

So I wasn't being in any way disingenuous when I said I'm incredibly impressed with the progress that we've made. In terms of strengthening the leadership team, there's a couple of things at play there. We're -- in the greater scheme of things, we're not the largest company. So we have to always balance talent that we're promoting from within, which is about 70% or 80% of the changes that we've made in the organization with introducing people from outside who have different experiences and skill sets.

Within the propane sector, you're unlikely to find someone who has a sophistication in AI-driven algorithms around customer engagement, or someone who's -- there's not a lot of people who've worked on optimizing customer experience with call centers and sort of other digital engagement technologies. So what we're trying to do is not only bring in fresh points of view and leadership talent that's got a fresh perspective, but also acquiring skills that aren't resident within the industry. That married to people with great depth of experience in the industry like Tommy and others, has really had a big -- very positive impact on the organization. So I hope I answered your question. I'm not -- it's probably a longer answer than you're looking for, but everything begins with culture, and we wouldn't be where we are if we hadn't seen a marked change in terms of our cultural engagement here.

And our next question will be coming from Daryl Young of Stifel.

I wanted to switch gears a little bit to Certarus and just get a sense of how you're thinking about the oil and gas exposure into 2026, maybe shifting of the fleet or maybe what you're seeing from a potential rationalization of the competitive landscape currently just given the oil and gas market seems like it's going to be weaker for a while?

Daryl, it's Allan. Let me offer a couple of strategic comments, and then I'll let the people that run the business actually talk. Dale is sitting here right next to me. The one thing I'll tell you about Certarus that I'm incredibly pleased with is Dale and his team are running this business so that they exit the cycle stronger and more competitive than they ever have before. And Dale and I were just talking before the call started. And sometimes, through periods of adversity, afterwards, you reflect on them and say they might have been a blessing in disguise.

The success that Dale and his team are having in expanding this business into new markets, into adjacent categories, I don't think would have happened if it weren't for the challenges in the oil sector. They've restructured the business, so it's much more competitive at lower price points, and that's opened up the opportunity to explore other markets and have them be really attractive.

So I can't say enough good things. This company is getting stronger and stronger through this last 12 months, and they're just -- they're on a great trajectory. I couldn't be more pleased. Having said that, obviously, there's a lot of questions about the oil sector and Dale, I'm sure he will share with you.

Daryl, as Allan said, we're extremely proud of the way the team is working to deliver for our customers safely and reliably while also improving our efficiencies and driving down our cost structure. And so as you probably know, just from an overall oil macro, which drives a lot of the North America activity, we were enjoying oil prices north of $70 in the first quarter of the year. I think recently, those have dipped below 60%. A lot of our customers have not provided a kind of spending forecast into 2026 yet. And so it's difficult for us to say exactly what to expect in that space. What we are -- many have talked about maintaining production or maintaining spending. And so we know that the blue chip folks are going to be in the best position to provide work.

And so we have a very account-focused strategy where we're using our capabilities, our experience, our fleet size, our hub network, our digital tools to be the best provider, to be the most reliable provider at a cost-effective price point. Of course, they're all interested in reducing their operating costs, and we're in a great position to help them do that.

And so as Allan mentioned, we've focused on our own procurement, and we focused on our own efficiencies to take advantage of the market circumstances to improve our competitive position. There hasn't been a lot of change in the sort of the competitive environment. We're still -- as you can see from the margin pressure, it still remains intense, and we're very focused on kind of building the capabilities and strengthening competitive advantage to maintain market share and be the best able to serve and whatever the competitive environment unfolds.

And then in terms of just the ERP route optimization tool, effectively, I guess, if I were to summarize it, has it led to an under or an incorrect fill rate that you're now playing catch-up and effectively paying overtime wages to execute? And I guess, is there a risk that customers are underfilled coming into the winter heating season that could result in more customer churn in the future?

Daryl, it's Allan. No, I wouldn't describe it as playing catch-up. We have some capacity, some sort of in-tank level that's slightly lower than it was last year. But the catch-up, in Grier's comments were how fast you sort of return to normal or more historical tank levels will be a factor of the winter that we face. If we -- we're going to do everything in our power, obviously, to make sure we don't run customers out of gas and put people in any kind of jeopardy and that's our first priority. And very much conversations we're having, as a matter of fact, as soon as this meeting ends to make sure that's not the case.

The speed of recovery that we have will depend on the winter that presents. If we have a fairly normal winter, we'll recover the lion's share of it. If we have a heavy winter like we did in Q1 of last year, some of that volume will get deferred to later in 2026. But make no mistake that making sure that customers' tank levels are sufficient to get them through their season of demand is really important.

The one thing I would sort of add to that is we've made a big shift away from -- we monitor customer tank levels, of course. But no two customers are the same. So in our vernacular, it's -- while that's an important metric, we've added to it days to empty because you can have 2 customers at 30%. One has 5 days to empty and one has 5 months to empty. So this is kind of a little bit of insight into the complexity of just how far we've come.

There will be customers that -- we're calculating every customer's days to empty and there'll be customers we're reacting to with a lot of urgency, and there are other customers that we know that we can fill on a regular basis when the routes -- when the capacity allows and when the routes are in their vicinity. So we're trying to be very, very calculating and mindful of how we sort of recover this volume gap.

And our next question will be coming from Nelson Ng of RBC Capital Markets.

So I think in some of the commentary, you talked about mitigating customer attrition by -- with price management. Can you just give a bit more color on that initiative given that, I think, it's one of the headwinds. Like are a lot of customers -- like will lot of customers require like a lower propane price or margin to retain them. And is it more on the retail side or in industrial side?

Nelson, good to talk to you. Well, there's a few things going on there. Number one, the biggest contribution that we've made to improving retention is not raising our prices, which we've historically done year-over-year, which our competition continues to do. So we haven't had any price increases sort of categorically in the last, 12, 18 months. So that's step number one. The impact that has on churn is it doesn't necessarily -- price increases agitate churn, so we've removed that, but it doesn't necessarily improve churn. So what we've done following up from that is, in centralizing our call center and customer experience group, we've now got a group that are completely dedicated to customers who are at risk of churn.

We've got some predictive models that were -- that are in place now that we continue to refine that predicts customers that are at risk, and we have interventions where we reach out to those customers and discuss issues, whether they be pricing-related issues or service-related issues, and we have some remedies in place to make sure we retain those customers.

We've implemented, in some instances, price match guarantees, where when customers are calling in and having been offered at a better price, depending on our new pricing models, which allow us on a per customer basis to be able to calculate our optimal return and our optimal pricing based on their distance, their volume, their density of the community they live in, we're able to be much more aggressive. All of these things are sort of single instance tools that you apply to each customer. And so we're getting much better at remediation.

Where I think the next stage in our evolution is doing that at scale and really tackling the churn opportunity that we have. I don't want -- what I said in my remarks was that these changes churn lags these changes. Often, customers are considering moving suppliers because of a price increase that happened maybe 12 months ago or a service incidence that happened 12 months ago because bear in mind that when we fill a tank, customers don't anticipate a change until they, for the most part, empty the tank. And if you're a seasonal customer, that could be 12 to 24 months.

So that was really the comment about the lag between these changes and the impact we have on churn. But I don't want to leave you with the impression that churn has in any way changed materially in the negative over the last year because that isn't the case.

And do you have any KPIs on churn and attrition? Or is that something more for -- given the lag, is that something you'll look to disclose at a later date?

Yes. It's something we'll look to disclose at a later date because I think one of the things we talked about historically was around the work that we've done, rationalizing our tank inventory in field, cleaning up old data sources that have inactive customers that, for all intents and purposes, haven't been a customer for years, but we're still included in our customer accounts, normal things you have when you grow through acquisitions. So getting that data up and getting reliable trending data and year-over-year comparative data is still a work in progress. We're getting there, but it's not completed yet. So it will be a while yet before we're able to share reliable churn data.

And then just switching gears to Certarus. Can you just talk about the market dynamics in the sector? I think previous commentary mentioned that there was like an ample supply of MSUs in the market, particularly for like Q2 and Q3. Can you just talk about how we'll utilize the fleet was in Q3? And was the reduction in EBITDA partly due to losing some market share? Or it's mainly reducing price to maintain market share?

Nelson, it's Dale. It would be the latter. So price reductions required to maintain a consistent market share. The utilization of trailers was very similar to second quarter. So the fleet was not fully utilized in the third quarter. So we have trailers we can put to work. And as you know, the seasonal demand as it relates to winter type work and applications picks up for us in the fourth quarter and first quarter. And we will be in a sold-out position as we head into the heavier season.

And then just one other one on Certarus. So I think, Allan mentioned that you guys are serving or will soon be serving 2 data center sites. Can you just talk about how long the expected contract term would be? Are we talking about a few months or a few quarters?

That's -- yes, we're really excited about the data center and had a press release in the quarter, getting one under our belt and demonstrating to the industry that this is a viable option to deal with pain points that they're experiencing in terms of getting power and fuel to get the data center up and running, you're probably seeing a bunch of things about that.

In terms of your question, months to quarters is the right way to think about it. I mean everyone is going to be a little different. And of course, there -- the first that we talked about, there is a plan to have pipeline supply fuel there sometime in 2026, but they're ready to go sooner than that. And so as Allan mentioned, we've got a unique set of capabilities to be able to go after an opportunity that requires that much fuel, requires a fleet of trailers, it requires mobile compression, it requires end-to-end project management. And so we're really excited about how we're positioned in that space. As you know, there's a lot of capital flowing into the construction of data centers. And there are discontinuities in fuel supply and energy supply that we're well positioned.

And so these will, in many cases, not be permanent supplies. They'll be looking for permanent infrastructure, but we have a really unique solution that we can kind of step in and be able to alleviate some pain points and at a cost-effective way that really kind of brings an end-to-end solution all the way from experience and having sort of the fleet of gear that can be mobilized on a time schedule that provides value for the customers. And so we're -- our focus right now is doing a great job in sort of building a strong reference case and sort of becoming better known in that ecosystem and further developing that pipeline.

And then just one last question, and maybe it's for Grier. So it looks like you're a little bit behind on deleveraging this year. I know deleveraging is a combination of like outright debt reduction and EBITDA growth. But in terms of capital allocation, like does it make sense to allocate some capital from buybacks to debt reduction? Or how do you prioritize the two?

Yes, Nelson, no, I think no change, right? I think we're still very committed to share repurchases. But it is a balanced plan. And we -- as I said in my remarks, we are still very committed to the leverage. Our plan is to get to 3.0 by the end of 2027. As you know, that was previously kind of mid-2027, and with the cash -- the reduction in cash flow from kind of the lower EBITDA this year is a factor. They'll take a little bit longer, but that is still a very important goal for us.

But I mean, look, the share repurchases so far have been very good, and we'll continue to do that. We think it's an important part of the overall strategy. So I don't know, obviously, no change. We're still committed, but debt reduction and the overall leverage reduction is still very much a priority. So we believe that we can balance both these. There's really -- there's no change in that regard.

And our next question will be coming from Robert Catellier of CIBC Capital Markets.

I wanted to ask that capital allocation that Nelson just asked, but maybe I'll ask the other part of it, and I don't want this to sound any more dramatic than it is. But in terms of capital allocation, do you see any further risk to the dividend? Or you're just looking at the other levers and trying to balance repurchases and leverage?

Rob, it's Grier again. Look, I think the dividend is not something that we're discussing here at all. It's part of the overall return to our shareholders. And we think that's an important part of the overall mix here. So yes, no, that's just not a topic that we're discussing right now. So you can assume that, that's part of the go-forward plan. And as I said to Nelson earlier, I think the strategy here is the same as what we would have said at Investor Day. I mean the allocation, the percentages, the things that we're focused on, there is no change whatsoever.

If you think of what we're talking about today, we're talking about things that are temporary in nature, some well within our control, some less so. But in the longer run, we still are very much on the same path here. And all the things that we've been saying all along, we're very much along those paths. So yes, no change.

Yes. No, I'm surprised to hear it. And then just on the MSUs and specifically in 2026, what is the outlook really for adding more MSUs to the fleet given the amount of pricing and margin pressure?

We haven't taken a decision on adding MSUs, as we mentioned, like we'll be in a sold-out position as we go through the winter season. And if there's opportunities to make high -- make good returns on capital adding to our fleet, we may need to do that as we open up additional hub locations. As Allan mentioned, we signed agreements for a piece of real estate and a gas supply in Florida. We're in process of moving gear to that location. We have a customer there already, a few others that will be coming online over the course of the next 90 to 120 days. And so as we -- and we anticipate opening additional hubs in early 2026, but too early to say specific plans for MSU adds for '26.

And last one for me. As you guys look forward, obviously, the plan you're executing on Superior Delivers is not measured in months or quarters. But as you look through the fullness of that plan and you achieve your objectives, is there a permanent reduction in working capital to the business?

Yes. Maybe I'll start, and Allan may have some comments as well. It's being completely honest, I think it's probably a little too early tell. But what we've baked in our plans is that any working capital changes would be insignificant. I mean look, this is obviously something we'll continue to look at if there are great opportunities to be better there. And I think they probably are. But we're focused on the bigger prizes at this point. There's a lot here, right? I think like this -- when you look at the list of initiatives that we're focused on, one of the battles here is to try to not take on too much. And there's a lot there that can go on for a while. I think when you get further down the list, are there some working capital things in there? I would say that's highly likely. Are they bigger than the things we're working on today? I think you could confidently say probably not. But yes, maybe at the margin, there are some things, but I don't have anything more intelligent than that to say at this point.

Our next question will be coming from Patrick Kenny of NBCM.

Just back on the leverage discussion. I know we've talked in the past about asset sales as a potential plan B to help shore up the balance sheet. Just wondering if given some of the challenges being experienced in California on the propane side, or obviously in the Permian within Certarus, if you're maybe reconsidering high-grading the portfolio at all, not only put the rightsized leverage over the near term, but also just to set these businesses up for perhaps less volatility down the road?

Pat, it's Grier. Yes. No, look, we feel really comfortable with the capital allocation plan. We think it's a great use of capital to continue buying back shares at this level. But keep in mind, it was always a balanced approach we are very focused on also bring the leverage down. The switch in the dividend, which basically went kind of straight to share repurchases almost for kind of dollar for dollar. But keep in mind, we're also driving more cash flow through the business, particularly in the case of Certarus where we brought the CapEx down significantly. That business will produce a bunch of cash flow. So there are a bunch of things we're doing here. Like in the next 6 months, we're going to see quite a lift in the EBITDA and cash flow from the propane business. And so, no, I mean, we're very much along the same path.

I hear what you're asking for sure. We discussed it regularly. The reduction in leverage is really important to us as well. But there are other priorities here, and we're still on the same path here and committed to that.

And then I guess on Certarus specifically, and we've all seen the oil and gas customers pullback in terms of Permian drilling activity and overall CapEx. But just wondering on the Canadian side of the border, if you might be seeing any signs of customers accelerating activity, just given the added egress across the basin as well as LNG projects being declared in the national interest now? So just wondering how your team might be able to I guess, capitalize on this Canadian growth story over, say, the next 3 to 5 years?

Thank you, Patrick. This is Dale. No, great observation. We have the leading market position in the Canadian well site business, have multiple hubs that serve that market, have very good relationships with some of the folks that you're talking about that are involved in those. And while a smaller market, of course, in relative size to the Permian, an important one for us. Of course, the business was established in Alberta. And we feel really good about our position there and are continuing to invest in competitive advantage to grow with those opportunities.

And our next question will be coming from Ben Isaacson of Scotiabank.

Just one question for me and about the bigger prize that you mentioned. You talked a lot today about everything being on track and confidence in delivering value. As you reflect on some of the setbacks though, to balance sheet leverage or Superior Delivers, can you talk about your confidence level in achieving 2027 free cash flow at USD 1 to USD 1.10? And then what is the cadence or the path to get there? Because presumably, it seems that the slope is a little bit higher to meet that target, but that's also in the face of headwinds that you mentioned. So I was just hoping you could connect the dots.

Ben, it's Allan. I'm going to just offer a comment on the trajectory of Superior Delivers, and then I'll let Grier take the hard part of the question. I said in my opening comments that transformation isn't linear. And it's always super frustrating when you can't see what I see, and I know it's frustrating for you guys, too. The fact that we were able to change wholesale, our distribution model here at Superior in 2 quarters, for me, it's an incredible accomplishment. People said we'd never be able to do it. And you're all smart people. You know these things aren't like a light switch where you're flipping on, everything works perfectly, and we'd be misrepresenting ourselves as we said it was. But it's in place, it's working. We're continuing to refine it, and we're starting to see the results.

So in terms of, honestly, I think some of the biggest challenges that Superior Deliveries represented, we've tackled in 2025. Culture shift, bringing the organization together as a single business is much more complex than the average person would appreciate. And then really tackling our distribution model, being able to get our hands around pricing, bringing on new Chief Commercial Officer is a huge win for us.

So I don't see the overall program being in jeopardy. In fact, we're all having to operate with a lot of discipline to not be distracted by some of the short-term challenges that invariably come with the transformation of this size and then the headwinds that we -- that are created that we don't control and remaining enthusiastic and determined about what the ultimate price is. And I'm as comfortable now as I -- probably more comfortable now than I was in April to be perfectly honest. But you had a specific question that Grier is going to answer for you.

Yes. So Ben, I would agree with everything that Allan said. So if we look at kind of what's changed between Investor Day and today, it's really kind of 3 things, right? And the CNG business obviously hasn't performed to our expectations. And largely, that's been the oil markets and completion activity, which has had an impact. And so in our model, in the long run, to get to 2027, if I look at what needs to happen, do we need to get back to the same oil prices and the same level of activity that was happening at the start of this year, certainly it would help, but we don't need to have that. If you listen to what Dale has said, we're trying to make this business better. The team has done an incredible job trying to make things more efficient, be better at what we do and diversify.

And there's a couple of pretty good examples of diversification, and we'll continue to do that. So the business will be better. And I think -- so to get to 2027, I'd say we've made this business better since when we talked at Investor Day. And so in a stable environment, if the -- all this activity in the oil prices were the same, I would actually say that would probably be performing even better than what we said for 2027. But a lot of it is dependent on what happens in markets that are very difficult for us to control, but what we can control is making this business better. So that's the first thing I would say.

On Superior Delivers, this is onetime thing. We will get -- as I said, we'll get this volume back most likely in the fourth quarter. There's onetime cost there, but if you look at the exit rate leaving this year, it's very much intact with what we originally said. So if you look at the health of the program, the size of the prize at the end, the inventory, the sale -- like the funnel that we use, like this stuff is all very healthy. And I would say we feel as good today as we did back at Investor Day. So I'd say that's the same number. I mean we -- yes, we brought the number up slightly, it's not that big. But I think hopefully, that will show the level of confidence that we have in the program and what we think will be achieved in 2027. So I'd say no change on that.

The third item, Martinez, this has been a pain for us this year. Latest I've heard is that this will come back online start of next year, and so that should go away. Look, would there be potentially other refinery things that may come along? I mean, we'll always have to continue to evolve this business and assess things that are kind of coming at us and do the best things. But no, I think we're not going to get into like the fine-tooth comb of like pluses and minuses here or there or whatever. I would say, largely, no, the 2027 stuff is very much intact, but with that, I would say it is somewhat dependent on what happens in oil and gas markets. That will have an impact and maybe...

That's helpful.

And those are market pressures that blow both directions. Do you think it just as easily because of the same eventuality and the positive being overachievement. But to Grier's point, we're just focused on running the best business we can and thinking about the future. Sorry, Ben, did you have another question?

No, that's it. Appreciate it.

And our final question will be coming from Aaron MacNeil of TD Cowen.

I can appreciate the comments in the prepared remarks, including the clarity on the miss on the guide this year, but Superior is now missed 2 years in a row. So just in that context, can we expect that Superior will employ more conservative guidance assumptions in 2026? An obvious one for me is just the assumption of 5-year average temperatures, which historically overstates heating degree days. Again, I know you can't get into specifics, but -- maybe you could highlight the broader approach and your appetite for potentially starting the year with a lower growth rate that you can increase as the year progresses if things play out as you expect?

Aaron, it's Allan. My surprise you. I'm going to jump in on this one before we'd like to talk. First of all, thanks for joining us, and we wouldn't end the call, of course, without getting everybody. One of the -- you're absolutely right. Guidance has been real tricky for us. But our guidance is tied to our budget, and that's been really tricky for us. And part of the genesis of Superior Delivers was sophistication with which we ran the business. So if you start with how easy is this business to predict, right out of the gate, you've got the cyclicality in the propane business and the weather factor. I hate 5-year average, by the way. So I'm with you on that one.

And then you have cyclicality in the oil and gas sector, which is incredibly difficult to predict. So those two things are not a great starting point. Historically, our capability to predict the performance of the business, I think, has been really challenged by understanding the relationship between price, margin, customer acquisition and your cost fluctuations. So a lot of the work we've been doing, and Grier and his team have done a great job at this over the past 1.5 years is understanding our business better. And when you understand it, you can predict -- it becomes more predictable.

So I think what you've seen over the last year is a combination of a business that's tough to predict, but also one that didn't have very sophisticated tools at its disposal. We're not in the ninth inning on that yet, but we're much better than we were historically. So I think you'll start to see that our ability to forecast our own performance is markedly improved. Our ability to predict what happens in the external market, of course, is always going to be an X factor, but Grier and I both are much more leading on the conservative side than the ambitious side in that regard.

Yes, for sure. I would agree with everything that Allan said, I look, at the end of the day, we're trying to create realistic internal budgets that are not super easy and sandbag type things, but at the same time, things that are realistic and achievable. We save for these things, it's very hard to see some of these external factors happen, right? To be fair. And so we put the thing together with the best information that we had, and we'll continue to do that. It is somewhat difficult to see things that are, as I say, kind of from the outside. The Superior Delivers one is one that really I would kind of focus on that was more on us, right? And that's a big program. There's a lot of stuff in it, and we didn't see that.

And so yes, do we maybe add a reserve for things like that? We'll certainly have more sight line though. Like if you think of where we are today versus where we were back in February when we announced our guidance, we didn't know nearly as much about Superior Delivers as we know today. So that will be quite helpful. But that -- the base business is actually -- we've been quite close so far. If you look at where we are kind of year-to-date, the base business estimate has been very close to right on.

Now having said that, we had a good idea what the weather looked like in first quarter and second and third quarter, the weather is not as much of an impact. So we'll see what kind of happens in the fourth quarter. But yes, look, we did our best. I think that's -- I would say we'll do our best again and trying to give our people here a shot at realistic targets and letting the market kind of see what we see, but it is difficult to anticipate all these things.

I kind of look at the 3 major factors here. And the 2 external ones were pretty tough for us to see. The internal one, it's a big program, that's complicated. Should we may be seeing that, I guess, maybe you could say that. But we'll know a lot more for sure, as I say, going into next year. And I think the budget will be different. But from my perspective, it's not -- I wouldn't say, yes, we're going to set a way easier budget next year, numbers that are easier to hit. I think we'll continue to try to set what we think are realistic targets and try to have our people motivated to do great stuff and also give the market the best idea of what we think the business is going to do.

Yes. And it's funny because Q2 and Q3, they are so unforgiving, they're so small. That anything -- in a lot of companies, your margin of error would be negligible in a quarter, but because of the way our business comes in, it's really unforgiving to the smallest of miscalculations or external factors that you don't control, which is frustrating. But I mean, it's a business we're in, so we have to live.

Okay. Fair enough. All very good points. Dale, maybe just another one for you on Certarus. I just want to confirm that the current data center opportunities today contemplate gas delivery only. And if the answer is yes, what's your appetite to sort of branch out to electric power and sort of just given the several other competitors are starting to do that with the quarter?

Yes, Aaron, confirming that it is for gas supply only. And I mean really the full system to provide fuel to whatever their power generation of choice is. And as you know, providing -- actually providing the power is a different capital profile than what Certarus has right now. And there are a number of people that are doing that already. And so our approach has been to build relationships with those people, the people that have the power generation assets, and be able to provide a complementary service that helps them operate reliably when pipeline supply is not available.

I'm showing no further questions at this time. I'd like to hand the call to Allan MacDonald, President and CEO, for closing remarks.

Thanks, operator, and thanks all of you for your time and attention. And you've all been on this journey with us, and we're continuing to persevere. Something that Grier and I talked about earlier this week that's not lost on me is, it's always easy to focus on the challenges in front of us, and sometimes we forget to reflect on how far we've come. Our results so far in 2025 certainly aren't as -- they didn't meet our expectations. Having said that, year-to-date, this company is growing and it's growing despite the challenges that existed in the business. And when I joined 2.5 years ago, this was about, "Hey, how do we transform Superior into an organic growth story?" So this company is growing without acquisitions, without raising margins, without pulling deliveries forward.

And I'm incredibly proud of the team. For us, that is -- that was a really big milestone to pass through. Now we still have another quarter to go, and that's okay, but we're well on our way in this journey. And I think when we reflect on it, we'll say it wasn't easy, and there were difficult times through it, but perseverance was what made the difference. So you can rest assure that you have a management team that is incredibly focused on the long-term health of this company. So with all that, thank you all very, very much and look forward to talking to you in our next quarterly call in between. Take care.

And this concludes today's program. Thank you for participating. You may now disconnect.