Ladies and gentlemen, thank you for standing by and welcome to the Tidewater Midstream and Infrastructure Limited third quarter 2020 results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. I would now like to hand the conference over to our speaker today, Chief Financial Officer, Joel Vorra. Joel Vorra, my apologies. Thank you. Please go ahead, sir.
Thank you. Good morning and good afternoon, everybody. On the call with me today, as usual, is Joel MacLeod, Tidewater's CEO. Before passing the call over to Joel to review the quarterly highlights, as usual, I'd like to remind you that some of the comments made today are forward-looking in nature, and include expectations, estimates, judgments, and projections. Forward-looking statements we may express or imply today are subject to risks and uncertainties, which can cause actual results to differ from expectations. For further information, please refer to our non-GAAP measures and further disclosure at tidewatermidstream.com and on SEDAR. With that, I'll pass it over to Joel MacLeod for an overview of the quarter and opening remarks.
Thanks, Joel. Good morning, everyone, and thanks for joining our Q3 2020 conference call. We delivered a record corporate adjusted EBITDA quarter in Q3, where we exceeded our previous record adjusted EBITDA in a quarter by 14% and delivered a record CAD 47.6 million of adjusted EBITDA in Q3. This represents an 86% increase in adjusted EBITDA year-over-year. We continue to see growth into 2021 and are reiterating guidance of CAD 175 million-CAD 185 million of adjusted EBITDA for calendar year 2020. Our number one priority remains de-leveraging and free cash flow generation, and we are confident in our ability to achieve our target of three to three and a half times debt to EBITDA with the closing of the Pioneer Pipeline.
We are also confident we will be able to continue to grow per share distributable cash flow into 2021 as we continue to execute and grow a significant inventory of high rate of return small capital projects. We are nearing pre-COVID distributable cash flow levels with the main drivers being our Prince George Refinery seeing cracks improve, high rate of return and optimization projects coming online, diesel demand continuing to outpace supply at Prince George Refinery , and also our Pipestone gas plant having runtimes that continue to improve into year-end in 2021. Our business, although not untouched, has remained resilient and as a result of the contracted nature of our assets. Over 70% of our business remains under long-term contracts. Approximately 50% of our EBITDA is derived from investment-grade counterparties.
We are not aware of another infrastructure company in Canada that delivered adjusted EBITDA per share growth of over 85% year-over-year. The amount of government outreach/stimulus and support we have seen in recent months is like nothing I have seen in my career, and we want to thank the various provincial and federal governments for all their support. Tidewater is positioned extremely well to benefit from renewable energy and clean fuel stimulus. Our canola co-processing project, which was initiated over 18 months ago, continues to be a huge success and will come online in late 2021, where the BC government's support has been instrumental and we do not expect material net incremental CapEx from Tidewater related to the project.
With the support of the B.C. government, we are currently also evaluating a large renewable diesel project at the Prince George Refinery, which would also have a renewable hydrogen component. We are in a prime location at Prince George Refinery for potentially the first renewable diesel project in Canada, where B.C. is the only province with LCFS compliance cost/credits, and we also have the highest diesel prices in North America. We have had numerous parties approach us on hydrogen and various hydrogen opportunities, given we have three operating hydrogen assets in Prince George Refinery today. We also do have a material number of operating carbon capture assets that are likely to benefit from the growing hydrogen and renewable energy push that continues globally. Tidewater is in a strong strategic position with significant infrastructure to become a leader in clean fuels across Canada.
We are also likely to continue to see significant government stimulus on intensive infrastructure capital deployment period over the next 12- 24 months. Tidewater is positioned very well to take advantage of this. This includes some of the largest capital projects in Canada and even North America in and around Prince George, including Site C Dam, Coastal GasLink, LNG Canada, and Trans Mountain Pipeline, all of which are multi-billion CAD projects. We have seen activity ramp up materially on Coastal GasLink pipeline, which runs just north of Prince George Refinery , with the workforce now over 3,400 workers on the right of way. To see the majority of North American refineries have significant contraction in margins, while our margin at Prince George has held above CAD 45 a barrel crack also emphasizes the strategic nature of our assets and infrastructure.
We have seen numerous refineries announce reductions, shut-ins, closures, and conversions to renewable diesel, including Phillips 66, Rodeo and Santa Maria, Marathon, idled Martinez, HollyFrontier also working on a conversion of the Dickinson refinery, and HollyFrontier converting their Cheyenne refinery to renewable diesel. Shell Convent recently announced idling, shutting down their 240,000 barrel a day refinery. Come By Chance has been idled from their 130,000 barrels. PBF Paulsboro on the East Coast also announced some reduction in production, and a few others. This is definitely positive for Prince George, as diesel and gasoline production on the West Coast will be reduced significantly, and Prince George pipeline remains advantaged with their Canadian crude supply. For a quick update on the Pioneer Pipeline, the Pioneer Pipeline continues to operate incredibly well from an operational standpoint.
Tidewater and NGTL have agreed to terms and conditions to qualify Tidewater to receive interruptible storage services at Tidewater's Brazeau River Complex storage facilities. With the ITS service, Tidewater will be able to attract new credit-worthy storage customers at the storage facilities, creating expansion opportunities to increase storage capacities at the BRC storage facilities. The disposition of the Pioneer Pipeline continues to move forward where Tidewater, ATCO, TC Energy and TransAlta continue to work through the regulatory process. Regulatory approval is anticipated in the first quarter of 2021, and Tidewater remains proactive in our efforts to accelerate this timeline. In regards to our Prince George Refinery, during the third quarter of 2020, PGR achieved over 95% utilization. We have seen significant success on debottlenecking optimization blending operations, where butane blending commenced in Q3 2020 and has exceeded our expectations.
With our blending operations, we are now producing over 11,000 barrels a day of diesel and gasoline. Tidewater is encouraged by the resilience of the PGR asset in an unprecedented time with crack spreads, holding steady at approximately CAD 50 a barrel. This demonstrates the refinery's long-term value in servicing the markets where and in which it operates. Of note, a CAD 5 barrel per move in crack spread would provide over CAD 15 million of incremental free cash flow over a 12-month period. Demand for diesel continues to exceed our production as a result of the large infrastructure projects that I previously mentioned. The first offtake contract here with Husky Energy ended on November 1st, 2020, with Husky meeting its offtake obligations to Tidewater.
The corporation has received confirmation from Husky that the force majeure notice under the offtake agreement that was initiated by Husky in April has been withdrawn.
Tidewater looks forward to continuing to work with Husky Energy as regional demand remains strong. We feel the merger between Cenovus Energy and Husky Energy will only strengthen the combined entity's balance sheet, and we look forward to continuing to grow our partnership with the combined team and want to thank the Husky Energy team for all their efforts as they have been an absolute pleasure to work with. On to Pipestone. Tidewater, we processed an average of 72 million cubic feet a day in the third quarter of 2020. Facility availability for the quarter averaged 78%. Due to a constraint in early July, this was offset by record throughput in September of 86 million cubic feet a day and over 90% availability. The Pipestone gas plant is fully contracted with over 80% committed on take-or-pay arrangements.
As for our gas storage assets, they performed well in Q3 as volatility and gas prices increased materially. Our Pipestone gas storage facility is fully contracted with take-or-pay contracts spanning up to eight years with multiple investment-grade counterparties. The facility represents a significant step forward in our fee-for-service gas storage business and offers producers at Pipestone significant optionality, where the plant has three egress solutions, including connections to TC and Alliance, in addition to gas storage. We continue to be committed to our ESG performance by investing in infrastructure to increase energy and natural resource efficiency, reduce emissions, and enhance environmental performance. We have recently updated our Tidewater website for significant incremental ESG disclosure. As mentioned earlier, we do feel Tidewater is positioned tremendously well to be a leader in clean fuels within Canada.
To reiterate, after enduring what is likely the largest shock to the global economy and the oil and gas industry, we do feel the worst is behind us, and we are well-positioned for what is likely to be one of the largest economic stimulus and infrastructure build-out periods in our lifetime. We also feel we are positioned tremendously well to be a leader in clean fuels across Canada. Our business remains resilient as a result of the location of the contracted nature of our infrastructure assets, accompanied with our strong defensive assets. We are confident in our ability to deliver CAD 175 million- CAD 185 million of adjusted EBITDA in 2020, with debt to EBITDA being 3x- 3.5x at the closing of the Pioneer Pipeline sale.
Our focus remains free cash flow generation and debt reduction. We do feel strongly that we can continue to show material debt-adjusted distributable cash flow per share growth for years to come. Capital expenditures are currently planned to be minimal as we close out 2020 as we focus on de-leveraging, but do want shareholders to be aware that we do have a significant growing inventory of projects with two to three-year payouts. I do want to thank board, shareholders, credit syndicate partners, and all stakeholders for all your support. We look forward to continuing to delivering strong results into Q4 and into 2021, and remain confident in our ability to deliver debt-adjusted per share free cash flow growth into the future. I'll pass it back to Mr. Vorra, and he can walk you through some of the details around the financial components of our Q3.
Thanks, Joel. I'll walk through some of the high-level quarter-over-quarter and year-over-year changes, then we can open it up for questions. Revenue increased significantly quarter-over-quarter, primarily related to a recovery in commodity prices and refined products. Revenue in Q3 was CAD 273 million, representing a 53% increase from the second quarter of 2020, a 70% increase from the same period in 2019. The year-over-year change would be primarily related to the addition of the Prince George Refinery and the Pipestone gas plant. Gross operating margins after adjusting for realized hedging gains was approximately 17%, which is consistent with prior quarters, excluding Q2, where we had deferred certain operating and maintenance costs as a result of COVID, which had slightly increased margins in Q2. Downstream margins increased slightly from 15% closer to 20%. Midstream margins remain relatively consistent, around 15% for the quarter.
Adjusted EBITDA for the third quarter was CAD 47.6 million, as Joel mentioned, with EBITDA margin approximately 17%, which again, would be consistent with prior quarters, excluding Q2. EBITDA increase quarter-over-quarter was approximately CAD 42 million, up to CAD 47.6, mainly related to a recovery in demand at the Prince George Refinery. Something we watch very closely, payout ratio and distributable cash flow. Distributable cash flow was approximately CAD 10.6 million for the quarter compared to CAD 12 million in the prior year and approximately the same distributable cash flow in Q2. The main drivers for the decrease year-over-year would be a deferral of some operating costs and maintenance capital in Q2 as we dealt with COVID that were incurred in Q3, and also about CAD 2 million of one-time costs related to a provision for doubtful AR accounts and a one-time payment on some new leased equipment.
We do expect that distributable cash flow number to start to step up into the end of the year and into 2021, and definitely something that we monitor closely, if not the most closely, and watching its impact on net debt as well. Definitely looking at ways and focused on increasing that distributable cash flow number. Carrying costs related to our leverage are projected to come down with the closing of the Pioneer Pipeline, which will save on our interest costs and start to bring that down after we've completed our capital projects. Increased run times at the plants now that we've moved out of some of the impacts we saw in Q2 related to COVID will also help that number, but also watching those developments closely. Net debt quarter-over-quarter moved down approximately CAD 8 million. We expect that to continue to move down into 2021.
Again, I think as everyone's aware, upon closing of the Pioneer Pipeline disposition, decrease in carrying costs, leverage costs, and even some other higher cost debt instruments in our capital structure, focusing on those to bring those costs down. With that, I think those are the main drivers for the quarter, and happy to open it up for questions.
Certainly. At this time, I would like to remind everybody, in order to ask a question, please press star, then the number one on your telephone keypad. We will pause for just a moment to compile the Q&A roster. Your first question comes from the line of Patrick Kenny from National Bank. Your line is open.
Hey, guys. Just on the tie-in of additional volumes at BRC, I was curious if you're also starting to have discussions with customers looking for incremental capacity at Pipestone, or are we still a ways away from seeing discussions around the phase II expansion no matter what AECO trades at, just given maybe there's some underutilized facilities in the area?
Hi, Patrick, and great question. Joel here. Brazeau, I would say those volumes are more tied to gas price, given a little drier gas, and most of it'll be Mannville-related production with a little bit of Rock Creek and a little bit of Cardium. Great to see activity, and you'll see from public data who's drilling around us, one of our existing large customer and then a new customer. Great job by our commercial team to get those volumes locked up. You will see a bump in processed volumes here into the next six and 12 months, which is great to see. As for Pipestone, I still feel that's more of a WTI oil type driven place. Definitely gas prices have helped. To your point, you can see the press releases of the operators in the areas.
There's definitely activity there, but it's not like it was. We would say there's interest, there's discussion, but it's not significant. Today, probability of an expansion would be sub 50%, but we all know that can change. I think if WTI got back to 45-50, then probably we'd go above 50% probability. For now, for us, focusing Pipestone on getting operational operations run times up to 95% and improve what we can do. The plant's running well, but we can always do better and want to be the best performing facility out there, and we have a little bit of work to do to get there.
Right. I know your priority for next year is debt reduction, so maybe that timing lines up for you. At PGR, you mentioned large renewable diesel opportunities, so maybe you could just provide bookends on CapEx and timing, again, given the debt reduction priority. Also, with respect to renewable diesel capacity, would this production just simply replace your existing diesel production? If so, how should we be thinking about the potential EBITDA accretion on top of the obvious ESG accretion?
Pat, it's early days, but to see how supportive the B.C. government has been, has been absolutely phenomenal. We need a little more time. Are we committed? Are we FID'd? No, we're definitely very interested, especially when the federal government is also kind of reaching in and/or asking how they can be supportive. Definitely more work to be done. Everyone knows our balance sheet, where we sit. We won't be stepping into a massive capital project that's not contracted and wouldn't have a fairly high rate of return. When we have government support, it's getting quite interesting, especially with Prince George Refinery having the highest diesel price in North America, and also being the only province without LCFS compliance costs. If you could put a spot on a map where it would make sense to have a renewable diesel project, BC, X would mark the spot.
A little more work to do. Size-wise, again, we don't want to scare the market, our shareholders. Today, it's in that CAD 150 million range of capital, and we have some work to do, and I have lots of inbounds from various parties that would be happy to help fund that if Tidewater didn't want to commit a material check to the project. We are excited about the project, and I think we'll update the market here over the next month or so.
Okay, that's great. Just lastly from you guys on the liquidity front, obviously waiting for Pioneer to close, but maybe you can just comment on the repayment or refinancing plans for both the second lien loan as well as the high-yield notes. I know you guys still have some time, just curious if there's a chance to take advantage of any opportunities in the market.
Good question, Patrick. It's definitely on the forefront. We've got those maturities coming up in 2022, so we're likely looking sometime in 2021 to address those. A few catalysts, obviously, that are coming up. We've had the refinery now for 12 months. I think we can point and communicate to the market that we saw one of what we're hoping is the worst shocks to commodity prices and demand, and we can show how that asset performed. Obviously, on the liquidity front, bringing in the Pioneer proceeds is going to help the story. I think being able to put a couple quarters behind us, Q4 looking good as well, is going to help, obviously, our ability to get the best cost to capital.
We have seen, not a ton, but we have seen, as you would know, some deals in the market, it's definitely on the forefront. We're evaluating where our highest costs of capital are and definitely addressing those first. Yeah, to answer your question, that's something we'll be looking at in 2021 to consolidate, refinance those pieces. Credit syndicate has been very supportive to date. Yeah, to answer your question, that's on the forefront, something that we're looking at very closely and is likely coming up here in the next six to 12 months.
Okay, that's great. Thanks, guys.
Thank you.
Your next question comes from the line of Robert Hope from Scotiabank. Your line is open.
Morning, good afternoon, everyone. I want to follow up on some conversations that you had in your prepared remarks. Just taking a look at the gain and adjusted EBITDA through the year, we haven't seen the distributable cash tick up year to date. Can you just give us a sense of kind of what headwinds you've been seeing so far year to date on DCF and, I guess, specifically, how much of a magnitude do you think that has held back cash flow this year and kind of the implications for 2021?
Yeah, it's a good question, Robert. Obviously, we're not at the run rate on distributable cash flow that we would want. I think some of that is related to one-time items. Some of that is pushing a few pieces from Q2 that showed up into Q3. We had a couple one-time pieces. I mentioned a provision for some AR that was in the million-dollar range that would be coming off that number. There was another one-time payment on some leased equipment related to optimizing one of our facilities that would come off that number that we don't expect again. There are some leases expiring in Q4 that will bring that cash lease number down into Q4. I would say there's probably between CAD 3 million and CAD 4 million in that number. Obviously, we're CAD 10.5 million or so for the quarter.
When you look at a CAD 3 million or CAD 4 million move, it's 30% or 40% move to that number. Although it feels like relatively small dollars, when you look at a run rate, I think we can see a vision to increasing that number, getting the payout ratio closer down to 20%, where we would've communicated prior to COVID. There are some pieces going forward, and then obviously increasing the cash portion of EBITDA, lowering our I sort of talked about the capital structure and some of our carrying costs. Even when you take the Pioneer proceeds and you apply that to our cost to debt, you get into the CAD 6 million- CAD 7 million, even in interest costs a year, which will add to the bottom-line cash flow. I think there's a few pieces that came up in Q3 that we won't see going forward.
There's some additional pieces in Q4 that are coming off. Our finance costs are obviously going to come down when we're able to close Pioneer. I think you start to add all those up with some EBITDA growth, and you very quickly start to see a material percentage increase in that distributable cash flow number.
All right. That's helpful. Just in terms of growth CapEx, you spent a little bit of capital there in Q3. How are you balancing the balance sheet versus high-return projects, and what projects do you think you'll move forward on these small return projects over the next six months or the magnitude of such?
Yep. I think you'll see growth CapEx likely move down a bit into Q4 and into 2021. We feel the market will let us know when they're ready for growth projects. It's nice to have a few in the works. Butane blending at Prince George Refinery was a great example, where we're able to blend materially more butane into the gasoline stream than we anticipated and do feel we're going to achieve kind of a 12-month payout there. We're very cognizant, our board's very cognizant of that. We want to show free cash flow generation and get debt down. It's a fine balance, and you'll see that growth CapEx likely move down into 2021, barring a capital project that would have another means to finance.
Just want our shareholders and market to know we're very cautious and are grinding through all maintenance and growth CapEx, but are building a pretty significant inventory of high rate of return growth projects.
All right. Appreciate the color. Thank you.
Your next question comes from the line of Robert Catellier from CIBC Capital Markets. Your line is open.
Hey, good morning, everyone. I just wanted to talk to you about what you might envision coming from the Cenovus and Husky merger and how that influences your long-term plans for PGR beyond the initial offtake period. It seems to me that you've been working pretty hard to expand your markets. Is that the ultimate strategy here to expand the markets beyond that customer?
It's a great question, Robert. Husky's been a great counterparty and having that investment, great offtake. I think it definitely helped us finance the entire acquisition with debt. To your point, with COVID, we felt we have to have incremental markets, and the team's done a great job from product in Eastern Canada into the U.S., et cetera. At this point, Cenovus, we get along with them well. We're excited to work with their team members. Then the Husky team members that move over have been great. They overlifted on their first contract, and we continue to see big demand out at Prince George Refinery . I would hate to say we are committed to pivot away from Husky Cenovus because that's not the case.
I think I'd prefer to grow our relationship with them and work with them, but we have to make sure we can move product outside of the orbit should we need to do so. Today, there's way more demand than we can handle. Given COVID and the uncertainty, we want to make sure we do have a backup plan.
Okay. Thanks for that. The second question is also my last one. I just wanted to get an understanding of where you feel you are with marketing volumes. The depths of the trough post-COVID, how close are you to regaining those volumes, getting back to the levels that you were at pre-COVID?
As far as NGLs?
Yeah.
Probably more on kind of the crude condensate side.
Yeah.
On the crude. Yep.
Go ahead.
No. Good question. With Pipestone ramping up to record throughputs, I would say we're marketing more propane, butane, ethane volumes than we ever have. The driver there would be Pipestone. Brazeau continues to have significant volumes, and then also our extraction plants continue to run. If you said on LPG, our volumes are up, and Pipestone would be the main driver, and our team continues to be active and do a great job on that front. To your point on the crude side, yes, volumes are definitely down from what we've been marketing and/or the related EBITDA margin is down. Although realize corporately Tidewater, we've never had a big portion of our EBITDA being marketing driven. We do like to move volumes, we like to help customers, but we typically don't take big margins, and it's definitely not a large portion of our corporate EBITDA.
What do we think would change so that we'd move more crude volumes? Really, dislocation, to see how tight WCS is at -CAD 9, -CAD 10 differentials, to see light sweet to condy differentials. Finally, they've widened out a bit, so we can be helpful with producers there. For the past three, six months, it's been pretty tight, and sweet differentials have been as tight as I've ever seen in my career. Dislocation is typically where we can help, and should we see, and we have seen a little bit more over the last few weeks. If that continues, then I think we can move volumes. I would hate to say you're going to see a massive change in our EBITDA profile, as we never have had marketing drive a pile EBITDA, and it's more a service we offer to get longer term contracts.
Okay. That's great. Thank you.
Once again, in order to ask a question, please press star, then the number one on your telephone keypad. Your next question comes from the line of Robert Kwan from RBC Capital. Your line is open.
Good morning. There was a modest change in your DCF payout to 25%-30%, up from 20%-30% that you put out last quarter. Is that just some of the headwinds or one-time items that you had in Q3, or is there something else going on? Is there some sort of contemplation of doing something, in terms of a dividend increase?
Robert, it would be the first piece that you alluded to. Some of those one-time pieces, just tightening that guidance. Our long-term payout ratio has not changed. It would be down closer to that 20%. We have, we always have the discussions, even at the board level and with shareholders about the dividend. I would say not to expect a massive dividend increase anytime soon. If there was one, it would be small. As you know, it's not overly material even to have a 10% or 20% increase. The reason for that tightening of that range was not related to a contemplation necessarily of an increase, just the fact that we're three quarters through the year now.
We do expect, like I said, that DCF number to start to move up, but just realizing where we are today and where it sat for the first three quarters, just wanted to tighten that range a little bit, realizing we likely don't come in down at the 20% once we're through Q4.
Okay. Just sticking with a cash flow item, it doesn't look like you're able, or you haven't been able to get any cash out of your equity investments, and Pipestone Gas, I think is the biggest one. What should we be expecting on that front? Is cash going to be trapped for the foreseeable future?
It's a good question. I don't think cash will be trapped for the foreseeable future. The gas storage would be a good example. We had project financed that asset. Some of that cash is going to satisfy those obligations now, but we do have now, again, a year of that asset being on. We saw what it can do this summer when we saw a little bit of volatility in September. We didn't see maybe as much volatility as we've seen in prior years for most of the summer, but it did perform when we did start to see that volatility. No, I don't think cash is trapped there. The other piece, the other smaller, the Brazeau storage would be a smaller piece.
I wouldn't anticipate any material cash flow coming from there unless we were to expand those facilities, which is something that's being considered along with the Pioneer sale and those related discussions with NGTL. When you look back up at Pipestone, those assets are generating cash. I think it's just evaluating here capital structure of those entities. No, I would expect some cash flow coming back to Tidewater from those entities.
Okay.
From mainly the Pipestone.
Right. As soon as next quarter?
As soon as 2021, yeah.
2021, okay.
Yeah, go ahead.
Sorry, go ahead, Joel.
Next quarter may be a stretch, but into 2021 for sure.
Last question here is just on how you're thinking about the redeployment of capital into the growth projects, particularly where the share price is. Maybe coming back to your dividend comment, can you just balance your deliberations on capital allocation on whether it makes sense to deliver a dividend increase, even if it's a small one, versus putting capital in the new projects versus, say, share buybacks, given where your free cash flow yield is right now?
Yep. Robert, absolutely. In our board meeting, detailed discussions, capital allocation is critical for us. Getting that Pioneer Pipeline closed is step one. You wouldn't see us bump our dividend or even allocate significant growth capital, and we don't plan to allocate significant growth capital till Pioneer closes. Once we have a closing date and are going to close Pioneer, my view today would be if we have two-year payout projects, two and a half year payout projects, and we're deploying CAD 10 million, CAD 20 million, CAD 30 million in aggregate. That's where we want that capital to go. I do feel we're going to have an inventory of that, and if not larger, to allocate that capital before we would bump the dividend. We are having that discussion with our board and welcome feedback.
Do not expect a large dividend bump, do we go to a 5%-10% bump year-over-year for the next three to five years, as we are confident you're going to see our distributable cash flow increase here. No, to date, it would be growth capital likely first for kind of a tranche of CAD 20 million-CAD 30 million, as long as they're in that 2- 2.5 year payout range. We are continuing to evaluate a small, regular dividend bump kind of year-over-year.
Got it. Thank you. I guess just to boil it down, is the way you're looking at that kind of two and a half or better payback is just the cash-on-cash yield of doing something like that exceeds really that's going to win the day, in terms of other options. Is that really the driving process or something else strategic that we should be thinking about as to why you're looking at the growth first?
I'd say to your point, cash on cash. The other piece would be in NCIB. We don't expect to do anything significant, but if our share price continues to struggle and/or moves down, that is a piece we will be evaluating.
Okay, that's great. Thank you very much.
Thank you, Robert.
There are no further questions at this time. I turn the call back to management for closing remarks.
Thanks, everyone. Thanks for your time. Look forward to Q4 and year-end results. Please don't hesitate to reach out to us if you have any questions, concerns.
That concludes today's conference call. You may now disconnect.