David Brunetta - Director of Investor Relations Martin Ferron - President and Chief Executive Officer Rob Butler - Vice President, Finance Joe Lambert - Chief Operating Officer.

Chris Lalor - GMP Securities Ben Cherniavsky - Raymond James.

Good morning ladies and gentlemen. Welcome to North American Energy Partners’ Earnings Call for the First Quarter Ended March 31, 2015. At this time, all participants are in a listen-only mode. Following management’s prepared remarks, there will be an opportunity for analysts, shareholders, and bond holders to ask questions.

The media may monitor this call in listen-only mode. They are free to quote any member of management, but they are asked not to quote remarks from any other participant without that participant’s permission. I advise participants that this call is also being webcast concurrently on the company’s website at nacg.ca.

I will now turn the conference over to David Brunetta, Director of Investor Relations at North American Energy Partners Inc. Please go ahead, sir..

Thank you. Good morning ladies and gentlemen and thank you for joining us. Welcome to the North American Energy Partners first quarter conference call.

I would like to remind everyone that today’s comments contain forward-looking information and our actual results may differ materially from expected results because of various risk factors, uncertainties, and assumptions.

For more information on these matters, please refer to our March 31, 2015 management’s discussion and analysis which is available on SEDAR and EDGAR. On today’s call, Rob Butler, VP of Finance, will first review our results for the quarter. Afterwards, Martin Ferron, President and CEO, will have his remarks on our strategy and outlook.

Joe Lambert, Chief Operating Officer, will then deliver his comments on our business development efforts. Martin will then wrap up our comments. After the prepared remarks, there will be a question-and-answer session. For your information, management will not provide financial guidance. I will now turn the call over to Rob..

Thank you, David. Good morning everyone. Before starting, I’d like to introduce myself as new voice on the call. I started in North American as Corporate Controller in midway through 2008 with the primary responsibility for our public reporting.

Since that time, there have been opportunities to take on progressively more responsibilities within the finance organization. With this most recent role as VP, Finance, I look forward to leading the entire finance organization and the strong team of professionals we have here.

Let’s now review our consolidated results for the first quarter ended March 31, 2015 compared to the quarter ended March 31, 2014. Revenue for the quarter was $85.1 million, down from $107.7 million last year.

Unrelated to the current lower oil price, at the start of this year as a result of a long standing contract, the owner of the Horizon mine bought out the balance of the contract equipment fleet and assumed responsibility for maintenance activities for overburden removal.

The decrease in this quarter’s revenue was primarily the result of the elimination of revenue previously generated from the Horizon mine’s cost of ownership and maintenance on the cost reimbursable contract, coupled with the shutdown of the Joslyn mine development project in the second half of last year.

Normalizing results to exclude these two events, revenue generated in the quarter from the winter program of mine development and mine support activities was comparable to last year’s revenue, despite a slowdown of activity at the end of this quarter due to an early start to the spring breakup season.

Gross profit for the current quarter was $11 million, or 12.9% of revenue, down from a gross profit of $15.2 million, or 14.1% of revenue, earned last year. Included in last year's results was a pickup of nearly $2 million from project closeout activities.

Normalizing gross profit to exclude last year's pickup, the previously mentioned elimination of activity at the Joslyn mine and the lost profit contribution from the reimbursable equipment costs assumed by the customer at the Horizon mine, we generated current margins that were comparable to last year.

These results from our winter work were achieved despite an increase in equipment rental costs and higher depreciation from a larger mix of heavy equipment used to support these activities. Operating income for the current quarter was $2.2 million, compared to an operating income of $3.0 million last year.

G&A expense, excluding stock-based compensation, was $8.2 million for the quarter, up from $7.3 million last year. The increase was primarily driven by $1.4 million in restructuring charges recorded during this quarter.

The restructuring activities and cost reduction initiatives implemented in the quarter are expected to generate between $8 million to $10 million of annual G&A, equipment and project cost savings to mitigate pricing pressures on profitability levels.

Stock-based compensation expense was down $3.4 million in the quarter compared to last year, driven primarily by our lower share price as expected on the related liability. We recorded a net loss of $0.5 million in the current quarter, or a basic and diluted loss per share of $0.01.

This compares to last year’s net income of $0.1 million, a basic and diluted income per share of $0.0. Total interest expense was $2.6 million for the quarter, down from $2.8 million last year.

Interest on our higher cost Series 1 debentures was $1.3 million in the quarter, which is down from the $1.7 million reported last year, driven by the redemption of $16.3 million of Series 1 debentures last year.

Meanwhile, there was a slight increase in current quarter interest on capital lease obligations with the year over year increase in the balance in equipment finance through equipment leases.

Of note, we received $36 million from the owner of the Horizon mine on January 2 of this year for the settlement of assets sold under our overburden removal agreement. This amount was net cash received after buying out contract equipment financed by lease.

Given the current industry uncertainty, we plan to hold on to much of this cash in the short term. That summarizes our first quarter results. I’d now like to turn the call over to Martin for his remarks..

Thanks, Rob, and good morning to everyone. I’m very pleased that we have started the year with another quarter of strong operational execution.

We made the very best of the work that we had in an extremely challenging industry environment and produced pretty much the same EBITDA as in the corresponding quarter last year, even after a significant restructuring charge and without the benefit of a claim settlement.

The restructuring led to the departure of our Chief Financial Officer, David Blackley, who did a great job for us for several years, part of his legacy is that he built a very strong group of finance and accounting professionals.

Until the transition and since his departure it’s been smooth and effective, with Rob Butler stepping into the VP, Finance role.

Overall, the restructuring which involved other headcount reductions and decreasing benefits and bonus opportunities, less an impact of the pricing concessions that our customers are seeking in the present low oil price environment and make us more competitive for available work.

Discussions on those pricing reductions are in various stages of completion and will likely be concluded in the second quarter. It is noteworthy that we are already seeing a pickup in market share as the negotiations progress.

In my shareholder letter, which is [indiscernible] I gave several reasons why the Horizon mine will not be closed down due to prevailing oil prices, the main one being that the owners would use the economies of upscale production and lower operating cost.

In that context, it is good to hear evidence of progression along those lines in the earnings releases of our customers, with one already reporting a 20% reduction in cash operating expenses. We are playing our role in this and have received compliments on the proactive nature of our corporation.

Another feature of Q1 was the spring breakup started two to three weeks earlier than last year, which curtailed our winter work program and will lead to a longer than normal translation from winter earthworks to summer construction projects.

Customers are using this extended level to obtain best pricing, and so it is too early to predict how busy we’ll be in late Q2 and Q3. As last year, though, Q2 will be our slowest quarter, but based on the opportunities that we are addressing, we are hopeful of a reasonable construction season, especially given our better cost structure.

Those work opportunities are both inside the oil sands and outside. I have spoken on most calls about a desire to achieve revenue diversification. Our COO, Joe Lambert, is leading our business development efforts and I’d now like to hand it over to him for an update..

Thanks, Martin. As Martin just mentioned, we have been actively seeking industry diversification that help us improve our asset usage and expand our customer base. The recent drop in oil prices has reinforced a value and urgency in implementing that strategy.

Last year, we won our reentry into provincial roadwork with Highway 63 project which will be completed later this year. Since that award, we have been targeting a series of much broader and more robust projects outside the oil sands, the largest of these things is the BC Hydro Site C project.

We are a partner [indiscernible] that are prequalified for the Site C work contract. This involves core work for us in the form of major earthworks and includes a 30 million cubic meter in dam with rolled concrete cover in two diversion tunnels and it is expected to exceed $2 billion and run for seven to eight years.

Tenders will be submitted this summer and our share of the work would likely exceed $500 million. We also continue to pursue provincial municipal work jobs like the current Highway 63 job across all the Western provinces and generally we have a couple of active roadwork bid throughout Q2.

We will also be looking to partner on the overall project or establish a preferred subcontractor status with the upcoming Southwest Calgary wrangler. This major infrastructure project is expected to be commence qualifying potential teams by mid-2015 with an RFP expected by year end and awarded 2016.

Although activity is slow in some of our non-oil sand mining sectors due to commodity price, we continue to chase several projects and match our skills and capabilities, including construction of a tailings storage facility for a base metal producer in Q3, Q4, potential five-year mining contract with significant assets supplied by the coalmine owner and not unlike our current contract expected in Q3, Q4 and some initial budgetary pricing for the potential contract mining in our Eastern Canada Iron Ore min currently in development.

Lastly, we are activating and expect further activity in [indiscernible] Site D projects in Alberta. We’ve had expressions of interest for several earthworks support on pipeline projects in Western Canada and we continue to monitor and contact the LNG developers in Western Canada for potential upcoming sizable construction contracts.

Clearly, the recent positive news related to Pacific Northwest LNG project is encouraging for upcoming activity in this sector. I’d like now to turn the call back over to Martin for his concluding remarks..

Thanks, Joe. Staying on the topic of revenue growth for a moment [indiscernible] our earnings release was issued yesterday, perfect timing that we were not the selected performer for the early works of Site C. The nature of the work and the depressed activity levels in all markets, this trend became ultra competitive.

We understand that there were over a dozen business ranging from small private to large public contractors. Therefore, while we are a little disappointed by the outcome, we are not at all surprised by it. It is important for me to point out that the addition of revenue with low margin and high risk is very straightforward.

We, though, are only interested in actual revenue that carries a reasonable margin and appropriate risk. I’d now like to close our prepared comments by reinforcing the point that we aim to come out of this whole transactions stronger than we went it.

Both our balance sheet and project performance continue to improve and our near term aim is to reduce the cost of our debt. To this end, we’re making good progress in negotiating the credit facility which will allow us to deal with the outstanding debentures at the time of our choosing before they mature in April 2017.

In the meantime, we’re being buyers of both debentures and our stock in the open market. Myself and most of the board members are also being eyeing to our personal equity positions. Such is the confidence that we have in the future of our company. With that, I’ll pass the call back to the operator, Daniele, for any questions you might have..

[Operator Instructions] Our first question comes from Chris Lalor with GMP Securities..

Can you comment a little bit further on the EBITDA margin in the quarter and may be just the impact of utilization of larger versus smaller trucks?.

Chris, we benefited from good mix of work. In that mix, there was a lot of our heavy equipment utilized, after all it was mostly winter related works. But the true trick was just great execution. We executed extremely well. So I think that was the key to this..

And just in terms of visibility, I guess you’re currently in the process of bidding for the second half of the year, how is that – when do you expect some visibility on how the second half of the year will shape up?.

We’re taking up small awards on a daily, weekly basis, some of the bigger stuff as we mentioned in our prepared remarks, the customers [indiscernible] pretty hard and we’re looking for best pricing, it’s not surprising in the present situation. So it might be a few weeks before we hear things like the Syncrude MSA.

We are benefiting, as Joe mentioned, the large Site C, several contracts, probably June, July, about September. So the bigger stuff will be late Q2, Q3, but with a click start. So that’s kind of the timeframe we’re looking at..

And can you just comment on your view of the impact of the Alberta elections, put your thoughts on that?.

I’m an alien, so I’m not sure I can comment too much on it. Obviously it’s hot news and we’ll be interested to see the initial steps by the new party, so it’s going to be very interesting..

And last question just wondering if there’s any change in opportunities available to potentially acquire competitors out there?.

I think not enough [indiscernible] yet for M&A to be a focus. I am looking on it almost on a daily basis, but the spread between my bid and their ask is probably wide right now. I think [indiscernible] have to become appropriate. So I think it will not and I think as time will change here and M&A opportunities at depressed levels could be there.

But we’re just going to be patient, honestly there has been a strong growth time and we’re comfortable we can execute the work that we see in front of us. But [agents] is the key here..

[Operator Instructions] Our next question comes from Ben Cherniavsky with Raymond James..

First of all, Martin, it’s good to see that you guys are standing behind your work with the stock buyback and in particular your decision to put your skin in the game, I don’t see that often enough. So that deserves to be recognized.

The question I had just – and this maybe an untimely one now in light of the elections of state, but the LNG opportunities continue to be examined pretty closely, how do you guys feel you would be positioned and especially now in light of this safety development, you were in the contracts, but is this timing of the market at all, if future opportunities come up moving related to anything, but obviously LNG is something that people are watching.

So are you either directly positioned to bid on some of that work or even indirectly positioned to benefit if it goes forward?.

Yes, and I just [indiscernible] at Site C and to be honest we didn’t really expect to – the opportunity was there and we gave it a shot, but it was very competitive, over a dozen bidders. So no surprises that we didn’t get that.

What we think has gone to contract that we usually support kind of Site B work, so some equipment will leave and go and do that site preparation for six months. And that was the main civil project that we’ve always targeted and that’s still there in front of us.

As far as LNG is concerned, as Joe mentioned, we’re watching potential projects closely, because we think we can play our part in those works. So as news flows and it’s been getting a little better on one or two of those projects, we’re more hopeful of getting some work in the next two or three years.

So we’re tracking various opportunities outside of the oil sands, some of that near term, some are medium term and some are long term and we intend on adding revenue at the appropriate marginal risk is a key point..

There are no further questions at this time. I would like to turn the floor back to Martin Ferron for closing comments..

Well, thanks everybody for calling in today and we look forward to speaking to you next time. Thanks very much..

Thank you. Ladies and gentlemen, this concludes today's conference. You may disconnect your lines at this time. Thank you all for your participation..