SNDL Inc.

Good morning and welcome to SNDL's third quarter 2026 financial results conference call. This morning, SNDL issued a press release announcing their financial results for the second quarter of 2026, ended on September 30th, 2026. This press release is available on the company's website at SNDL.com and filed on EDGAR and CEDAR as well. The webcast replay of the conference call will be also available on the SNDL.com website. SNDL has also posted a supplemental investor presentation in addition to the conference call presentation we will be reviewing today on its SNDL.com website. Presented on this morning's call, we have Zach George, Chief Executive Officer, and Alberto Paredero, Chief Financial Officer. Before we start, I would like to remind the investors that certain matters discussed in today's conference call or answers that may be given to questions could constitute forward-looking statements. Actual results could differ materially from those anticipated. Risk factors that could affect results are detailed in the company's financial report and other public filings that are made available on CEDAR and EDGAR. Additionally, all financial figures mentioned are in Canadian dollars, unless otherwise indicated. We will now make prepared remarks, and then we will move on to analyst questions. I would now like to turn the call over to Zach George. Please proceed.

Welcome to SNDL's third quarter 2026 financial and operational results conference call. During the third quarter, S&DL delivered improved underlying financial performance while continuing to deploy capital against our highest conviction strategic priorities. We generated record quarterly free cash flow of $20 million and returned to positive adjusted operating income despite continued market pressure and significant challenges in cannabis operations. Cannabis retail delivered record quarterly net revenue and gross margin. while liquor retail also achieved a new quarterly gross margin record. These results demonstrate the value of disciplined pricing, mixed management, procurement productivity, and continued cost control across our retail platforms. At the same time, cannabis operations remain below our expectations. We took decisive action during the quarter to simplify the portfolio, exit the unprofitable domestic dried flower category, Reduce costs and concentrate resources on higher value products. We have also initiated a strategic review of the segment to assess a range of strategic and operational alternatives, including potential asset divestitures and broader productivity initiatives. We continue to allocate capital with discipline during the quarter. We repurchase 5.4 million shares and announced our intention to pursue a potential substantial issuer bid of up to 50 million, subject to required approvals and documentation. We also made significant strategic investments in the United States. Following the completion of Parallels Restructuring in July, our participation in its rights offering increased our indirect equity ownership from approximately 67% to approximately 92%. We also funded investments supporting a new cultivation facility in Gainesville, Florida, and the acquisition of an additional portion of Parallels take-back debt at a material discount to its face value. These actions reflect our priorities. Improve operating performance, preserve financial flexibility, return capital when our shares represent an attractive investment, and selectively pursue opportunities that can create meaningful long-term value. Over now to Alberto for more detail on our third quarter financial performance.

Thank you, Zach. Before moving on, I would like to remind everyone that the amounts discussed today are denominated in Canadian dollars unless otherwise stated. Certain figures referred to during this call are non-IFRS measures. for definitions of these measures and reconciliations were applicable. Please refer to SNDL's management discussion and analysis and the earnings press release issued today. Net revenue was 238 million in the third quarter of 2026, representing a decrease of 6.2 million or 2.5% compared with the same period of the prior year. Growth in cannabis retail and the impact of Lower cannabis eliminations partially offset declines in liquor retail and cannabis operations. Gross profit was 57.9 million, a decline of 6.3 million, or 9.8% year-over-year. Gross margin was 24.3%, down 2 percentage points, as record margins in both retail segments were more than offset by a weak performance of cannabis operations. Operating loss was $48.3 million, reflecting a $52 million non-cast goodwill impairment associated with cannabis operations. Adjusted operating income, which excludes intangible impairment charges and restructuring costs, was positive $5.2 million, an improvement of $14.8 million compared with the same period last year. Changing cash and cash equivalents was negative $50.7 million, primarily reflecting $60.8 million of capital contributions to equity-accounted investees and $10 million of share repurchases. Free cash flow was a record $20 million, up $3.3 million or 19.5% year-over-year, including a $10.6 million benefit from the initial unwinding of our captive insurance. Looking at our performance over the past several quarters, we're encouraged by the progress in adjusted operating income and free cash flow despite continued headwinds in revenue and gross profit. This reflects the financial discipline we have brought to the business and our continued focus on improving underlying profitability and cash generation. While there is still work to do, particularly in cannabis operations, We believe we're making meaningful progress towards a more profitable and cash-generative business. Looking more closely at segment contributions, consolidated net revenue declined by 6.2 million year-over-year. Liquor retail declined by 4.6 million, and cannabis operations declined by 10.3 million. Cannabis retail increased by 0.6 million, while the change in cannabis eliminations provided an 8.2 million offset. Gross profit declined by $6.3 million driven by cannabis operations which accounted for a $6.6 million decline. Liquor retail declined by $0.3 million while cannabis retail increased by $0.7 million. Adjusted operating income improved by $14.8 million from a loss of $9.5 million in the prior year quarter to income of $5.2 million. a $9.9 million improvement in corporate expenses and a $6.6 million improvement from investments more than upset weaker results in cannabis operations and liquor retail. Free cash flow increased from $16.7 million in the third quarter of 2025 to a record $20 million this quarter. Compared with the prior year quarter, lower cash earnings reduced free cash flow by $1.1 million and year-over-year working capital change reduced by 11.8 million. Working capital optimization contributed 2.5 million in the third quarter of 2026, but this benefit was lower than in the prior year quarter due to differences in the timing of working capital movements. These impacts were more than offset by 16.2 million of other items, including a 10.6 million benefit from the initial unwind of the captive insurance arrangement. While the captive insurance contribution to Q3 free classroom is a one-time item, we expect a second and final $8 million cash inflow in the fourth quarter as we completely unwind of the captive structure. Turning to the commercial segments, I will begin with liquor retail. As a reminder, beginning in 2026, applicable direct and indirect overhead costs are allocated from corporate to its operating segment within general and administrative expenses, and comparative periods have been recast. Liquor retail net revenue was $134.8 million, a decline of $4.6 million, or 3.3% year-over-year. Persistent softness in market demand continued to affect same-store sales, which declined 6%. Growth from the three new One and Beyond stores opened during the last 12 months, together with continued momentum in private label sales, which outperformed national brands by 8.5% points in the quarter, helped partially offset the same-store sales decline. Gross profit was $36.4 million, down $0.3 million, while gross margin expanded 70 basis points to a record 27.0%. The margin improvement was driven by pricing, product mix management, and procurement productivity. Adjusted operating income was $6 million, down $0.6 million year-over-year, as the benefit from gross margin expansion was more than offset by lower revenue and higher CNA expenses associated with the recent historic openings. Cannabis retail net revenue returned to growth and reached a new quarterly record of $85.6 million, an increase of $0.6 million, or 0.7% year-over-year. New store openings and value-backed conversions more than offset a 3.8% decline in same-store sales caused by market contraction in Alberta and Ontario. Gross profit increased by $0.7 million to $23.1 million, while gross margin expanded by 60 basis points to a record 27.0%. The improvement was supported by promotional and product mix efficiencies and increased data revenues. Adjusted operating income was $5.3 million, an increase of $0.2 million, or 4.7%, as promotional and product mix efficiencies and increased data revenue more than offset the impact of higher asset impairment reversals in the prior year period. Cannabis operations net revenue was $27.0 million, a decline of $10.3 million, or 27.7% year-over-year. The decline was primarily attributable to our exit from the unprofitable domestic dried flower category, as we reshaped the segment to focus on higher value product categories. Gross profit was negative $1.6 million, with a gross margin of negative 6%. These results were primarily driven by inventory adjustments associated with our exit from dried flower, as well as the gear cost variances. Adjusted operating income loss was $11.4 million, compared with a loss of $10.2 million in the prior year. While the segment results remain below our expectations, we took decisive action during the quarter to reduce manufacturing costs and other operating expenses, particularly at our Kelowna facility. These actions included a workforce reduction of more than 30% at that site. We expect the P&L benefits of these actions to begin contributing in the fourth quarter. Given the segment's continued underperformance, we have also initiated a strategic review to evaluate alternatives to improve its financial performance and reduce its impact on our consolidated results. The review will consider a range of alternatives, including potential asset divestitures and broader productivity initiatives. Over to you, Zach, for additional comments on capital allocation and our strategic milestones.