Alimentation Couche-Tard Inc.

Good morning. My name is Julie, and I will be your conference operator today. Bonjour. Je m'appelle Julie, et je serai votre opératrice pour la conférence d'aujourd'hui. I will now introduce Mr. Mathieu Brunet, Vice President, Investor Relations and Treasury at Alimentation Couchetard. Je vais maintenant passer la parole à M. Mathieu Brunet, Vice President, Relations Investisseurs et Trésorerie pour Alimentation Couchetard.

Good morning. English will follow. Bonjour. J'aimerais d'abord vous souhaiter la bienvenue à la téléconférence qui porte sur la diffusion des résultats financiers du quatrième trimestre et l'exercice 2024 d'alimentation couche-tard. Toutes les lignes seront placées en mode discrétion afin d'éviter tout bruit inutile. À la suite de la présentation, nous répondrons en direct aux questions des analystes. Nous souhaitons vous rappeler que cette webdiffusion sera disponible sur notre site Internet pour une période de 90 jours. In addition, note that some of the topics discussed during this webcast could consist of prospective statements provided by the Society with usual warnings. These warnings or risks, as well as these uncertainties, are described in our financial reports. It is therefore possible that our future results may differ from the information presented today. Les résultats financiers seront présentés par M. Brian Hanisch, Président et Chef de la Direction, M. Felipe Da Silva, Chef de la Direction Financière, et M. Alex Miller, Chef de l'Exploitation et Prochain, Président et Chef de la Direction. Good morning. I would like to welcome everyone to this web conference presenting Alimentation Cristal's financial results for the fourth quarter and fiscal year 2024. All lines will be kept on mute to prevent any background noise. After the presentation, we will answer questions from analysts asked live during the conference. We would like to remind everyone that this webcast presentation will be available on our website for a 90-day period. Also, please remember that some of the issues discussed during this webcast may be forward-looking statements, which are provided by the corporation with its usual caveats. These caveats are risks and uncertainties are outlined in our financial reporting. Therefore, our future results could differ from the information discussed today. Our financial results will be presented by Mr. Brian Anish, President and Chief Executive Officer, Mr. Felipe Da Silva, Chief Financial Officer, and Mr. Alex Miller, Chief Operating Officer and CEO-elect. Brian, you may begin your conference.

Thank you, Matthew, and good morning, everyone, and thank you for joining us for our presentation of our fourth quarter results. Before I get started, I wanted to say a few brief remarks about the press release we issued earlier this morning, announcing my decision to retire as Kushtar's president and CEO, and the appointment of Alex Miller as our next president and CEO, effective September 6th. I'll remain with the organization as a special advisor for the next couple of years with the focus on M&A. As I come to the end of my 10th year as Kushtar's president and CEO and 25th year as a part of this management team, I must say it's been a true honor of a lifetime to lead this amazing company. I'm so proud of the value that we've created together, as well as the commitment and passion of our team members to serving our customers. I know Kushtar will be in strong hands with Alex, as he's been one of my closest business partners at Kushtar for the last 13 years, and we've worked together in the industry for nearly 30 years. Alex knows the business inside and out. He deeply cares about our culture, and he'll have a great leadership team supporting him. I also want to thank Elaine Bouchard, our founders, our board of directors, customers, team members, shareholders, and all of you for your continued support in trusting me to lead this great business. For that and much more, you have my lasting gratitude. We'll have time to answer your questions later in the call as well as in the coming weeks. Now let me get back to our Q4 results. No doubt this was another challenging quarter with persistent inflation and continued pressure on consumers who are carefully watching their spending. However, we believe this is transitory, and we remain very optimistic about our business. Even with recent softness in same-store sales, overall, they've been steadily growing globally over the last two years, particularly in the U.S., which saw a 2.8% growth on a two-year stack for the quarter. On the fuel side of our business, we continue to strengthen our leadership position across most of our markets, and our margins remain healthy. We're also pleased that our focus has consistently remained on providing everyday value and ease for our customers and leveraging the competitive advantages of our global scale and diversified business to take market share and drive long-term growth. Turning to convenience, compared to the same quarter last year, same-store merchandise revenues decreased by 0.5% in the U.S., 2% in Europe and other regions, and by 3.4% in Canada. As I mentioned earlier, these results were impacted by near-term headwinds in the economy and continued inflation and are being compared with an exceptionally strong quarter last year. It's also worth noting that Europe has had a positive performance for the quarter with a plus 0.7% same-store growth. However, the overall Europe and other region results were impacted by weak results in our Hong Kong market, driven by large cigarette tax increase and weak tourism from mainland China. To help our customers look for value, we continue to focus on improving and expanding our loyalty programs both in the U.S. and in Europe. In the U.S., inner circle registrations and enrollments continue to grow, and we ended the year with over 6.3 million customers fully enrolled in the program. Across the 30 states with the membership program, we're seeing visit frequency and spends per member growing consistently month over month. Florida, which is our first business unit on the program, finished its inaugural year with about 20% of customer transactions linked to our Inner Circle program. In Europe, the updated Extra Loyalty program ended the year with strong key metrics across the board also. Nearly half of all fuel volume is coming through Extra, and merchandise penetration is also seeing year-over-year growth, with close to 30% of our merchandise sales attributed to Extra members. The program has just launched in Ireland, and we're exploring ways to expand it into our new European countries. Both programs enable us to offer personalized value to our most important customers. Shifting to food, Fresh Food Fast is now in nearly 5,800 locations globally. Operations teams continue to focus on improving profitability and reducing spoilage, including introduction of new production planning tool that improves the accuracy of forecasting. thereby allowing our store teams to better identify what products are needed and at what times of the day we're seeing strong sales and satisfaction with our freshly prepared cookie program and we've introduced some great lto's including our kong breakfast slam which with triple meat and double cheese this quarter we've also completed the rollout of our global digital food safety program which earned a food service innovator of the year industry award recently As we strive to be the number one thirst stop across the network, we've launched exciting summer campaigns to drive traffic and provide value for our customers. In the U.S., at participating locations, we're offering Polar Pop and Froster at any size for just 79 cents, and for our Inner Circle members, the same offer starts at 69 cents. We've also added exclusive Gayberry flavors called Lightning Blast, which has contributed to overall growth in sports drinks. In Europe, packaged beverage sales are also performing well, and we're growing market share. While we continue to see pressure on cigarette sips globally, in the U.S., we're starting to see some positive results with our tobacco customers. This is partly due to the initiatives we've had underway with our supply partners, including brand-focused contests and personalization programs for our age-verified customers. In other nicotine products, we continue to see strong growth across the network, with exclusive vaping opportunities coming to Europe by the end of the summer. For both, we believe we are outperforming the overall market. Moving to our fuel business, same-store road transportation fuel volumes decreased 1.6% in the U.S., 1.7% in Europe, and 3.5% in Canada. As I mentioned earlier, our fuel business, we have a strong leadership position across most of our markets, and our margins remain healthy. We also continue to build value for our customers and businesses through the optimization of our supply chain globally. In this quarter, low market volatility persisted, which is not optimal for our results, but our supply trading logistics teams are working to find new opportunities to improve supply optionality and increase arbitrage capture. Turning to our B2B business, in Europe, card volumes remain very robust across both fleet and truck segments, with small fleet remaining the main growth driver. In the U.S., the B2B share continues to grow double digit as we expanded our sales teams across our business units. Our Circle K Pro proprietary card platform also realized the overgrowth with both volume and transactions, bringing in new fueling B2B customers and outperforming our benchmark competitors. Our EV fast charging network now consists of more than 2,600 charge points, including about 55 charging points for heavy trucks. In North America, our EV rollout plan is progressing toward our deployment target of 200 locations. Network growth, we're making good progress in the integration of our four new European countries. Earlier this month, I visited all four countries and the team members. I was very impressed with their engagement and commitment to growing our business. It was also exciting to see and visit our newly rebranded Circle K stores. We now have 11, which I would call technical pilots in the four countries where we're exploring new ways to grow sales under the new brand. In organic growth, we continue to ramp up development and currently have a record number of projects under construction, primarily in the U.S., including a focus on rural and high-speed diesel locations. And finally, we're seeing more M&A opportunities than we have for quite some time, and so we're cautiously optimistic that we're going to find some new growth opportunities in the coming quarters. Before I conclude, I want to mention the work we're also doing to improve operational excellence, which is the foundation for everything we do. We continue to implement enhancements and programs that simplify administrative tasks required by our store teams and managers. We're also truly humbled and pleased this quarter to have been recognized as Gallup's exceptional workplace for the third year in a row. We are one of the very few businesses of our size to receive this honor. This is truly a testament to our highly engaged, customer-focused teams that are working hard to make it a little bit easier for our customers during these challenging times. Looking ahead, while we ride out these near-term economic headwinds, we're seeing our first quarter of the new fiscal year that the performance in same-store sales has sequentially improved to the last quarter. This is particularly due to our investment in bringing value to our customers. In addition, while road transportation fuel volumes remain a bit soft, we're also seeing fuel margins improve versus prior quarters. And with that, I'll pause and turn it over to Felipe. Felipe?