Goodfood Market Corp.

Welcome to the Good Food Fourth Quarter and Fiscal Year 2022 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question and answer session. As courtesy to others, we ask that each participant limit themselves to one question and one follow-up. Instructions will be provided at that time for you to queue up for questions. Please note that questions will be taken from the financial analysts only. If anyone has any difficulties hearing the conference, please press star followed by zero for operator assistance at any time. I would like to remind everyone that this conference call is being recorded today, Friday, December 2, 2022, at 8 a.m. Eastern Time. Furthermore, I would like to remind you that today's presentation may contain forward-looking statements about Good Foods' current and future plans, expectations and intentions, results, level of activity, performance, goals or achievements, or other future events or developments. As such, please take a moment to read the disclaimer on the forward-looking statements on slide two of the presentation. I'd now like to turn the meeting over to your host for today's call, Jonathan Fiore, Good Food Chief Executive Officer. Please go ahead.

Thank you.

Good morning, everyone, and welcome to this call for Good Food Market Corp. to present our financial results for the fourth quarter and fiscal year 2022, ended September 3rd. I'm happy to be joined on the call today by Neil Kugge, Good Food's president and COO, and Jonathan Reuter, a financial officer. Our press release reporting our third quarter results was published earlier this morning. It can be found on our website at makegoodfood.ca and on CDAR. Please be aware that we will refer to certain metrics and non-IFRS measures. Where possible, these measures are identified and reconciled to the most comparable IFRS measures in our MD&A. Finally, let me remind you that all figures expressed on today's call are in Canadian dollars unless otherwise stated. I will now turn to slide three, which reviews Goodfood's recent strategic developments. During the fourth quarter and in recent weeks, we have taken multiple key steps in our relentless march towards profitability and growing positive cash flows. Through the execution of Project Blue Ocean and other initiatives, we have made big strides towards achieving that goal. The two key pillars driving our progressive return to profitability are one, a renewed focus on inspiring joy with our weekly meal kit offering, helping our customers live longer on a healthier planet, and two, a continued improvement in our cost structure driven by a higher gross margin, reduced selling general and administrative expenses, and asset footprint streamlining. Together, they have combined the substantial gross margin and adjusted EBITDA improvements, over the year and during the quarter. Zooming in on the two pillars, we have first returned to our roots, focusing on our weekly meal kit offering with a twist. Thinking back to our purpose and to the problem Goodfood is looking to solve, we're looking to provide customers with joyful meal experiences and solutions to help them live longer on a healthier planet. To achieve that, our cornerstone product, our delicious chef-designed meal kits, and differentiated ready-to-eat and grocery add-ons combined to provide customers with a unique experience that simplifies their meal planning with great culinary experiences. As such, we announced the decision to discontinue our on-demand delivery and refocus our efforts on the differentiated weekly subscription offering that has always been the cornerstone of our customer value proposition. Our on-demand delivery had strong consumer fit and has allowed good food customers to experience an instant grocery solution. Due in large part to the high attachment rates of our meal kits, the on-demand proposition had attractive at-scale economics. However, on-demand's margin profile was yet to be at scale, and hence we made the difficult but financially disciplined decision to discontinue good food on-demand to best position the company to return to profitable growth. This decision does have a silver lining in that On Demand introduced the Good Food brand to thousands of Canadians, many of which are now enjoying the excitement and simplicity of our weekly meal kit experience.