Metro Inc.

Good morning, ladies and gentlemen, and welcome to the Metro, Inc. 2026 third quarter results conference call. At this time, note that all participant lines are in the listen-only mode. Following the presentation, we will conduct a question and answer session. And if at any time during this call you require immediate assistance, please press star zero for an operator. Also note that this call is being recorded on August 12, 2026. I would now like to turn the conference over to Sharon Kadosh, Director, Investor Relations, and Corporate Finance. Please go ahead.

Merci, Sylvie. Good morning, everyone, and thanks for joining us today. Our comments will focus on the financial results of our third quarter, which ended on July 4th. With me today is Mr. Eric La Fleche, President and CEO, Nicolas Amyot, Executive VP and CFO, Marc Giroux, Chief Operating Officer, and Jean-Michel Coutu, President of the Pharmacy Division. During the call, we will present our third quarter results and comment on its highlights. We will then be happy to take your questions. Before we begin, I would like to remind you that we will use in today's discussion different statements that can be construed as forward-looking information. In general, any statement which does not constitute a historical fact may be deemed a forward-looking statement. Words or expressions such as expect and send are confident that will and other similar words are for Expressions are generally indicated as forward-looking statements. The forward-looking statements are based upon certain assumptions regarding the Canadian food and pharmaceutical industries, the general economy, our annual budget, and our 2026 action plan. These forward-looking statements do not provide any guarantees as to the future performance of the company and are subject to potential risks, known and unknown, as well as uncertainties that could cause the outcome to differ materially. Risk factors that could cause actual results or events to differ materially from our expectations as expressed in or implied by our forward-looking statements are described under the risk management section in our 2025 annual report. We believe these forward-looking statements to be reasonable and pertinent at this time and represent our expectations. The company does not intend to update any forward-looking statements except as required by applicable law. I will now turn the call over to Eric.

Good morning, everyone. I will start with an update on the labor conflict in our Quebec operation, followed by comments on our quarterly results. Marc Giroux will then discuss the network optimization initiatives announced today, and Nicolas will address their financial impact as well as their financial performance for the quarter. As you will recall, on June 25, we provided an update on the ongoing strike at our produce distribution center in Laval. which has significantly impacted our operations and results in the quarter. Our adjusted EPS for Q3 of 1-24 is within the guidance provided at the time of the update. Our third quarter was certainly challenging. The contingency plan we put in place is working and steadily improving and our stores are generally well stocked and in good condition. Our focus is on restoring full assortment, strengthening store execution, and driving back traffic to our stores. That said, it remains a contingency measure and it does not replicate the effectiveness of our own network. Moreover, the labor disruption required significant attention and resources from our team which affected our operating focus in Quebec and to a lesser extent in Ontario as our Toronto fresh VC supported a portion of our Quebec stores. I want to be clear. We remain committed to reaching a negotiated agreement with the Union. The global offer presented by Metro provides competitive wage and working conditions that compare very favorably with the market, in addition to offering quality long-term jobs here in Quebec. While the strike is having a significant temporary impact, we must preserve the long-term competitiveness of our operations and our ability to continue serving our customers effectively in a competitive market. We will not compromise on this objective. I want to thank our teams for their resilience and our customers for their understanding as we continue working to provide the best possible shopping experience. After four weeks in our fourth quarter, food safe store sales remain negative at minus 1.5%. Based on current operating conditions and the absence of clear resolution timeline for the We expect that our fourth quarter results will continue to be significantly impacted while our teams actively manage operations, service levels, and customer recovery. Going back to our third quarter results, the quarter reflected continued strength in pharmacy, sustained online growth, and progress on our retail investment plan. Sales grew by 1.4%, adjusted EBITDA was down 11.3%, and adjusted earnings per share were down 18.4%. These figures are not adjusted for an estimated strike impact of approximately 32 cents per share. Total food sales were up 0.5% while same-store sales were down 1.5%. In pharmacy, total sales were up 5% with same-store sales growth of 4.8% on top of 5.5% last year. Our internal food basket inflation was in line with the reported food CPI of 3.9%. We continue to manage supplier cost increases through ongoing negotiations and a rigorous validation process with the objective of limiting the impact on our customers. During the quarter, comparable store customer traffic was down, partly offset by growth in the average baskets. Promotional activity remains elevated, as the competitive environment remains intense but rational. Online sales grew by 16.3% in the quarter, driven by third-party marketplaces, the wrap-up of click and collect services, and delivery within our discount planners. This growth, together with the customer's increasing demand for same-day delivery, supports the evolution of our e-commerce model, which Marc will discuss in more detail shortly. Turning to pharmacy, The business continued to perform well this quarter, with prescription sales up 6.4%, driven by continued organic growth, specialty medications, and GLP-1 therapies. Commercial sales grew by 1.4%, led by cosmetics, beauty, and seasonal categories, and supported by a strong promotional mix. These results build on strong underlying momentum, with prescription sales delivering a two-year staff growth rate of 13%, and commercial sales delivering a two-year stacked growth rate of 5.5%. During the quarter, generic semi-glutide entered the market, causing some price deflation within the category. However, demand fundamentals remained strong, with early evidence of increased patient adoption and higher prescription volumes. As generic supply continues to build, we expect ongoing expansion of the GLP-1 category to drive low team volume and contribution growth. In addition, following the agreement in principle between the Pharmacists Association, QPP, and the Quebec government, we expect professional services to gain renewed momentum beginning in the second quarter of fiscal 27. Our retail capex plan remains on track. We opened five new discount stores in the quarter, including one conversion and one relocation, and we will achieve our plan to open a dozen discount stores by fiscal year-end. We are very satisfied with the performance of our new and converted discount stores. On the pharmacy side, our renovation program is also progressing well, with 30 projects planned for the year, including seven pharmacies under our new content. Newly renovated pharmacies continue to outperform average network sales growth, supported by enhanced layouts and expanded consultation areas. To conclude, we are focused on restoring momentum and strengthening our market execution. We are confident that our merchandising programs, strong private label offering, more loyalty program, and consistent store-level execution will continue to provide value to customers and support long-term shareholder value. With that, I will now turn the call over to Marc, who will discuss the network optimization initiatives we announced today.