Saputo Inc.

Greetings and welcome to the Saputo, Inc. third quarter fiscal 2023 results conference call. During the presentation, all participants will be in a listen-only mode. Later, we will conduct a question and answer session. At that time, if you have a question, please press the 1 followed by the 4 on your telephone. If at any time during the conference you need to reach the operator, please press star 0. As a reminder, this conference is being recorded. Friday, February 10th, 2023. It is now my pleasure to turn the conference over to Nick Estrella. Please go ahead.

Thank you, Tina. Good morning, and welcome to our third quarter fiscal 2023 earnings call. Our speakers today will be Lino Saputo, Chair of the Board, President and Chief Executive Officer, and Maxime Therrien, Chief Financial Officer and Secretary. For the question and answer session, Lino and Maxim will be supported by Carl Kolitsa, President and Chief Operating Officer, North America, and Leanne Cutts, President and Chief Operating Officer, International and Europe. Before we begin, I'd like to remind you that this webcast and conference call are being recorded and the webcast will be posted on our website along with the third quarter investor presentations. Please also note that some of the statements provided during this call are forward-looking. Such statements are based on assumptions that are subject to risks and uncertainties. We refer to our cautionary statements regarding forward-looking information in our annual reports, press releases, and filings. Please treat any forward-looking information with caution as our actual results could differ materially. We do not accept any obligation to update this information except as required under securities legislation. I'll now hand it over to Lee Holmes.

Thank you, Nick, and good morning, everyone. Following a solid first half of the fiscal year, our positive momentum has continued across all our sectors in the third quarter. We delivered strong results, reflecting our focus on execution and the advancement of our strategic priorities. Our U.S. sector led the way with a significant year-over-year improvement, while our Canada and international sectors continued to deliver consistent results. Our Europe sector trended better despite inflationary pressure and prolonged challenges in the consumer environment. Consolidated revenues increased to 18% versus the prior year due to both inflation-driven price increases and improvements in our ability to supply ongoing demand. The broad-based inflationary pressure we are experiencing across our cost base continues to be well-controlled and mitigated. We're making progress on adjusted EBITDA margin recovery with a meaningful year-over-year improvement in Q3, a positive step up when compared to the last several quarters. Our focus on inflation-driven pricing actions and on operational improvements position us well from a margin perspective going forward. Consumer demand for our products in the third quarter was strong. Despite increasing prices, compared to last year. Dairy remains an affordable, flexible, and accessible option relative to other proteins on the market. That said, consumers are value conscious, so we're meeting their needs through tailored product offerings, pack sizes, and promotions. The operating environment remains dynamic. Consequently, we are advancing our efficiency and productivity initiatives. Like many other businesses, We have been constrained by labor shortages, especially in the U.S. Staffing levels and the impact on operational throughput have been a major challenge the past 18 months. We have responded aggressively by ramping up recruitment and retention activities and leveraging our foreign worker program. Although labor has improved, notably with greater workforce stability, we're not out of the woods just yet. While the external environment has required a heightened focus on execution, it has not limited our ability to advance our strategic priorities. We are continuing to make progress on our global strategic plan roadmap. While managing our portfolio to maximize value creation and drive organic growth, we are investing for the future. As such, several capital investments and consolidation initiatives in our U.S. sector were announced last week to further optimize our manufacturing footprint and enhance operational agility. This includes the construction of a new state-of-the-art cut-and-wrap facility in Franklin, Wisconsin, and the expansion of string cheese operations on the West Coast. This has led to the decision to permanently close our Big Stone South Dakota, Green Bay, Wisconsin, and Southgate, California facilities. As a result, we will increase operating efficiencies, translating into lower costs, further consolidate our production capacity in world-class facilities, and increase capacity and capabilities for higher margin, value-added products to meet growing demand. Specifically, we expect to yield financial benefits beginning in Q4 fiscal 2024 and reaching its full potential of approximately $74 million annually by the end of fiscal 27. This more focused footprint aims to strengthen the competitiveness and long-term performance of our U.S. operations. We reached a significant milestone with our OneUSA project. In April, we will have completed the combination of our legacy cheese and dairy foods divisions with the alignment of our business processes, system applications, and IT infrastructure. This will allow for a unified customer experience, easier customer and supplier transactions, support a single cheese and dairy food supply chain, and continued organizational growth. Overall, we expect the initiatives to harmonize our processes and procedures to maximize synergies, support growth, and drive more of an integrated business model in the U.S. sector. The project will mark the culmination of several quarters of hard work by our teams to thoughtfully plan for the implementation. So I'm confident we'll have a seamless transition in Q1 of fiscal 24. We're pleased with what we've accomplished so far this year. And overall, we see a long runway of opportunity ahead. I've said this in the past, all of our efforts to date need to be balanced with an eye towards future profitable growth. Although there remains more to do as we continue unlocking our full growth potential, this quarter's results represent a strong turnaround in our performance, and we have good momentum exiting this year. I will now turn the call over to Max for the financial review before providing concluding remarks. Max?