Good morning. My name is Michelle, and I will be your conference operator today. At this time, I would like to welcome everyone to the Andlauer Healthcare Group 2023 Second Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. Please be aware that certain information discussed today may be forward-looking in nature. Such forward-looking information reflects the company's current views with respect to future events. ... Such information is subject to risks, uncertainties, and assumptions that could cause actual results to differ materially from those projected in the forward-looking information. For more information on the risks, uncertainties, and assumptions related to forward-looking information, please refer to the company's latest MD&A and Annual Information Form, which are found on SEDAR. Management may also refer to certain non-IFRS financial measures. Although the company believes that these measures provide useful supplemental information about financial performance, they are not recognized measures and do not have standardized meanings under IFRS. Please see the company's latest MD&A for additional information regarding non-IFRS financial measures, including for reconciliation to the nearest IFRS measures. Please note that unless otherwise stated, all references to any financial figures are in Canadian dollars. Following management's remarks, there will be a question-and-answer session. This call has been recorded on August second, 2023, and I would now like to turn the conference over to Michael Andlauer. Please go ahead, sir. Good morning. Thank you, Michelle. Good day, everybody. Thank you for joining us today. With me on the call today is Peter Bromley, our Chief Financial Officer. Following my opening remarks, Peter will follow with a more detailed discussion of our financial results for the quarter. I'll provide closing comments and open the lines to questions. Well, we generated solid results in our second quarter this year, though not as strong as our record quarterly results of Q2 a year ago, when we benefited from superior U.S. truckload rate premiums, higher revenue related to COVID-19 vaccines, ancillary products, and an unusually high air freight forwarding volumes. Our Q2 this year also reflects much lower fuel surcharges than the Q2 of last year, in line with a similar reduction in expenses. Despite the lack of these operating tailwinds in Q2 this year, our consolidated revenue for the first half of this year is higher than the same period a year ago, and our EBITDA margins for the quarter and the year to date remain within our historical range of 24%-26%. As expected, our revenue related to COVID vaccines and ancillary products comprised of less than 1% of our revenue in Q2 this year, compared to 2.6% of higher revenue in Q2 a year ago. Our margins and net earnings for the quarter also reflect a year-over-year decline in contribution from our U.S. truckload operations, as the rate premiums we were able to capture in fiscal 2022 related to equipment and driver shores have now diminished. Our U.S.-based ground transportation revenue and related margins have returned to pre-pandemic levels, and we do not foresee a return to the premiums we achieved in fiscal 2022. These margins are attractive and in line with our initial projections at the time of our acquisitions of Boyle & Skelton USA, and we look forward to driving growth in our U.S. operations going forward. Despite the year-over-year decline in operating performance in the quarter, we continue to expect long-term consolidated organic revenue growth in the mid to high single digits. We also continue to pursue acquisitions to further strengthen our platform and drive incremental profitable growth. I'll turn it over to Peter to review our financial performance in more detail. Peter? Thank you, Michael. Good morning, everyone. Our consolidated revenue for Q2 totaled CAD 157.4 million, a decline of 7.1% from our record quarterly revenue in Q2 last year. Revenue for our healthcare logistics segment was CAD 43.7 million, down 9%, excuse me, from Q2 last year, reflecting a 5.8% year-over-year decrease in our logistics and distribution product line revenue and a 31.3% decline in packaging revenue. The decrease in logistics and distribution revenue was due to lower outbound handling activities for Accuristix and reduced transportation billings impacted by fuel surcharge programs from carriers. The decrease also is partially attributable to CAD 2.1 million of revenue recognized in Q2 last year, related to certain passthrough expenses, which were reclassified to logistics and distribution revenue for LSU in accordance with IFRS 15 during Q4 2022. This net revenue treatment has been consistently applied during year-to-date 2023. The decline in packaging revenue was due to the loss of one of our packaging customers previously disclosed in Q1, and lower volume from our remaining base of packaging customers related or compared to Q2 a year ago. Revenue in our specialized transportation segment totaled CAD 113.7 million, a decline of 6.4% compared with Q2 last year. The year-over-year decline in segment revenue reflects a 2.7% decrease in ground transportation revenue.... a 33.4% decline in air freight forwarding revenue, and a 4.5% decrease in revenue from our dedicated and last mile delivery product line. The decrease in ground transportation revenue is primarily attributable to lower fuel costs passed on to customers as a component of pricing. Our ground transportation revenue, excluding fuel in our Canadian network, increased by approximately 3%. Downward pressure on our U.S.-based truckload rates compared to fiscal 2022, as Michael noted previously, offset this growth. The decline in air freight forwarding revenue was attributable to lower fuel surcharge revenue and lower weight shipped by customers compared to Q2 last year. Our air freight forwarding customers shipped an unusually high volume in during Q2 last year due to supply chain issues during the period. The volume shipped in during Q2 this year were more typical and resulted in revenue slightly higher than our revenue for the Q1 this year of CAD 7.5 million. Approximately 25% of the CAD 3.9 million year-over-year decline in air freight forwarding revenue was attributable to lower fuel surcharge revenue. The CAD 0.8 million year-over-year decline in our dedicated and last mile delivery product line reflects lower fuel surcharge revenue compared to Q2 last year, partially offset by continued organic growth. Cost of transportation services was CAD 78.9 million, or 50.1% of revenue, compared to CAD 82.8 million, or 48.9% of revenue for Q2 a year ago. The lower cost of transportation and services this quarter was primarily attributable to lower fuel costs, in line with the decreases in revenue related to fuel prices. The increased operating ratio reflects lower pricing in our U.S. truckload operations. Direct operating expenses were CAD 26.4 million, or 16.8% of revenue, compared with CAD 28.3 million or 16.7% of revenue for Q2 last year. Our direct operating expenses, in the quarter reflect a reduction in outbound volume of our Accuristix logistics and distribution operations. SG&A expenses were 8.1% of revenue for the quarter, which is in line with our expectations and compares to 7.2% of revenue for Q2 a year ago. The increase was due to investments in supporting our business growth. Operating income totaled $22.6 million, compared to $30.2 million for Q2 last year. The decrease is primarily attributable to reduced contributions from Boyle Transportation and Skelton USA, lower air freight forwarding revenue, and the decline in revenue related to COVID-19 vaccines and ancillary products. Net income was $15.7 million, or $0.37 per share on a diluted basis, compared with $21.0 million or $0.49 per share on a diluted basis in Q2 a year ago. Total comprehensive income was $10.7 million, compared to $27.6 million in Q2 last year. Total comprehensive income differs from net income due to our foreign operations, Boyle Transportation and Skelton USA, which resulted in a negative foreign currency translation adjustment of $5 million this quarter, compared to a positive foreign currency translation adjustment of $6.6 million in Q2 2022. EBITDA totaled $39.5 million, compared with $46.3 million for Q2 last year. The decrease is due to the factors already discussed. Our EBITDA margin was 25.1% for the quarter, which is within our historical range of 24%-26% and compares to our margin of 27.3% in Q2 last year. If I look at our balance sheet, at quarter end, we had cash and cash equivalents of $84.3 million and working capital of $117.3 million. This compares to cash and cash equivalents of CAD 65.9 million and working capital of CAD 85 million at the 2022 year end. At quarter end, the amount outstanding under our credit facilities was CAD 50 million under our term facility and nil under our revolving credit facility. We remain well-positioned financially to pursue growth opportunities. I'd now like to turn the call back over to Michael for closing comments. Michael? Okay, thanks, Peter. As, as Peter said, supported by our strong and growing free cash flow and low debt levels, our board approved a CAD 0.01 increase to our shareholder dividend yesterday, bringing our quarterly payout to CAD 0.09 per share. Looking ahead, we'll continue to remain focused on opportunities to strengthen our clients' connection to our platform by broadening our service offerings, increasing our capacity to attract both new clients and new business, and pursuing strategic acquisitions to further strengthen our platform in both Canada and in the United States. We have an attractive pipeline and potential acquisition targets, and we're well-positioned financially to pursue value-enhancing growth opportunities. As we continue to expand on our platform, we'll maintain our disciplined, focused approach and respect, with respect to both financial and operating metrics, and our constant focus on better serving our customers and our employees in the future. I'd like to open the line to the questions. Michelle, please commence the Q&A. Thank you. Ladies and gentlemen, we'll now conduct a question and answer session. If you have a question, please press the star key followed by one on your touchtone phone. You will hear a tone prompt acknowledging your request. If you would like to cancel your request, you may press the star two. Please ensure you lift the handset if you're using a speakerphone before pressing any keys. Gentlemen, the first question comes from Kevin Chiang with CIBC. Your line is open. Please proceed. Hi, hi, hi, good morning, and thanks for taking my question. Maybe just a clarification question, just given all the moving parts as you, as you lap, you know, the record 2022. You know, when you talk about the, you know, 2.6% of, of, of revenue that was associated with COVID last year, is that only inclusive of products you would have moved related to the pandemic, or would that be inclusive of some of the other benefits you saw from some of the broader disruptions in the supply chain, such as, you know, the higher, we'll call it non-recurring rates within U.S. ground transportation, you know, some of the, some of the airfreight opportunities in Q2 last year? Just trying to level set, like, how much of this revenue you view as being, essentially non-recurring and kind of, reflective of a lot of the disruption we saw last year, which aren't occurring this year, thankfully. Yeah. Good morning, Kevin. Yeah, that's a good question, and that's one of those areas that was kind of hard to qua-quantify. But we felt it was important to, to, to quantify as best as we could. How we did that is we, we, we looked at the truly related vaccine products. If it was a Pfizer vaccine that we were moving, we were identifying that as such. If there were test kits from Abbott, we would, we would be identifying tho-those items. Those were directly related. There's no doubt, you know, that's why your question is so good, is that there, there are, there are related, you know, revenues. You know, we talked about the premium rates. You know, we had vaccine... You know, it's interesting, I was speaking to somebody with respect to, you know, the, the, the, the, the border issues, and obviously the, the, the outcome in Ottawa and, and... Anyway, at dinner last night, and one of the things that we were able to do is we actually, you know, paid our drivers a premium to be vaccinated, and we were able to get our drivers across the border, and we were actually getting a higher premium. So those premiums are there, that are, that aren't gonna be, you know, be back, and those, those weren't necessarily related to it. Mm-hmm. I, I, you know, I feel that we've hit the trough when it comes to U.S. truckload. No doubt that the FDA has, you know, is not nearly as stringent. We've come, you know, I, I... You know, Kevin, we talked about our learnings, right, from the U.S. You know, the U.S. market is definitely different than the Canadian market when it comes to distribution of, of healthcare products, both through the distribution channel of wholesalers and et cetera, but also in terms of standards and requirements when it comes to temperature control. We've, we've recognized that. We feel that, you know, I think all truckload companies have been punished in the U.S. with, you know, big rate reductions or rate pressures. I hear some of them have been affected by as much as 40%. You know, we, we are probably somewhere in the middle, at the, at the 20% mark, same customers. We're not losing business. We're just- we've just had to maintain that business, at, at, at lower rates. I think we've hit the trough of this. We, you know, and we, we see, we see that, behind us. Mm-hmm. After this quarter. That, that's helpful. Yeah. No, that, that, that's helpful. Actually, it, it, it leads me to my second question. Just, just given, I guess, the volatility we've seen in the U.S. freight sector, you know, talked about the, you know, what's happening with, with the rates there. Is the underlying cyclicality of the assets you acquired aligned with what you would have thought when you made these acquisitions? As you noted, you know, you expected it, it would see more, more volatility just because the regulatory environment is different in the U.S. than in Canada, or, or, or is it performing worse? Is maybe holding in maybe better? Just any, any commentary there. No, I would be lying if I told you it didn't catch me by surprise. Mm-hmm. I mean, I think it's, you know, it is. It's, as I said, it's a learning process for me. We're treading cautiously. I still love our acquisitions, even, even, even the way where we are today. Our performance is still strong, and it's, more importantly, it's sustainable going forward. Mm-hmm. We continue to grow. The irony of this is that we actually have more trucks on the road today than we did a year ago. Mm-hmm ... to even compound the situation. Our trucks are busy. We continue to see more, a lot of, a lot in the pipeline, you know, with opportunities in the U.S., but it's a matter of making sure we it's managed properly, and continue to learn and grow. The truckload market is definitely the most volatile of all, as witnessed in, you know, in the transportation industry. You know, certainly with, you know, I think we announced last, last quarter, that Graham Cromb just started a Chief Strategy Officer. We're focusing our energies more on, on the areas of logistics in the U.S. right now, and which is a little bit more, more stable. Okay. That makes sense. Maybe just last one for me, you know, the CAD 84+ million of cash and cash equivalents you have on your balance sheet. At least when I look at my model, it's as high as it's ever been in what has been, you know, just a relatively short period since going public for your company. I know you talk about or you've talked about a deep M&A pipeline, just how you think about deploying that excess cash? You know, we talked a little bit about the U.S., you know, the learning curve here. Just wondering if you're seeing any benefits from just the Yellow bankruptcy. I'm not sure if that at all helps you. Maybe that's an area of an opportunity for you, just given all that's happening in the, in the U.S. less-than-truckload market. Yeah, unfortunately, we're not in the less-than-truckload market in the U.S. You know, but, interestingly enough, I was in the warehouse last, I guess a couple of days ago, Monday. Speaking to one of our employees who happened to walk, be walking through, and he... I said: "How's your day going?" He mentioned that he was out to see, one of, one of our med-surg clients. Mm-hmm. He suggested to me that the Yellow was, they were having all kinds of issues because they couldn't get their product that were in the Yellow warehouses. There was product that was destined for their Edmonton Distribution Center in, in Mississauga, and, basically, could we, you know, could we help in any way and get this product brought, bring it in and, and create a kind of, consult, truckload consult and, and, and redistribution in, here in Canada. He was working on that, and that's, that's, that's directly related to this Yellow. Right. issue. I, I don't know what the spill out is from, from our perspective, but it was kind of interesting. I, I figured there would be zero fallout out of this from our standpoint, but it, obviously, there might be an opportunity here or there. Okay. That's, that's that one. and then just on your, your cash balance, just, you know, is... Oh, yeah. anything you would, you, you would highlight in terms of? Yeah, yeah. sitting, sitting at such a high level? Yes, sorry, like, Kevin, yeah. I, that it's, it's an opportunity as I see it right now. It's, it's great. I mean, you know, it's, it's, it is disappointing. You know, I, I'm, I'm, I'm just where I'm. You know how competitive I am, both on and off the ice. But I, I, but I, I, I certainly look at the, at, at, at the, at the, you know, we've got a strong foundation and, and strong results. Our, our margins are strong. Our customers are, are, are with us, so we're gonna continue to expand, you know, organically with some, some, some opportunities continuing to do that. We're very focused right now. The M&A pipeline, I'd really like to be able to announce something, you know, we're working, we're working hard on that, on that area. We're gonna do what's right, and it's nice to be in this position. Mm-hmm. depending how the analysts react today, and we'll see, we'll see where. We'll, we'll put that money at work, I guarantee you that. Excellent. Thank you for taking my questions, Michael and Peter. Thanks, Kevin. Next question in the queue comes from Konark Gupta with Scotiabank. Your line is open. Please proceed. Thanks, operator. Morning, Mike and Peter. Good morning. Morning. Morning. I just wanted to confirm the ground transportation segment organic growth 3% was just in Canada, right? Ex fuel, but I don't think I heard you disclosing a comparable number for the U.S. No, we didn't. Okay. Uh. Um- Yeah. And, and go ahead, sorry. I mean, go. No, I was just thinking, like, I think I know you mentioned, like, the U.S. truckload comparables were tough and all that, right? I'm like, I'm guessing the, the U.S. organic growth, if I just strip out ex fuel, you know, with the truckload pricing down, seems like, you know, the organic growth could be down as well in the U.S. I hear, it depends what the growth, what's your measure on growth. Is it revenue or is it volume? Yeah, it is revenue. I'm like, yeah, I'm like, yeah. Yeah, and... Give me some perspective on volume and pricing. Yeah, thanks. Yeah. I mean, I think, I think from a revenue standpoint, we're pretty close to last year, almost bang on. From a volume standpoint, it was up. I mean, we really got not hammered, but punished or we really did not get the same rates as we were previously having. We were, you know, everyone, our big customers, getting the pressures all the way around, the wholesalers, distributors, third party, obviously, these, you know, the Coonamans of the world who represent some of the transportation services were very aggressive and there were people out there looking for business. While their trucks may not have been validated, they were able to handle that business, which was, you know, another surprise for us. At the end of the day, that's what happened, and, you know, we're persevering. We actually increased our volumes. On the domestic side, we had good organic growth. Interestingly enough, our volume by weight was down year-over-year, but our shipment count was up year-over-year. Just as a matter of reference. No, that, that's great, color, Mike. Thank you. I just want to kind of follow up on that. I know you mentioned to Kevin about the Yellow anecdote. Are you seeing any change in the volume or rate patterns now in July or heading into August? You know, you mentioned the truckload rate in the U.S. might have troughed. Obviously the Yellow has happened and, you know, maybe there is a little bit of demand there. Can you share any perspectives between the U.S. and Canadian businesses you have in terms of volume and pricing? What are you seeing right now in July and August? I, I, I You know, it's kind of too early to tell. I certainly think it's it's not going, it's not going down, put it that way. I think, like I said earlier on, I think we've hit the trough. Certainly, that's, that's, that's what we're getting from our, from our customer base. I'm you know, when I think of that, I think more of the U.S. than Canada, when I say the trough. Canada's more disciplined, and in our approach, and it's more transparent and, you know, we certainly have a market advantage, based on our history and network. I'll leave it at that. Yeah. No, that's, that's great, color, Mike. Thank you. Just on the cash question that Kevin asked, I just want to kind of, you know, ask it differently. What do you think is the best use of your cash in the next six months? Like, do you have any organic growth or demand or any CapEx demand or requirements here? Do you want to kind of balance between the M&A and something else? Like, any thoughts on the best use in the next six months? That's, I, and I don't I don't want to sound political, but it's all of the above. We just finished having our two days of board meetings, and, and, it that was obviously a topic of conversation. We, you know, we're, we're very confident in our performance and, and, and stayed the track of, of a, of a dividend increase, felt comfortable with that. We're looking at all our options. All those are options. We had, we had, Graham, strategic officer, present to the board, what we had in our pipeline. We, you know, there, from other divisions in terms of some of the new product offerings that we're trying to do, or, from a QA, officer. We, we, we're, we're, we've got a lot of options, and it's a matter of what, what, you know, what the low-hanging fruits are, we'll, we'll capitalize and move we. I'd certainly like to make that, that cash work in some, some form or matter. Great. Appreciate the time, Mike. Thank you. Thank you. The next question in the queue comes from Walter Spracklin with RBC Capital. Please proceed. Yeah, thanks very much. Good morning, good morning, everyone. Just wanna, wanna start just from modeling on, on packaging. I know the loss of customers has led to quite a decline in that, that segment. Is the call it $4.0 million to $4.3 million quarterly run rate now, one we should now go with going forward, or is there seasonality here in the Q2 that made it particularly more extreme, the, the, the downturn, and that, that maybe we see some seasonality lead to a pickup in that? Or, or should we just model kind of in that $4.3-ish range, going forward, plus any organic? Yeah, Walter, good morning. No, this is a one-time client that that left for lower rates. Co-packaging is, is definitely the most commodity-type, lowest margin business that we have in our portfolio. We've never really put that much focus on it, even though we try to service it. We always felt that it was complementary to the business since we already had the, the, the product in-house, but the decision-making process is a little different in that, in that field. We, we learned that over the years. Having said that, we maintained what we had. We did lose a large consumer goods client, a consumer health goods client. I think it was identified in Q1. Yes, and the type of product is actually seasonal to the summer. We had. It was big in Q2 last year. What you see is probably what you're gonna get going forward, in the packaging, is the Crēdo business, and that continues to grow. The co-packaging business, part of the business is, will stay. We have long-term contracts with what we have, and it's really nothing much more to comment on that file. Okay. Yeah. Then same kind of type of question for your dedicated and last mile. That's an area that was really growing, and we're seeing step function growth. I mean, it was up, you know, 50% in 2020, 20% in 2021, 28% in 2022, and now we're seeing it down year-over-year for the first time ever. Are we now level setting now at this rate, and it's gonna go more in line with your historical or your overall company growth rate? Or was there something in particular, again, going on in the second quarter here? Yeah, that's a good observation, Walter. I, so, it, it's down year-over-year because of-- strictly because of fuel. It, it actually did grow. The dedicated last mile is really driven not, not for the home delivery part, but more from a network to, to, to, you know, to the pharmacy, direct to pharmacy, to, to clinics and, and, and, and hospital network. That last mile network, we emphasize in the rural areas of Canada, and focus that energy. Obviously, we're, we're, we're, there's only so much geography we can do, in Canada, where, where there's, where there's people anyway, and pharmacies. We've, we've, we've grown that, to a point. To us, it was strategic to our whole, the whole network, to ensure that we go to every pharmacy and every hospital in this country, every day. Through the dedicated last mile network is how we approached it, and we've grown it successfully. We will continue to grow it in the Q4. We have some upcoming initiatives, but we're like, for example, we just opened up in Prince George, BC, an area that we didn't have before, and we continue to do that, but nothing to the extent of what was, was in history. I would conservatively put what we have today as a mid to high single digits, so long as fuel prices stay stable. You know, it was only- Yeah. A year ago, it was $2, $2 a liter at the pumps, a year ago today. Yeah. Okay. Then, lastly on, or second last question here, one on, on the margins. Peter, you, you had pointed to a margin today that was within the historical range, but you gave a very wide range. You were running at an EBITDA margin of 27% the last couple of years. Going now down to 25 has a fairly significant impact on your EBITDA. You know, 200 basis points is a decent move. It looks like it's leveled in at this. The 27% that you had over the last two years, clearly driven by some of the factors Michael had been pointing to before. As we look at a normalization back to some run rate, it looks to be 25. Is that rate, judging by your results so far to date, is that fair to say? I mean, you know, if, if we model 25 going forward, and then growing that on a modest basis as you build a new business, is that the right approach? Was there, again, something in the first or second quarter results that would make them a little less representative of your margin run rate going forward? No, I think it's pretty good. First of all, I don't think we've been running at 27% for the last 2 years. I think at 27 was high points in some quarters, and I think it was more around the 26 area. I think when we went, when we went public, it was, might have been even south of 25. Feel very comfortable with the 25 point. I think, you know, like we talked about the tailwinds of last year. I, you know, like I said, I was disappointed with the quarter, but when I look, when I, when I look and see what, what really happened in Q2 last year, late Q1, Q2, and the beginning of Q3, I, I realized that this was truly an anomaly. That, that was, you know, like I said, when your truckload to the Canada, because we have vaccinated driver, commands CAD 15,000 a load today, Q2 last year, and today, it's commanding about CAD 7,000. You can see the difference in how it would affect our margins. And, you know, the same thing with the air freight, some of the air freight of Q2 last year, where it was actually supply chain issues, but it was actually because of the system issues that they had, the system change that they had with one particular large pharma customer. All those things being said, I think it was a perfect storm of Q2 last year, and I think this is more the norm today, and feel comfortable with the, with, with, the trends going forward. Perfect. Last question now, this is more a philosophical one for you, Michael. I mean, you know, you, you look at a company you know very well, Cargojet, where, where they're you know, they did a very good thing in Canada. They had a great market, and then, you know, they announced an expansion of aircraft to, to target outside of Canada, and the market has reacted very negatively to that, rightly or wrongly. We'll debate that another day. I wonder if, if, if with the acquisitions that you're seeing, you're, you're pushing the U.S. and some of the negative trends we're, we're seeing developing there. My question, I guess, is, is Canada off the table? Is there, is there nothing more you can do either within directly your, your, your line of business in Canada or even adjacent? I know there's some products that are not necessarily pharmaceutical that you do haul that, that are, are related to and, and are sensitive to temperature, and, and just curious whether you would look to expand more in Canada at all, or is that option kind of off? Is there really viable opportunities in Canada, or is there just too many in the U.S. that it's, it's, it's really U.S. gonna be your focus going forward? That's a very good question, and I, I think the one area that I will always focus on is not having to grow because the analysts are writing that. I'm gonna do what's in the best interest of the sustainability of our company long term. I'm a long-term holder, and I'm, I'm, I think that way. I've always thought that way. It's about sustainability. Canada is an area that, that we've been very successful in. I consider myself less of a transport carrier and more of a healthcare service provider. The business is changing. The healthcare business is changing, in the way it's-- you know, I look at our logistics business, and I see how the, the fridges are filling up and less ambient. You know, biologics is, is, is, you know, a bit of a paradigm right now within the healthcare sector and, and adapting to that. And some, some of that includes offering different types of services that are complementary to what our manufacturers and distributors are looking for. You know, I think, I think we, we, we will look at, at that spectrum to expand. I think in Canada, there's some geographic areas that we still are not quite as strong as. I, and I, I think it was alluded to on the dedicated last mile. I think we're gonna focus on that, on those areas a bit, a bit stronger. I think Canada still has a big, some good runway to continue. That's our comfort zone. That's where we have a stronghold, and the, the more we widen that moat, the, the, the better it is for, for an investor long term. And, and the more we can offer the healthcare industry as well and make a difference. On the U.S. side, I alluded to earlier on, you know, to, to Kevin, I believe it was, is that we're continuing to learn. I'm continuing to learn. The volatility that we've experienced, there, is, is one of. You know, in talking to the folks in the U.S., you know, FDA is focusing more on serialization than they are temperature, right now. The, you know, so that, that's a reality, and that's, that's, you know, let's make sure that we're, we don't, we, you know, pretend that we're, we're in Canada, when we're, when we're offering services in the U.S. We'll take it one, you know, one small step at a time. We're not, I don't know, our, our, our capital expenditures aren't gonna be as great as Cargojet's are, and, you know, those, those are maybe riskier ventures. I'm a slow and steady guy, as you've, as you've, as you've known me since 2004, Walter. Great. I appreciate the time, Michael, as always. Thank you. Thank you. The next question in the queue comes from Ty Collin with Eight Capital. Please proceed. Hey, good morning, guys. Thanks for taking the questions here. Michael, in the data we're looking at, it seems like freight volumes continue to be quite sluggish industry-wide into the summer here. appreciate that the dynamic's a little different for you guys, given the healthcare focus, but are you seeing any signs of destocking, particularly in your non-pharma business, that could be a headwind heading into the second half of the year here? That's a good question, Ty, 'cause we looked at our. You know, I think I mentioned earlier on that, that, our volumes, our shipment count's higher, but our weights are lower. I think we're seeing a bit of that trend on the consumer health side of things, so not necessarily for the pharma or ETC, or, you know, kind of OTC product, a larger, like. I think there's maybe a little bit of tightening on the consumer health goods products. Interestingly enough, our warehouse are full. Our handling isn't quite as, you know. I don't know. I think maybe the turns aren't as great, so I don't know if it's as much as destocking, you know, I mean, I think one quarter doesn't, doesn't-- I'm talking about Canada here. I, I'm, I'm, I'm in a better position, Ty, to talk about Canada trends. In the U.S., you know, we're dealing with, you know, with manufacturers, but more on the truckload side, we're dealing with distributors, wholesale distributors. They'd be in a better position to answer those questions than I, I could. I don't have enough- Got it. Okay. Yeah. Yeah. Yeah. No, that's, that's very helpful. I guess, sticking on the U.S. business, just a question on the cost structure there. As you continue to build that business out organically and maybe look to add to it through M&A, I'm wondering if you could kind of speak to the longer-term SG&A structure there. Maybe, you know, how much cost can ultimately be shared with the Canadian side of the business, and, is it as efficient as it can be right now from an overhead perspective, or, or is there, maybe a little more to squeeze out of that? Yeah, I certainly don't, I don't, I don't buy businesses to try to squeeze SG&A. To me, I look at a company like Boyle and, and, and Skeleton, or whether it be LSU and Accuristix, they, they, they have unique areas of differentiation that, that is why the customers use them, not necessarily rates and shedding costs. What I do focus on is best practice, and sometimes that creates cost efficiencies and because of better productivity, better, better, better product outcome, you know, on the insurance side of things, equipment, but ultimately, from an SG&A standpoint, we're in the people business and, and we are focused on, on customer service. And, you know, this is a business that's not as commodity-like, and, and it's all about service. We were looking at a company that Graham presented yesterday, and the suggestion was that every package that went out had a $6,000 value to it. You can just imagine that that's, you know, now obviously, you're not gonna, you're not gonna talk about rates, you're, you're gonna talk about service and ensuring that product gets delivered 100% of the time. Okay, great. Great. Maybe last one for me. I know, a couple of questions have been asked about about the, the wind down of Yellow in the U.S., and I, I know you kind of spoke to the potential opportunities or, or lack thereof coming from that. I, I, I'm more curious to just hear if you have any sort of learnings or, or takeaways from, from that situation there in terms of M&A competition, operations, labor. I know obviously the, the U.S. is still a learning process for you, and, and this is a company that's kind of been around for a long time. More just high level, if, if you kinda took anything away from that situation. Gosh, nothing that nothing that some of these analysts can, can talk to better than I could. I mean, from my standpoint, certainly it's, you know, obviously, it was a tired company with labor issues and, and, for me, it's, you know, it's all about people, and, and good communication and understanding and, and, focus. I don't know. I really can't. I'm not here to, you know... I think there's obviously going to be less capacity in the United States, which is obviously going to lead to hopefully, some better price disciplines, and maybe a bit more real estate, you know. I know we'd like to see in Boyle and Skelton be in another strategic area in the in the U.S., so maybe there's some real estate opportunities there, but ultimately, that's, that's, there's not really that much more I can say on this call. I got it. Yeah, I appreciate the thoughts there, Michael. Thanks. Thanks, Ty. Thank you. The next question in the queue comes from Tim James with TD Securities. Please proceed. Thank you. Good morning. Just wondering if, if we could explore a little bit further the volume improvement that you've seen in the U.S. specifically. If you could just kind of characterize. You mentioned earlier, Michael, about how you, you've got more even though your revenue is roughly flat year-over-year, you've got more trucks on the road and, you know, therefore more, more volume. I'm just wondering if you could kind of characterize how that additional volume comes about. Is it from existing customers that you're just, you know, doing a bigger share of their business? Is it new customers? What types of, of products are, are sort of contributing to that higher volume? Good morning, Tim. Yeah, it's a good question. I, I, the-- It's, we were trying... The extra volume is probably, I would suggest, reputation. I think we, we, we have, what, what Skelton and Boyle did during, during the COVID period, was quite exceptional, for a lot of these customers. Now, having said that, you know, they say, "Thank you very much, but here's your new rates. We really like to use you." That's just the reality of the business right now, but we respect that and continue. One of the areas that, you know, Skelton is really strong in Canada is, with, you know, Canadian Blood Services and Plasma and, and, and, and, and the likes. we're getting into that market in the United States, and, and that truly is, you know, quality over procurement. I mean, it's, it's, it's, it's, it's not easy to do. We have to have contingencies, like dual reefers on trailers. It's more specialized type of business, so we're focusing our energies on, on those areas. Having said that, distributors, like the, the Big Three, are intrigued by our service commitments. You know, after all the negotiation, if it does make sense, you know, we, we, we get some lanes with the Amerisources and the McKessons and the Cardinals. we're gonna focus-... and, and we had already put orders in for, for trucks and, and, and the like. By the way, and the ease of getting drivers is a lot easier now, and our pipeline is full of drivers and making sure we have the right, right drivers. Those are all team drivers, you know, except for maybe one or two trucks. Because of the security component to the business. That's, that's I, I would say reputation, really is, is what's, what's driving the growth. Okay. That, that's helpful. Thank you. Then just, just wanna return to the decrease in revenue in logistics and distribution, lower outbound order handling activities for, for Accuristix being a driver there. Could, could you talk about, and maybe this ties into one of your previous comments, I think, but I'm just wondering specifically, what was the reason for the lower handling activities? Is, is that just sort of products that maybe are a little more economically sensitive, or how would you characterize the, the, the products and service that-- services that were in, in decline year-over-year? Yeah, the decline was, was, the consumer health part of our business. We have, you know, Accuristix and LSU handle, you know, everything from narcotics to vaccines, to RX product, to OTC, to even some cosmetics in some cases. The, the lower-end spectrum are the ones that, that we saw a decrease. The interesting part is that that's also the most voluminous part of our business, which, you know, from a weight. When, when you're charging transportation, you're charging by the, by the pound, right? Each shipment by the pound. If when you're, we were seeing a reduction in weights being shipped out. The logistics part of our business is not only warehousing and distribution and, and the likes, but it's also transportation services, where they have a buy and sell with, with, with, you know, different carriers, including Boyle and Skelton and ATS and, and others. That's a markup on that. You know, they're adding fuel surcharge and making a markup on that as well. That, I guess that's, that's, that was the decline on, on there, on that side of things. One just quick, quick follow-up then. Do, do you feel like this, the decline or the levels you're seeing now, are these sort of lower than historical norms, or was the year-ago period higher? Like, do, do you think this is the, you sort of return to normal in terms of the activity and the handling, or do you think because of economic conditions or some other factor, that maybe they're a little bit more depressed and, and, you know, maybe if you reflect back sort of pre-COVID? No, I think at the end of the day, you're a consumer. You, you'll, if you're, if you're tightening your belt, that's, that's, that's indicative. Are you gonna continue to tighten your belt? Is, is really, you know. It's not, it's not, you know, I, I don't know. How do I say? It's not a fashion thing, it's, it's a necessity in, in when it comes to healthcare. I, I believe that there's, you know, I, I don't, I don't see much, you know, like I said, it's not sexy. It's, it's, you know, it's, you know, demographics. You know, you got a lot of immigration coming in over the next years. You got an older demographics, all, you know, all the signs should be good from a healthcare spend standpoint going forward, more people and aging population. I, I'm, I'm, yeah. Okay, great. Thank you very much. Thank you. The next question in the queue comes from Justin Keywood with Stifel. Your line is open. Good morning. Thanks for taking my call. Just on the commentary of the organic growth, the historical and expected range of 4%-6%, any indication of when we could see that return to those levels? I realize there are several moving parts. Then also on the COVID-19 related revenue, is there an expectation that we could see a bit of a pickup heading into the fall with new boosters? That's a good question, Justin. I'm not gonna speculate. I mean, I'm-- I, I'll suggest that, that, you know, I think we've hit the trough in, in our, in our, you know, going through Q2 and Q3 because of the COVID-related distractions and extracurricular activity i- in our business. I don't know. You're a consumer. Are you gonna go out and get your booster? Because I think we'll be warehousing a lot of vaccines. We're, we're, in the midst of doing that right now with some of the provinces, getting ready for, not only the flu vaccine, but also the COVID vaccine. I, I would be speculating at this juncture, so I'm, I'm not gonna, I'm not gonna really comment mu- much more than that. I mean, I'm hoping it's not there because I'm a Canadian who's wants to have healthy, healthy outcomes. You know, I said that last quarter. I'm glad it's not, you know, we it was a big windfall, but I'm glad it's not there. I'm hoping it's not going to be there in the fall, so. We are going to be warehousing a whole bunch of vaccines. Whether it's just warehousing revenue or there's handling revenue associated with it, and transportation is to be seen. Understood. My other question is, we saw UPS avert a large strike last week with an expectation of rising wages. Do you anticipate any pressure on your wages for your drivers or any increased competition there? No, I don't think so at all. I think we're, we're, I keep on saying I'm a people first business. I love our drivers. They're our ambassadors for our company. We gave, you know, not because they were asking for it, but I think it was when I was looking at the grocery bills, and of our out there and the fuel costs, et cetera, it was important to react. To me, it's important that our frontline employees don't have to moonlight in order to make ends meet for the simple fact that then they can focus on, on the task at hand and taking care of our clients, because ultimately, it's our clients are paying their wages. We have that, that culture, that mentality all the way through. You know, I just actually I got an email yesterday saying, which, which branches do you want me to that am I going to go visit? Our executives are mandated every quarter to go meet with all the employees and have either coffee and donuts or, or whatever, whatever they want, it depends what, what branch. At the end of the day, we're, we're, it's about good communication and making sure that we're not making money on the, on the backs of our, of our, of our employees and drivers. Good to hear. Thank you. Thank you. The next question in the queue comes from Endri Leno with National Bank. Please proceed. Hi, good morning, thanks for taking my questions. I, I just, I, I had a, a few, I, I just wanted to start with the, with the U.S. one. Michael, you spoke earlier of, of seeing a rate somewhere, like, down 20% versus last year. I was wondering if you can talk a little bit about the U.S. business in the sense that you kind of serve different customers in there or different parts of it. I believe some, some of it is a U.S. government, some of it might be non-prescription pharmaceuticals and some prescription pharmaceuticals. I was wondering if you can give a little bit of a breakdown between those segments, and where are you seeing the most impact from the lower truckload rates, or is it all over? Yeah, I think, the impact is all, it, it is all over. Which one are impacted are, are, it would be a good exercise. Certainly, as you go down the line, the, the pressures, the price pressures gets, gets, gets harder. You know, I'll give you an example. A wholesaler who's, who's, you know, who's making, let's say, a 2% markup off the manufacturer, is going to squeeze as much as they can. You know, a, a third-party logistics provider, will squeeze as much as they can as they represent, so because they're, they're making a smaller piece of that pie. Manufacturer is going to focus a little bit more on, on, on quality. The, the, the reality in the U.S. is that there, there's no provider that can go directly to every pharmacy and hospital, unlike, unless, unless you're a wholesaler, in America, unlike, unlike, unlike Canada. There's, there's those pressures. For me, it's, you know, we're at a point where we, we did have other truck orders that we actually stopped. Not that we could not have used the extra business, but I didn't want to do it at a margin. I think we're, we're, we're looking at being more selective, and I think I referred to the plasma blood services business as being an area. We're going to always focus on specializing where, where procurement is not as important than quality. Hopefully, that answers your question. Oh, it does. It does. Thank you. As, as a follow-up for that one, I mean, I, I have a couple of other ones, but as a follow-up to that, you mentioned the blood plasma services in the U.S. and, and the wholesalers. I mean, is there any opportunity there to work with the manufacturers as, as well, or is there a body in the U.S. sort of similar to the Canadian Blood Services or Héma-Québec that we have here that you can work with? Yeah, interestingly enough, it, it, it is with the manufacturers in the U.S., unlike Canada. The answer is yes. We're actually working with manufacturers. manufacturers and, and, and, and the wholesaler as well. Some wholesalers are offering the services. Yeah. Okay. No, that's great. Thank you. The other question I had about the U.S., I mean, you referenced to margins and the rates, potentially returning to pre-pandemic levels. I just wanted to clarify something because I think you bought this business in 2021, or you got in there, and then the margins that were disclosed at the time on the trailing were 23.7, so 24-ish EBITDA. Is there where you kind of, you know, see that business again? Is that what you're referring to pre-pandemic, or is there a different number? Just, just for sake of, of reference, because I don't have any of my numbers here with me. I'm just, one sheet of paper. What are you-- well, the 2023, 2024 is referring to what? to the EBITDA margin. For, for U.S. or? For U.S. I think. Yeah The Skelton and Boyle acquisition was done, the trailing 12 months, EBITDA margin, I think it was 24%. Yeah, I mean, I, I, I think we're down, maybe slightly lower right now. If it is, it's only slightly lower. I think we're, we're, we're pretty much close to that. I think at that time, there was a huge driver shortage, as well. I think, I think in light of what, where we're, where we're sitting right now, we're, we're comfortable with, with where we are, and they're pretty close to that, to those numbers, if I'm not mistaken. Peter, you want to...? Yeah, I think, I think that's, that's fair. The margins in the U.S. have really normalized to the, to their prepa-. Okay ... pre-pandemic levels, we're not seeing a decline further. Well, that, that's great. Thank you. As a follow-up a bit, I mean, a bit in the U.S., but also a bit in Canada, too. I mean, you mentioned that there was... Q2 and perhaps early Q3 was the trough here. Would you think that it picks up a little bit more towards the second half of Q3 and then into Q4? Sort of related to that question, that mid to high single digit, is that something we can contemplate for 2024, or we can see it as early as late 2023? Yeah, I think, I mean, I'd look, I'd look at the bottom line before the top line, because, I mean, I think, you know, the, the, the fuel, you know, certainly on the, on the transportation side is more of a pass-through. On the logistics side, it's actually a profit, maker, but, on the, on the, the fuel side. The fuel, you know, all, all things being equal, being, i.e., being fuel surcharge, then we should be expecting that. Absolutely. Great. Thank you. There are no further questions in the queue at this time. Speakers, please proceed with closing remarks. No, that's it for me. I thank you for all the questions. Yeah, it was, like, I, I said at the outset, it was a little disappointing because I'm competitive. I, I realize when you look at it, it's, it's, it was. I feel very comfortable with our, with our quarter. We have, our customers are, are happy, our employees are happy, and that to me is the most important going forward. Thank you. Have a great day, and see you next quarter. Thank you, ladies and gentlemen, this will conclude your conference. Please disconnect your line.