Good morning, ladies and gentlemen, and welcome to the Loblaw Companies' Third Quarter 2024 Results Conference Call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. I would now like to turn the conference over to Mr. Roy MacDonald. Please go ahead. Thank you, Jenny, and good morning, everybody. Welcome to the Loblaw Companies Limited Third Quarter 2024 Results Conference Call. I'm joined this morning by Per Bank, our President and Chief Executive Officer, and by Richard Dufresne, our Chief Financial Officer. So before we begin the call, I want to remind you that today's discussion will include forward-looking statements, which may include or are not limited to statements with respect to Loblaw's anticipated future results. These statements are based on assumptions and reflect management's current expectations. As such, they are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from our expectations. These risks and uncertainties are discussed in the company's materials filed with the Canadian securities regulators. Any forward-looking statements speak only as of the date they are made. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether it's a result of new information, future events, or otherwise, other than what's required by law. Also, certain non-GAAP financial measures may be discussed or referred to today, so please refer to our annual report and other materials filed with the Canadian securities regulators for a reconciliation of each of these measures to the most directly comparable GAAP financial measure. With that, I will now turn the call over to Richard. Thank you, Roy, and good morning, everyone. I'm pleased to report that we delivered another quarter of steady operational and financial performance. We continued to provide value to consumers and carefully managed our expenses while delivering earnings performance in line with our financial framework. On a consolidated basis, revenue grew by 1.5% to CAD 18.5 billion, and Adjusted EBITDA increased by 7.4%. Both consolidated revenue and same-store sales were negatively affected by the shift in Thanksgiving, which occurred in Q4 this year versus Q3 last year. Compared to Q2, our sales performance improved in both food and drug. Adjusted diluted net earnings per share grew by 10.6% to CAD 2.50. On a GAAP basis, our net earnings increased by 25%, reflecting the recovery of CAD 125 million related to a PC Bank commodity tax matter. In food retail, we attracted higher customer traffic and drove tonnage growth. The timing of Thanksgiving had a negative impact on reported same-store sales of approximately 80 basis points. Excluding this impact, same-store sales grew 1.3% in the quarter. Canada's grocery CPI has returned to normal, coming in at 2.3% in the quarter. Our internal CPI-like food inflation measure was slightly higher this quarter. However, when we look at our average article price data, which reflects items actually bought by our customers, our internal inflation rate was much lower than CPI and lower than our adjusted same-store sales figure. We're still seeing higher-than-normal price increases coming in from our global vendors. The weaker Canadian dollar, which is dropping versus the U.S. dollar, is having an impact on inflation, mostly in fresh categories. Our hard discount banners' same-store sales performance outperformed our conventional stores, illustrating that the consumer shift to discount continues. We're still pleased with the success of our conversions and the ongoing success of our Maxi banner in Quebec, which celebrated the opening of its 175th store in the quarter. Last week, we opened our 183rd Maxi, and we have four more to go before year-end. We opened six small-format No Frills stores in Q3, and while it's still early days, we are pleased with customer reactions and overall performance. In Q4, we will be adding another 20 new Maxi and No Frills stores, with the majority of these being new builds as we continue to bring more value to communities across the country. For the full year 2024, we expect to have opened 50 new stores and converted an additional 42 stores. Right-Hand Side had a negative impact on food same-store sales of 53 basis points in Q3. These categories are accretive to our gross margin, and we continue to carefully manage inventory levels. Discount continues to grow tonnage market share, and our conventional stores are performing well. In drug retail, absolute sales increased 3%, and same-store sales grew 2.9%. The timing of Thanksgiving had a nominal impact on drug retail same-store sales growth. Pharmacy and healthcare services grew same-store sales by 6.3%, driven by broad strength in prescription and new healthcare services. Our specialty acute and chronic prescription growth led our pharmacy numbers. Patients continue to respond very positively to the convenience and expanded level of primary care we offer through our more than 1,800 pharmacies across the country, including our 120 new in-store clinics. As expected, our front-store same-store sales improved over Q2 but declined by 0.5% year over year. Beauty continued to deliver strong growth, in particular the prestige category. Headwinds continued from our decision to exit certain low-margin electronics categories and from lower consumer spending on food and household convenience. Our decision to exit these electronic categories, including laptops, computers, TVs, and cameras, is having a 1% impact on front-store sales in 2024. We recently decided to also exit game consoles and games altogether, which will affect Q4 this year and add 1% more pressure on front-store sales next year. These sales come at extremely low margin and do not drive basket building. We remain pleased by the underlying strength, profitability, and sales momentum of our front-store. Overall, drug retail sales growth continued to outperform food and have a positive impact on our margin mix. Online sales in the quarter reflected our highest growth rate in two and a half years, increasing 18.5%. Within grocery, delivery continues to outperform as a channel. We remain pleased with our online sales penetration in both food and pharmacy. Across our grocery and pharmacy banners, we're proud to see Canadians increasingly choosing our stores for value, quality, and service. Total retail gross margin was 30.9%, growing 30 basis points. Trading margin in our grocery business was flat. I'm pleased with the strong shrink improvements in both food and drug, which drove our retail gross margin improvement this quarter. That said, improving shrink remains a major focus and opportunity for us. Our teams continue to do a great job managing cost. Our SG&A spend rate as a percentage of sales decreased 30 basis points, driven by year-over-year benefit of certain real estate activities and some operating leverage. This was partially offset by incremental costs related to the ramp-up of new stores and conversions. Third-quarter retail EBITDA increased by CAD 130 million, yielding a margin of 10.9%. PC Financial's revenue increased 0.8%, driven by growth in the credit card portfolio and partially offset by lower service growth in our Mobile Shop. The bank's adjusted earnings before tax increased by CAD 14 million, with higher interchange and credit card fee income and lower operating costs offsetting higher credit losses. We remain very comfortable with the risk profile of the bank's portfolio. We continue to take a conservative position in our provisioning with a strong and well-capitalized balance sheet. On a consolidated basis, adjusted EBITDA increased by 7.4% to CAD 2.1 billion. Our retail free cash flow was CAD 562 million, and we repurchased CAD 523 million worth of common shares. Our balance sheet remains strong, and we continue to improve our key return metrics. Our return on equity sits at 23.3% and our return on capital at 11.8%. Our tax rate is returning to normal versus last year. As we approach the end of our fiscal year, we remain confident in our ability to deliver our financial framework, and we now expect EPS growth for the year to be slightly higher than our original outlook. Additionally, as a result of the accelerated pace in store openings, we now expect to invest approximately CAD 2.3 billion in gross capital expenditures or CAD 1.9 billion net of proceeds from property disposal. The fourth quarter is off to a good start. Food same-store sales growth is improving over the previous quarter, but we expect incremental top-line pressure on front-store and Shoppers as we lap our biggest quarter of electronic sales. Also, gross margin is expected to continue to benefit from incremental shrink improvements. Customers continue to respond well to our focus on delivering the value, quality, and service they are looking for. Our assets are well-positioned, we are executing well, and we are investing for the future, all while delivering steady operational and financial performance. I will now turn the call over to Per. Thank you, Richard, and good morning, everyone. So we continue to build momentum in our food and drug business in the quarter. Canadians remain focused on value, and we deliver the quality, prices, and service our customers count on. This quarter, more customers once again visited our stores and our tonnage grew, demonstrating that we are meeting their needs. As expected, we saw improvements in our same-store sales performance in food, and we see that continuing into the current quarter. The shift to discount and to value continued, and sales growth in our discount as well. Our banners outperformed our conventional banners once again. In our hard discount division, our team opened 29 new Maxi and No Frills stores in the quarter, including six new small No Frills stores. I'm proud to add that we now have three new No Name pilot stores operating in Ontario, with the latest one opening in Brockville only two weeks ago. This is a great example of the innovative solutions that we bring to Canadians. The intent of these stores is to take out all unnecessary costs and then pass those savings back to our customers. This means we are priced up to 20% below the cheapest of our competitors. I'm very pleased with how the team implemented this initiative. A small team took this from concept approval to our first store opening in less than two months. It's still too early to draw meaningful conclusions. We're still learning and refining our offer. If it works, we'll do more. If not, we will pivot, take the learnings, and apply them to our discount program. Across our super and market banners, we continue to provide a very strong, differentiated, full-service grocery shop. We have continued to improve our offering and are providing more value, more quality, and more choice for these full-service customers. Every year, we bring great new products to our stores. Some of these innovative products come from our smaller local vendors and others from across the globe. This year, we have introduced more than 650 new products to Canadians, and I'm excited to share a few of my favorites with you on our holiday Insiders Report. My personal favorite is the PC Ultimate Pork Rib Roast. Not only is it simple to prepare and delicious, but it's priced at only CAD 15. Our innovation is also evident in our leadership in bringing multicultural food to Canadians. I see an interesting fact that first-generation immigrants represent almost a quarter of our population, and that number is growing faster than any other G7 country. This is why you will notice new merchandising and more multicultural products across our stores, including more T&T private label products. Speaking of T&T, we have recently opened new stores in London, Ontario, Canada, and last week in Brossard, Quebec. All three opened with huge customer excitement. I'm sure you have seen the videos on social media from China, and our T&T stores continue to outperform our existing network, and it's generating consistent high single-digit same-store sales growth. Richard, call out the impact of our Right-Hand Side on our food sales. This is another area where we are creating excitement for customers and bringing more value to innovation. Last quarter, I mentioned that we planned to add new apparel brands, and that was just the beginning. We now have two of our Real Canadian Superstores piloting our new Right-Hand Side concept and a third in Milton, opening at the end of November. We're still in the early days, but we are very pleased with their performance. Across our retail banners, we have also introduced some fun into the shopping experience with our first-ever Marvel Collectible Cards programs. A subsequent customer survey shows that most customers felt the program was exciting and well-executed, and our customer data shows that we attracted new customers, drove higher baskets, and more trips. Next up is our new cookware program. Launched in October, customers collect stamps, then redeem them for 75% off high-quality pots and pans. We've seen great customer interest, and it is already exceeding our initial expectations. I'm pleased with these results as these programs help to create excitement in our stores today and build loyalty over the long term, and we gain valuable insight that we will apply for future programs. Overall, our customer traffic and tonnage will open the quarter. This is a testament to the positive customer response to all the things we are doing to deliver great value and service to Canadians. And speaking of value, I was very pleased to see that Canadians again choose the PC Optimum as the most trusted loyalty program in BrandSpark's annual review. Turning now to our drug retail business, we are seeing a return to normal. Growth in pharmacy and healthcare services continues to be strong, reflecting long-term trends that continue to position us very well for the future. Our same-store sales and front-store growth improved compared to quarter two, but we expect sales pressure to continue in quarter four. As Richard highlighted, we saw continued strength in our prestige beauty category, but saw pressure as we exit low-margin electronics categories and a slowdown of consumers' convenience spend. We've been working to address this. This week, we launched a new program across our Shoppers and pharma network to lower the prices of hundreds of items that are most important to our customers. With front-store improving and pharmacy healthcare services growing, we are well-positioned to further strengthen our leadership position. This quarter, I wanted to take a minute to highlight our commitment to have all our control brands and in-store plastic packaging aligned to the Consumer Goods Forum Golden Design Rules by 2025. The reality is that the issue of plastic is one that will require a collective effort and technological advances to tackle. The solution is well beyond the actions of any single company. As a retailer and a brand owner, we have the opportunity to play an innovating and leadership role. In collaboration with our suppliers, we have already achieved a compliance of almost 80% of our control brand and in-store plastic package products, and we're working with our national brand vendors, encouraging them to join us and adopt the Golden Design Rules by 2025. As we work hard to close the year, our focus remains on our strategic pillars of retail excellence, driving growth and investing in the future, while at the same time embedding ESG into everything we do. Our success allows us to make important investments into our growth areas, creating operational efficiencies and into protecting our planet. This, in turn, allows us to offer Canadians the best value and service. We'll now open the call for questions. Thank you. Thanks, Per. Jenny, if you'd please introduce the Q&A process. Thank you. Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please press the star followed by the one on your touch-tone phone. Questions will be taken in the order received. If you wish to cancel your request, please press the star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. Once again, that is star one should you wish to ask a question. Your first question is from Tammy Chen from BMO Capital Markets. Your line is now open. Hi, good morning. Thanks for the question. Maybe I'll start with Shoppers on the front of store here. So I know you laid out a number of factors of what's going on there, and that's very helpful. I just wanted to go back to, if I look on a two-year stack, that front-of-store comp, it's still decelerating. You've talked about going forward, there's some additional electronics headwinds, so I understand that, but I want to talk about the segment without the electronics. Are you just seeing the consumer incrementally still pull back from this channel overall? How are you thinking about that, minus the electronics part going forward? No, thank you. That's a great question. So what we are seeing in the front-store is that our prestige beauty is continuing to perform really, really well. So we're pleased with that. In the last quarter, we saw that cough and cold was slightly down, and that was on top of a very, very strong quarter last year. And then food was down a little bit, and we are addressing that by what I mentioned in my speech about lowering prices on 400 items because the shift to value and discount, of course, has a slight impact on the food sales in our Shoppers Drug Mart stores. But we're realizing it by lowering more than 500 products by 10%-50%, so we will encourage more customers to shop in our front-store. And we stay confident going forward in our front-store sales. Richard, do you have anything to add? Yeah, I just want to put a little bit more emphasis on cough and cold, because you've heard us over the last two years report every quarter that we had record cough and cold sales, and so that is now behind us. We still are selling more cough and cold than historically prior to COVID, but those numbers are now starting to trend to normal, so that is also affecting our front store sales, and I expect that to continue going forward. And allergy was up as well, so. Okay, got it. Thank you. Another question I had is, it might be a little early, but just want to gauge your initial sense. How are you thinking for next year, 2025, in your framework? You've had three very strong EPS growth years that are above your framework. You've been talking about these pre-opening costs because you've got the new store pipeline. What, as you look to next year, keeps your framework and your growth still in that 8%-10% range? What are the risks, and what are the levers in your control that you'll lean on? Thank you. No, thank you. Let me start, and then I'm sure Richard, he will add to this. So next year, we are opening a new DC. Of course, we are in control, and we're sure that will be good. We are also opening more stores next year than this year, but at the same time, we will still be within our financial framework. So this is about investing in the future at the same time as delivering on our framework. So that will create some good tonnage growth next year. And there's a lot that's in our control, like further improving on strength, getting the top line up, and then maybe referring back to our strategy, which is long-term, getting the growth, keeping costs in control, and thereby being able to continue to deliver the profit we need to stay into the framework. Yeah, Tammy, I'm just going to double-click on this. So Q4, good, okay? Our mind is all focused on 2025. As Per mentioned, we know that we're going to have a new DC that ramps up starting Q1 of next year, and we know that we're going to be building more stores than we have this year. As such, we've been planning accordingly this year to be able to deliver the earnings growth that we've made the investment community accustomed to. The big picture point, and we're not giving guidance today, the big picture point is, despite these two big factors, we are confident that we're going to be delivering earnings within our financial framework in 2025. Yeah, and I think it's important to say that we are planning for the long term, not the short term, because yes, it is going to put some pressure on the short term, so like the next few years, but still, we'll be delivering within the framework, but it's going to help us long term because, as you rightly said, opening more stores will put a bit of pressure short term. Thank you. Thank you. Your next question is from Irene Nattel from RBC Capital Markets. Your line is now open. Thanks, and good morning, everyone. Could you please spend a couple of minutes just giving us a little bit more insight into what you're seeing in consumer behavior within the grocery store? Because I understand the shift to discount. You mentioned that your average unit price is down, so can you talk about volumes, baskets, penetration on promotion, private label, and how all of that is playing into your gross margin run rate? Okay, so if I start again, then it's going to be more of the same, so more of what we have seen over the past half a year or year. So customers, they still like our promotions, so they're buying a lot into our promotions. They like our No Name, and they're shifting to value. But what we're seeing is that they're not only shifting to our hard discount, our Maxi and No Frills, but they're also going more into our superstores because after having combined our Real Atlantic Superstores with the Real Canadian Superstores, we're seeing a good benefit of that. So it's more value, but again, it's not only value in our superstores and hard discount stores, but it's also values in our Zehrs and our Fortinos and our Loblaws. It is actually across the piece, and we're doing a lot of work to give Canadians values across the piece because value is not only price. So what I refer to, it's the range we offer, it's the quality, and the promotion. So it's a lot of things. So we try to cater for all customers' needs in Canada. So overall, the trend is going to be the same. I don't think we will see that trend going to be even stronger, but not weaker either. I think we'll continue to see the trend as we are seeing right now. Yeah, Irene, specifically, our traffic continues to be up. Basket is down slightly, but not more than any quarter so far this year, so we feel good. Obviously, we're adding square footage, and it's definitely starting to make a difference. Yeah, maybe we can say that. Maybe we can add that we will add tonnage growth this year. So this year, we probably, as we see it right now, we will have the best year in a decade in regards to tonnage growth for the company. That's outstanding. Just following up, sort of tying that into the question of gross margin, I think you mentioned that you're going to be lowering prices on about 400 items in Shoppers. We've got the Hit of the Month. We have other sort of value creation initiatives. How should we think about the gross margin impact? And I guess the real question is, do you have enough initiatives in the business itself to be able to do all of that and deliver some gross margin growth? Yeah, I think and I believe we have. It's also about the mix because if prestige beauty is sitting over and above the rest, we will have a slightly higher margin there to compensate for some of the others. But then again, of course, we also need to do our job and negotiate well with our branded suppliers to make sure that we have the right cost base, which is important. Yeah, and specifically with the numbers, Irene, you've seen significant performance in gross margin beyond our expectation because we've done a better job at managing shrink. And this has been the story for 2024. It's coming down, the benefit of shrink, quarter after quarter, but it's still there. And, happy to say, that on the food front, we're back to pre-pandemic level on shrink. So that's quite an achievement, and that, to me, is one of the reasons why we've done so well this year. On Shoppers, shrink is improving, but not at the same pace. So we're doubling down on our efforts with Shoppers, and this will be some sort of a tailwind for that business for the next year. That's great. Thank you. Thank you. Your next question is from Michael Van Aelst from TD Cowen. Your line is now open. Thank you. You went through some of those numbers really fast, Richard, and could you just quickly summarize the puts and takes you're seeing in Q4? The puts and takes I'm seeing in Q4. Okay, so Q4 is so let's start with outlook. So we moved our outlooks to slightly low double digit because mathematically, there was no way we could be able to hit our outlook. So expect for the year to be slightly low double digit, but not that much, okay? So I want just to specify that. What you're going to see is front store in Shoppers is going to get worse because of consoles. Consoles is a Q4 thing. And so as you've heard us talk all through the year, we've made the decision to get out of electronics early in the year. But the console impact is only it's not only in Q4, but it's largely in Q4. As we were discussing consoles, I guess a few months ago, business came to us and said, "Hey, are we buying new consoles?" Per and I said, "No, no, we're not buying any more consoles." So that's going to have a material impact on front store in Q4 for Shoppers. Having said that, our decision to get out of electronics, we looked at whether or not it's driving a basket, and it's not driving a basket. More than 80% of the transactions that are on electronics, customers come in and just buy that item and leave. So it's not good for our business, so that's why we're deciding to exit it. The fact that we're not going to be doing consoles anymore is going to put more front store pressure for all of next year again. So that's why we said an additional 1%. Does that answer your question? Yeah, that's great on that front. And then I think you had made some comments on margin implications for both food and. Okay, yeah. Margin, you're going to see. So let's go back. We all said to all of you early in this year that our plan was to deliver flat gross margin, flat SG&A for the year. We've done better on gross margin because of shrink. Check. Okay, SG&A. We said we're going to be more or less flat, which is still our plan. So you're going to see slightly improved gross margin in Q4 and flattish SG&A rate in Q4. All right, thank you, and then I wanted to ask you about the initial takeaways that you've seen so far from these pilot No Name stores that are heavily discounted in price and whether you see much of a future for these stores based on some of the initial reaction? Yeah, thanks. So first of all, we have received great customer feedback from those stores, but it's still very, very early days to make any meaningful conclusions about it. But I can say one thing is that we have already learned a lot from doing it, how cheap we can build, how low we can go on prices, and how we can manage the operation. The team are doing a super good job on managing operations there. So if not anything else, then we're taking a lot of learnings there, as I said before, that we can apply to the discount business and help us continue to build new stores. But again, it's too early to say whether we're going to build more or whether we're going to pivot. Excellent. Thank you. Thank you. Your next question is from Mark Petrie from CIBC Capital Markets. Your line is now open. Yeah, thanks. Good morning. You've touched on a bunch of my questions, but I just want to follow up on a few of them. As you mentioned, the gap between full service and discount has narrowed somewhat, but are you seeing other indicators of trade downshifts move at all? Promo penetration, package size, penetration of good versus best product, are any of those shifting at all, or are those all relatively stable? First of all, I don't think we said that it's narrowed. I think we said it's more of the same. So the gap continues to be the same as it has been. So the trend is still that customers are buying a lot into the promotion. So the promo penetration is staying very high. We're also seeing that customers more and more like our No Name brands, so of course, the low end of our control brands. And that's it. So it is more of the same. And still, customers, they really love our market division, so our supermarket stores. So it's not only discount. We're also seeing good traction on delivering value in those stores. And I think it is important to, again, mention that it is both the range, like Frank and his divisions, he has put in a lot of multicultural products. So overall, 600 new products and a lot of those multicultural. And they are clearly outperforming the rest of the new products that we are putting in. So that's also giving customer sentiment. Mark, I want to add one point for you. We have data from our PC MasterCard that we look at. When we look at our data, it tells us that Canadians are buying more groceries these days than they were the same period last year at the expense of restaurants. We are seeing that trend. Yeah. Okay. That's helpful. Thank you. On the private label penetration side, wondering if there's any way you could sort of contextualize the listings and sort of the penetration on shelf of private label versus a year ago or where that would have been kind of pre-pandemic or something like that. I'm not sure we give you those numbers, but I'll let Roy decide that. But what I can say is that because we implemented Hit of the Month this year, then of course, that's giving some traction to the big CPGs because those products that we put in, they are primarily the big brands, and that's shifting a lot of tonnage. But it's almost equal to last year. We stay at a high penetration on our control brands. And of course, it's also helping on us on our margin. Yeah. Okay. Thanks. And then just two quick follow-ups just to clarify. Obviously, lots of puts and takes, but I think it's fair to say, Richard, based on what you were saying, that gross margin is the biggest factor in sort of outperforming the typical financial framework that you would have communicated to the street for that low double-digit EPS growth. Is that fair? I think that's fair. I think that's fair. But I think we still continue to do a good job on managing our costs also. It's masked a bit by some real estate gains that we have, but those are not material, and we've been selling real estate for the last three years now. So you also need to take note that our tax rate is 2% higher this quarter than last year. And our non-controlling interest is actually CAD 50 million higher than it was last year, and this is just timing. So when you look at all the puts and takes, it's actually a very solid quarter that we printed for Q3. Yep. Understood. And then if I could just clarify the Q4 food same-store sales trends, you said those are better. I'm assuming that still holds, and you're giving this on a like-for-like basis, sort of normalizing for the Thanksgiving headwind in Q3, and then I would presume a tailwind in Q4. Is that right? Yes. Yeah. Okay. Thanks a lot. All the best. Thank you. Thank you. Your next question is from John Zamparo from Scotiabank. Your line is now open. Thanks very much. Good morning. I wanted to start on the new store growth plans. I wonder if you could talk about the profitability metrics of new stores and, in particular, hard discount, and just remind us how long it typically takes for these stores to reach mature profitability levels. Yeah. So the profitability on these stores is going to be the same as the rest of our stores. And it takes about three years for the store to reach sort of a peak profitability. But more importantly for us is to see the sales. We know in the first six months whether or not the store will make it based on where the sales are going. And that's why we're pleased right now because we look at the few stores we've opened already, and we look at their sales performance, and it's sort of very, very promising. So that's how we're looking at it. Yeah. And think about the number of new stores. So we cannot talk about how many next year, but we opened 50 this year, and it's going to be more next year because if we start on a consistent basis over the next few years, or maybe many years to open more stores than we've done in the past, then that will eventually also help the same-store sales because year two for a new store is significantly over and above the average of the rest of the stores. So like the 50 stores that we open next year, when they turn same-store sales next year, that will help increasing our overall sales for the like-for-like. Yeah. And I want to add to that because that is true. What's also true is our absolute sales will also shoot up next year. With low inflation that we're in now, the fact that we have all these new stores that are opening right now and that we're planning more of that next year, you're going to see a higher absolute sales growth for Loblaw in 2025 and beyond. Yeah. And I think on the sales, so again, it's early days on the Right-Hand Side and the pilots we are doing there. But if that works and the one that we're opening in Milton end of this month, if it continues to do as well as we're seeing right now, that's, of course, something that we're going to deploy over the next three, four years to all our superstores, and that will also help our sales. So it's not that we only focus on the hard discount and the small stores. It's like we're looking across the board in all our banners to improve sales and doing something that's better for customers. We encourage you to go see those two stores. Understood. All right. That's good color. Thank you. Moving to the pharmacy side of things and coming back to exiting out of electronics and consoles, I wonder what it is you're giving that square footage or that shelf space to, and are there other areas of the store that next year or year after that you're thinking of reconfiguring as well? Don't expect you to share what those are, but are there other opportunities to grow even the dollars by reconfiguring your front-store? No, I think we are good where we are now. I think we have the right mix. And it's not that the electronics takes up a lot of space, and we can just take that space and convert that into a shop-in- shop of something else. Remember, it's a few items with a high ticket price that we sell. So it's not that we have a specific electronics department in our Shoppers. But of course, what we're refocusing more on, that's the beauty side, both the prestige beauty and also the mass beauty. That's where we're really, really strong. And we are the biggest beauty seller in Canada and want to continue to grow that part. And also the market there is growing over and above the food. Right. Okay. That's helpful. And then just one clarification on your guidance. The increase in CapEx guidance, it's relatively small, but can you add any color on what's driving that? Yeah. It's very small, as you mentioned. It's just like new stores that we've added up as the year progressed. So that's it. Okay. Understood. I'll leave it there. Thank you very much. Thank you. Thank you once again. That is star one, should you wish to ask a question. And your next question is from Vishal Shreedhar from National Bank Financial. Your line is now open. Hi. Just with respect to the changing population growth outlook in Canada, wondering how we should expect that to unfold as it relates to Loblaw. Are you anticipating different sales trends and associated different labor hiring challenges as you look at the population growth cadence? Vishal, this is actually super interesting. We were actually looking at those numbers recently. If you remember, Canada reached 40 million people last June, June 2023. We reached 41 million in March of this year, and we're edging close to 42 million as we speak. So Canada continues to be the country whose population growth is the fastest in the industrialized countries. And while it may slow a bit, we still believe that it's going to grow. And that's a tailwind that is very positive for grocery players like us. So we expect that that trend should continue. Maybe not at the same pace, but it should be a positive for us. And that's also why we are adding a lot of new SKUs exactly on the multicultural assortment, which we are doing both in our discount stores but actually across the board. And just seeing what we are utilizing the skill and the scale of the group and taking some of the T&T products and bringing them into our conventional business is also something that's really, really helping a lot. Okay. Thanks for that. And Per, with respect to all the changes that have happened at Loblaw since you've come in, you and your team have put in a lot of exciting new programs, quite a few. And but we're noticing the sales gap on the food side, that delta versus peers, not at the same level that we've become accustomed to for Loblaw. And I'm wondering if the multi-buys, the different promo changes, the lowering prices, if that's caused that gap versus peers to not be what we've become accustomed to, or if there's other reasons. How should we think about that? No. I think you think about what I said before, that we are having the best tonnage growth in a decade in our business. And of course, when we remove the multi-buys, we are doing the right thing for customers. And you want to remove multi-buys when you're doing well in your discount stores because it's taking sales time. Of course, it is short-term, but long-term, it makes more customers to come into our stores. So lowering prices, as we have done, will give more tonnage, but of course, it's put a little bit of pressure on the overall top line. So you are right in that. But for us, it is really important to be in tune with our customers and give them what they want. And that's value at the moment. Okay. So you're content with sacrificing a little bit on the sales line maybe to gain the tonnage. And, as the rate of changes that you're implementing at Loblaw and the org's ability to adjust them, you were talking about the pressure on Shoppers and the Right-Hand Side pressure and all those initiatives. Is that the right balanced approach for Loblaw at this point in time, or as you look at your sales performance versus peers, or is that not a consideration that Loblaw has? I'm not sure I understood it right, but I think all the new things that we are implementing, like the Right-Hand Side, it's definitely the right thing to do because we have been declining in our non-food, apparel, and beauty, or at least not growing over the past years, and it is margin enhancing categories, and that side of the big superstores, it's about a little bit less than 40% of the space, and it's less than 20% of sales, so by doing that, we will both increase the Right-Hand Side, but we will also increase the left-hand side of the store, and that's what we're seeing in the pilot. Still early days, but we're seeing it, and one of the things we're doing, we're moving the pet food to the Right-Hand Side, getting more customers over there. When they see what great stuff they can buy, they buy more into our range. Yes, we have done a lot. Of course, now we're going to perfect what we have done the first year I've been here. It's not that I will bring on 10 big new initiatives because we have a lot on our plate, and we're going to perfect it and do even better with what we have. I'm sure we can do that. Yeah. And just, Vishal, I think I got one portion of your question. I think, yeah, we made decisions to get out of electronics because we think it's best for the customer and it's sacrificing sales. Yes, we made the decision to get rid of multi-buys because we think it's the right thing to do for consumers and it's affecting sales. But you know what? This is sort of the right things to do long-term for the business. And our focus is on adding square footage. So if we have the right business model that works and resonates with customers, if we just replicate it with new stores, long-term, we win. So that's how we're thinking about this. Yeah. Thank you for that color. And Richard, maybe just to get your update on transportation as a service and media and how you expect that to unfold in 2025. More of the same. So we remain quite excited about the performance of our transportation business in 2024. And we have, again, ambitious plans for 2025. As we talked about media for a number of years, this business continues to grow quite nicely, but it's still quite small compared to the other one. But it's heading in the right direction. Thank you. Thank you. Your next question is from Chris Li from Desjardins. Your line is open. Hi. Good morning, everyone. Maybe I should start with a very quick clarification question, Richard. When you mentioned sort of slight low double-digit EPS growth for this year, I take it we should kind of read it as more like 10%. Is that kind of a fair assumption? In that zone. Okay? In that zone. Perfect. And Richard, also, I know you and your team have done a lot of great work just over the years in achieving that consistent EPS growth quarter after quarter. And I wanted to ask you for next year, you said you're going to deliver the same financial framework, but I want to maybe get a bit of more detail about how would you think about from a quarter-quarter basis just because you mentioned you'll be opening a new DC in Q1. So when we think about the progression of EPS growth, should we model that same framework quarter after quarter like what you have achieved the last two years, or should we be more back-end weighted because of some of these one-time startup costs in the first half of the year? So I don't want to be too specific about next year because we're not providing outlook yet. Having said that, we are planning for consistent quarter-over-quarter performance, and we're planning to be within our financial framework. So that's as far as I can go today. When we come back to you after the holidays, we'll be able to be a little bit more clear as to exactly what that means. But that's how it's shaping up as we speak. Okay. Well, that's helpful. And then, Per, maybe just follow up on, I think, Tamy's question earlier. Just as you look out for next year, I wanted to ask you, if you take a step back, maybe not looking at Loblaw per se, but looking at just the grocery industry in general, what do you see as one or two of the biggest challenges facing industry for next year? I don't see any new challenges that we haven't faced this year. So basically, it is a boring answer. It's more of the same. And I also believe that a lot has to do with what we do. So some of the changes that we apply to our entire store portfolio, of course, will make a difference. But customers, they are continuing looking for value. And that will be the theme, not only for the next year, but I think for the next many years. That's also why we are building many of the new small stores in our hard discount because that resonates so well with our customers. And the first indication on sales for those stores, they're performing good. And that's how we provide real value to Canadians because those stores are much cheaper than the average store. Okay. Perfect. And I just have maybe two questions left. Maybe just switching to the strength in the e-commerce sales that you are continuing to see, I'm thinking more in the grocery side. Is that coming more from you guys taking market share, or are you seeing a bit of a resurgence in the adoption for e-commerce for the industry as a whole? I think it's growing slightly. So I think we are growing in line with the industry, but probably you can tell me whether that's true. But it is a good high growth that we're having. And we're also having a fair share that's over and above the average. But too, in addition to that point, our Optimum members, they continue to be very important for us. And then they once again grew. And year over year, we have been growing by 500,000 with our Optimum members. And we're also seeing a good increase in our weekly digital engaged customers who are normally buying more than average. And of course, that also has an impact on our e-commerce sales. So we're happy with the growth there. Okay. Perfect. But I guess probably in line with the industry growth. In line. Okay. That's great. And my last question, this might be a tough one to answer, but I'm just thinking ahead. With some of these big GLP-1 drugs like Ozempic going generic in Canada in 2026, do you expect a big sort of pickup in demand? And then maybe another question is, at a very high level, is the generic version of these specialty drugs generally more profitable for community pharmacy than the branded version? I think the GLP-1s, the drugs, they are growing more than the rest. On a margin percentage, they are diluting, but on a quantum profit, they are helping us, and whether it's going to pick them up more or less, I don't know, but it's good. We're still seeing good growth right now in it, so. Generics are more profitable? Just math, Chris, because the price is lower, and so you get more weight loss. So that's how to think about it. It's just math. That makes sense. Okay. Thanks, guys. All the best. Thank you. Thank you. There are no further questions at this time. Please proceed. Thanks very much, Jenny. Thanks, everybody, for your time today. If you have any follow-up questions, drop myself or Philippe a note. We'll get back to you quickly. And open your calendars and mark Thursday, February 20th, when we will be releasing our Q4 results. Thanks, and have a great day, everybody. Thank you. Ladies and gentlemen, the conference has now ended. Thank you all for joining. You may now disconnect your line.