Morning, ladies and gentlemen, and welcome to the Metro Inc. 2026 second quarter 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. Also know that this call is being recorded on April 22nd, 2026. I would like to turn the conference over to Sharon Kadoche, Director, Investor Relations and Corporate Finance. Please go ahead. Good morning, everyone, and thank you for joining us today. Our comments will focus on the financial results of our second quarter, which ended on March 14th. With me today is Mr. Eric La Flèche, President and CEO, Nicolas Amyot, Executive VP and CFO, Marc Giroux, Chief Operating Officer, and Jean-Michel Coutu, President of the Pharmacy Division. During the call, we will present our second quarter results and comment on its highlights. We will then be happy to take your questions. Before we begin, I would like to remind you that we will use in today's discussion different statements that could be construed as forward-looking information. In general, any statement which does not constitute a historical fact may be deemed a forward-looking statement. Words or expressions such as expects, intend, are confident that, will, and other similar words or expressions are generally indicative of forward-looking statements. The forward-looking statements are based upon certain assumptions regarding the Canadian food and pharmaceutical industries, the general economy, our annual budget and our 2026 action plan. These forward-looking statements do not provide any guarantees as to the future performance of the company and are subject to potential risks, known and unknown, as well as uncertainties that could cause the outcome to differ materially. Risk factors that could cause actual results or events to differ materially from our expectations, as expressed in or implied by our forward-looking statements, are described under the Risk Management section in our 2025 annual report. We believe these forward-looking statements to be reasonable and pertinent at this time and represent our expectations. The company does not intend to update any forward-looking statements except as required by applicable law. I will now turn the call over to Nicolas. All right. Thank you, Sharon, and good morning, everyone. I will go directly to our Q2 results as Eric will comment on the status of the current strike in our Québec operations. Q2 sales reached CAD 5.1 billion, an increase of 4.1% versus the second quarter last year. Sales were positively impacted by new store openings, same-store sales growth, as well as the transfer of one significant pre-Christmas shopping day to the second quarter this year. Front store sales or food same-store sales grew by 1.8% in the quarter, up 1.5% when adjusting for the Christmas shift. On the pharmacy side, same-store sales grew by 5.1%, supported by a 6.1% growth in prescription sales and a 2.8% growth in front store sales. Similar to food, when adjusting for the Christmas shift, front store sales were up 2.3%. Our gross margin reached CAD 1.03 billion or 20.1% of sales in the quarter. This compares to 20% in Q2 last year. Part of the increase is attributable to productivity gains recorded in our distribution centers. As mentioned on the last call, our operations are back to normal in our Toronto distribution center. Operating expenses were CAD 538.9 million in the quarter, up 3.4% year-over-year. As a percentage of sales, operating expenses were 10.5% versus 10.6% in the second quarter last year, reflected continued cost discipline. The asset disposals recognized in the second quarter of 2026 generated net gains of CAD 20.4 million, of which CAD 20.1 million was attributable to the disposal of out-of-service warehouses. EBITDA for the quarter amounted to CAD 508.6 million. That's up 10.3% year-over-year and represented 9.9% of sales. Excluding the gain on sale from the disposal of out-of-service warehouses of CAD 20.1 million, adjusted EBITDA stood at CAD 488.5 million, up 6% year-over-year, reaching 9.6% of sales, an increase of 16 basis points over the second quarter of 2025. Depreciation and amortization expense for the quarter was CAD 144.3 million, up CAD 8.2 million. The increase in depreciation and amortization is mainly due to the increase in retail network investments, including right of use assets, as well as ongoing investment in technology. Net financial costs for the quarter were CAD 37.3 million, compared to CAD 33.4 million last year. The increase is mainly due to higher interest expense on net debt. On February 25th this quarter, the company tapped the bond market and issued a five-year, CAD 350 million note-bearing interest at a rate of 3.469%. We used the proceeds of the offering to repay debt under our revolving credit facility and for general corporate purposes. Including this financing, our debt to EBITDA ratio stands at about 2.2x. Our effective tax rate of 24.6%, which continues to benefit from the Terrebonne DC tax holiday, is similar to the effective tax rate of 24.5% in the second quarter last year. Adjusted net earnings were CAD 236.5 million in the quarter, compared to CAD 226.6 million last year, an increase of 4.4%, while adjusted fully diluted net earnings per share amounted to CAD 1.11 versus CAD 1.02 last year, up 8.8% year over year. Our capital expenditures in Q2 totaled CAD 85.3 million, consistent with last year. After 24 weeks on the food retail side, we opened or converted six stores and carried out four major renovation projects for a net increase of 141,000 sq ft, or 0.6% of our food retail network square footage. Under our normal course issuer bid program, as of April 2nd, we have repurchased 2.9 million shares for a total consideration of CAD 279.8 million at an average share price of CAD 96.47. In closing, we delivered solid Q2 results supported by strong sales growth and good expense control. On this, I will now turn it over to Eric for additional color on our Q2 results. Thank you. Thank you, Nicolas, and good morning, everyone. Before turning to the results, I will provide an update on the strike that started on March 30 in our Québec operations and which is impacting produce distribution to our stores in Québec. We are obviously disappointed by this strike now in its fourth week. We have been back at the bargaining table since April 8 and remain determined to reach an agreement that takes into account the needs of our employees and those of our customers while ensuring the long-term competitiveness of our company. As in any situation of this kind, the first days of the labor dispute required adjustments while our contingency plan was being fully implemented. Our contingency plan is now in place and our stores, although not in perfect condition, are generally well-stocked. The strike has impacted our sales, especially given that it happened the week before Easter. We will be able to specify the financial impact once the dispute is settled. Turning to our second quarter results, we delivered solid results driven by strong revenue growth and good expense control as our teams continue to offer the best value possible to our customers in all of our banners. We are very pleased with our discount store expansion plan that is fueling our food sales growth and with the continued strong momentum in our pharmacy business. In Q2, sales grew by 4.1%, adjusted EBITDA by 6%, and adjusted earnings per share by 8.8%. Total food sales were up 3.6%, and food same-store sales were up 1.8%. In pharmacy, we had another strong quarter with 5.1% total same-store sales growth on top of 7% last year. Our discount banners continued to perform well with same-store sales growth exceeding that of Metro, together with the continued contribution of new store openings and conversions. Our internal food basket inflation was in line with the reported food CPI of 4.3%. We continue to see inflationary pressures on certain commodity prices, namely in the meat category, in addition to higher than usual CPG vendor cost increases. Our teams remain highly focused on cost mitigation initiatives through supplier negotiations and pricing discipline with the objective of offering the best value possible to our customers. During the quarter, comparable store customer traffic was slightly lower, offset by growth in the average basket. Absolute traffic across the network increased, supported by new store openings. Promotional activity remains elevated and private label sales continued to outperform national brand, contributing to our gross margin performance. Competitive environment remains intense but rational. Online sales grew by 19.8% in the quarter. Growth is being driven by third-party marketplaces, the ramp-up of click and collect services, and delivery within our discount banners. We are pleased with the sales performance of our own services and third-party marketplaces, which are recording similar growth rates compared to last year. Turning to pharmacy, prescription sales were up 6.1%, driven by continued organic growth, specialty medications, and GLP-1s. Commercial sales grew by 2.8%, led by cosmetics and health and beauty categories, partly offset by a softer performance in OTC. The cough and cold season was compressed this year. It peaked earlier and was shorter in duration. Our retail CapEx plan is on track as we successfully opened three new stores in Q2, including two discount stores. Halfway through F26, our food retail network square footage growth increased by 0.6%, and over the last 12 months, it increased by 1.9% as we execute our new store opening plan, mostly in discount and mostly in Ontario. On the pharmacy side, after two quarters, we have completed 15 out of the 35 renovation projects planned for F26, including seven pharmacies with our new concept. To conclude, we're confident that our effective merchandising programs, strong private label offering, our Moi program, consistent execution at store level, as well as our ongoing collaboration with our supply chain partners, will allow us to continue to grow and deliver long-term shareholder value. Thank you, and we'll now be happy to take your questions. Thank you, sir. Ladies and gentlemen, if you do have any questions, please press star followed by one on your touchtone phone. You will then hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by two. If you're using a speakerphone, you will need to lift the handset first before pressing any keys. Please go ahead and press star one now if you have any questions. Your first question will be from Mark Carden at UBS. Please go ahead, Mark. Good morning. Thanks so much for taking the questions. To start, your food inflation was essentially in line with the 4%+ food purchase from store CPI. Just as inflationary pressures persist, have you seen any sequential changes in customer behavior? Are they leaning even more heavily into discount? You called out the strength there in your release. Are you seeing any incremental uptick on trade down within your stores? Just any changes on that front. Thank you. No real changes. Very consistent customer behavior as we've been reporting over the last several quarters that I tried to outline in my opening remarks. Yes, discount is growing faster. People are searching for value in all of our banners, not just discount. Private label is up, penetration remains elevated, so it's very consistent. Food inflation is driven a lot by the meat category, and as I said, CPG cost increases. I would sum it up that way. Great. That's helpful. Thanks. As a follow-up, just given where fuel prices are today, historically, have you guys seen any demand destruction or consumers taking units out of their baskets when prices at the pump cross a certain threshold? Or any broader shifts in food shopping behavior at your stores? We don't have a specific number to report to you, but energy prices, pressures, fuel price pressures contribute to affordability crisis and contributes to customers searching for value in everything that they buy, including food. It's just one more element that puts pressure on the customer, and we're well positioned with our multiple store formats and growing discount formats to address those customer needs. Got it. Thanks so much and good luck, guys. Thank you. Next question will be from Michael Van Aelst at TD Cowen. Please go ahead, Michael. Hi. Thank you. I just wanted to start by following up on the competitive question. Last quarter, you pointed to the competitive nature of the industry and it seemed to spook the stock a little bit. You suggested that it's intense but rational. That doesn't seem like anything different than what you've said in the past. Do you feel that the moderating trend of normalized same store sales growth from Q1 to Q2 reflects an increase in competition or consumer that's under more pressure and therefore trending down more, cutting back on tonnage? Tonnage in the whole market is flat to down, so clearly there's pressure on the consumer side. I think it's a general market dynamic of low consumption and people being careful. The competitive environment, as I said, it's intense. We are competing with large players. Everybody is looking for market share and it's competitive out there the way it's always been. Last quarter, I was perhaps referring more to the square footage growth and people opening stores. That creates some noise in the market, but nothing abnormal and nothing that we've not seen before. We're, like I said, well positioned to compete. Okay. Thank you for that. Just on the fuel cost increases, I know you mentioned your comments relative to the consumer impact, but as far as your cost impact, I know you have a lot of third-party distribution, so are you seeing fuel cost surcharges already? And if so, are you able to pass those on, or should we expect that to have some pressure on margins? Yeah, maybe I'll take this one, Michael. I would say that from a fuel cost increase perspective, two sides to the story. On the products that we buy from the supply chain, so far we have not received that many price increase requests. Only a few, actually. We're negotiating the conditions and trying to delay the impact that this might have on food pricing. Obviously, the situation, as everybody knows, is very volatile and we don't know how long it's gonna last and how it's gonna unfold. At this point, nothing to say per se on cost of product. In terms of our own distribution side, the cost of fuel is impacting our activity to distribute food and drugs to stores and pharmacies, and that's pretty direct. We've started feeling it. At the current elevated pricing of fuel, you could imagine a CAD 5 million-ish per quarter impact if everything was to hold as the situation is today. That's obviously, everything else being equal, more pressure that we need to manage. In the past, I think you said you typically pass on these higher fuel costs in your distribution system. Is that something you're already working for or you're looking for other ways to offset? Well, it's part of our cost structure, and we have to manage and keep our prices competitive in the market. Over time, we expect that higher costs like that will be reflected, but it hasn't started to happen yet. Okay, great. Thank you very much. Next question will be from Mark Petrie at CIBC. Please go ahead, Mark. Yeah, thanks. Good morning. I know you're not going to give specific numbers, but obviously, the strike impact is on people's minds. Hoping you can give us some qualitative comments just with regards to how Québec or Ontario might be tracking differently in Q2 so far, and if you can give us some sense of the incremental costs that are incurred as a result of your mitigation strategies? Like I said in my opening remarks, we're going to keep the impact for a later date in due course when we have the full tally. Like I said, we lost some sales. When you lose sales, you lose a bottom line. Clearly it has had an impact. There are direct costs to set up a contingency plan, so we will communicate in full transparency when we're in a position to do so, but I don't want to give, at this time, any color. This is a strike that's affecting our Québec business, not our Ontario business, so let's be clear on that. It is having an impact. The contingency plan is better every day. Stores are looking better every day, and we are, I think, decent. We're not perfect, like I said. There's maybe some small varieties missing from one store to another or from time to time, but generally our stores are looking okay, looking good, and we can answer most of the customer needs in our Québec stores. Hopefully we'll settle the strike. Like I said, we need to be competitive. The demands at the table are not reasonable and can't be accepted. We are patient, and we will preserve our long-term competitiveness. Maybe, Mark, just a quick comment. I think in your question you referred to Q2, but it's really Q3 for us, right? The strike started on March 30th, so it's going to be no impact in Q2. It's going to be impacting us in Q3. In Q3. Yeah. Okay. Yeah, understood. Okay, thanks for those comments, and totally understand. I guess one other question. I'm just curious if you can share any trends or data with regards to the impact of Buy Canadian, and how some of the most affected products and categories last year have been performing as you lap sort of the biggest impact last year? Mark, it's Marc here. We said in the last few quarters that the Buying Canadian, there was still elevated sales on Canadian product, but it has softened over the last few quarters. Buying Canadian continues to be of interest for consumers, but we have not seen a significant increase of sales year over year on Canadian product right now. Yeah. Okay, as you're lapping the big sort of initial surge last year, are you seeing outright declines in any of those sort of most affected categories? No, I would say it's pretty stable, Mark. Yeah. Okay. I appreciate the comments and all the best. Next question will be from John Zamparo at Scotiabank. Please go ahead, John. Thank you. Good morning. I wanted to ask about the pharmacy side of the business and prescriptions in particular that saw same-store sales accelerate this quarter. I wonder if you could add more color on what you're seeing from your GLP-1 sales. I think you listed that third among the drivers of growth. Is that to say it was less of a driver this quarter against prior quarters? Does Coutu capture a similar level of market share on GLP-1s as it does on the rest of its pharmacy business? I'm sorry, I missed the last part around market share. Yeah, the second part of it is. GLP-1 Is the market share on GLP-1s similar to the rest of the pharmacy business? Yeah. Perfect. You are correct in saying when we listed it as organic specialty and GLP-1s, GLP-1s is a slightly less strong contributor to same-store sales growth as the other two. Despite that, it is considerable, and it's continuing to grow at a very strong pace, especially as new generations of GLP-1s are coming to market, and that's driving a lot of the growth right now in the GLP-1 sector. In terms of share, we are definitely holding our normal share and even for some molecules, outperforming, I'd say. Okay. Understood. Back to the grocery business. The growth from e-commerce continues to be robust. I wonder if this sustains at or around these levels and if the e-commerce business continues to grow, does that eventually create a drag on gross margins, or is profitability from these sales roughly in line with the overall consolidated number? That's a good question. We believe that e-com growth will normalize at some point as the market matures. As you're pointing out, we continue to see strong growth on both food and pharma. E-com sales has a lower contribution as brick-and-mortar sales. However, we've been able, with our e-com model, to mitigate that profitability gap with efficiency and multiple efficiency strategies, and we will continue to do so. That's what allowed us to continue to deliver the type of EBIT growth as a business as a total. We'll continue to leverage our flexible model to meet customers where they are. More and more customers are moving to same-day delivery, and our model and a fulfillment model allows us to meet that demand from customers and we'll continue to be focused on, as I say, efficiency, not only in e-com but in our overall business. Hopefully, I've answered your question. Yes. Thank you very much. Thank you. Ladies and gentlemen, a reminder to please press star one should you have any questions. Thank you. Next is Chris Li at Desjardins. Please go ahead, Chris. Good morning, everyone. I was wondering if you can provide some sort of very high-level colors on how the food gross margin performed during the quarter. I know in the opening remarks, you referenced private label and some DC efficiency as being positive, but just at the overall level, did the gross margin in food, was it largely stable or did it improve slightly? Thank you. We don't segregate between food and pharma on the gross margin. Like I said, private label contributes, lower shrink contributes, better forecasting contributes. I think the teams did a good job to protect and slightly grow gross margin, and we're pleased with that performance. Okay. That's helpful, Eric. Thanks. Maybe a follow-up just on the Moi loyalty program in Ontario. It's been, I think, in the market for a year and a half now. Just where are you on your journey to leverage the enhanced data analytics to deliver more personalization and effective promotions in Ontario through the new program? Thank you. Thanks for your question, Chris. It's Marc here. Moi continues to perform well and sales penetration continues to increase, and digital customer engagement continues to increase as well. We're satisfied with the progress we're making on Moi in Ontario and in Québec, in food and pharma in Québec. We've been leveraging data for a number of years, even before the launch of Moi in Ontario with our partner, dunnhumby. We use that data in our merchandising team to optimize promotion, to optimize assortment, and make sure that we have the right commercial strategy to meet the customers. We've been doing that before Moi and now are continuing to do it with Moi. On personalization, since our launch, as more and more customers engage digitally, we can have direct digital contact with them and deliver personalization directly to different channels. As Moi progresses, our reach in terms of personalization increases. As for Québec, the program has been in market now for a few years in both food and pharma. With our multiple banners and high penetration of Québec households, the extent of our reach and personalization is greater in Québec, and the cross-shopping and the impact of cross-shopping in Québec is greater as well. While we see cross-shopping and the benefit of cross-shopping in Ontario as well, to give you an example, in Québec, as consumers shop food and pharma, they spend 100% more with our business as a whole, through all of our stores and different channels. We'll continue to focus on increasing reach, increasing digital reach, so we can continue to drive personalization. There's still opportunity for us in both markets, more in Ontario, where the program continues to grow. That's helpful and thank you and all the best. Thank you. Thank you. At this time, gentlemen, it appears we have no other questions registered. Please proceed. Thank you all for your interest in Metro, and please mark your calendars for our third quarter results on August 12th. Thank you. Thank you, sir. Ladies and gentlemen, this does indeed conclude the conference call for today. Once again, thank you for attending. At this time, we ask that you please disconnect your lines. Enjoy the rest of your day.