Good afternoon, ladies and gentlemen, and welcome to Richelieu Hardware fourth quarter results conference call. At this time, all lines are in listen-only mode. Following the presentation, we'll conduct a question and answer session, which will be restricted to analysts only. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on January 18, 2024. Bonjour, mesdames et messieurs, et bienvenue aux résultats du quatrième trimestre de l'exercice 2023 de Quincaillerie Richelieu. Présentement, vos lignes sont en mode écoute seulement. Suite à la présentation, nous allons procéder à une période de questions et réponses, qui sera restreinte aux analystes seulement. Si vous avez besoin d'assistance au cours de l'appel, appuyez sur étoile et zéro. Veuillez prendre note que cet appel est enregistré le 10 janvier 2024. J'aimerais maintenant céder l'appel à Monsieur Richard Lord, Président et Chef de la Direction. La parole est à vous. Merci. Thank you. Good afternoon, ladies and gentlemen, and welcome to Richelieu's conference call for the fourth quarter and twelve-month period ended November 30th, 2023. With me is Antoine Auclair, CFO. As usual, note that some of today's issues include forward-looking information, which is provided with the usual disclaimer, as reported in our financial filings. We ended 2023 with a solid fourth quarter. Our sales are nearly in line with those of the same quarter of 2022, when the renovation market continued to benefit from favorable market conditions. Our inventory level continued to improve, helping generate over $70 million of cash flow from operating activities during the quarter. As for the EBITDA and net earnings, these were essentially impacted by the return to pre-pandemic operating expenses and costs incurred in projects to extend and optimize several of our solution centers, mostly in the U.S. For fiscal 2023, our total sales, including acquisitions, are also in line with those of 2022. Throughout the year, we maintained our commitment to financial discipline in order to continue generating healthy margins and strong cash flows, as shown by the $271 million generated from operations this year. 2023 was also another good year for acquisitions complementary to our activities, as well as concrete achievements in our network in line with our optimization culture. We invested in six new acquisitions: Unigra, Usimm, Quincaillerie R. Laberge, all three in Quebec, then Transworld Distributing in Nova Scotia, Maverick Hardware in Oregon, and West Coast Distributing in Minnesota. With this full acquisition completed in 2022, we're adding $152 million in sales on an annual basis, as well as extending our customer base and our offering and adding talented people to our team. Regarding our network projects, undertaken to better seize market growth opportunities, optimize our operation and service, we are pleased with our achievements to date. We have successfully completed the expansions of our centers in the Atlanta, Nashville, Fort Myers, Pompano, and Seattle areas. Our brand new Chicago center, serving the retailers market, is fully operational, as are the two new centers in the Minneapolis and Chicago regions. In December, we completed our Calgary expansion by consolidating the two centers into one single 250,000 square feet building. This center will become a destination for our customers, architects, and designers with a state-of-the-art showroom. In addition, we will be able to serve our retailer customers in Western Canada and our certain Alberta manufacturers from one single location. I'd also like to add that 2023 was a strong year in terms of innovation, as we added many innovative solutions in several of our product categories, all available in our one-stop-shop network and on richelieu.com for our customers. Optimizing the customer experience is always at the top of our priorities. Antoine will now review the financial highlights of the quarter and the year. Then I will continue, and we will take your questions. Antoine? Thanks, Richard. Our fourth quarter sales reached $454 million, slightly down by 0.8%. Sales to manufacturers stood at $393.1 million, down 1.2%, of which 2.8% from internal decrease and 1.6% from acquisition. In the hardware retailers and renovation superstores market, we achieved sales of $61 million, in line with 2022. In Canada, sales amounted to $267 million, a decrease of $6 million or 2.2%. Our sales to manufacturers reached $220 million, down 2.5%. As for retailers market, sales stood at $47 million, in line with last year's. In the U.S., sales total $136 million in U.S. dollars, same as last year. Sales to manufacturers reached $126 million in U.S. dollars, down 0.7%. In the retailers market, sales were up 8.8%. Total sales in the US reached $186 million in Canadian dollars, an increase of 1.2%, representing 41% of total sales. Total sales in 2023 reached $1.8 billion, a slight decrease of 0.8%, of which 1.8% from acquisition and 2.6% from internal decrease. Sales to manufacturers reached $1.5 billion, down 0.8%, of which 2.9% from internal decrease and 2.1% from acquisitions. Sales to hardware retailers were down by 1% or $2.6 million to $248 million. In Canada, sales total $1 billion, down 2.5%, of which 4.4% from internal decrease and 1.9% from acquisitions. Our sales to manufacturers amount to $856 million, down by 2.4%, of which 4.7% from internal decrease and 2.3% from acquisitions. Sales to hardware retailers and renovation superstores were $198 million, down 2.9%. In the US, sales amounted to $548 million in US dollars, down 2.7%, of which 4.4% from internal decrease and 1.7% from acquisitions. They reached $740 million in Canadian dollars, up 1.6%, accounting for 41% of total sales. Sales to manufacturers reached $506 million in U.S. dollars, a decrease of 3%, and sales to hardware retailers were up by 1.2%. Fourth quarter EBITDA stood at $58.8 million, compared with $76.7 million last year, down 23.3%. EBITDA margin stood at 13%. For the year, EBITDA was $230.4 million, down 19.8%, and EBITDA margin stood at 12.9%, reflecting the return to operating expense closer to pre-pandemic level and expenses incurred specifically for projects to expand and modernize several of our distribution centers. Fourth quarter net earnings attributable to shareholders totaled $28.5 million, compared with $44.9 million last year. Diluted net earnings per share reached $0.51, compared with $0.80 in 2022. For the year, net earnings reached $111 million, a decrease of 33.8%, and $1.98 per share, compared to $2.99 per share last year. Fourth quarter cash flow from operating activities before net change in non-cash working capital balances were down 20.7% to $49.3 million or $0.88 per share. Net change in non-cash working capital balances represented a cash inflow of $23.3 million, reflecting mainly the change in inventory and accounts receivable. Consequently, we generated $72.7 million in cash flow from operating activities, compared with $3.6 million for the fourth quarter of 2022. For the year, operating activities generated a cash flow, a cash inflow of $271 million. Net change in non-cash working capital balances represented a cash inflow of $80.2 million, mainly resulting from improved inventory level. During the year, we paid dividends of $33.5 million, up 15% over 2022, of which $8.4 million were in the fourth quarter, and repurchased common shares for $800,000. We have thus distributed a total of $34.3 million to our shareholders this year. We also invested $62 million during the year, of which $20 million was for business acquisitions and $42 million mainly for equipment to maintain and improve operational efficiency, including additions resulting from expansion projects and for the purchase of a building in Drummondville, Quebec. As of November 30, 2023, net cash amounted to $24 million, compared to net bank overdraft of $112 million last year. Our working capital was $622 million, for a current ratio of 3.7 to 1. I now turn it over to Richard. Thank you, Antoine. I will now conclude with our most recent developments. On December 1st and January 15th, respectively, we completed two new acquisitions. Olympic Forest, a specialty wood and tile distributor operating its distribution centers in Erin, Ontario, and Rapid Stap, a specialty hardware distributor with one distribution center in Whitman, Ohio. These two transactions, in line with our objectives, will add sales of approximately $18 million on an annual basis. We will also benefit from the expansion projects undertaken in the last two years. Richelieu is well-positioned to achieve good results in 2024. That will fit very well with our solid financial history of the last 30 years as a TSX listed company. Our acquisition strategy, supported by a strong balance sheet with no debt, our innovation and value-added service, have always served the company very well. We continue to execute them in the year to come. Thanks, everyone, and I'll be happy to answer your questions. Thank you, ladies and gentlemen. Should you have a question, please press the star followed by the one on your touchtone phone. If you'd like to withdraw your question, please press the star followed by the two. One moment, please, for your first question. Your first question comes from Hamir Patel from CIBC. Please go ahead. Hi, good afternoon. Richard, could you give us a sense as to how your sales are tracking through the first six weeks of the new fiscal year? Yeah, I see. What I see, you know, the trend that we had in the last quarter of 2023 continue to be effective as we speak, you know. We don't see the first quarter with a positive organic growth because of the situation of the market. But we expect basically the first half to be, I would say, low growth or negative, slightly negative growth. But we do expect... We don't know why exactly, but we expect that the second half should be much better. This is where, you know, after reading what's going on in the market, we listening to our sales force and our people and our customers, we feel that the second quarter will be much better because the first quarter is also being impacted by some inventory left from the pandemic period, where we still have about $25 million of excess inventory, which we, with the whole cost. So, but we have to live with that for at least the next quarter, maybe the next two quarters. But basically, things are very healthy. The balance sheet is very clean. The cash flow is very clean. Our sales force is intact. What we hear from the competition is that we're doing much better, but we cannot make a clear demonstration of that. But we feel that we really continue to capture more market penetration, selling to more customers, and again, because of the new products that we have introduced and the acquisitions, the pipeline is very healthy. Basically, that should be a good year for acquisition. Okay, and thanks, Richard. That's helpful. So it sounds like, you know, last quarter you had kind of pointed to the excess or higher warehousing costs being incurred through the first half of fiscal 2024, and it sounds like you'd still expect to kind of have worked through that excess inventories by the end of Q2. Is that fair? Yeah, that's fair. I mean, basically, what I'm expecting is we'll be flat for the first quarter, because with the Chinese New Year, we have to order in advance. So we should have a flat inventory for the first quarter, but then I'm expecting a reduction of around $24 to 25 million over the next two quarters. Great. Thanks, Antoine. Just asking, turning to EBITDA margins, it moderated further to 13.0%. Does that mark the low of the go-forward business, or would you expect that to continue to trend lower for another quarter or two before inflecting higher again? Yeah, I would expect to continue to trend lower because with a volume that is slightly down, I'm expecting the EBITDA margin to be anywhere between 12% and 13%. So in a better market environment, 13% is achievable. In a more difficult environment, I would say around 12%. So anywhere between 12% and 13%. Okay. And for a full year 2024, Antoine, do you have a sense as to what sort of margin you would expect on a full year basis? Depending on the market condition, it's between twelve and thirteen. Okay, fair, fair enough. And just a last question I had, I noticed in prior years, the company tended to announce a dividend increase with the fourth quarter results. Richard, is there a reason this year the board held off? Well, we think that we have increased the dividends. I don't know how much we have increased. Last time we increased, I think, was a big increase, so we thought that we could take it easy this year. But that doesn't mean that... Don't forget that our dividend policy is per quarter. It's not a yearly dividend, so basically, we can make change whenever it's going to be needed. Okay, fair enough. That's all I had. I'll turn it over. Thanks. Ladies and gentlemen, as a reminder, should you have a question, please press the star followed by the one. Your next question comes from Zachary Evershed from National Bank Financial. Please go ahead. Thank you for taking my question. Hey, everybody. Hello, Zach. Yep. In terms of gross margins and pressure there, is the effort to reduce inventory weighing on that, or are there other factors at play? Well, the excess inventory, as I said earlier, we still left with $25 million. That should go quite fast. I would think the first two quarters, we should get rid of that. Unfortunately, this is creating some decrease of the gross margin temporarily. This is important to specify it's temporarily, because basically our margin for the product that we have paid the right price, that we sell now, we sell the same margin that we had before. We come back to that. Basically, we have to live with a little bit of some of the deflation. But as I said, it's going to affect mainly the retail hardware stores, because the product that we sell there is mainly from Asia. Basically, our cost would decrease. Some of our selling price will decrease, but as a percentage, the gross margin will remain the same though. That's good color. Thank you. You also mentioned that there were some project expenses weighing on EBITDA margins. How much was that in Q4, in dollars or basis points? Well, in dollars, in Q4, you could estimate around, for sure, a million dollars in Q4. Perfect. Thank you. And then you mentioned that the acquisition pipeline is looking pretty good. Are seller expectations coming back down to earth after being inflated during the boom time? Yeah, that's a good point. So for sure that now we're looking at twenty... We're basing the acquisition based on 2023, so it's going to change, it's going to certainly change how we address these acquisitions. So yes, it's coming down to more reasonable prices. Excellent. So 2023, very eventful for projects. Should we expect more of those in 2024, or are you happy with where the network sits? No, we're finished with this. I think all the projects that we have to do have been finished at the end of 2023. We're in the process of finishing. We have finished Calgary in the month of December. In the year to come, we're going to have it in Vancouver. We're going to have to make a change in Vancouver, but that's not a major project, though, but we don't have any choice because we cannot take any chance because actually we have some businesses that have doubled up in size there, and with which we have to operate in two different warehouses, and we're getting the stuff back and forth from one warehouse to the other. So we have to rationalize a few things, but that's the only project. That's perfect. Thanks. That's it for me. Presenters, there are no further questions at this time. I will turn it back over to yourselves for closing remarks. Okay, so thank you very much for attending this call. We'll always be happy to talk to you if you decide to call us. Have a good day. Ladies and gentlemen, this concludes your conference call for today. We thank you for joining, and you may now disconnect your lines. Thank you.