Thank you, Marlene. After forging through another difficult quarter, it's clear we're still facing considerable headwinds. We continue to feel the lingering disruptions of the pandemic, and with economies reopening, we're particularly challenged with access to labor, supply chain difficulties, and inflationary pressures. This situation isn't unique to Saputo or our industry, and its impact on our second quarter performance is significant. Max will dig deeper into the details of our results and the catalysts behind the numbers we published today. After this, Kai will highlight the steps we've taken to mitigate some of these headwinds and provide an update on our global strategic plan. Before they do, I'll touch on some recent company announcements. In August, we grew our footprint once again with the acquisition of the Carolina Aseptic and Carolina Dairy businesses. Marking our fourth acquisition this fiscal year, we were delighted to welcome their talented teams to our roster in the U.S. By complementing our network and bringing new innovative capacity and capabilities in-house, these businesses will expand our presence into areas including aseptic formats, nutritional beverages, dairy snacking, and long-term strategic customer partnerships. We're also adding further depth of expertise to our company's board of directors. We're thrilled to welcome Olu Beck, who brings more than 30 years of experience in the consumer goods industry. Olu was CEO of Wholesome Sweeteners and has held senior executive positions at Mars and Johnson & Johnson. Her successful track record of transformational growth and her proven leadership experience in key operational regions for Saputo, namely the U.S., the U.K., and the EU, will bring tremendous value to our board. Moreover, as we execute our strategic growth plans, we also aim to benefit from Olu's depth of knowledge in the areas of branding and innovation. We're also pleased to announce Lyne Castonguay will officially take the lead as President and COO in the U.S. after successfully transitioning into this role over the last nine months. Furthermore, Leanne Cutts officially started as President and COO International and Europe on September 20. Building on our new 2025 supply chain pledges announced in August, recently, we shared our support for Pathways to Dairy Net Zero, a global dairy platform initiative aimed at accelerating climate change action in the global dairy sector. I'm passionate about this fight, and we are committed to doing our part to help transition to a net zero food system by 2050. This initiative is helping create a sustainable and equitable food system, working together with farmers, suppliers, and industry partners. With all this positive momentum propelling us forward, I strongly believe we're moving in the right direction, battling the short-term hurdles, while ensuring the long-term sustainability of our business and creating shared value for all stakeholders. Before I hand it over to Max to provide more color on our Q2 results, I'd like to emphasize, despite the headwinds, our commitment to discipline and rigor has not wavered. We're channeling our efforts towards the elements within our control, and our global strategic plan has solidified our resolve. We stand firm in maintaining our adjusted EBITDA target of $ 2.125 billion by the end of fiscal 2025. In fact, we are leveraging this adversity to make us stronger. I've always been impressed by the resilience of our business and most importantly, our people. I thank them once again for their outstanding efforts during these difficult times. Their passion truly drives our success day after day and year after year. Now, to you, Max. Thanks. As Lino alluded to, the external environment is incredibly dynamic right now, and we see many of these challenges persisting within our U.S. sector being impacted the most. During the second quarter, consolidated revenues were stable at $ 3.7 billion, while our adjusted EBITDA was at $ 283 million. Consolidated sales volume were stable compared to those of the second quarter of fiscal 2021. Food service market segment sales volume are beginning to recover as COVID restriction continued to be gradually lift by governments and vaccination rates rose. This increase was offset by lower retail market segment sales volume, now more in line with historical level. COVID-related supply chain disruption had a negative impact on export sales volume in the international sector, although this situation did improve in Q2 in comparison to Q1. Input costs, such as transportation, fuel, consumable, and packaging increased in all of our divisions due to inflationary pressure, but mainly impacting us in North America. Pricing initiatives undertaken during the quarter lagged rising costs, which continue to increase. The rollout of our pricing initiative will continue to be implemented in the back half of fiscal 2022, which should further offset some of the cost pressure we are experiencing. U.S. market factors continued to impact negatively in Q2, although there was an improvement when compared to Q1. Our Canadian sector continued to show improved results, benefiting from a rebound in sales volume in the food service market segment, while sales volume in the retail market segment returned to historical level. In our international sector, lower export volume due to container shortages and port inefficiency, combined with reduced availability of milk in Australia, derived from intense competition for raw material, negatively impacted efficiencies. In our Europe sector, overall sales are returning to historical level. This includes higher industrial market segment sales in the ingredient categories. Our Q2 results reflect the contribution of pricing initiative undertaken to mitigate higher input costs caused by inflation. Despite our best efforts to control the controllable, the magnitude of the lingering effect of the pandemic on our fiscal performance in fiscal 2022 remain difficult to estimate. That said, we anticipate our upcoming third quarter to be our strongest this fiscal, but still lower than the same period last fiscal year, which included highly favorable U.S. market factors that are unlikely to reach similar levels this time around. We do not expect to see year-over-year improvement before the fourth quarter of fiscal 2022. As we move into the back half of fiscal 2022, we expect to see benefits from our labor attraction and retention-focused efforts, price increases, and strategic initiatives. As Lino mentioned, we believe in the numerous initiative we are implementing to deliver $ 650 million in adjusted EBITDA growth by fiscal 2025, and we stand firm in maintaining our fiscal 2025 adjusted EBITDA target as this is what we believe we can achieve with the asset at our disposal. Now, Kai will share some measures we're deploying to ensure we progress against our plan. Thank you, Max. As mentioned, labor challenges in the U.S. persist, and in response, we continue to deploy and test several initiatives, including wage adjustments, bonus referrals, and increased advertising. Labor challenges have been linked to the fact that many of the rural areas where we operate have lower vaccination rates, which can lead to higher infection rates in the community and higher absenteeism rates as well. This situation should improve with the U.S. government's vaccine mandate for companies with more than 100 employees coming into effect. Addressing labor availability is top of mind as we deploy our global strategic plan. We are currently prioritizing network optimization initiatives in those facilities where we see a stable and sustained talent pool for the longer term. We are focusing on a less-is-more approach. We have begun rationalizing the number of SKUs we produce, thereby reducing complexity in our commercial, manufacturing, and supply chain operations. Finally, as our plan progresses, we intend to increase automation in selected facilities. I'll now move on to our pillars and provide some concrete examples of the progress we've made in the first half of this fiscal year. When it comes to strengthening our core business, we remain focused on the potential of our market-leading Cathedral City brand. In the first quarter, we entered into a long-term exclusive partnership with Hochland to expand distribution of our market-leading Cathedral City brand into Germany, starting in the fourth quarter of fiscal 2022. We continue to ramp up our distribution to North America. In the U.S., our new filling production lines have been up and running since the end of August, enabling us to manufacture aseptic nutritional products to be sold in the retail market segment under a partner's very well-known brand name. Also in this sector, we made progress on our simplification and SKU rationalization projects as we work to reduce the number of formats we manufacture in order to increase productivity while decreasing the complexity of our commercial and supply chain activities. In Canada, as part of our e-commerce strategy, we launched Nibbl, an innovative B2C platform, in September. Nibbl delivers curated specialty cheese boxes direct to consumers in Ontario and Quebec, and we are actively working on expanding our distribution across Canada. Looking at our accelerating product innovation pillar, on the dairy alternatives front, we are well on our way. With the acquisition of U.K.-based Bute Island Foods, we're confident we have a great product that has been very well received by our North American food service partners during the trial phase. We are working on converting this success into sales on a global scale, including in North America and Australia. We continue to see a long runway for growth in dairy alternative cheese. We anticipate incredibly strong demand here, and we believe this will be a significant growth driver for Saputo. For dairy alternative beverages, we are focused on supporting existing players through private label and co-packing arrangements. We currently have two facilities in the U.S. that have taken on additional volumes in the second quarter, and we have just added more capacity with the opening of our Port Coquitlam facility in Canada. When we look at the next pillar, which is to increase the value of our ingredients portfolio, we have some interesting progress to share as well. Since the acquisition of the Reedsburg facility, we have begun materializing on our ingredient strategy to enhance our portfolio in the U.S. and internationally to move up the value chain. As a leading goat cheese manufacturer in North America, we are now well-positioned to take a leadership role in manufacturing goat whey and other niche value-added products. We've made great strides towards that goal during the first half of the fiscal year as we continue to evaluate our ingredients portfolio and develop specialized whey products to bring to market. In Europe, we have worked diligently on diversifying our dairy ingredient customer base, and we have reached a more flexible business relationship pertaining to an exclusive arrangement that hampered our ability to diversify our customer and market mix. We expect the benefits to come through in the second half of this fiscal year. I'll now move on to the optimizing and enhancing operations pillar. The execution of our U.S. cheese network optimization plan has begun, and we have already made investments aimed at enhancing the production of our market-leading string cheese portfolio. In Canada, we initiated several automation projects during the second quarter, which were originally slated to begin in fiscal 2023. As mentioned earlier, our new state-of-the-art fluid milk and dairy alternative beverage facility in Port Coquitlam is now open. Following a transition period, we completed the transfer of production and staff from certain neighboring facilities over to the new plant. In Australia, we are accelerating continuous improvement projects aimed at maximizing our yield per liter of milk that we process. Finally, I'll touch on our create enablers to fuel investments pillar. Our global harmony deployment remains on track with the rollout within the remainder of our Australian operations and the subsequent phases of the implementation within our U.S. sector expected to be completed by the end of this fiscal year. In Canada, the planning for our ERP rollout is currently underway, although we may replan deployment activities based on the evolution of the COVID-19 pandemic and imperatives relative to our global strategic plan. As for the merger of our two U.S. divisions to USA One, we are making great progress as we continue to work on harmonizing our processes and procedures to maximize synergies and support our divisions' future growth. I'll end on that note, and we'll open the floor to your questions. Franz, you'll have everyone queue in, please. Thank you. If you would like to register your question, please press one followed by four on your telephone. You will hear a three-tone prompt to acknowledge your request. If your question has been answered and you would like to withdraw your registration, please press one and three. Our first question is from the line of Irene Nattel with RBC Capital Markets. Please go ahead. Thanks, and good afternoon, everyone. I guess just trying to understand how we should be thinking about the cadence of sort of recovery in profitability and recovery in aggregate earnings towards that, you know, the $2.125 billion objective. I'm thinking particularly here about the U.S. You know, when we look at that Q2 margin of 4.4%, like, I'm still having a hard time wrapping my mind around it, and I'm sure you are as well. You know, how should we realistically think about, as I say, the cadence of recovery? I appreciate the question, Irene. Your question is specific to the U.S., but let me talk about the other platforms and the other divisions and some of the great things that are happening there as well. Our Canadian sector has not been as impacted, although we've got some labor shortages and some inflationary costs within that platform as well. The Canadian platform is one that is well-balanced between retail food service and industrial sales. Plus we have our own distribution network in place that in certain respects allows us to control our own destiny. The evolution of the gain relative to the strategic plan in Canada has not been hampered by the current circumstances that we're feeling. If we park that one on the side, things are in very good shape in Canada. I would say, the team in Argentina has been facing all kinds of headwinds, from the first day that we acquired them in 2003. There has always been some inflationary pressures there relative to foreign exchange. There have always been headwinds on a political nature and on an economic nature, and our team is extremely resilient at being able to navigate through these choppy waters. There's very little risk of them hitting the cadence that we expected of them when they first rolled out their strat plan. The three sectors that were challenged on the outset relative to the pandemic were the U.S., Australia, and the U.K. Let me talk about the U.K. Early on in the pandemic, the shift to retail was a real benefit for the U.K. business. The team responded extremely well to being able to fill the pipeline of orders that we had. Coming out of the economy then, they were hampered with less demand because retail started to taper off relative to year-on-year comparables. We also had the challenge of the byproducts value, unfortunately, which was attached to a contract that was signed prior to our ownership. We have since gotten out of that contract, and now we control our own destiny on the ingredient side. I feel very good about that. The team has also been able to navigate well with the different cycles in demand relative to what's coming at the retail level and what was starting to open up at the food service level. Added to that, we acquired Bute Island, which is now under their responsibility and their control. We added Wensleydale, which was a business that unfortunately was a little distressed that they were able to bring back in line in short order. The U.K. business, we feel very good about it, and I'm quite optimistic that coming out of this year, they will hit their targets in line with what we had planned out in a four-year strat plan. That leaves us with Australia and the U.S. Australia initially challenged with the lack of milk production coming from the country, which impacted our milk intake at our plant, which of course has an effect on overhead absorption for the platform. Added to the issue of committing early on in the pandemic to lower market prices on their export volume, which they weren't able to export. We were hindered in Q1 and Q2 trying to fill those orders with the container shortages at lower prices than what we would normally sell, until such time that we got out of that inventory and those commitments. I will tell you that Australia has since responded extremely well. We're out of that, the pain of low contracted prices, getting into October with a better cadence and better volume on the container front on the export side. The team has done what they needed to do on the domestic front in terms of taking on the inflationary cost to market. I will tell you that Australia is still on our watch list, but certainly off of intensive care. The one platform I would say that is still in what we would deem to be in intensive care is at Cheese USA. This is not because the initiatives aren't there or haven't been executed, but it's been hard to keep up with the inflationary measures. Although we've taken price margin to the market under our third COLA increase, we're still lagging the inflationary percentages to keep our heads above water. Added to that, we're hampered with some plant inefficiencies relative to lack of labor, and also hindered with a lack of ability to get the transport where we need it, when we need it. But that doesn't mean that the team isn't working hard. The team is working diligently to try to control the controllables. This would be the platform if I consider, you know, your question in terms of cadence. That there is going to be a lag effect in terms of their year-on-year performance, that rather than having high single digit incremental volume and EBITDA, as we had expected, I would say that the foundations are being built so that when the markets turn as they turn, we will have the right infrastructure and the right focus to be able to hit our numbers. Perhaps that might not happen until year two or perhaps into year three of our strat plan. But that doesn't change our focus and our resolve for this platform hitting their numbers, relative to the overall strat plan by 2025. I'm just gonna ask, Kai, if there's anything that I have omitted, relative to your question, Irene. Yeah. Thank you, Lino. Just to give a little bit more color, when we look at the U.S. division, in terms of the cost recovery initiatives, there were three rollouts that had taken place year to date, and there was a lag effect which Lino talked to. We are catching up as we move into our next planned cost recovery initiatives. When we look at the labor initiatives, we've talked a lot about labor shortages. We are ramping up our efforts. You know, we've talked about wages, retention bonuses. We're looking at flexibility and scheduling. We're working with local high schools, community colleges, universities, even going to county fairs, increasing our advertising, signing bonuses, looking at childcare. A lot of different initiatives to try and mitigate some of the challenges that we faced on the labor front. The Biden mandate today announced COVID vaccine mandate for employers with more than 100 employees. Hopefully, that will provide some relief as well. When we look at some of the initiatives that the U.S. team has tackled, we look at the SKU rationalization initiatives. They're well underway. We look at the network optimization initiatives that are longer term, medium to longer term in nature, but they're well underway. When you look at some of the supply chain challenges, the team has been successful in getting pass-through rate increases to customers. They're now looking at pre-purchasing lanes, making routing guide adjustments. Looking at different levers to pull to mitigate some of the challenges on that front as well. I just wanted to provide a little bit more color around some of the mitigation initiatives. That's really helpful. Thank you. Just listening to what you're saying, obviously, you know, the labor availability and the cost of labor are very significant issues. If you're implementing retention bonuses, wage increases, et cetera, presumably you're gonna have to implement more. I shouldn't say presumably. Will you need to implement more significant price increases? Yes, that goes without saying. Even though we will be rolling out COLA four, we reserve the right moving forward to continue increasing relative to inflationary measures, which includes labor. You know, we are providing our teams the ability to have courage in their decision-making process. We are encouraging them to look at all elements of their business and take necessary, appropriate action, and we will support them. Yes, we reserve the right to continue to increase our prices relative to the market conditions. Just one final one, if I may, around that. What are you seeing in terms of customer response, consumer response, and are you in lockstep with what the rest of the industry is doing? It's a mixed bag of what the industry is doing. Some competitors are increasing prices, others are not. We can't stop ourselves from doing the right thing because you know, the industry isn't following. Again, that's the courage that we're providing our teams to do the right thing, because it's the right thing to do. We're, you know, we're very clear about it. Right now, we have more orders than we have capacity to fill those orders, not because the plants don't have the infrastructure, but we just don't have the labor. This is where we need to pick and choose our customers, based on trading up value, and not just trading four quarters for a dollar. We're very, very clear with everyone in our system, in all our geographies, that that's what we need to do. That's really helpful. Thank you. Our next question is from the line of Mark Petrie with CIBC. Please go ahead. Yeah, good afternoon, and thanks for all the comments so far. Beyond the disclosed market factors for the U.S. segment, can you please help quantify the commodity impact on your business? We need to look at it from a global, international, and the U.S. We do have some favorability on the international front. When we would combine the commodity and the market pricing that we see on the international front, typically would be offset by the negative impact of the U.S. market factor. Those would be in the same ballpark figure, if that's gonna help. Okay. I guess looking specifically at the U.S., how about the byproduct market versus what you might overall expect for contribution in a normal period? What was the impact of that in Q2? Well, overall, if you will, the ingredient market in the U.S. obviously have been favorable. That favorability create a pressure on the spread, on the cost of milk. The overall impact to us is a negative impact. As we've seen on the market right now, whey remains quite high, and that continue within Q3 to put pressure on our spread. The overall impact of both it is negative. Maybe, Kai, you wanna add something? Yeah. No, just in terms of the ingredient outlook, just to provide some color. The commodity prices are, we see a positive outlook pricing, if you look at the GDT tenders and sort of where commodities are going. Whether it's 80 skim milk powder, whole milk powder, all of those are looking good moving forward. So that's obviously gonna be quite helpful for our export platform, our international platform. Yeah. Just one thing I would add, Mark, in this is that the gains that we're making in the dairy ingredients, unfortunately, in Q2, did not offset the losses in the milk price itself. So there still is a shortfall between the milk price spread and the gains that we're making on our byproducts. Understood. Thank you. I guess I also wanted to just ask about the ERP rollout or harmony. I mean, you did have some pretty big challenges in U.S. dairy foods and I think Australia. What is sort of the current net impact of that rollout in those segments? Is it now sort of at the point where you can leverage that in dairy foods, or do you have to wait until the SCUSA rollout is complete and you can sort of harmonize those two together? And then any update, I know you addressed it in your outlook, but what is the plan with regards to Canada, and should we expect that to be a headwind on Canadian profitability in the next sort of, you know, 12-18 months? Mark, I'll just take the general outlook for ERP first, and then maybe Max might want to complement it with some numbers and figures. The ERP rollout that you're referring to in terms of dairy foods was, you know, in past fiscal years. That was, I have to say, quite painful, and we were very expressive and communicative about the pain that we felt as we were rolling out the ERP. Since that rollout, we have had other geographies and other platforms that have rolled out ERP with great success. If I think about the Cheese USA, we're towards the tail end of the ERP rollout, which the deployment of that has gone quite well. I would say that in Australia, we're pretty well rolled out without any impact at all. I think we learned from some of the mistakes in terms of how we prepared our team, change management mindset, after the first experience with Dairy Foods. We are mindful of what it takes to roll out efficiently. As we're thinking about the SAP programs moving forward, we know that it's going to be a great benefit. We know that the Maestro system has a shelf life on it. There's no question of whether or not we're going to continue ERP. What we're asking ourselves the questions right now is, what is the timeframe of that? Not because we don't have confidence that we'll roll it out, but given the current context in labor shortages, we're asking ourselves the questions: would the labor be better deployed in other facets of our business as opposed to an ERP rollout? We're being very transparent here that these are the questions we're asking ourselves as a management team. No decision has yet been taken, but we do need to unlock all of the value that we have in our business without disruption and using our talent to the best of our ability to generate positive EBITDA. All options are open at this stage, Mark. I hope that answers your question. Maybe Max, talk about some numbers, if you don't mind. From an ERP initiative, year over year, we don't have a major impact to our EBITDA, to our numbers. When you're looking at it, considering the fact that Australia is now complete, F 2022 will have the USA complete. Those costs are anticipated just to start to slow down as there's no deployment in those major platform that we have. The second thing I'd like to point out also is that the fact that we would be completed in the U.S., this SAP system is serve as an enabler to our USA One initiative aimed at maximizing, you know, our harmonized processes within our U.S. platform. That would also serve as a plus as we're looking forward. Okay. Appreciate all of that. I also just wanted to follow up on the whole, sort of pricing commentary, and I guess specifically with regards to Canada, for next year, you know, it's being reported that the CDC is recommending a pretty large increase in the price of milk. Do you anticipate any issues in passing this through? As consumers presumably trade down, do you think that affects Saputo, positively or negatively? I don't see any negative effect to that. We will roll out price increases. Raw material, as you know, Mark, is the highest cost of input costs that we have. If there is going to be a milk price increase, then definitely we have to roll that out to the market. Perhaps maybe the impact that we may see in our industry relative to that is a reduction in consumption. As you know, year after year, Canada has had milk price increases that have been passed on to consumers. We see that in many categories in the dairy space, consumption continues to increase, albeit on the fluid milk side, there are reductions in consumption, perhaps sometimes related to pricing, maybe sometimes related to consumers switching on to other beverages. I don't see this being any different than past milk price increases we faced before. All right. Appreciate all the comments. All the best. Thank you. Our next question is from Michael Van Aelst with TD Securities. Please go ahead. Hi, good afternoon. You've covered quite a bit, but I did have some, a few other questions, and I wanted to start on the price increases because you talked about a number of price increases through Q2. Some of them will be fully in Q3, and then there might be more to come. If I recall last quarter, you indicated that the price increases were mainly to pass on the supply chain pressures rather than the labor pressures. I wonder if since then, you guys started taking price increases for labor as well like some of the other industry participants. You know, to what extent do you expect these price increases to cover your inflationary pressures? Yeah, Michael, it's Kai speaking. It's not only on the supply chain side, on the freight recovery side, but labor as well as the input costs that we're seeing because we're getting inflation. There are inflationary pressures as it pertains to corrugate, aerosol cans, all of the packaging, all the key inputs. We are looking to roll out cost recovery initiatives to recover all of the inflationary pressures that we're facing across all inputs, which include those three components. Where do you stand on that now? It sounded like Canada and the U.K. were already in a good position. Is that the case? That's fair. That's a fair statement, Mike. Canada, U.K., we had, you know, quite a bit of success to recuperate, you know, a big portion of the cost increases. In the Australian market, price increase starts to kick in Q3 in this quarter. So the situation in the U.S. that do require multiple price adjustment for all the reasons that we talked about. Now the team is working on the fourth version of our price increase to kick in in Q4. If we are looking to recover all the costs, you know, it all depends on the ongoing inflation that keeps on going. But at this time, that would be into Q4 with our coal in Q4.. If there is no more inflation beyond where we stand right today on some of these input costs and labor supply chain, would this fourth increase in the U.S. cover where, you know, where you are now, where these costs are now? Yeah. Correct. That assumes that with the Q4 price increase, we would be covered. Okay. That would mean that the, you know, the challenges to get back on track on your strategic plan, in the U.S., and you talked about, you know, maybe in year two, maybe in year three, that has more to do with, I guess, volumes and competitive pressures? Not so much competitive pressures, Mike, but has to do more with labor, getting our capacity through our clients, so that when I talk about capacity, the orders that we have. Right now, I think I talked about this on the previous call. Normally our historical levels of order fill rates are in the 99.8%. We were at 91 in Q2. We're inching up. We're anywhere between 92%-93% order fill rates now, but we're still a long ways away from the 99.8%-99.9% order fill rates. A lot of our shortfall in the U.S. overhead absorption profitability on categories of product that are value added that has a lot to do with the labor shortage. Even though we're passing on our cost inflationary issues to the market, we cannot pass on costs related to our inefficiencies or plant efficiency shortfalls. Okay. You said competition isn't as big of a factor, but you did mention the oversupply situation and for cheeses in general, I think inventories are up 7% or something in September. Then the overcapacity in mozzarella. What's your outlook for that? How quickly that can get absorbed? What's the catalyst? My statement is that the demand flow is good. We just can't keep up with the orders. That was the reference. If we were able to fill the orders relative to what we have on our POs, then a lot of the plant inefficiencies would be covered. It's in reference to that, not so much in reference to previous years' volume, year-on-year growth or declines. Does that make sense, Michael? Yeah. That's better. Thank you. Okay. Our next question is from Peter Sklar with BMO. Please go ahead. Okay, thanks. Sorry, back on the U.S. business, and I'm just trying to understand why the business from a financial perspective deteriorated so badly versus the first quarter. If I'm reading my numbers right, the U.S. segment had $96 million of EBITDA in the first quarter. That declined to $67 million of EBITDA in Q2, so quite a decline. Your dairy market factors were a lot less in Q2 than they were in Q1 versus negative effect. I think U.S. dairy market factors have a negative impact of $42 million in Q1 and a much lesser impact of $17 million. When you combine, like, those two numbers together, it's a real deterioration quarter-over-quarter. What's going on that things got so much worse in Q2 versus Q1? Because when I hear your whole discussion, you're talking about the same things you talked about last quarter. What caused the quarter-over-quarter deterioration? I just wanna maybe correct something here with regard to your statement around market factors. The market factors we're disclosing are versus the prior year, so they're not versus the month or the quarter before. The $ 42 million-ish that we disclosed in Q1 was in relation with Q1 of last year. The $ 17 million in Q2 is in relation to Q2 last year. It's not an improvement of $ 25 million. We cannot do that math. If we would compare the market factor from Q2 to Q1, you will not have that big, huge improvement. In fact, it was pretty much flat. Also we saw an improvement at the end of the quarter. That you cannot do that math in that same order, if you will. The other piece is around the impact of the logistical transportation, fuel costs. Those costs kept coming. We've signaled that, and in Q2 increased, I would say exponentially, it continued to increase, and the price increase were not enough to cover for those increases. The net of the two was a bigger impact this quarter than in Q1. I hope this helps. That's a good explanation. I just have one other question just to make sure I understand. The U.S., the negative market factors were year-over-year, as you point out, a negative $17 million swing. Somewhere else I saw in your press release, like you talked about that the block and butter price had a negative impact on EBITDA of $ 119 million. I'm just not too sure how to reconcile those two numbers. The $17 million is U.S. market factors, is the $119 million for Saputo globally. I just didn't know how to put those two numbers together. Yeah. The $119 million is the revenue side. Really from a revenue perspective, without having the cost of milk attached to it, you know, it just impacted, you know, the top line. It's not a measure per se of profitability. That's why we're calling out the U.S. market factor within our EBITDA section, because that's the true impact of the fluctuation of the butter, of the block versus the milk and the ingredient price and the relation of the inventory. The $119 million, it's not a one for one impact in our EBITDA or our bottom line. This is pure and strictly revenue perspective. Okay, I get it. That's it. Thank you. Our next question is from Vishal Shreedhar with National Bank Financial. Please go ahead. Hi. Thanks for taking my questions. I was hoping to give this one a shot just because of the materiality of this issue. Can you give us context of the, perhaps globally, the amount of pricing that Saputo has taken, to date? Is that something you can provide? I would say we would not provide that number. I would say that the increase that we're seeing in all of our jurisdiction are being tackled through price increase. As I mentioned, Australia, the price increase starts now in Q3. U.K. and Canada, you know, from a global go-to-market versus the inflationary cost, we feel good about where we stand, and the issue is more within the U.S. We're not recovering, we're recovering less than 50% of the incremental cost, like much less than that. I'll leave it at that. Okay. I think earlier in the call it was mentioned that Saputo is not necessarily following the market with price increases, and it's doing the right thing as it pertains to its business. Given that Saputo's price increases may be higher than the industry in aggregate, are you seeing market share losses related to that? Or I understand you can't fill the orders currently, but are some customers balking at these price increases? No. We're taking those hard decisions that talk to our customers, and when we tell them that we're prepared to walk away from the business, sometimes they tell us, "What? Name your price." Listen, a lot of our customers are also challenged with their supply. That, you know, I think puts in evidence how challenging the markets are for everyone. We have not lost market share relative to our price increases. It's a necessary thing to do, and we're seeing that our customers, although in some cases don't like to have the price increase, they understand that it's necessary because they're feeling the same pinch. Given the rural locations of many of your facilities, is that placing you at a disadvantage versus your competitors with respect to obtaining labor to get your order fill rates up? Absolutely. That's a very good question. Part of our CapEx plan will address that either through automation in those areas or in a very extreme condition, network optimization, which would ultimately mean plant rationalization of some sort. We have to take all of this information and understand what is structural in terms of change and what is temporary. With our read on the markets, we then put our plan in place to make sure that we have the assets in the areas, in the geographies where we can ultimately get back to the order fill rates that we're historically accustomed to. When you look at some of the initiatives that we're pursuing from a network optimization perspective, we are looking to invest. CapEx dollars in those communities and areas where we will have a more stable access to labor longer term. Okay. With respect to the SKU rationalization, just changing topics here, is that a temporary measure? Or do you expect some of these SKUs to come back when your ability to manufacture improves? What are the sales loss associated with SKU rationalization? We have the aggressive SKU rationalization program taking place in the U.S., but it's not to say that we don't pursue the same discipline in other geographies. In terms of the sort of lower volume, less profitable SKUs, there's no motivation for us to return to those SKUs. We do have plans as part of our strategic growth plan in terms of strengthening our core, which includes line extensions. When we look at our new product innovation pillar, there are plans to launch new products in terms of formats, packaging, product types, and so on. That's where the focus is gonna be. It's gonna be on rolling out SKUs that drive profitable growth, and we're not interested in just producing SKUs just to produce volume. Okay. Lastly here, just a quick numbers question. There was $33 million of logistics pressure in North America. Is that primarily, overwhelmingly U.S.? Absolutely, yes. Okay. Thanks a lot. Our next question is from Patricia Baker with the Scotia Capital. Please go ahead. Yeah, good afternoon, everyone. Thank you so much for taking my questions. First of all, Max, can we just follow up on one of your responses to Vishal, and you referenced the fact that in the U.S., the pricing recovery, you're getting less than 50% of the incremental costs in pricing. Is that a structural dynamic in the U.S. market so that, you know, we would never be able to recover more than that? No, we do feel with the multiple go-to-market that is being implemented in the U.S. that we'll get on top of that at some point. We see that our call on number four, which is our go-to-market number four- Mm-hmm you know where we maximize, if you will, the cost recovery. This remains subject to the ongoing devaluation, not devaluation, ongoing inflation that we're seeing now. If it gets worse, then we might need a call of five, like, to be able to Mm-hmm. -capture. Okay, thanks. Thank you for that. Understood. Just following up on the discussion of the simplification and the SKU rationalization and that you have started in the U.S. So how aggressive have you been, Kai, and would we expect to see the impact of that simplification start to show up in next fiscal year? Or would it come even in the back half? I believe that it'll show up in the back half 'cause it's really helping us in terms of simplifying the supply chain part of our business, whether it's on the op side or whether it's on the warehousing side. Less is more for us. Those are well on our way under Lyne's leadership, together with Carl and the group. They've been very aggressive in reducing those low-margin SKUs, and we're already seeing the benefits of that as we move into the next quarter. Yeah, Patricia, if I could just add, you know, SKU rationalization is one of many initiatives that are going on, especially in the U.S. business. It's unfortunate, but the results don't show the great things that are going on in the U.S. platform. I've had the great pleasure of traveling across the country. Thankfully, now I can get on a plane and get into our facilities and meet our folks on the operation side. There are so many good little things that are going on, so many little wins that, you know, I, quite frankly, think we need to celebrate because it's not highlighted enough in our results. I feel very good about this transformation that we're in. Our team feels very good. When I say our team, I'm not talking about the executive team. Our teams in the local areas feel very good about the strat plan. Having access to the CapEx allocation to invest in their infrastructure gives them great energy and great confidence that we will find solutions out of this mess. Ultimately, I you know, once the new equipment is installed with more automation and more throughput and less reliance on, you know, just having bodies and people on our pack off lines, we will be set for great success. Perhaps this is a moment in time that we're in right now, and it's a tough moment in time. I tell you that there's, you know, there have been some sleepless nights, not just for myself, but for the entire group, because we don't like to underperform. Unfortunately, that's what we're doing right now. We are underperforming, but I've gotta keep the team focused on controlling the controllables. The stuff that is market-related, whether it's labor, transport, inflation, you know, U.S. market factors, nothing we can do about that other than trying to find ways to mitigate it and having the courage to take those decisions. From an infrastructure perspective, I feel very, very good about where we are and where we're heading, and I believe that the entire team in the U.S. feels the same way. Okay, thank you for that, Lino. If, you know, listening to the opening remarks in a manner of speaking, you kind of provided some guidance for the back half, referencing the fact that Q3 will be, you know, one of the strongest quarters, but it will be below Q3 of last year, and that you expect to see year-over-year improvements, not, you know, starting in Q4. What level of confidence do you have in both of those indications? What degree of visibility do you have on that? Because if we went back three or four months and we're having a discussion, you would not have thought that Q2 of this Q2 that you just reported would have had the deterioration that we saw. When we look at, you know, some of our positive within the quarter, we do expect the trend to continue from a Canadian perspective. Typically in Canada, Q3 is one of our solid quarter, and we do expect the performance to maintain in Canada. I would echo the same comment on the U.K. side. We do expect this business to perform better in the second half like it did, you know, from a historical perspective. We do expect that business to generate more EBITDA in Q3 and in Q4. This would also be the similar story in Australia, where price increase starts to kick in. At some point, the initiative that has been worked on since the beginning of the year starts to give some benefit. As it relates to Argentina, no major up, no major down from that platform is expected. We're very satisfied with the performance we were able to generate out of Argentina, and that gives us you know, the platform in the U.S., which is you know, the main focus. I do call out that the market factor will not be a positive. Last year, we had our record quarter in Q3, so the record quarter in Q3 of this fiscal is not gonna happen. Market factor will be negative as opposed to, as compared to the prior year. We're calling out that the first two quarters of this year, this first half, is gonna be hard to recuperate in the back half. That's why we're calling it that it's gonna be lower in F 2022 versus F 2021. Thank you, Max. Our next question is from Chris Li with Desjardins Securities. Please go ahead. Good afternoon. Just maybe one quick follow-up here. With respect to Canada, is the 8.4% increase in the milk cost proposed by the CDC a good proxy for the increase in Saputo's underlying raw material costs or are there other factors that would impact the actual increase for Saputo? Chris, I'm not sure I understood your question completely, but you know, 5% of our cost of goods are coming from the raw material. Whatever increase there is going to be on the raw material, we need to pass that on to the market. Outside of the raw material increase, we definitely do have to pass on other inflationary costs, which have already taken effect in Canada, as Max well explained. We have great confidence that whatever that percentage is on the milk cost, we will pass that on to the market. I hope I answered your question, Chris. Yep, you did. No. Thanks a lot, Lino. Best of luck. Okay, great. Thank you. Our next question is a follow-up from Michael Van Aelst with TD Securities. Please go ahead. Thank you. Just finishing up on the U.S. again. You talked about automation and network optimization strategies necessary to help you get back to where you want to be. Can you remind us of the timing of these major projects and whether you've been able to accelerate them at all given the tough supply chain for equipment and whatnot? Yeah. Some of these initiatives have been rolled out. We saw in the month of September and October where we're manufacturing the products in those regions where the cost of raw material is more favorable than others and then focusing on cut and wrap and packaging in other regions and other areas. There are a couple of initiatives that have already taken place. Those initiatives didn't require a lot of CapEx allocation. It did require some innovation in terms of our make and the way we package product and move it to different locations. That was pretty well internal. The timing of the other initiatives will be a little longer, only because we have to order equipment, and our equipment suppliers are also challenged with the labor shortages, and so the lead times are longer than normal. I would suspect by the end of calendar next year, we should start to see some benefit of some of the equipment having arrived on our docks and having been installed and debugged. I would say some of the good benefit will be towards the end of calendar 2022. The years are all mixed up in my head right now. With the pandemic, it's hard to tell what year was 2020 and 2021 and what is 2022. The end of calendar 2022, we should start to see some of the benefit of new equipment coming in that take care of automation and network optimization. Okay. Is it a good chunk that's coming in by the end of calendar 2022, or is it the initial parts and then you've got more coming in the following year? It's the initial part, and then there's more to come in 2023 and 2024, all the way through our 2025 plan. Progressively, midway through next calendar year, that's when we'll start to see some of the benefits rolling in. All right. Perfect. Thank you. Ms. Robillard, there are no further questions at this time. You may continue with your presentation or closing remarks. We thank you for taking part in this webcast. We hope you'll join us for the presentation of our fiscal 2022 third quarter results on February 10. Have a nice day. That does conclude the conference call for today. We thank you all for your participation and kindly ask that you please disconnect your lines.