Hello, and welcome to the Saputo First Quarter 2026 Financial Results call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star one on your telephone keypad. If you would like to withdraw your question, simply press star one again. I will now turn the conference over to Nick Estrela, Senior Director of Investor Relations. Please go ahead. Thank you, Jean-Louis. Good morning, and welcome to our First Quarter Fiscal 2026 Earnings call. Our speakers today will be Carl Colizza, President and Chief Executive Officer, and Maxime Therrien, Chief Financial Officer and Secretary. Before we begin, I'd like to remind you that this webcast and conference call are being recorded, and the webcast will be posted on our website, along with the first quarter investor presentation. Please also note that some of the statements provided during this call are forward-looking. Such statements are based on assumptions that are subject to risks and uncertainties. We refer to our cautionary statements regarding forward-looking information in our annual report, press releases, and filings. Please treat any forward-looking information with caution, as our actual results could differ materially. We do not accept any obligation to update this information as required under securities legislation. I'll now hand it over to Carl. Thank you, Nick, and good morning, everyone. We are pleased to begin Fiscal 2026 with solid momentum and a record First Quarter adjusted EBITDA. Our performance reflects the underlying strength of our business and execution across global operations. We are successfully building on the foundation established over the last years, focused on enhancing operational efficiency, investing in capabilities, and delivering on a strategic roadmap with precision. The macroeconomic environment remains complex, and our diversified footprint and resilient business model continue to serve us well. Our two largest operating sectors, Canada and the U.S., delivered meaningful improvements in the quarter, reinforcing the strength of our core operations and our ability to generate value in our key markets. In Canada, we exceeded expectations driven by strong commercial initiatives. In the U.S., our ability to drive efficiencies and reduce duplicate costs enabled us to improve performance. This is despite commodity market headwinds. Our international and Europe sectors also delivered year-over-year improvements. Volumes were robust, supported by improving market fundamentals and our commercial performance across all sectors. Our brands are resonating with consumers, and our partnerships in Food service and QSR are important growth drivers. Our operational improvement efforts, particularly those tied to capital investments, are delivering measurable benefits. This is supporting both our performance and our long-term competitiveness. We are also seeing gains from our SG&A optimization and logistics initiatives. We are improving efficiency and enabling more effective resource allocation. Our strong operating cash flow this quarter highlights the resilience of our business and the discipline with which we execute. It has enabled us to return a majority of that cash to shareholders through share repurchases and dividends, demonstrating both our commitment to our balanced capital allocation approach and our confidence in the long-term value we are creating. We have continued to repurchase shares opportunistically under our NCIB program, contributing to growth in earnings per share while maintaining a flexible balance sheet. We take a long-term, disciplined, and balanced approach to capital allocation. This includes supporting growth, maintaining a strong financial position, and delivering consistent returns to our shareholders over the long run. Looking ahead, we remain focused on generating sustainable growth, maximizing shareholder value, and delivering consistent EPS expansion over time. Our strategy emphasizes commercial execution, cost discipline, and unlocking value from our diversified portfolio. To support scalable growth, we are investing in key capabilities, including innovation, data-driven decision-making, and customer engagement. While consumer preferences evolve, demand for high-quality, protein-rich dairy products is resilient. Our products are well-positioned to meet this demand. We remain vigilant with respect to trade and policy developments, particularly those that may affect cross-border flows. We have an agile supply chain ready and able to adapt to evolving conditions. We had an excellent start to the fiscal year, and we're confident that we can build on this momentum going forward. I will now turn the call over to Max for the financial review before providing concluding remarks. Thank you, Carl. Good morning, everyone. The financial highlights of the quarter are the following. Consolidated revenues were $4.6 billion, a 1% increase when compared to last year. Revenue increased mainly due to higher selling prices in both domestic and international cheese and dairy ingredient markets, as well as higher sales volume, excluding the impact of the divestiture in our dairy division, Australia, while U.S. dairy commodities market pricing was lower. Adjusted EBITDA amounted to $426 million, which was 11% higher compared to last year. Net earnings for the quarter totaled $165 million, and on an adjusted basis, net earnings totaled $184 million, up $17 million, or 10% when compared to the same quarter as last year. Adjusted EPS was $0.44 per share versus the $0.39 last year. The 13% increase in adjusted EPS is primarily attributable to higher net earnings, but also reflects common share repurchased under our NCIB program. Cash flow from operating activities was robust at $317 million, up 66% year-over-year, reflecting improved EBITDA and lower working capital usage. Capital expenditure totaled $65 million, in line with our plans, and we continue to prioritize investments that enhance efficiency and capacity. As of June 30th, 2025, our net debt-to-adjusted EBITDA ratio improved to 2.03, reflecting a strong balance sheet and liquidity position. I will now take you to key highlights by sector, starting with Canada. Revenue for the first quarter totaled $1.3 billion, an increase of 5% when compared to last year, supported by strong sales volume across retail, Food service, and industrial channel. Growth was led by our milk, cheese, and dairy food categories. Adjusted EBITDA for the first quarter totaled $170 million, up 11%, with margin of 12.9%. Our improved performance reflected commercial initiatives driving higher sales volume, favorable product mix, and higher pricing implemented to mitigate inflationary pressure and the higher cost of milk as raw material. Performance also reflected benefit from SG&A cost efficiency, primarily due to cost optimization measures. In our U.S. sector, revenue totaled $2.1 billion, and we're 2% higher versus last year. Revenue increased due to higher sales volume in both retail and Food service market segments. We benefited from a favorable product mix and by increased sales volume. Adjusted EBITDA was $171 million, which is 6% up when compared to last year. The increase in adjusted EBITDA reflects operational improvement, primarily driven by efficiency initiatives stemming from our recent capital investments. These initiatives contributed to a reduction in duplicate operating costs. In addition, disciplined execution on customer fulfillment and proactive cost management supported margin enhancement. Higher sales volume and favorable product mix, driven by our commercial initiatives, positively impacted results. Our cost optimization measure also resulted in SG&A cost efficiency. Compared to the same quarter last fiscal year, U.S. dairy commodity market conditions were unfavorable. On June 1st, the new milk pricing formula approved for all Federal Milk Marketing Orders in the U.S. became effective. While the impact in Q1 was limited, we expect a positive contribution in future quarters. In the international sector, revenues for the first quarter were $865 million, down 14% versus last year. Our sales volumes were lower compared to the same quarter in both domestic and export markets. The decrease in domestic sales volume is mainly due to the divestiture in our dairy division, Australia. Our export sales volume decreased in line with our strategy to reposition sales volume towards our domestic market. Adjusted EBITDA totaled $55 million, up 22% on a year-over-year basis. The favorable relation between the international cheese and dairy ingredient market prices and the cost of milk as raw material had a positive impact on our first quarter results. In Argentina, milk costs were higher. However, results reflected a more favorable alignment between inflation and the devaluation of the Argentine peso. Reduced milk availability in Australia due mostly to ongoing drought conditions in key milk-producing regions negatively impacted efficiency and the absorption of our fixed costs. This impact was mitigated by our product mix optimization strategy. In the Europe sector, revenues were $317 million, while adjusted EBITDA was $30 million, up $7 million or 30% versus last year. The improved performance was mainly driven by the more favorable relation between selling prices and input costs, which supported overall margin recovery. We remained committed to disciplined capital allocation. During the quarter, we returned $202 million to shareholders through dividends and share repurchases under our NCIB program. We repurchased approximately 4.7 million shares for $123 million. Subsequent to quarter-end, we repurchased 1.7 million shares for approximately $47 million. The board of directors approved an increase to our quarterly dividend from $0.19- $0.20 per share, a 5.3% increase, reflecting our confidence in the business and commitment to shareholder returns. In closing, our Q1 results demonstrate the strength of our diversified platform and the effectiveness of our strategic initiatives. We remain focused on delivering sustainable value to our shareholders and executing with discipline across all markets. This concludes my financial review, and with that, I'll turn the call back to Carl. Thank you, Max. In Canada, we delivered a solid quarter with year-over-year growth and adjusted EBITDA. Operationally, logistics and distribution costs improved, driven by network efficiencies. From a commercial perspective, volume growth was supported by several factors. First, our retail market segment generated growth across all categories. This was underpinned by the depth of our branded portfolio, particularly Armstrong, which for the first time became the national leader in the everyday cheese category. Second, our expanded presence across major national retail banners further strengthened our platform for growth. Lastly, Food service volumes were resilient, driven by long-standing customer relationships, diversified channel exposure, and execution across QSR and FSR channels. Quick service restaurant traffic and dollar growth held steady, and we saw high single-digit growth in QSR pizza traffic, reflecting the strength of convenience-driven dining. Full-service restaurant volumes also showed signs of recovery after a period of flat performance. Combined with a favorable product mix, featuring a greater share of value-added and branded products, these volume trends supported earnings growth. We remain focused on effectively managing our overall operating cost structure. This quarter's results reflect the benefits of our cost optimization initiatives. These efforts remain a priority as we look to preserve agility and enhance overall efficiency across the organization. During the quarter, we launched Armstrong Cheese GPT, an AI-powered chatbot designed to inspire consumers year-round with meal and snacking ideas. This digital activation provides recipe inspiration, product information, coupons, and more, making it a valuable tool for consumers looking to bring more cheese goodness into their everyday lives. The Canadian team continues to operate as a responsible and reliable supplier to the domestic dairy industry. Our disciplined commercial approach prioritizes long-term customer relationships and reinforces our role as a trusted partner in the Canadian dairy ecosystem. In our U.S. sector, we delivered a solid performance this quarter, reinforcing the strength of our core business and the resilience of our operations. This performance came despite a year-over-year headwind from commodity market price dynamics. Although commodity market conditions were negative on a year-over-year basis, we saw meaningful stabilization quarter over quarter, which helped create a more constructive backdrop for operational and margin management. Performance gains were largely driven by continued improvements in operational efficiency. Our teams made progress streamlining processes, optimizing on-the-ground performance, and reducing duplicate costs that had weighed on prior quarters. These gains also reflect the stabilization and maturation of recent investments across the network. Volume growth was encouraging, with increased demand from several of our largest customers, highlighting both our strong commercial relationships and the relevance of our offering in their portfolio. We continued to grow in our core mozzarella capabilities through enhanced commercial execution. This included securing full supply of pizza cheese for a major international Food service partner, reflecting our strong customer relationships, product quality, and operational reliability. In the U.S. Food service market channel, we gained momentum with top-tier customers and expanded volume across focus categories. We also began shipping to a leading meal kit provider and secured new wins with a regional QSR chain and a major Food service distributor. We are aligned with the right customer base and continue to grow with high-performing partners, a clear validation of our strategic direction and commercial focus. On the product innovation front, we continue to respond to evolving consumer preferences with a focus on bold flavors and elevated experiences. This quarter, we introduced Saputo Spicy Mozzarella, a premium cheese that blends the smooth, creamy texture of traditional mozzarella with the bold heat of habanero jack. Designed to bring a zesty twist to pizzas, flatbreads, and sandwiches, this launch tapped into the growing demand for spicy offerings. We also expanded our capabilities in the beverage enhancement space with the launch of a new line of cold foams, available in caramel, macchiato, sweet cream, and vanilla. These products are designed to transform everyday beverages into indulgent, café-style experiences at home. Finally, building on the strong equity of our Cheese Heads brand, we introduced Cheddarella, a cheddar-style strong string cheese that combines the classic peel-apart texture of our best-selling string cheese with the added flavor of real cheddar. This innovation was launched just in time for the back-to-school season, further strengthening our position in the snacking category. This quarter's results signal what our U.S. business can deliver. Our teams remain focused on disciplined execution, and we are pleased with our ability to consistently meet customer demand. Fill rates are at record levels, which speaks to the strength of our supply chain and our commitment to service excellence. Turning to our international sector, results improved compared to the same quarter last year, driven by the performance of our Australian division. In Australia, milk intake was lower due to seasonal conditions and prolonged drought in key milk-producing regions. However, we still benefited in Q1 from the favorable impact from the relationship between selling prices and the cost of milk. We returned to growth in our everyday cheese business, driven by strong brand momentum in Cheer and Devondale. The successful Easter promotion also contributed, led by our Tasmanian Heritage brand. In Argentina, higher milk costs impacted results. However, macroeconomic factors led to a reduced non-cash hyperinflation accounting impact. In this context, the team continues to adapt and to manage the business effectively. Looking ahead, the sector will continue focusing on maximizing export returns, optimizing production planning, and maintaining cost control in response to evolving global and regional conditions. Turning to our Europe sector, performance this quarter came in better than last year and Q4, supported by our enhanced commercial strategy and cost management. Targeted price increases were successfully implemented to offset inflationary pressures, including elevated milk input costs. Higher overall sales volumes, particularly in private label and bulk cheese, contributed meaningfully to top-line growth. Importantly, despite an increase in milk supply during the quarter, we stayed focused on working capital to avoid any buildup in dairy solids inventories. Our flagship Cathedral City brand recently launched a new national creative campaign called Make It Better. This omnichannel campaign is designed to reinforce cheese as a comforting, versatile staple that enhances everyday meals and will be the most significant advertising spend on the U.K.'s largest cheese brand for many years. In addition, through our licensing partners, we expanded the Cathedral City brand into the chilled prepared meals category with the launch of four new products, including Cheesy Mash, Potato Gratin, Cauliflower Cheese, and Broccoli Cheese. Introduced at the end of April, this innovation extends our brand into new occasions while reinforcing Cathedral City's comfort food credentials. Overall, the U.K. business demonstrated good momentum and continued to advance key levers in a complex operating environment. As we look to the balance of fiscal 2026, we are confident in our strategic direction and the disciplined execution of our global teams. The fundamentals of our business are strong, and we are seeing positive returns from our commercial and operational initiatives across our global platform. While we remain attentive to potential headwinds stemming from dairy market dynamics, economic uncertainty, and cost pressures in certain markets, we are well positioned to deliver continued earnings and steady cash flow generation and long-term value for our shareholders. That concludes our formal remarks. I will now turn the call over for questions. Thank you. If you have a question, please press star one on your telephone keypad. If you wish to remove yourself from the queue, simply press star one again. One moment for your first question. Your first question comes from the line of Irene Nattel of RBC Capital Markets. Your line is open. Excellent. Good morning, everyone. Congratulations on a great quarter. In listening to your remarks, one of the things that really struck me in reading the release was the volume growth across channels, across geographies, and the repeated use of favorable mix and commercial initiatives. Can you walk us through where you are in that trajectory and how that will contribute to Saputo as we go forward? Because this is a bit of a different twist than what we've heard historically. Thank you, Irene, for the question, and I would say that we came out of a period over the last couple of years where our fill rates weren't the greatest for a number of reasons which we all know, but where we are today, first and foremost, we have the mechanical capabilities to be able to service our customers. Secondly, the relationships that we have with them, the ideation and innovation that we bring to them has allowed us to fundamentally fuel their growth as well, so as we look to each of our partners, both in the Food service, industrial, and retail space across the globe, our commercial teams are constantly ensuring that, one, the product mix that we manufacture and that we bring to market are relevant to the consumer base, and that might vary, of course, by region, but equally by some of our business partners, so we tailor our offering to them. We ensure that we're in a good stock position across the board, and this has absolutely, our fill rates have fundamentally allowed us to capture the momentum and the opportunities that exist in those markets, so we're fortunate to have the kinds of partnerships that we have. We're fortunate to have the commercial focus at this moment in time. We're also in many parts of the world right now. As we continue to push through our focus on commercial strategy, we're also unlocking incremental A&P investments on our key focus brands. And that's an important pivot for us, I would say, as well. As we look forward, we will certainly be looking at optimizing the portfolio and making sure that the best of our brands and the most relevant of the brands get the lion's share of the investments and the incremental investments that we plan to put behind Advertising and Promotions. That's really helpful. Thank you. And just focusing on the U.S. for a moment, great to see the progress. How should we be thinking about the evolution of the EBITDA delivery in the U.S. over the next, let's call it, through F26 into F27? The U.S. team has performed very well over the last several quarters, in fact, and they're consistently improving on a week-to-week basis. Probably the KPI that would be the most telling is our fill rates. We're seeing levels that we haven't seen either ever or in several years, so it's a testament to the hard work at ramping up through the various capital initiatives that have been put through that division. Franklin, in particular, on a week-to-week basis as well, is improving its overall supply. As I'm on the topic of Franklin, in particular, Franklin today is operating basically at about, let's call it, 60-ish% of what it will see volume-wise once we complete that cycle with the Green Bay facility closure, still on track for December of this year. So all of this is essentially leading us to more efficient operations, continued fulfillment of the demand from the marketplace, and all of this will continue to spell improved conversion costs. All of that at a time when demand for our products and our sharpened focus on the most relevant aspects of our portfolio are being brought to market. So I'll say very encouraging, very confident about the trajectory in the U.S. That's great. Thank you. Your next question comes from the line of Michael Van Aelst of TD Cowen. Your line is open. Hi, good morning. I wanted to continue on Irene's questioning around the U.S. You used to see low double-digit margins in the U.S. on a somewhat regular basis, but we certainly haven't seen that in a while. I'm wondering what it would take to get margins back to 10%+ in the U.S. And if that's still a possibility. Well, I think the answer is yes. And so the U.S. team, as we look at where the product portfolio is at today, the focus that we have on some of our core categories, we look at the solid demand and the balance between supply and demand in the marketplace today and what's still left in our tank when it comes to the U.S. performance. If you recall, we had talked about overall important returns from our capital investment program. The lion's share of the remaining returns from that global capital investment program will come from the U.S. yet or is yet to come yet in the U.S. So all of this to say that the U.S. team, both on the core cheese, dairy foods, and let's not forget our ingredient sector as well, will continue to improve its output and its overall margin structure. I can see the U.S., if we want to look at it from a relative perspective, positioned between the margins of Canada and that of the international. Okay. So is that something that you would expect you could achieve over the next couple of years? And are the big buckets, the return on capital investments, capturing the remaining of that, as well as the milk pricing formula change that should kick in next quarter? Yeah. What I would say is that we will see the remaining returns from our legacy capital investment program delivered by the end of this fiscal, the run rate of that. So that will improve the overall structure. Again, these are always providing that there isn't some sort of change in the market dynamics. But when we look at the things that we do control and we look at our operational performance, how it is we bring our products to market, everything that we're doing in the background with supply planning, demand planning, and growing with our customers and their needs, I feel very confident that we can build off of the base we have today and improve from there. Okay. And just finally, you talked about solid demand for dairy products, supply demand balance, and that. But some of the U.S. dairy prices are reasonably well below international prices. And I'm wondering what you believe is behind that and if you see it changing. Yeah. It's clear what's driving that. And that is there is an abundance of milk right now in the U.S. The abundance is coming from twofold. One, the solid output per pound or per liter of milk has improved as well, as well as the net volume. We're also seeing fewer cows being culled and remaining in the herd for milking. So it's created an abundance of milk, if you like. But despite that, all of the milk has found a home for processing. And following that, we're seeing a good demand both domestically and internationally for those products. So certainly, the pricing and the attractiveness of it is helping the U.S. products find international homes. We've had record export volumes over the last couple of months. And it's creating a relatively stable environment for us in the domestic market as well. Perfect. Thank you. Your next question comes from the line of Mark Petrie of CIBC. Your line is open. Yeah. Thanks. Good morning. I actually have just a couple more questions also on the U.S. You specifically called out better mix, and I'm just hoping you can give a bit more color there. Is that just sort of channel mix? And is that more a result of demand shifts or your work to intentionally reposition the portfolio? I would say it's a little bit of both, so when we talk about favorable product mix, obviously, we're talking either about products that earn better margins. We're also talking about products that we excel at in our manufacturing platform, and of course, those that are earning a better margin are in the value-added segment, but some of our core offerings, nonetheless, is some of the areas where we are the most efficient as well, and that is aligning well with demand right now. So in the Q1 space, there's been a good pull on things like Mozzarella, which, of course, we excel on the manufacturing side at. And on the dairy foods in particular, we've also seen a shift from lower margin products to higher margin offerings or demand. So it's a combination of both the channels that continue to be resilient and the offering that we have behind it. But I also want to underscore once again that it's our ability to fill that demand that is creating likely or certainly the most of the improvement is our ability to supply the demand that's there. Okay. Thanks. And actually, just on your dairy foods comment, specifically the shift to better margin product, could you just expand on that a little, please? Well, in the dairy food sector, part of our offering also includes things like cottage cheese. And as you can understand, the sector of dairy protein is in good favor with consumers. Share of stomach is high. Cottage cheese is a strong offering, if you like, in the space of dairy protein. So we are a large manufacturer in the U.S. of dairy proteins. And cottage cheese and our offering in this space is certainly helping our overall performance. Equally, fat is in high demand. And our dairy foods portfolio offers a variety of fat-rich, if you like, cream-based products that are also being offered and returned on good margin. Okay. Thanks for that. And last question. Just on the milk price formula change, you mentioned it was a limited impact in Q1, but expect more going forward. Is that just a matter of one month in this period versus a full quarter of contribution going forward? Or what are the sort of competitive dynamics that you've observed following that formula change? Well, I'll say the following. So yes, very limited impact in Q1 from the changes in the Federal Milk Marketing Order and the impacts to milk pricing fundamentally. As we look into Q2, it's active. It's live now. We pay our milk with the benefit associated to that. And as far as the impact in the commercial space or in the market space, the U.S. market remains competitive. So whether it's related to the capacity that's in the marketplace, whether it's the milk offerings in the marketplace, all of the above, it remains a competitive environment. So for us, it's business as usual when it comes to focusing on our customer engagement and consumer offering. We're going to see the changes in that milk marketing order translate into our milk price and into our margin structure over time. But as we said before, that change, which is fundamentally the make allowance, is going to manifest itself in our cheese pricing and in our ingredient pricing. It's also a reset because we know that it was not sustainable the way it once was. And part of those returns will be invested in bringing new products to market and keeping our dairy sector innovative and relevant. Got it. Appreciate it. Your next question comes from the line of Chris Li of Desjardins. Your line is open. Hi. Good morning, everyone. Moving first with the question on the U.S., the EBITDA performance during the quarter, are you able to share with us how much EBITDA benefit you achieved just from your network optimization and lower duplicate cost during the quarter? Hi, Chris. If we refer to the duplicate costs, what we had last year was something around $13 million. These costs were cut in half for sure during this quarter. And equally, a similar amount of overall efficiencies was generated through all the other elements associated with our investments. So hope that clarifies it a little. Okay. Thanks, Max. Maybe just one follow-up on that. I remember last year, I think you achieved around $100 million, roughly, of cost efficiencies. This year, can you share with us how much you would achieve this year? As we mentioned, with all the investment we've made over the years, we're chasing something around $200 million. And some of those $200 million were achieved in fiscal 2024. The majority was realized last year in our fiscal 2025. And as for the residual to get to that $200 million, we said that this fiscal year would be the year for us to close the loop on that. And we feel very comfortable that we will be able to achieve that run rate of $200 million. Okay. Thank you. That's helpful, Max. And Carl, just maybe a follow-up to your answer around the lower milk pricing. I think you mentioned previously with the reset, if that happened last year, there would have been an EBITDA benefit of like $60 million-$70 million in U.S. dollars. I was wondering, is that a good proxy of what we should expect to realize in terms of EBITDA benefit this year? Yeah. I know there's a lot moving forward. Yeah. So Chris, that number is generated, of course, on the volume and the mix of the products that were produced at that point of comparison. And the change in the milk pricing formula is, I'll say, just simple mathematics. It's just an allowance that's provided, an increased allowance that's provided for the manufacturing of cheese, or support of anyway, for manufacturing of cheese and manufacturing of ingredients. And that's a fixed amount. So it gets put through the calculator, and then the milk price output will automatically see that benefit. But then what happens next is all about market dynamics. As you've heard from Max and I, we're very confident with our offering in the marketplace, the relevance of what we do, the sustainability of the demand, and our performance on fill rate. So all of that should translate into those returns coming to Saputo. Okay. That's helpful. And maybe last question, switching gears to Argentina. The quarter was still impacted by higher milk costs, but obviously, milk production down there continues to be very robust. I was wondering, do you have a view on what would happen to milk costs in the next couple of quarters? How meaningful would the tailwind be if milk costs start to ease or come down relative to your profitability on Argentina? Because I know it was a big negative impact, obviously, last year. But just wondering how meaningful could that tailwind be once milk costs start to stabilize or even go down with better production? That's a good assessment, Chris. So yes, the milk has rebounded in Argentina over the last several months versus some of the struggles that our dairy farming partners had last year. So there is an abundance of milk. It is finding its home both in the domestic and in the international markets. The relationship between the currency and the devaluation of the currency and the inflationary rates is stabilizing, if you like. So all of that is creating an environment where milk pricing is stable, manageable, an abundance of milk. There are a number of other things in the agricultural sector that are also favorable, creating an environment where there's a lower cost base for producing milk. All of this is suggesting that, yes, we might see milk prices that are favorable to what we've seen. Okay. Thanks very much and all the best. Your next question comes from the line of Étienne Ricard of BMO Capital Markets. Your line is open. Thank you. Good morning. It looks like you've been successful with pricing increases across many geographies this quarter, in particular in the U.K. So I'm wondering, to what extent is this supporting margins in Q1? And more broadly, what's your confidence in your ability to raise pricing looking forward to offset potential cost increases? When we look at our strategy on pricing, raising price is typically the last tool we use for our customers and our consumers. We certainly do our homework and ensure that we are always looking to find alternative ways to bring the same quality and performance of our products to the market. When all of those options are expired, we will turn to pricing action, typically if it's related to extraordinary inflationary pressures and/or both in the raw material space and/or other elements of cost inputs. When it comes to the U.K., so yes, we've been able to, and the U.K. has seen, unlike North America's, probably a higher percentage of inflation over the last couple of years, stabilizing as we speak today. All this to say that we've been able to, on the Cathedral City brand, as well as some of our butters and spreads business, pass on some of those costs to the customer that we just could not mitigate internally. But the strength of the U.K. operation and performance isn't all about price increase. There are a number of initiatives in the U.K. that are on the go. We have, as we previously announced, work that we're doing in the ingredients space. That project is well on track with a cutover expected by the end of this quarter. We have other work being done in the cut and wrap space for further consolidation. In fact, the last days of one of our cutting operations in Kirkby Malzeard was a week and a half ago. So the U.K. team, by virtue of the work that they're doing on fuel efficiency, SG&A, and cost optimization, are in a good place. There's good momentum supported by the market-leading brand, Cathedral City. And take price when it is our last alternative. Okay. I appreciate the details. On leadership, I'd like to circle back on the appointment of the Chief Commercial Officer. What are some of the learnings that you've had to date, and how is it helping shape your strategy going forward? There's been a lot of learnings. It's been inspiring to have Leanne Cutts lead our commercial initiatives and to set the boundaries and focus of our commercial strategy. I think those two words, boundaries and focus, is a key component of Leanne's mandate and her leadership in this space. We've targeted the things that we are willing to do when it comes to A& P. Secondly, what are the brands that resonate the most with consumers today? What is their license to continue to be invested behind? What is our trajectory and, if you want, pace of innovation required to remain relevant? We're talking about a whole host of revenue management approaches and techniques that we had not utilized in the past. We are also looking at different markets for our products. There are a number of emerging markets that also view dairy as a value-added product, something that can be a good complement to the dietary needs in these areas. Leanne and the team are focused on unlocking all of these potentials and ensuring that we maximize the returns of the dollars that we put in this space. So it's been great to date. We're only beginning to see the benefits of that now, but more to come in the future. Thank you very much. And again, if you would like to ask a question, press star and the number one on your telephone keypad. Your next question comes from the line of Vishal Shreedhar of National Bank Financial. Your line is open. Hi. Thanks for taking my questions. There have been many gyrations globally related to tariffs and other dislocations. And at the same time, Saputo has been engaging in a variety of significant manufacturing optimizations. So I was hoping you could go by major region and just reaffirm what the value of each region is to Saputo's strategy and global intentions. So Australia, is that still what we envisioned it wants to be an exporter to the globe? And Argentina, do we anticipate that to reconstitute historical margins? And Europe as well, is that your U.K. business? Where does that stand? I just want to get a high-level view on where it all stands. Thank you, Vishal, for the question, and you already hit some of the responses with each of the sectors. But yes, every one of our divisions in our portfolio has a clear role to play and contributes to our overall business. When we take a look at and, if I can say, before going into each of the details, they're also structured and run quite independently. So one is not a drag, if I can say it that way, on the other or to any of the corporate resources. There's a fairly high degree of autonomy in each of these sectors. And when we look at the role that each play, first and foremost, we're constantly evaluating what the role of each of those are, both from the mechanical assets they have, the brands, and the capabilities that they have in supplying both the domestic and international markets. From an Australian perspective, yes, we've indicated in the past that we're looking to focus to a greater degree in the domestic market and reducing our offering to the international. Part of that is related to the milk situation. Milk supply in Australia is not growing. And because of that, we're certainly going to look to maximize our offering. And we've already done a lot of that through the platform consolidation that has occurred in Australia. So we feel good about the balance that we have and the ongoing pursuit for incremental domestic volume. Argentina, by virtue of it being a growing milk shed and its ability to flex between domestic and international, we are looking at optimizing the Argentinian platform for a number of international customers. When we look at the U.K., the U.K. is predominantly a domestic play. We have the market-leading brand or market-leading brands when you look at both categories, cheese and spreads, and we're comfortable with the work that the team has done with its footprint, and then we have Canada and the U.S. We know the Canadian story, very domestic-focused in nature. When it comes to the U.S., I would say that the U.S. is, in addition to all of what you've heard about its recent performance, the strength of the brands and the offerings that we have, the U.S. is also the platform that we will look to to expand exports over time. It has lots of capabilities, a competitive milk price, and favorable conditions for trade as well, so in the end, I would say that each of the locations that we currently operate in have a purpose. We're constantly reviewing and ensuring that they bring the value that was expected. We're proud to have the offering that we do have for a growing international customer and domestic customer base. Okay. With respect to Argentina, do you think that could reconstitute the historical levels of EBITDA that it generated in the past? Argentina is performing well. It's actually, and if I can use the opportunity also for my Argentine team, when you take a look at the comment I made about autonomy, the Argentine team is absolutely autonomous. For every year over the last two decades that they've been part of our team, they've always found ways to manage through the volatility and, dare I say, chaos that sometimes ensues in that region for all the reasons we know. All this to say that they're performing well today. There's an abundance of milk. We still remain first. We are the number one dairy in Argentina. We still operate the most efficient plants. We are the most efficient on any metric you can measure, and they'll continue to do the best they can with the circumstances and cards they are dealt with. Vishal, I will just add that maybe the question relates more to the economic conditions that are prevailing. The divisions, our operation, our brand, our people has been performing strongly, is performing strongly, and will continue to do so. As it relates to the various mechanics on the peso, the valuation, or the inflation, that remains to be seen in terms of what could be the impact onto our business. Right now, what we're seeing is a stabilization and a reduced gap between those significant metrics that allows us to have a more steady and more predictability onto our results. But the stability of our business, the brands that we have, the performance of the plants, there's absolutely no change, and we don't anticipate any change moving forward. Okay. And with respect to the CapEx, Saputo has gone through a big CapEx cycle, and now you're starting to bear the fruits from a variety of those initiatives. How should we think about the longer term? Are there new facility optimization plans in size anticipated, or should we anticipate this next several years to be more of a harvesting the fruits of past initiatives and working on lighter CapEx initiatives? Right now, if we look at our investment in CapEx, which is a reduced number from the recent history, you could expect that allocation to maybe expand from just pure inflation perspective. Should any initiatives come in with ROI that justifies it, we will certainly be looking at it. Organic growth remains one of our key focuses still today. So I'd say if we look at the 360 that we're planning this year, it could be looked at at the low end of our CapEx allocation. But you should not expect us to go back to the level we've seen in the last four years. Okay. Thank you very much. Your next question comes from the line of John Zamparo of Scotiabank. Your line is open. Thank you. Good morning. I wanted to come back to the Class III formula change and just make sure I've got a good understanding of this. Should we interpret this as the market has, for now at least, become more competitive and that given initial reactions you're seeing, that theoretical $60-$70 million benefit, all other things equal, is currently lower? Are we right to assume that absent of that or separate from that, you want to reinvest some of the savings that presumably you will see in various internal initiatives? I think the best way to answer that, John, is the, again, I come back to the number that we shared was based on product mix that we manufactured, both in the ingredients and cheese space, and the volumes in which we were selling of each of those at the moment of the calculation about a year ago. When you look at the formula changes and the formula is, and the, call it the benefits, if you like, of the FMMO for a processor comes from the make allowance in the calculation for milk price. That has been activated. It is present. It is present in parts of our June results and our current results. Is that translating into a more competitive market environment? What we're seeing is that the U.S. market is as competitive as it was before the FMMO started, and it remains as such today. There are a lot of dynamics that can drive the market conditions, as you know, John. And for us, it's coming at a time when there's also an abundance of milk. The margin structure for milk production at the producer level is also good because of feed costs and a variety of other elements. So we're seeing an abundance of milk. We're seeing the processing capacity is resilient and available, and so are the outlets. So all of this is creating a balanced competitive environment, not much different than what we've seen over the last several quarters. Max. John, just to clarify, we did call out that the impact was limited in our Q1 for two reasons. First, the new pricing formula started in June, so only for one month. But also, as we get into the month of June, we still have to sell our inventory, which has been built at the higher milk cost. Hence why we don't see a significant impact to that new pricing formula in Q1. But by no means were we changing the long-term trajectory of the benefit associated with that. Okay. That's helpful, color. Thank you. And then my second question is on Armstrong. It's encouraging to see that brand continue to take share. Is that a brand that's portable beyond where it's currently offered, or can you extend it into other products or categories that it's not currently in? I would say the following. Armstrong has come a long way for sure. From fundamentally a location in British Columbia where we used to manufacture cheese to a Western star to now a national star in nature and a national leader. We've expanded and innovated in that category for several years now with the support of our Canadian team and the passion that they have for not just the brand, but the willingness to develop products, install the capabilities required to bring these products to market. So Armstrong has lots of brand equity. It is core to dairy, and it is core to cheese. So I think its runway is still relatively large for innovation. But I think if you ask the question to our brand managers, they would say that Armstrong is a strong everyday cheese brand and has lots of opportunities in that space yet to come. Okay. Great. I'll leave it there. Thank you very much. Your next question is a follow-up from Chris Li of Desjardins. Your line is open. Well, thanks for squeezing me back in. A quick one, maybe back to Australia. Can you maybe update us on just the latest reduced milk availability situation in Australia? Is that causing more upward pressures on farmgate milk prices? And you mentioned that you're mitigating that impact through your product mix optimization. Can you just elaborate a little bit on what you're doing there to offset the impact? Thank you. So yes, Chris, you are correct. It's been a difficult number of months for our Australian dairy farming partners, from severe droughts to flooding, depending on which parts of the country. It has not been easy. We've been focused on, in those times, supporting them through it. Also, from a financial perspective, as we look at the dairy year closing and a new dairy year starting, we've been spending time shoring up and securing the milk supply that we require for our annual plan. So yes, milk supply has been more difficult this year than it was in the year prior. We've been able to secure the necessary solids and milk supply that we require to operate our business for the plan that we have this year. And we are seeing some relief now with the weather, hoping that this will provide some of the relief needed to expand milk production or at least get some of the solids up. All this to say that we are in an okay place today with the supply of milk, but it's still tough going, certainly, for our farming community. Okay. Thank you. There are no further questions. I'll now turn the call back over to Nick Estrela for some closing remarks. Thank you, Jean-Louis. Please note that we will release our second quarter fiscal 2026 results on November 7th, 2025. Thank you for taking part in the call. Goodbye. Have a great day. This concludes today's conference call. You may now disconnect.