Good morning, and thank you for standing by. Welcome to Stella-Jones' fourth quarter and year-end 2023 earnings call. At this time, all participants are in listen-only mode. Following the presentation, we will hold a question-and-answer session. To queue up for questions by phone, please press star one and a moderator will contact you. If anyone has any difficulties hearing the conference, press star one for operator assistance at any time. I would like to remind everyone that this conference call is being recorded on Thursday, February 29th, 2024. Please note that comments made on today's call may contain forward-looking information, and this information, by its nature, is subject to risks and uncertainties. Actual results may differ materially from the views expressed today. For further information on these risks and uncertainties, please consult the company's relevant filings on SEDAR+. These documents are also available in the investor relations section of Stella-Jones' website at www.stella-jones.com. We have also prepared a corresponding presentation, which we encourage you to follow along with during this call. I'll now pass the call over to Éric Vachon, President and Chief Executive Officer of Stella-Jones. Éric? Thank you, Matthew. Good morning, everyone, and thank you for joining us. With me on today's call is Silvana Travaglini, Senior Vice President and Chief Financial Officer of Stella-Jones. Earlier this morning, we issued a press release reporting our results for the first quarter and year-end 2023. Along with our MD&A, it can be found in the investor relations section of our website at www.stellajones.com, as well as on SEDAR+. As a reminder, all figures expressed on today's call are in Canadian dollars unless otherwise stated. Our strong operating and financial performance made 2023 a resounding success for Stella-Jones. Recorded a 23rd year of continuous sales growth, and we generated a record increase in profitability. Our solid results not only reflect the continued growth and momentum of our infrastructure product categories. They are also indicative of our team's forward-looking preparedness and ability to leverage their expertise and industry intelligence to take action and seize opportunities for the business. Much of last year was focused on building additional capacity and inventory levels to meet growing demand for our infrastructure products. On the heels of 2023, a number of factors support a solid demand environment over the long term. For utility poles, we have several of our customers shift to long-term sales commitment to secure supply for their ongoing maintenance programs and expansion projects. Utilities and governments, both in Canada and the U.S., have also publicly announced broadband expansion and electrical grid hardening projects. The railway tie product category remains underpinned by steady demand driven by railroad maintenance, and our railway tie and industrial products are expected to benefit from important government infrastructure investments and mandates. In addition to the strong long-term fundamental of our infrastructure businesses, the value-driven dynamics of our residential lumber customer base provide a relative steadiness and positive prospect for this business. Our loyal and dedicated customers recognize Stella-Jones' value-added proposition of premium lumber products, accessories, and composite products distribution. In the face of these trends, we've taken a proactive approach to both procurement and capacity. With our robust growth CapEx program for utility poles, we actively expanded our peeling, drying, and treating capabilities, making significant investments in six peeling and treating facilities in the U.S. and Canada. Additionally, we bolstered these investments with targeted and accretive acquisitions. In 2023, we completed 3 acquisitions, which added 2 treating facilities and 2 pole peeling operations to our network in the southeastern United States. These capital expenditure projects and acquisitions reinforced our procurement and production capabilities and enabled us to secure new customers and expand our customer base. Our strategic approach to augmenting capacity was upheld by our procurement capabilities and financial strength to secure ample wood supply. In 2023, we seized procurement opportunities, benefiting from fiber availability and prioritizing mutually beneficial relationships with sawmills and loggers across North America to build a robust inventory position. As always, ESG is a significant company-wide focus. Through our formalized ESG strategy titled Connecting Our Sustainable Future, we identified long-term and measurable near-term targets across 6 strategic topics, including climate change, greenhouse emissions, as well as health and safety. In 2024, we look forward to reporting on our progress and to move forward on key initiatives that will drive sustainable improvements across our value chain. All of these initiatives, coupled with the strong performance from each of our key product categories, enabled us to finish 2023 satisfied with our performance and with the progress we are making on our business objectives. Allow me now to elaborate on the performance of our key product categories. Our infrastructure products sales benefited from strong organic growth and the contribution of strategic investments. Utility pole sales grew organically by 18% in 2023, profiting from favorable pricing dynamics and the emergence of growth investments during the year. While the long-term market fundamentals and growth prospects for this product category remain unchanged, we experienced lower volumes year-over-year and noted a softer pace of purchase, mostly attributable to certain customers' capital budget constraints. During the year, we've shifted our focus to preserve existing and capture new business for the long term. As electrical and telecommunication utilities across North America remain dedicated to grid maintenance and upgrades, their request for sales contracts with a long-term horizon instills confidence in the upcoming demand for our products and in our investments to meet this demand. Turning to railway ties. Following 2022, when the industry was faced with fiber availability challenges, our focus in 2023 moved to replenishing and maintaining adequate inventory levels to meet demand. We were successful in that regards and are now well-positioned to cater to the commercial side of the market. Railway ties sales grew above our expectations in 2023, driven largely by the pass-through of untreated tie cost increases from the previous year. Looking ahead into 2024, we expect the cost of untreated ties to remain relatively stable. While maintenance programs for Class 1 Railroad customers should remain comparable to those in 2023, we anticipate additional sales volumes from our commercial business supported by a healthier inventory position. As we see railway tie customer agreements gain in maturity in the coming years, a key area of focus in contractual discussions will be to reset pricing and establish improved cost recovery by reviewing agreements to ensure costs are better incorporated in our pass-through clauses. Lastly, we remain pleased with the performance of our residential lumber product category in 2023. We continue to prove our ability to provide consistent supply to big-box retailers, which comprise approximately 70% of our customer mix. Though the consumer base is contending with macroeconomic headwinds brought on namely by interest rates, our customers are noting good demand driven by persistent consumer trends such as homeowners expanding their living spaces outdoors. This bodes well for our business and will certainly support our premium treated products as well as our composite products we distribute. On the procurement front of residential lumber, Canadian sawmills have curtailed production in the last year, which has brought on challenges making it difficult to source specific components in Canada. In response, our resourceful procurement team has started turning to alternate geographical regions to secure required materials and help maintain a healthy mix of inventory, and I commend them for their creativity. With that, I will turn the call over to Silvana. Thank you, Éric, and good morning, everyone. As Éric stated at the top of the call, Stella-Jones delivered another year of solid financial performance marked by increased sales and a record improvement in profitability. Sales for the year were CAD 3.3 billion, up CAD 254 million from last year. This increase was driven by the 13% organic sales growth of our infrastructure products. All of our infrastructure products benefited from favorable pricing dynamics, while residential lumber and logs and lumber sales pulled back due to the decrease in the market price of lumber. The acquisition of Texas Electric Cooperatives late in 2022 and more recently Baldwin, as well as the favorable currency conversion effect, also contributed to the higher sales in 2023. For the fourth quarter, sales amounted to CAD 688 million compared to sales of CAD 665 million for the same period in 2022. The increase continued to be driven by the sales growth in utility poles and railway ties, offset in part by lower residential lumber sales. For utility poles, we generated CAD 383 million of sales in the fourth quarter, up 17% over the same period last year. Pricing gains and contribution from acquisitions were partly offset by lower volumes, mainly due to the slower pace of purchases of certain utilities. Volumes were down 5% versus Q4 of last year. For the fourth quarter, sales of railway ties were CAD 165 million, up 2% compared to CAD 161 million in the fourth quarter of last year. Pricing was up 8% but was largely offset by lower non-Class 1 volumes compared to Q4 last year. Similarly to previous quarters, sales of residential lumber decreased compared to last year. Sales were CAD 82 million in the fourth quarter of 2023, down from CAD 100 million in the fourth quarter of 2022. While pricing in 2023 pulled back, residential lumber sales benefited from higher sales volume due to solid consumer demand. We ended the year with sales of CAD 645 million within our CAD 600 million-CAD 650 million target range. Turning now to profitability. EBITDA for the year increased to CAD 608 million, up by a record 36% compared to last year. The higher EBITDA was largely driven by the margin expansion of the company's infrastructure businesses. The utility pole acquisitions in late 2022 and in 2023, and the positive impact of currency conversion, further contributed to the increase in EBITDA. We ended the year with an EBITDA margin of 18.3%, up from 14.6% last year. As a percentage of sales, EBITDA also benefited from a better product mix led by the strong growth of utility pole sales and the lower relative proportion of residential lumber sales, now representing 19% of the company's total sales. For the quarter, EBITDA increased to CAD 120 million, an increase of 38% compared to the EBITDA generated in Q4 last year, and the margin grew from 13.1% in the fourth quarter last year to 17.4%. Compared to the third quarter, all product categories generated similar margins as a percentage of sales. The sequential decrease in EBITDA margin was a result of the lower volumes and operating leverage that is typical in Q4 versus Q3 when the margin percentage benefits from strong seasonal volumes. Consistent with the EBITDA growth in 2023, net income for the year increased 35% to CAD 326 million. Earnings per share also continued to benefit from our share buybacks and grew by 43% to CAD 5.62 per share. During the quarter, we initiated another normal course issuer bid as part of our strategy to return capital to shareholders. During the year, we deployed the cash generated from operations of CAD 107 million in available credit to maintain our network assets, make capacity-enhancing investments, which included the acquisition of three businesses, as well as return capital to shareholders. In line with our capital allocation policy, in 2023, we increased dividend by 15% to CAD 0.92 per share, and yesterday, given the record increase in profitability, the board of directors announced a 22% increase in its quarterly dividend to CAD 0.28 per common share. This marks the 20th consecutive year that we have increased our dividend, which speaks to our overall confidence in the long-term fundamentals of our business. We ended the year with a net debt-to-EBITDA ratio of 2.6x, deviating slightly from our leveraged target as we invested in strategic growth CapEx and acquisitions. These growth opportunities totaled over CAD 150 million and are expected to contribute to future profitable growth. At year-end, inventories stood at approximately CAD 1.6 billion, an increase from CAD 1.2 billion at the close of last year. In addition to the increase in inventories in the fourth quarter due to the slower pace of purchases of certain utilities, we also built inventory to support the anticipated infrastructure demand growth and to secure longer-term utility pole sales commitments. Further, following the limited availability of untreated ties in 2022, we ceased procurement opportunities in 2023 to replenish our railway ties inventories. This higher investment in inventory places the company in a good position to service the anticipated increase in customer demand. Subsequent to year-end, we amended our syndicated credit agreement in order to increase the amount available under the revolver to $600 million and extend the maturities, demonstrating our lenders' confidence in our ability to execute our plan and grow the business. In summary, with a healthy financial and inventory position, as well as solid market fundamentals, we have confidence in the financial strength of our business and believe Stella-Jones is well-positioned for success in 2024. I will now turn the call back to Éric for his closing remarks. Thank you, Silvana. By all measures, we had a strong year and a strong start to our three-year strategic plan. After the first year, sales reached CAD 3.3 billion, but were CAD 3.2 billion on an organic basis. Based on our progress in 2023, we remain confident in the sustained growth of the company and our ability to attain or exceed the CAD 3.6 billion organic sales objective set out in our financial guidance. In 2023, our infrastructure product categories represented 77% of sales mix, and residential lumber sales represented 20% in line with our expectations. Looking ahead, we expect continued profitability for the business. External factors like the continued higher cost of capital and increased supply from the utility pole industry bear undetermined effects, which could impact our EBITDA margin. In light of this, we remain confident in attaining our 16% objectives through 2025. We are also optimistic that the proactive planning and execution of our business strategy will enable us to continue returning capital to shareholders, having already returned almost 40% of the minimum CAD 500 million objective outlined in our guidance. We are focused on maintaining our leadership position in North America, and that requires us to evolve with the needs of our customers. With our growth CapEx program largely complete, our attention in 2024 will remain on growing our business. Acquisition on the wood treating side of the business, as well as investing organically in our network, remain key elements of our strategy. But we will also pursue growth through acquisitions in other infrastructure products and services where we can leverage our continental network, industry-leading customer relationships, and solid reputation. In closing, I want to mention that we have high standards for our business, and if I'm confident in our capabilities, it's because of our nearly 3,000 employees. Whether our products enable power to flow through the electrical grid, help move merchandise on the continent's rail network, or help retailers in North America supply lumber products and accessories, our employees are the ones who make it all happen. I want to thank everyone for their contributions in 2023 and beyond, and for their ongoing dedication to customer service and maintaining our leading reputation in the industry. Stella-Jones is ready for the future, and this is in great part thanks to you. With that, I will open the line for the questions. Thank you, Éric. The line is now open for questions. I would like to remind you that if you are on the phone and wish to ask a question, please press star one. Our first question is from James McGarragle from RBC Capital Markets. Please go ahead. Thanks for taking my question. Yes, good morning. On the utility pole segment, you mentioned some constraints, and we've heard a slow pace of federal funding has some utilities cautious about their pace of purchases. But to what extent do you see this as a temporary headwind? I mean, you're making significant investments in inventory. I guess, what gives you that confidence that this situation will resolve during the remainder of the year? Well, thank you for the question. I mean, several factors, right? So let me address further this slowdown piece. In our view, it's not necessarily related to federal funding. It's the timing of the availability of capital budgeted at our customers. Many leaders in North American utilities have pointed out to me that the cost of capital right now is a bit of a headwind, as obviously, the increased cost of capital is making certain projects a bit harder to get off the ground. That being said, I'm not an economist, but I think we all feel generally or see in the news that interest rates will be dropping in the next year, let's say, and I think all this will resolve itself. On the second part of your question, we have secured long-term contracts with several customers in the United States. We have secured new customers in 2024 that Stella-Jones has not serviced in the past. So we have definitely built some inventory to be able to address those customer demands. Most of our customers, although at a slower pace, are still increasing demand for their maintenance projects going forward. I'm very optimistic and looking forward to see those projects execute, but we're quite confident as we look at the remainder of our, let's say, our guidance period, that we will continue to see growth to our 2025 objectives, and it would be driven by some volumes. And lastly, I just want to point out some public information that you're probably aware of, and maybe for everybody listening, obviously, there's been some public announcements from Canadian utilities, U.S. utilities, as well as the governments, which indicate that we and all of these announcements talk about decades' worth of work. When we say we're future-ready, we have definitely positioned ourselves in the last 18 months as building the capacity, building the procurements, getting the long-term contracts. We hold all the right cards to be very successful for the long term. I appreciate that. Just my other question is going to be on margins and the longer-term outlook. You put up a really strong margin in a seasonally weak quarter in Q4. I know there's some uncertainty due to potential cost inflation. Pricing can move around with some of the new pole supply coming online, but anything to call out specifically in the quarter? Looking ahead, it looks like mix should continue to shift towards poles. You mentioned some of those extremely long-term investments on the utility side. Just trying to better understand the puts and takes in the quarter and to what extent these levels of margin would be sustainable in 2024 and potentially longer term. Well, with regard to the quarter, we're actually very pleased with the percentage margin. I haven't checked in the books, but it's probably one of the highest on the record for us. You know that we have a cycle throughout the year. The fourth quarter is usually a lower volume quarter, which makes it such that the margin percentage compresses to some extent because we have a certain network that has its base cost that we need to support. So very happy with the year-over-year performance. I think at least four points plus compared to last year. And maybe if I understand your question, going into the future, we finished the year as a very strong year, sitting over 18%. We had a very good product mix, definitely weighted towards utility poles. So we're very pleased with the performance. And we are cautioning in my last remarks. There are certain dynamics in the spot markets, not the long-term contract piece of it, but the more well, the spot market or the contractor market where we feel that additional capacity in the industry right now might and will probably put some pricing pressures later in the year on that part of the business. Just a quick follow-up on that. The spot market, I think you mentioned last quarter is about 30% of your overall pole mix. So if we're going to see, for as an example, 100 basis points decrease in your consolidated margin, that would imply extremely significant drops on the spot market. Any color you can kind of share with regard to what you're seeing in the spot market. After that, I can turn the line over. Thank you. No, certainly. So we haven't seen it as of today. So we're calling it out because we're observing the dynamics in the market, and we're paying close attention to it. By default, Stella-Jones getting into long-term agreements and welcoming new customers as suppliers, every action we take has a reaction in the market, and it would expect dynamics in the spot market to become a bit more active. So that could be compensated by a very healthy demand throughout the rest of the year, and we may never talk about it, but I do think it's something we'll observe this year. And it most likely will be short-lived. I think it's a bit of a it'll follow a bit of the trends in the general market as interest rates subside a bit. We see some pickup with the bigger utilities with their business. Hard to predict at this point. I can't give you much color. I'm just sort of explaining to you a bit of my logic and how we're seeing things. We're being cautious, I guess, not necessarily wanting you as an analyst to take this 18% and sort of project it straight line out. I think we need to live through a few cycles here, a few quarters, to see where this is going to lead. Thank you very much. Thank you very much. Thank you. Our following question is from Hamir Patel from CIBC Capital Markets. Please go ahead. Good morning. Éric, just sticking with the poles category, what type of volume growth would you expect there in 2024? Just given some of your comments around near-term demand being perhaps less robust, do you think you'll be capacity-constrained, or is your growth on the capacity front going to likely track ahead of demand in 2024? So obviously, with the investments and the acquisitions we've done, we were obviously planning ahead. So capacity constraint, not one of my concerns at all at this point. To answer the first part of your question, I guess I will answer it referring you to our guidance in 2025. If you look at our first year of performance, call it the CAD 3.2 billion organic oh, but sorry, talk about yeah. And the utility pole business in there to be able to reach that objective, we're probably looking at a call it 14-16, midpoint of 15% CAGR for the next two years for utility poles, and that would mostly be volume. Mostly volume. Okay. That's helpful. Éric, in terms of the share of poles that is spot, just given the capacity you're bringing on, would you expect that share to change, or is that already kind of contracted up? I don't think so. It's part of a bit of the general approach on when we're planning production. We have our steady base, which is great, and we're growing it, obviously, as I mentioned, because we have new customers. But part of it is, I guess, to plug the hole, we'll sort of fit in where it makes sense that this is a spot market business. We've grown the network. Obviously, we've got new treating facilities with our Baldwin acquisition, and we've increased cylinder sizes at certain facilities last year. So we've grown the capacity. We're growing the long-term, and then we'll continue complementing with the spot market and with certain strategic partners also, should I say. Okay. Thanks. That's helpful. And just the last question I had was on residential lumber. Could you give us a breakdown of how the volume and price mix was for 2023, and are you expecting any volume growth in residential lumber in 2024? Yeah. So for 2024, we keep guiding to our CAD 600 million-CAD 650 million, and I think, could there be marginal growth there, perhaps? We do feel like there's good consumer dynamics. So last year, we had some volume growth in the business around, call it 7%, and that was obviously all overshadowed with the reduction in price of lumber. So coming out of a good year on the volume side, I would say relatively comparable. If I listen to our customers, they feel that there's some potential increase, call it the mid-single digits. That's sort of the discussions. I mean, looking outside today, it looks like spring here in Montreal, and obviously, it gets those projects started earlier, so that could also be very helpful for us. But if you look at our guidance, I still think we're going to be in that range of 6-650, and we got a great customer base to support that basis and maybe a bit of growth there, but we'll see how the season rolls out. Great. Thanks, Éric. That's all I had. I'll turn over. My pleasure, Hamir. Thank you. Thank you. Our following question is from Jonathan Goldman from Scotia Capital. Please go ahead. Hi. Good morning, and thanks for taking my questions. Maybe just a housekeeping one to start off with on weather. Have you noticed any impacts on your business from the flooding in California or even the colder weather in the Northeast? Do you anticipate that impacting any sales levels, anything in that regard? Well, obviously, we had cold snaps in January and some ice storms in the south, and obviously, that doesn't help. But there are winter conditions, and last year, we had these river storms in California and mudslides and actually a record snowfall. So it seems like every year, we have some of these weather events. So I guess, yes, it does slow down a bit business, but it's one month out of a year. I think our customers have plenty of time ahead of us to readjust. I'm not really concerned about that unless we keep seeing these continued storms in specific geographical areas, which would have a long-term trend. But right now, it's down slightly, but it's one month. Okay. Thank you for that. And then maybe switching to capital allocation priorities for 2024. Maybe you can just remind us what the priorities are and then whether or not you've earmarked any CapEx this year for additional capacity that would be required in 2025 to support additional potential spend in infrastructure-related assets. Yes, certainly. I'll let Silvana take that one. So, Jonathan, for 2024, our priority is first to complete the capital expenditures related to our growth CapEx or utility growth CapEx. So we had told the market that in total, we had a five-year project and capital expenditures to grow our utility poles of CAD 115 million. So there's about CAD 25 million-CAD 30 million left to complete that in 2024. We have maintenance and other efficiency projects being looked at and targeted, and we always mention somewhere between CAD 65 million and CAD 75 million of, let's call it, more regular CapEx. So that is always top priorities for us. We continue, as I noted in the conference call, that we have initiated a new NCIB program, so still committed to returning capital to shareholders both through dividends and through repurchase of shares, always keeping in mind that we have a three-year commitment to return CAD 500 million to shareholders. We do not have specifically earmarked any additional growth CapEx in 2024. That will be looked at as we prepare for our budgets for 2025. Perfect. Maybe just a quick follow-up, Éric. How long would it take to bring on additional capacity? I guess you can quantify it however you want. I mean, similar magnitude to the capacity you're bringing on this year. What would be the sort of ramp phase? It's an interesting question. So we do have a bit of a cheat sheet of what we could do in the next 12 months and what we could do in 18 months to execute quickly on capacity. And when I hear that question, I think of a few things. When I think of Southern Yellow Pine, it's a drying capacity. And we do have quick access to kilns if we would need to execute on that. I would say within 6 months, I could get kilns installed or additional kilns installed at facilities. The quickest way to increase treating capacity right now would be to add treating cylinders or increase the size of cylinders at certain facilities. And we have those earmarked. Lead time currently right now is about 6 months to get it and call it another 2 months to put it in place, or maybe 8 months to install the cylinder. I would say pretty much anything we'd want to do within 12 months, we'd most likely execute on that. I'm excluding a greenfield plant because that's a bigger endeavor because permitting and finding a facility and working with the community. That's a longer piece. Greenfield plant is something that if you ever hear us talk about that, it'll be announced ahead of time. It'll be well thought out planned. Right now, I think we've got enough capacity to execute on what we want to do for at least 18 months, and I feel comfortable that in our five-year planning exercise that we'll be doing in the next few months, we'll already started talking about what could happen and what we would need to do to capacity. So trying to give you a bit of flavor, but I think within a year, we could easily execute if something would happen quickly as far as demand. But what we've done in the last 18 months was really trying to plan for increased demand, potential new customers that we have now. And I am hoping for some other new customers in 2025 at this point that we keep talking to. So I think we're well positioned to address any unexpected demand coming our way. No, that's really helpful. I appreciate the color. I'll turn the line over. Thank you. Thank you. Thank you. Our following question is from Benoît Poirier from Desjardins Securities. Please go ahead. Éric, good morning, Silvana. Just to come back on the utility pole volume, I think you mentioned earlier on the call that you felt comfortable with 14%-16% growth in the coming two years. I'm just wondering about pricing expectation, what we could expect in 2024, whether pricing could be incremental to volume. Morning, Benoît. So was it a question for me or for Silvana? One of you. First off, thank you. So it is mostly volume, I think. So if you recall, we've had two years of growth or good pricing increases or pricing growth. I'm very confident that we will hold those prices. Could we see a bit of an uptick, maybe offset by what I was talking about, pricing headwinds in the spot market potentially? But when we think about the future growth, it will be on volume, and if there's some pricing uplift, it'll be a bonus. Okay. Just coming back on railway ties, you made great color about the flat expectation from Class 1, although you have additional ties to serve the commercial customer. So what could be reasonable in terms of overall organic growth expectation? I would be curious to get your thoughts about the pricing environment. It looks like there was improved pricing in Q4, and I don't know how significant it was on the organic growth. So the pricing on the organic growth was trying to figure it out because obviously, we had lower volume. So we had lower volumes because obviously, we focused our inventory to service our Class 1 numbers. So that overshadowed the sales growth. Call it a 5-ish% pricing increase over the year just as it passed through of untreated high cost passing through. As I said, going forward, we think the untreated price of ties would be relatively stable. So going forward, I know we're basing it all on volume, so you can call it in that low single digit range. And I'll leave it up to you to define the low single digits. In my mind, it's not one or two, but I'll let you model it out. Okay. Perfect. Plus some pricing on top of that. Depending on the price of ties, well, there's always a bit of it. It's true for poles also. Every year, there's a bit of a, our poles have inflation indicators and different things that can give us a couple of% here or there. That would be part of it. But yes, I would agree with that. Given the favorable mix, Éric or Silvana in 2024 talking about bigger contribution from utility pole, stabilized residential lumber, better mix from commercial on the railway ties, could it be enough to offset the potential risk around additional pole supply toward the back half of 2024? Just wondering if you could sustain kind of a 18% margin profile if one could offset the other positive implication from a mix standpoint? I guess it would be difficult for us to say because obviously, we could quantify quite easily what the improved mix would do to our margin, but harder for us to sort of determine what potential impact the spot market pricing would have. Yes. The negative impact, as I mentioned in your previous answer, is we haven't seen it or felt it, and it's something we're monitoring. So it's kind of hard to quantify. So I do think we'll see some of that. To what extent it'll be significant or not, we'll have to see, Benoît. Okay. And just Silvana, in terms of working cap, any thoughts about working cap requirements for 2024? I understand you're still growing, but there might be some reversal at one point given the buildup in 2023. So if you could provide some color on that and maybe given the leverage situation a little bit higher than the targeted range, should we expect you to be maybe less focused on the buyback activity in 2024? To answer the first part of the question, in terms of the working capital going into 2024, we would not be expecting any significant increase. We think it would be fairly flat-ish when we compare end of this year, end of 2023, to end of 2024, keeping in mind there will be some seasonal variations. As you know, in the first quarter, there will be a pickup, but then there will be a release expected in the second half of the year. In terms of the leverage, no, I do not expect the higher leverage to impact the buybacks. We are still focused on returning that CAD 500 million over the three years. So the buybacks will be in line with that target. Comfortable, again, that the uptick in our leverage was really based on our opportunities to invest in the three acquisitions that we did as well as our growth CapEx. So expect the leverage, as it usually does, to go a little bit higher in the first quarter, but then to leverage back down subsequently in the second half. Okay. Perfect. Thank you very much for the time. Thank you, Benoît. Thank you. Our following question is from Michael Tupholme from TD Securities. Please go ahead. Thank you. Good morning. Éric, maybe just to start on the utility poles product category, for Q4 2023, can you talk more specifically about the pricing versus volume changes seen in the quarters in terms of pricing being a tailwind and volume being a headwind, kind of what the actual numbers were for those two? Pricing was about—sorry, the volume was about 5%. So obviously, the organic growth you see is net of that. And sorry, the volume was a bit of a 5% downside. Okay. And then we can back into the pricing. Exactly. By difference, it'll give you 22, right? That's a simple math. And then just to be clear, I guess just to go back, I think it's been asked a few times now, but as far as the outlook for organic growth in poles, I think if I'm understanding correctly, you're talking about something in and around the 15% range. Organic growth for poles over the next two years is sort of a CAGR. I guess first question is just if you can reconfirm that for me. And then just to follow on, though, how do we think about that over the next two years for modeling? Is there much variance from one year to the next as we look at 2024 versus 2025, or is that a fairly steady state expectation in each of the next couple of years? So you understood properly. Let's call it a 15% CAGR over two years. It would be sort of even between the two years, evenly spread out. Got it. Okay. This is just to be clear, this is organic growth for poles, or is this 15% inclusive of the benefit of the acquisitions you announced late last year? Purely organic. I'm carving out whatever gains we would have in the first six months for the Baldwin acquisition. Okay. Perfect. Thank you. And then I guess just talking about that you mentioned some of these announcements from North American utilities about longer-term CapEx plans as far as meeting increased power demands and how they're going to do that. In your conversations with utilities I mean, I think this is an area you've been excited about for some time now. But the conversations you've been having more recently, I mean, are you feeling more encouraged by the medium- to longer-term outlook than previously, or is this just sort of unfolding as you would have expected as far as your views on that? So the slowdown that we sort of called out today, I guess, was not in our three-year guidance. It's not something that we saw coming. But to your point, in talking with leaders of utilities, they have a lot of projects and a lot of work to do. There's lots of maintenance and grid hardening and upgrades to be done across North America. And I'll say it's even before considering the impact of electric vehicles because that is apparently something that is still very difficult to model. Everybody knows that there'll be an expansion, that there's going to be some hardening and some adjustments because you'll need more transformers and more cables in the network. But right now, it's not clear for our customers and I understand it, actually. It's not clear for them how to model. Where do we upgrade and how much? So until they see where the different projects are going to get established, they're not necessarily even modeling that. So I am very optimistic about what our customers have to do. It is unfolding as it goes. But as I pointed out, it's not by coincidence that all of these announcements usually cover a 10-year or 15-year period, and we're now signing supply agreements that cover those periods. And as utilities' CapEx budgets increase over time, we do observe a correlation with our utility pole division sales increase on the volume side. So as all of this sort of unfolds, and we will benefit and see continued growth and I don't want to stretch myself, but I would say beyond our current guidance. Yes, to answer your question, in my discussions with leaders of utilities in the U.S., I am quite optimistic of what the next two years for our guidance hold, but also probably the next decade as I sort of look at those announcements. Okay. That's very helpful. Thank you. Then just back on the margin question you've also had a few times about strong margins in 2023, and you've highlighted a couple of potential headwinds. Doesn't sound like you've necessarily seen much impact as it relates to any kind of spot market pricing for poles so far. So understandably, that could come, and you're rightfully correct to be cautious about that, I gather. But should we be thinking about margins sort of holding in at least through the early part of the year given that you have yet to see those kinds of pressures materialize yet? I think that's a fair assumption for now, Mike, because if I follow my statement, I did say we haven't seen it yet. Before we get those quotes done and delivered, it'll probably be a few months out. We could see you're right that we could see a good first part of the year with softening if it happens in the summer and the back half of the year. Okay. Got it. And then maybe just lastly, I don't think you've been asked about this today, but just on the acquisition front, is that still a focus area for you? And if so, what are you seeing, and what are you looking at right now if you can comment? Oh, certainly. Always interested in increasing our network and doing some acquisitions. We have a very large and strong network in North America. So there are geographical regions where I don't necessarily need more capacity and other parts of the continent where I would definitely consider some acquisitions. So definitely, utility poles is top of mind. If that business comes with good assets and a good book of business, we'd be really interested in that. There's still some opportunities potentially on the railway ties side, and we keep our eyes open. We are very patient, but I think there's some opportunities that could come there. And last but not least, infrastructure products that support our customer base remains very appealing to us. It's something that we keep investigating and studying and have had discussions in the last year with different parties to see what could the future look like. I guess top of mind is how do we better service our current customers? I do have positive signaling from our customers of encouraging us to consider other products and even services, I'll add, actually. We're very structured and disciplined in how we're approaching this, but it's definitely something of interest, especially when we got the green light from important customers. I think it really makes things easier to consider. We just want to make sure that whatever or whenever we do it, we will be very successful at what we in our new endeavors. Okay. Perfect. Just one follow-on to that, this latter part that you were just discussing there that ways to better serve existing customers, could these be impactful opportunities, or are these sort of more likely to be smaller tuck-in type situations? They vary in size, Mike, from very impactful to small. My view is if we are going to enter something that is different than treating wood, it would be of a certain size where there's good structure, good leadership, good knowledge, a strong base to ensure what I just mentioned about being very successful at what we do. I don't think we'd buy a small shop thinking we're going to grow it to CAD 1 billion. I think we'd probably buy a medium-size if I can make the analogy a medium-size that has a good engineering team and a good footprint and good customer access and already thriving within us, potentially adding on with our customer relationship and distribution network as potential synergies. Okay. That's all very helpful. Thank you. My pleasure. Thank you. Our following question is from Maxim Sytchev from National Bank Financial. Please go ahead. Hi, Éric. Silvana, good morning. Good morning, Maxim. Éric, just in terms of the poles dynamic, so you don't think it's a reaction to the price increases that we've seen over the last two years, and it's really in relation to kind of the CapEx pacing on the part of the clients. Is that how you guys are thinking internally? Yes, 100%. No doubt in my mind, it's nothing to do with the pricing. Okay. And then in terms of obviously, you said -5% in terms of volume in Q4, but what are you guys seeing in Q1? Are the rates of sort of volume headwinds, are they similar, different? What can you tell us? For now, I would say similar. Obviously, we got one month really under our belt, and the last few weeks, I've been focused on our quarterly. So I have to say I haven't spent much on our February, but so a bit of the same for now. But as someone asked earlier about weather in January, that's sort of a bit of a headwind, so I can't draw a conclusion on that part. And maybe a thought, Maxim, is our customers work for I was talking about decades a few minutes ago. We work on the long-term aspects. So the quarter-to-quarter impact we report quarterly. We want to deliver great results, and we typically do. But you also need to keep in mind, what does that trend look like for the year, for 2024 and 2025? Because part of our team is now actually planning on 2025 business and looking at contracts and renewals and extension and new customers. It's a bit of that long-term play when we talk to utilities. Right. Yeah, makes sense. And then, Silvana, just in terms of thinking about sort of the margin profile for poles, we're not in a situation where kind of a higher cost inventory is cycling through the P&L, right? So I mean, that's kind of the comment around margins staying relatively stable in poles. Is that how we should be thinking about this? Yes. So the increase in the inventory was mostly volume, right, and not cost. So no impact on the expected margins on that volume. Okay. Okay. That's great. Thanks so much. And then, Éric, just circling back to kind of the obviously, you're looking at M&A, and I think obviously, the market appreciates that. But in terms of commitment to sort of all the verticals in your current platform, no incremental thoughts in relation to the resi exposure if that's something that you "need" in the long term? Maybe, yeah, any thoughts there? Thanks. Well, Maxim, the way we look at it, tie business out of the three product categories, that's a business that turns its inventory 4x or 5x a year, healthy margin, and definitely is a good contributor to the business. So I don't know what the future holds as far as dynamics and what comes our way. We've always obviously been vocal that we're investing in our infrastructure business, and that business is proportionately shrinking, although stable as in revenue and very steady on the margin piece. It is shrinking. So as long as it's a key contributing to the business, it's wood treating, which is part of our core knowledge. It still fits very well with what we do. Okay. Perfect. And then so just one last question, clarification. When you talk about sort of additional services, potentially for your tie and pole clients, so you would not be averse to potentially looking at something which is sort of less manufacturing and maybe a little bit more kind of headcount-driven in terms of M&A, seeing that it meets certain ROIC targets. Is that the way we should be thinking about this? Yep, definitely. If we find the right partner that is, if I could say, the Stella-Jones equivalent in their own segment, I wouldn't hesitate, especially as we got customers saying 100% Stella-Jones can bring value in a combined service/product offering. Okay. Excellent message from me. Thanks so much. Thank you. We have no further questions in the queue. Thank you. Well, thank you, Matthew, and thank you, everyone, for joining us today. We look forward to updating you on our first quarter results in May. Have a great day. Ladies and gentlemen, this concludes today's call.