Q1 2025 Lassonde Industries Inc Earnings Call

Operator: Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Lassonde Industries.

Good morning, ladies and gentlemen, thank you for standing by welcome to Lasalle in the industry.

Operator: On October 28, 1925, first quarter earnings conference call. Corporation's press release reporting financial results was published yesterday after the market slowest. It can be found on its website at lasonde.com along with the mdna and financial statement. These documents are available on CDAR Plus as well. Presentation supporting this conference call was also posted on the website. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question and answer session. All instructions will be provided at that time for you to queue up for questions. If anyone has difficulties hearing the conference, please press star and zero for operator assistance at any time.

25 first quarter earnings conference call.

Corporations press release reporting financial results were published yesterday after the market close.

It can be found on its website at <unk> dot com, along with the MD&A and financial statements.

These documents are available on SEDAR pluses well presentation supporting this conference call was also posted on the website at.

At this time all participants are in a listen only mode. Following the presentation. We will conduct a question and session and instructions will be provided at that time for you to queue up for questions. If anyone has difficulty hearing the conference. Please press star.

Zero for operator assistance at any time.

Operator: Before turning to management's pre-recorded remarks, please be advised that this conference call will contain statements that are forward-looking and subject to a number of risks and uncertainties. that could cause actual results to differ materially from those anticipated. Please refer to the Forward-Looking Statements section of the MD&A for further information. Also note that all figures expressed on today's call are in Canadian dollars, unless otherwise stated, and that most amounts have been rounded to ease the presentation. Finally, be advised that the presentation will refer to non-IFRF measures or ratios most mostly to ease comparability between periods. Reconciliations to IFRS measures are provided in the appendix to the presentation and in the corporation's MD&A.

Before turning to management's pre recorded remarks. Please be advised that this conference call will contain statements that are forward looking and subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. Please refer to forward looking statements section of the M.

DNA for further information.

Also note that all figures expressed on today's call are in Canadian dollars, unless otherwise stated and that most amounts have been rounded to ease the presentation.

Finally, he advised that the presentation, we'll refer to non ifr F measures or ratios.

Yeah.

Mostly to ease comparability between periods reconciliations to I F. R. S measures are provided in the appendix to the presentation and in the Corporation's M. D N a.

Operator: I would like everyone...

I would like everyone.

Operator: I would like to remind everyone that this conference call is being recorded on Friday, May 9th, 2025.

I would like to remind everyone that this conference call is being recorded on Friday may nine 2025.

Vincent Timpano: I would now like to turn the conference over to Vince Timpano, Chief Executive Officer. Good morning, ladies and gentlemen. I'm here with Eric Gemme, Chief Financial Officer of Lassonde Industries. Thank you for joining us for this discussion of the financial and operating results for our first quarter ended March 29, 2025. please turn to slide four. Lassonde began 2025 on a positive note, delivering solid sales and operating profit growth, despite ongoing uncertainty. Sales increased 22.8% to $700 million, with growth reaching 9.3% without the foreign exchange impact and the recently acquired summer garden business. This performance reflects market share gains in both Canadian and U.S.

Vince: I would now like to turn the conference over to Vince <unk>, Chief Executive Officer, Good morning, Ladies and gentlemen, I'm here with Eric Jim Chief Financial Officer of assigned industries. Thank you for joining us for this discussion of the financial and operating results for our first quarter ended March 29 2025.

Please turn to slide four.

Vince: Lasalle and began 2025 on a positive note delivering solid sales and operating profit growth despite ongoing uncertainty.

Vince: Sales increased 22, 8% to $700 million with growth, reaching nine 3% without the foreign exchange impact and the recently acquired summer Garden business.

Vince: This performance reflects market share gains in both Canadian and U S beverage activities, driven respectively by effective merchandising and our build back plan.

Vincent Timpano: beverage activities driven respectively by effective merchandising and our Build Back plan. Meanwhile, in Specialty Food, we delivered another strong EBITDA margin in the quarter thanks to both our legacy business and Summer Garden.

Vince: Meanwhile, in specialty food, we delivered another strong EBITDA margin in the quarter. Thanks to both our legacy business and summer Garden.

Vincent Timpano: Now let's turn to slide 5 for a closer look at operations beginning with U.S. beverage activity. Lassonde sustained its momentum, gaining market share in this first quarter as volume increased 10% in a market that contracted slightly. Keys to this gain were the execution of build-back initiatives through increased distribution with new and existing customers, which in turn drove better network efficiencies as well as the contribution of our new single-serve line in North Carolina. You may recall that this line encountered certain mechanical issues during the first quarter. These issues have largely been addressed, and the line is now producing at a pace aligned with our expectations.

Vince: Now, let's turn to slide five for a closer look at operations, beginning with U S beverage activities.

Vince: <unk> sustained its momentum gaining market share in this first quarter as volume increased 10% in a market that contracted slightly Keith.

Vince: Keys to this gain were the execution of build back initiatives through increased distribution with new and existing customers, which in turn drove better network efficiencies as well as the contribution of our new single serve line in North Carolina.

Vince: You may recall that this line encountered certain mechanical issues during the first quarter.

Vince: These issues have largely been addressed and the line is now producing at a pace aligned with our expectations.

Vincent Timpano: We anticipate reaching full production rate by the end of the second quarter. I'm also pleased to report that our strategic investment initiatives remain on schedule and on budget. These include the construction of a new facility in New Jersey and the relocation of certain production assets from a U.S. co-packer to our North Carolina hub, where we're investing an additional $20 million. This investment will see us establish our first-ever in-house juice box production in the U.S.

Vince: We anticipate reaching full production rate by the end of the second quarter.

Vince: I'm also pleased to report that our strategic investment initiatives remain on schedule and on budget. These.

Vince: These include the construction of a new facility in New Jersey.

Vince: of certain production assets from a US co-packer to our North Carolina hub, where we're investing an additional $20 million. This investment will see us establish our first ever in-house juice box production in the US.

Vincent Timpano: Turning to Canadian beverage activities on slide 6, we are witnessing the benefits of the price adjustments that were mostly implemented last year. We have continued to successfully execute on pricing to offset key commodity inflation. As part of our productivity initiatives, we have significantly enhanced efficiency by deploying new high-speed juice box lines. These new lines are replacing five older ones, allowing us to deliver higher output more efficiently. Lassonde also benefited from effective merchandising, new product innovation launched Rogue 2024, and a rising consumer sentiment to buy Canadian. This combination contributed to solid market share gains across our branded and private label portfolio despite a market contraction, most notably within refrigerated orange juice.

Vince: Turning to Canadian beverage activities on slide 6, we are witnessing the benefits of the price adjustments that were mostly implemented last year. We have continued to successfully execute on pricing to offset key commodity inflation.

Vince: Lasalle also benefited from effective merchandising new product innovation launched road 2024, and a rising consumer sentiment to buy Canadian.

Vince: This combination contributed to solid market share gains across our branded and private label portfolio. Despite a market contraction, most notably within refrigerated orange juice.

Vincent Timpano: With respect to growing demand for Canadian products, we launched our new Canadian to the Core campaign. This umbrella campaign shines the spotlight on our Canadian brands, including Oasis and If There's No Taste Like Home tagline, and have continued until a few weeks ago in digital, print and outdoor, while still present on pack and in store marketing. Importantly, we also recently commissioned our new bag-in-a-box of septic packaging lines slightly ahead of schedule. Our initiative received positive response, which validates our view of strong potential in this market. As I mentioned last quarter, this new technology offers convenient dispensing, which makes it ideal for a wider range of customers in food service, such as quick-serve restaurants and convenience stores.

Vince: With respect to growing demand for Canadian products, we launched our new Canadian to the core campaign. This umbrella campaign shines the spotlight on our Canadian brands, including Oasis and if Theres no taste like home tagline and it continued until a few weeks ago in digital print and outdoor while still press.

Vince: On pack and in store marketing.

Vince: Importantly, we also recently commissioned our new bag in a box of aseptic packaging lines slightly ahead of schedule.

Vince: Our initiative received positive response, which validates our view of strong potential in this market.

Vince: As I mentioned last quarter. This new technology offers convenient dispensing, which makes it ideal for a wider range of customers and foodservice such as quick serve restaurants and convenience stores additional bulk aseptic packaging formats are also available and we will support sales to industrial customers like food manufacturers.

Vincent Timpano: Additional bulk of septic packaging formats are also available and will support sales to industrial customers like food manufacturers. This investment represents a significant step forward and allows us to expand our presence and deliver efficient, customizable beverage solutions to the food service channel across North America and expand our reach with industrial supply.

Vince: Yeah.

Vince: This investment represents a significant step forward and allows us to expand our presence and deliver efficient customizable beverage solutions to the foodservice channel across North America, and expand our reach with industrial supply.

Vincent Timpano: Let's turn to specialty food on slide seven. During the first quarter of 2025, we continued to integrate our North American activities. Overall, we saw positive top and bottom line growth within our legacy specialty food business, while Summer Garden had another solid quarter with sales of $55.5 million and EBITDA of $13.5 million, representing a margin of 24%. As for legacy operations, our growth momentum continued in retort products, mainly for premium glass jar soups and sauces, buoyed by continued category growth in the premium segment, and through growth in our key customers via new product launches and expansion of our Canadian business, as we continue to balance our portfolio and drive Canadian business via innovation and new customers.

Vince: Let's turn to specialty food on slide seven.

Vince: During the first quarter of 2025, we continue to integrate our north American activities overall, we saw positive top and bottom line growth within our legacy specialty food business, while summer garden had another solid quarter with sales of $55 $5 million and EBITDA of $13 5 million.

Vince: Representing a margin of 24%.

Vince: As for legacy operations, our growth momentum continued in retort products, mainly for premium glass jar soups and sauces buoyed by continued category growth in the premium segment and through growth in our key customers by new product launches.

Vince: And expansion of our Canadian business as we continue to balance our portfolio and drive Canadian business by innovation and new customers.

Vincent Timpano: We are also continuing our evaluation of targeted investments to accelerate growth by enhancing specialty food production capacity. This includes the ongoing assessment of a potential plant expansion in Ohio to support future growth, lower costs, while also supporting our long standing strategy of producing closer to our customers.

Vince: We are also continuing our evaluation of targeted investments to accelerate growth by enhancing specialty food production capacity. This includes the ongoing assessment of a potential plant expansion in Ohio to support future growth lower cost, while also supporting our long standing strategy of producing closer to our.

Vince: Customers.

Vincent Timpano: Before turning the call over to Eric, let me highlight organization changes that support the continued evolution of our operating model, starting with the creation of our new North America Beverage Division on slide 8. This division comprises our two U.S. beverage business units, our flagship beverage business in Canada, and our newly consolidated North America Food Service business unit.

Vince: Before turning the call over to Eric Let me highlight organization changes that support the continued evolution of our operating model starting with the creation of our New North America beverage Division on slide eight.

Vince: This division comprises our two U S beverage business units, our flagship beverage business in Canada, and our newly consolidated North America Foodservice business unit.

Vincent Timpano: To lead this division, Amanda Burns was appointed Chief Commercial Officer, North American Beverages. Amanda previously served as President, U.S. Private Label, where she played a key role in developing and executing Project Eagle, our initiative to revitalize U.S. beverage activities.

Vince: To lead this division.

Speaker Change: Mandar Burns was appointed Chief commercial Officer, North American beverages. Amanda previously served as President U S. Private label, where she played a key role in developing and executing project Eagle Our initiative to revitalize U S beverage activities.

Vincent Timpano: Gabriela Arriaga was appointed Chief Marketing Officer for North American Beverages. Her mandate includes establishing best practices, capturing synergy, and building a growth-oriented portfolio through innovation. In parallel, Gabby remains General Manager of our U.S. National Brands Business Unit.

Gabriela at Jaeger was appointed Chief marketing Officer for North American beverages. Her mandate includes establishing best practices, capturing synergy and building a growth oriented portfolio through innovation and.

Speaker Change: In parallel Gabby remains general manager of our U S National brands business unit.

Vincent Timpano: Turning to slide 9, Elizabeth Hill was named General Manager, Private Label Beverages USA. Having joined Lassonde 22 years ago, she has extensive experience in sales and marketing, building dynamic teams, and stimulating growth through a focus and commitment to helping customers achieve their objectives.

Speaker Change: Turning to slide nine Elizabeth Hill was named General manager private label beverages USA having.

Elizabeth Hill: Having joined US on 22 years ago. She has extensive experience in sales and marketing building dynamic teams in stimulating growth through a focus and commitment to helping customers achieve their objectives.

Vincent Timpano: In Canada, Martin Laussiere was named General Manager, Beverages Canada. Since joining Lassonde in 2008, Martin has held various senior management positions, including the last two years as Senior Vice President of Financial Planning and Analysis, where he played a key role by directing and overseeing all commercial-related finance activities across each division.

Speaker Change: And Canada, Martin <unk> was named General manager beverages, Canada.

Since joining was signed in 2008 Martel has held various senior management positions, including the last two years as senior Vice President of financial planning and analysis, where he played a key role by directing and overseeing all commercial related finance activities across each division.

Eric Gemme: I now turn the call over to Eric for a review of Quarter 1 results. Eric. Well, thank you, Vince. Good morning, everyone. Let's turn to slide 10 for our first quarter sales, which amounted to $700 million, up 22.8% versus last year. Excluding Summer Garden and a favorable foreign exchange impact, sales increased 9.3%, reflecting a higher sales volume in the U.S. and mostly the ongoing effect of pricing adjustments in Canada.

Speaker Change: I now turn the call over to Eric for a review of quarter one results Eric Paul.

Eric Paul: Thank you Vince good morning, everyone.

Speaker Change: Let's turn to slide 10.

Speaker Change: For our first quarter sales, which amounted to $700 million up 22, 8% versus last year.

Speaker Change: Excluding summer garden, and a favorable foreign exchange impact sales increased nine 3%, reflecting a higher sales volume in the U S and mostly the ongoing effect of pricing adjustments in Canada.

Eric Gemme: Moving to slide 11. Growth profits reach $183 million, or 26.2% of sales, up from $150 million a year ago, also representing 26.2% of sales. Excluding Summer Garden, gross profit dollars increased 7.1% and, as anticipated, the gross profit margin contracted to 24.9% due to higher costs of certain inputs, mainly oranges and, to a lesser extent, pineapples and apples. and accelerated depreciation expenses of certain U.S. assets. These factors were partially upset by lower PET resin cost and a more favorable sales mix in the U.S. SG&E expenses were $140 million, up from $115 million last year. Excluding SG&E expenses coming from Summer Garden, they've increased by $9 million, up 8%.

Speaker Change: Moving to slide 11.

Speaker Change: Gross profit reached $183 million or 26, 2% of sales up from $150 million a year ago also representing 26, 2% of cells.

Speaker Change: Excluding summer garden gross profit dollars increased seven 1% and as anticipated the gross profit margin contracted to 24, 9% due to our cost of certain inputs, mainly oranges and to a lesser extent pineapples and apples.

Speaker Change: And accelerated depreciation expenses off certain U S assets.

Speaker Change: These factors were partially offset by lower resin cost and a more favorable sales mix in the U S.

Speaker Change: SG&A expenses were $140 million.

Speaker Change: From 115 last year.

Speaker Change: Excluding SG&A expenses coming from summer Garden. These increased by $9 million up 8%. These reflecting the currency conversion effect of expenses from our U S legacy entities.

Eric Gemme: These reflecting the currency conversion effect of expenses from our U.S. legacy entities.

Eric Gemme: are your outbound transportation costs, mainly in the U.S., in part due to higher volume, and are your finished goods warehousing costs? Excluding items that impact comparability, adjusted EBITDA increased 36% to $71 million or 10.2% of sales from $52 million or 9.2% of sales last year. Adjusted profit attributable to the corporation's shareholders was $27 million, or $4 per share, compared to $25 million, or $3.68 per share last year.

Speaker Change: Are your outbound transportation costs, mainly in the U S. In part due to higher volume and higher finished goods warehousing costs.

Speaker Change: Excluding items that impact comparability, adjusted EBITDA increased 36% to $71 million or 10, 2% of sales from 52 million or nine 2% of sales last year.

Speaker Change: Adjusted profit attributable to the corporation shareholders was $27 million or $4 per share compared to $25 million or $3 68 per share last year.

Eric Gemme: Turning to cash flow on slide 12. Operating activities required $60 million in Q1 2025 versus generating $11 million last year. This variation mainly reflects more important working capital requirement this year versus last, essentially due to higher raw material inventories from advanced purchases of apple concentrate to secure prices and supply. Our finished goods inventory, mainly for our Canadian beverage unit, in anticipation of greater demand and also reflecting the timing effect of certain shipment for our Canadian food unit. An unfavorable change of $16 million in settlement of derivative instruments associated with FCOJ this year versus last. The payment in the quarter of $35 million of payable at December 31st that were associated with Capital Expenditures Project.

Speaker Change: Turning to cash flow on slide 12.

Speaker Change: Operating activities required $60 million in Q1, 2025 versus generating $11 million last year.

Speaker Change: This variation mainly reflects more imported working capital requirement this year versus last essentially due to higher raw material inventories from advanced purchases of Apple concentrate to secret prices and supply.

Speaker Change: Higher finished goods inventory, mainly for our Canadian beverage unit in anticipation of greater demand and also reflecting the timing effect of certain shipment for our Canadian food units.

An unfavorable change of $16 million in settlement of derivative instrument associated with F. C O J this year versus last.

Speaker Change: The payment in the quarter of $35 million of payable at December 31.

Speaker Change: That were associated with capital expenditures project.

Eric Gemme: These were only $8 million at the end of the quarter, resulting by itself in a net outflow of $26.4 million in the quarter. And then a slightly higher DSO, essentially due to timing. All of these elements were partly offset by a higher Hibbitt dA. The days of operating working capital ratio stood at 55 days, which is above the historical range due to higher days of inventory outstanding at 92 days and to a lesser extent higher DSO at 23 days. We expect the ratio to revert to its historical range by the end of 2025 as the inventory situation normalizes.

Speaker Change: These were only $8 million at the end of the quarter, resulting bites off and a net outflow of $26.4 million and the quarter.

Speaker Change: And then a slightly higher DSO essentially due to timing.

Speaker Change: All of these elements were partly offset by higher EBITDA.

Speaker Change: The days of operating working capital ratio stood at 55 days, which is above the historical range due to higher days of inventory outstanding at 92 days and to a lesser extent higher D. S O at 23 days.

Speaker Change: We expect the ratio to revert to historical range by the end of 2025 as the invest REIT situation normalizes.

Eric Gemme: Capital expenditure totals $79 million in Q1 of 2025, including U.S. dollar $34 million, or $48 million Canadian, related to the construction of the New Jersey facility. This project remains on track and on budget, representing CapEx of approximately U.S. dollar 100 million in 2025. As a result, we expect CapEx to reach up to 9 percent of sales in 2025.

Speaker Change: Capital expenditure totaled $79 million in Q1 of 2025, including U S dollar $34 million or $48 million Canadian.

Speaker Change: Related to the construction of the New Jersey facility.

Speaker Change: This project remains on track and on budget, representing Capex of approximately U S dollar $100 million in.

Speaker Change: In 2025 as a result, we expect capex to reach up to 9% of salad and 2025.

Eric Gemme: Turning to our balance sheet on slide 13. Lassonde net debt totaled $587 million at the end of the first quarter versus $449 million three months earlier. The increase is attributable to a draw on both revolving Canadian and U.S. revolving operating credit to finance inventory and capex. As anticipated, the net debt-to-adjusted FDA ratio increased, reaching 2.021 at the end of the first quarter of 2025, notably reflecting the U.S. CapEx program and an elevated level of working capital. All things being equal, we anticipate the leverage ratio to range between 2 and 2.5 to 1 until the end of 2026, remaining well within our comfort zone of less than 3.25 to 1.

Turning to our balance sheet on slide 13.

Speaker Change: Well saw net debt totaled $587 million at the end of the first quarter versus 449 three months earlier.

The increase is attributable to a draw on both revolving Canadian and U S revolving operating credit to finance inventory and Capex.

Speaker Change: As anticipated the net debt to adjusted EBITDA ratio increased reaching 2.0 to one at the end of the first quarter 2025, notably, reflecting the U S. Capex program and then elevate the level of working capital.

Speaker Change: All things being equal we anticipate the leverage ratio to range between two and 2.5 to one until the end of 2026 remaining well within our comfort zone of less than $3 25 to one.

Vincent Timpano: Ladies and gentlemen, I turn the call back to Vince Fordialdo. Thank you, Eric. Please turn to slide 14.

Vince: Ladies and gentlemen, I turn the call back to Vince for the outlook.

Vince: Thank you Eric Please turn to slide 14.

Vincent Timpano: We are pleased with our first-quarter performance and remain cautiously optimistic for 2025. However, it is important to acknowledge the significant economic and geopolitical uncertainties that persist. These uncertainties require us to remain vigilant and adaptable as we navigate the months ahead.

Vince: We are pleased with our first quarter performance and remain cautiously optimistic for 2025. However, it is important to acknowledge the significant economic and geopolitical uncertainties that persist.

Vince: These uncertainties requires remain vigilant and adaptable as we navigate the months ahead.

Vincent Timpano: As always, our focus is on executing our strategic priorities. For U.S. beverage activities, these include continuing our private label volume build-back plan, ramping up the North Carolina single-serve line, and executing our initiatives to improve capacity and lower cost. For Canadian beverage activities, our main priority is to fortify our leadership to be achieved through innovation, to reduce commodity exposure, and ensure active participation in on-trend and growing beverage segments. channel expansion through our food service bag-in-a-box initiative, targeted marketing adjustments including our ongoing Canadian to the Core campaign, and through ongoing efforts to improve productivity. In specialty food, we will continue the integration of our North American network, address opportunities to build brand distribution, including with the recent launch of Yellowstone in the U.S.

Vince: As always our focus is on executing our strategic priorities.

Vince: For U S beverage activities. These include continuing our private label volume build back plan.

Vince: Ramping up the North Carolina single serve lying in executing our initiatives to improve capacity and lower cost for Canadian beverage activities. Our main priority is to fortify our leadership to be achieved through innovation to reduce commodity exposure and ensure active participation in onshore.

Vince: Trend and growing beverage segments.

Vince: Channel expansion through our foodservice bag in a box initiative.

Vince: Targeted marketing investments, including our ongoing Canadian to the core campaign and through ongoing efforts to improve productivity.

Vince: In specialty food, we will continue the integration of our North American network address opportunities to build brand distribution, including with the recent launch of Yellowstone and in the U S.

Vincent Timpano: As well, we will continue our assessment of a potential expansion of the Ohio facility, which would enable Lassonde to grow capacity, capture growth, and lower costs.

Vince: As well, we will continue our assessment of a potential expansion of the Ohio facility, which would enable lasagna grow capacity capture growth and lower cost.

Vincent Timpano: Moving to slide 15 for our sales outlook. Given our first quarter results, we continue to anticipate a sales increase of approximately 10%, excluding currency fluctuations, reflecting a full year contribution from Summer Garden The Run Rate Effect of Existing and Planned Selling Price Adjustments sequential sales volume improvement related to the pace of our U.S. build-back plan and additional volume available from our new single-serve line. We are closely monitoring changes in consumer food habits and the demand elasticity for our products amid ongoing inflation and tariff impact in key commodity costs. Additionally, we are observing market participants' reactions to these factors and have recently noted an increase in promotional activities, primarily in the U.S.

Vince: Moving to slide 15 for our sales outlook.

Vince: Given our first quarter results, we continue to anticipate a sales increase of approximately 10% excluding currency fluctuations, reflecting a full year contribution from the summer garden.

Vince: The run rate effect of existing and planned selling price adjustments.

Vince: Sequential sales volume improvement related to the pace of our U S build back plan.

Vince: And additional volume available from our new single serve line.

Vince: We are closely monitoring changes in consumer food habits, and the demand elasticity for our products amid ongoing inflation and tariff impact in key commodity costs.

Vince: Additionally, we are observing market participants' reactions to these factors and have recently noted an increase in promotional activities primarily in the U S market.

Vincent Timpano: market.

Vincent Timpano: Turning to slide 16, we will remain vigilant in monitoring cost fluctuations for certain commodities such as orange and apple concentrates and other inputs affected by tariffs which we expect to remain volatile through 2025. The class of orange concentrate has been extremely volatile over the past few weeks. At the beginning of the year, the price was around $5 per pound solid. However, in February, we saw a sharp and sudden decline. Since then, prices have fluctuated between a low of $2.10 and a high of $3.15. Currently, they are hovering in the range of 230 to 270. Later today, we expect to receive the forecast from Fundacitrus, which should provide some visibility on the upcoming crop and hopefully lead to less volatility.

Vince: Turning to slide 16.

Vince: We will remain vigilant in monitoring cost fluctuations for certain commodities, such as orange and Apple concentrates and other inputs affected by tariffs, which we expect to remain volatile through 2025.

Vince: The class of Orange concentrate has been extremely volatile over the past few weeks at the beginning of the year. The price was around $5 per pound solid. However in February we saw a sharp and sudden decline.

Vince: Since then prices have fluctuated between a low of 210 and a high of $3 15.

Vince: Currently they are hovering in the range of $2 30 to $2 70.

Vince: Later today, we expect to receive the forecast from fund to citrus, which should provide some visibility on the upcoming crop and hopefully lead to less volatility.

Vincent Timpano: This being said, if prices remain at these levels, we should benefit from lower costs at the end of our hedging horizon. As for apple juice concentrate, higher costs in the first quarter affected our margins, but we proceeded with price adjustments late in the period, and we now have a better visibility on our 2025 costs, although any changes in tariffs may impact this outlook.

Vince: This being said if prices remain at these levels, we should benefit from lower costs at the end of our hedging horizon.

Vince: As for Apple juice concentrate higher costs in the first quarter affected our margins, but we proceeded with price adjustments late in the period and we now have a better visibility on our 2025 cost although any changes in tariffs may impact this outlook.

Vincent Timpano: The sudden and significant fluctuations in the price and availability of key ingredients, along with evolving consumer beverage needs, highlight the importance of innovation to reduce our commodity exposure, and you can expect us to remain active on that front.

Vince: The sudden and significant fluctuations in the price and availability of key ingredients, along with the ball being consumer beverage needs.

Vince: Highlight the importance of innovation to reduce our commodity exposure and you could expect us to remain active on that front.

Vincent Timpano: As for the trade environment, uncertainty remains regarding current and potential tariffs and their associated impact. We have prepared mitigation measures to maintain a strong competitive position and an optimal cost structure, but the timing, duration, and evolution of tariffs may affect these measures.

Vince: As for the trade environment uncertainty remains regarding current and potential tariffs and the associated impacts we are prepared mitigation measures to maintain a strong competitive position and an optimal cost structure, but the timing duration and evolution of tariffs may affect these measures.

Vince: <unk>.

Vincent Timpano: In closing, on slide 17, we expect our momentum to continue throughout 2025. Driven by an extensive and diversified product portfolio, Lassonde is well positioned to grow its reach in the North America food and beverage market.

Vince: In closing on slide 17, we expect our momentum to continue throughout 2025.

Vince: Driven by an extensive and diversified product portfolio Lasalle is well positioned to grow its reach in the North America food and beverage market. This concludes our prepared remarks, we are now pleased to answer your questions.

Vincent Timpano: This concludes our prepared remarks.

Operator: We are now pleased to answer your questions.

Operator: We will now begin the question and answer session. To ask a question, you may press star then one on your touchtone phone.

Vince: We will now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone if youre using a speakerphone. Please pick up your handset before pressing the keys.

Operator: If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star and then two.

Vince: If at any time. Your question has been addressed and you would like to withdraw your question. Please press Star then two.

Martin Landry: Our first question comes from Martin Landry with Stifel. Please go ahead. Good morning, Vince and Eric. Good morning, Mark.

Speaker Change: Our first question comes from Martin Landry with Stifel. Please go ahead.

Speaker Change: Good morning, Dan generic.

Speaker Change: Good morning, Mr. Martin.

Martin Landry: I would like to touch on Summer Garden. The division generated a very strong EBITDA margin of 24%. Looking back when you acquired Summer Garden, I think the last 12 months before the acquisition closed, the EBITDA margins were around 19% on an annual basis, obviously. I'm looking at a quarter, a Q1.

Speaker Change: I would like to touch on our summer garden.

Speaker Change: You know that the company or the division generated a very strong EBITDA margin of 24%.

Speaker Change: Hey, you know looking back when you acquired summer Garden I think the last 12 months before.

Speaker Change: The acquisition close the EBITDA margins were around 19% on an annual basis, obviously and I'm looking at our quarter. Our Q1. So I'm wondering is there a favorable seasonal impact in Q1 that could help to could've helped at the margin the EBITDA margin of summer Garden.

Martin Landry: I'm wondering, is there a favourable seasonal impact in Q1 that could have helped the EBITDA margin of Summer Garden?

Vincent Timpano: So Martin, let's unbundle that in three components. So as I said previously, the 19% that we've disclosed was based on a 2000 sorry, May 12 months of May 2024 run rate. And we were cautious when we provided that information. So we were very tight on our calculation. So not to get anybody excited. So then on top of that, we have more volume and hitting our plan. So that helps us as well absorb fixed costs.

Speaker Change: So I think that's.

Speaker Change: That's unbundled that in three components. So as I said previously the 19% that we've disclosed was based on a 2000, sorry may 12 months of May 2024 run rate and we were cautious when we.

Speaker Change: Provided that information so we were very tight on our calculation.

Speaker Change: So not to get anybody excited so then on top of that we have more volume and hitting.

Speaker Change: Hitting our plan, so that help us as well absorb fixed costs.

Speaker Change: Giving us a bit of a boost there you do have the seasonality effect first quarter and if you look at summer garden, It's a source business, it's a barbecue sauce as well, but source, which is our more consume in the winter and then the last element that should not be.

Vincent Timpano: forgotten is, as we said a few times, and we even said today, we are still working on our future for our food business. And we said that we would take some of the synergies generated by the Summer Garden transaction to reinvest. However, at this moment, we, since we have not formally defined where we will need to invest, so those investments are not there. So we see a bit of a leak of the synergy that I've started to materialize heading to P&L. Super. That's helpful.

Speaker Change: Forgotten is as we said a few times and we even said today, we are still working on our future for our food business and we said that we would take some of the synergies generated by the summer garden transaction to re invest however at this moment we.

Speaker Change: Since we have not formally.

Speaker Change: Define where we will need to invest so those investment are not there. So we see a bit of a leak of the synergy that have started to materialize hitting the P&L.

Speaker Change: That's helpful.

Martin Landry: Maybe switching gears to look at the margins. I believe in Q4, Eric, you had mentioned or you had discussed the potential margin contraction that you were expecting in Q1 because of a surge in Apple concentrate costs, but margin held up versus last year.

Maybe you know switching gears.

Speaker Change: To look about it.

Eric Paul: The margins I believe in Q4, Eric you had mentioned or you had discussed the potential margin contraction.

Eric Paul: That you are expecting in Q1 because of a surge in apple concentrate cost.

Eric Paul: But margin held up versus last year.

Eric Gemme: I'd like to better understand, what was the offset that enabled your gross margins to come in better than expected in Q1? Absolutely, Martin. If you look at the Q1 2025 margin, 26.2%, that includes summer gardens. If you were and you were able to do that with DMDNA, back out the summer garden contribution, you would see that the margin would be would have been 24.9 excluding summer garden compared to 26.2 same period last year without summer garden. So that's hence the contraction in the margin. OK. So OK.

Eric Paul: No.

Speaker Change: I'd like to better understand what was the offset that at mobile ear your gross margins.

Eric Paul: Even better than expected in Q1.

Eric Paul: Absolute MSA.

Eric Paul: So if you look at the Q1 2025 margin 26, 2% that includes summer garden.

Eric Paul: If you were and you were able to do that with the M. D. N. A back out the summer Garden contribution you would see that the margin would be would have been $24 nine excluding summer garden compared to 26 point too.

Eric Paul: Same period last year without some regard them. So that's hence the contraction in the margin.

Eric Paul: Okay. So okay.

Eric Paul: And then so so that will.

Martin Landry: So then, bringing this maybe a little bit to look at Q2 and on a go-forward basis, what should we expect for your margins? I mean, you have mentioned that there's a lot of fluctuation in your price to concentrate, while Summer Garden seems to be performing a little bit above expectations. So, if we look at the consolidated basis, Eric, for Q2, where do you expect margins to land?

Eric Paul: Bringing this maybe a little bit too to look at our Q2 and on a go forward basis.

Eric Paul: What should we expect for your for your margins I mean, you have mentioned that Theres a lot of fluctuation in your and your price you can century.

Eric Paul: Last summer garden, it seems to be performing a little bit above expectation. So.

Eric Paul: If we look at the consolidated basis, Eric for Q2.

Speaker Change: Where do you expect margin to land.

Eric Gemme: Mateo, I'm not giving guidance, as you know, but thank you for asking still. Listen, we said that first quarter We were expecting a bit of a pinch on margin because of the lag between increased cost and pricing. And we are saying that now that we've addressed the pricing issue and we have good visibility on cost. So, Martin, again, I'm not giving guidance, but if you incorporate all of that, I'll let you make your conclusion. But I think these are the key element that you need to consider as you project our margin.

Eric Paul: So I'm not giving guidance as you know, but thank you for asking Phil.

Speaker Change: Listen, we said that first quarter.

Speaker Change: We were expecting a bit of a pension on margin because of the lag between increased cost and pricing and we are saying that.

Speaker Change: Now that we've addressed the pricing issue.

Speaker Change: And we have good visibility on cost so and I think again, I'm not giving guidance, but if you incorporate all of that I'll, let you make your conclusion, but.

Speaker Change: But I think these are the key element that you need to consider as you project of our margin.

Eric Gemme: Sorry, Eric, can you repeat that? I guess I'm not sure if I understood correctly. So what I'm saying is the first quarter... experience a contraction in margin because of a higher cost, mainly in the U.S., of our apple concentrates. and costs that were offset by price increases toward the end of the quarter. So basically you see that's the squeeze in the margin now going forward. We have a good visibility on our cost for the back end of the year, and now the price has been adjusted. So if you take that into consideration, what causes squeeze in the first quarter?

Speaker Change: Sorry can you repeat that because I'm not sure if I understood correctly, so what I'm, saying is the first quarter.

Speaker Change: Experienced a contraction in margin because of our higher cost mainly in the U S of our Apple concentrate.

Speaker Change: And Ah cost that were.

Speaker Change: Offset by price increases towards the end of the quarter.

Speaker Change: So basically you see that's the squeeze on the margin now going forward.

Speaker Change: We have a good visibility on our cost for the back end of the year and now the price has been adjusted.

Speaker Change: So if you take that into consideration what causes squeeze in the first quarter.

Eric Gemme: should be neutralized. We don't know what tariff will do, we don't know what volume could do, but that's all being equal, that's how you should read this and that's how you should think about it as you project our margin for the back end of the year.

Speaker Change: Should have been.

Speaker Change: Should be neutralized halting b equals S E S easier better a better alignment of our pricing versus cost for that accident years that fair all thing exactly all thing being well because of course.

Speaker Change: We don't know what tariff will do we don't know what volume could do but deaths LTE being equal that's how you should read this and that's how you should think about it as you project our margin for the back end of the year.

Speaker Change: Perfect.

Martin Landry: Perfect. Okay.

Martin Landry: Thank you, guys, and best of luck. Best of luck.

Speaker Change: Perfect. Okay. Thank you guys and best of luck.

Speaker Change: Michelle.

Luke Hannan: And the next question comes from Luke Hannan with Canaccord Genuity. Please go ahead. Thanks.

Speaker Change: And the next question comes from Luke Hannan with Canaccord Genuity. Please go ahead.

Luke Hannan: Good morning, everyone. I wanted to start on the topic of the higher promotional activity that you've noticed, particularly in the US market. Can you clarify, is this something that's broad-based across several product lines? Is it specific to maybe a few product lines or verticals? And is this broad-based also amongst your competitors, or are you noticing that it's just the heavier promotional activity from select?

Luke Hannan: Thanks, and good morning, everyone I wanted to start on the topic of the higher promotional activity that you've noticed particularly in the U S. Market can you clarify is this something that's broad based across our <unk>.

Luke Hannan: Several product lines is it specific to maybe a few product lines or verticals and is this broad based also amongst your your competitors are you noticing that as just the heavier promotional activity from our select few competitor, yes. So look it's Vince let me answer that so it is very recent that we've noted the promotional.

Vincent Timpano: Yeah, so Luke, it's Vince. Let me answer that. So it is very recent that we've noted the promotional sort of uptick as we noted. So obviously we're going to spend a little bit more time trying to understand sort of the drivers of that. One of the things that we do have to take into consideration is Easter. And so Easter moved from the March time frame to the April time frame, so it would be natural that you should see some uptick from a promotional perspective. And to your question in terms of where we're seeing it, it's in total category more specifically.

Luke Hannan: Sort of uptick as we noted so obviously, we're going to spend a little bit more time trying to understand sort of the drivers of that one of the things that we do have to take into consideration is Easter and so Easter moved from the March timeframe. The April timeframe. So it would be natural that you should see some uptick from a promotional perspective and to.

Luke Hannan: Your question in terms of where are we seeing it.

Luke Hannan: Total category more specifically you think about it in the context of shelf stable and across our Salt Lake competitor base and brands is what we've been seeing so again, it's early information we're.

Vincent Timpano: Think about it in the context of Shell Stable and across our select competitor base in brands is what we would So again, it's early information. We're gonna spend a little bit more time reviewing it. And there is an element, we believe, of the timing of Easter and the shift in promotion from one month to another. Yeah, it's really the last four weeks of data that we got recently in terms of April that telling us that we have an uptick in promotion, so it's very recent. Got it, now this is permanent, we'll have to figure it out.

Luke Hannan: We're going to spend a little bit more time reviewing it and there is an element we believe the timing of Easter and the shift in promotion from one month to another.

Luke Hannan: Yes, it's really both to continue to monitor it sorry air. So it's really the last four weeks of data that we got recently in terms of April debt.

Luke Hannan: Telling us that we have an uptick in promotion.

Luke Hannan: So it's very recent.

Luke Hannan: Got it that was a permanent we'll have to figure it out.

Luke Hannan: Thanks for that.

Luke Hannan: Thanks for that now I also wanted to follow up you talked about.

Luke Hannan: Now, I also wanted to follow up. You talked about some of the new capabilities that you have in the bag-in-a-box vertical as well.

Speaker Change: Some of the new capabilities that you have in the bag in a box a vertical as well could you can you help us frame up I mean, just what what is the size of that addressable market for you and similarly, I mean, what's the competitive environment. There I mean, I can't imagine you guys look to get into that unless you felt like you could take up a meaningful share of the market, but if you could just expand on that please.

Luke Hannan: Can you help us frame up, I mean, just what is the size of that addressable market for you? And similarly, I mean, what's the competitive environment there? I mean, I can't imagine you guys would look to get into that unless you felt like you could take up a meaningful share of the market, but if you could just expand on that.

Vincent Timpano: Yeah, look, Luke, I'm not going to get into the specifics in terms of sort of the market opportunity that You know, we just see, however, an opportunity to move into a niche segment which includes two elements. One is when you take a look at the dispensing elements. So Bag and Box provides you to have dispensing. And if you were to compare dispensing to something in other categories, it's like fountain. So it's a product proposition that can be served behind the counter that we can deliver through a Bag and Box formula that we think we can do it quite effectively, leveraging our quality and an R&D and product capabilities and start to provide a broader set of beverage solutions more efficiently for our customers as they serve their consumer segment.

Speaker Change: Yes look at I look I'm not going to get into the specifics in terms of sort of the market opportunity that we see.

Speaker Change: We just see however, an opportunity to move into a niche segment, which includes two elements. One is when you take a look at the dispensing elements. So bag in box provides you to have dispensing and if you were to compare dispensing does something in other categories. It's like film. So it's a product proposition that can be served behind the counter the week.

Speaker Change: Can deliver through a bag in box formula that we think we can do it quite effectively leveraging our quality and in R&D and product capabilities and start to provide a broader set of beverage solutions more efficiently for our customers as they serve their consumer segment. So I'm, just telling me a little bit in terms of the opportunity when you.

Vincent Timpano: So I'm just telling you a little bit in terms of the opportunity. When you think about dispense, what does it have an opportunity to serve? QuickServe Restaurants is just one example. And you can understand that the quick serve restaurant segment is really quite a large segment. And so that's why we believe there's an opportunity for us to capture, in a very targeted way, a very large segment within the industry.

Speaker Change: Think about dispense what does that have an opportunity to serve.

Speaker Change: Quick serve restaurants is just one example.

Speaker Change: And you can understand that the quick serve restaurant segment is really quite a large segment.

Speaker Change: So that's why we believe there's an opportunity for us to capture in a very targeted way a fairly large segment within the industry recall a couple of things. One is when you take a look at retail versus foodservice foodservice represents roughly about half of consumer spend roughly I would say I'd want to go back into sort of validate that.

Vincent Timpano: Recall a couple of things. One is when you take a look at retail versus food service, food service represents roughly about half of consumer spends, roughly, I would say. I want to go back and just sort of validate that number. But when you take a look at our business, it's always been about a 10-90 split between food service to retail. Of course, when you think about a diversification strategy, we think there's an opportunity to increase that 10%. This is one avenue that allows us to do that.

Speaker Change: Number, but when you take a look at our business. It's always been about a 10 90 split between foodservice to retail of course, when you think about our diversification strategy. We think there's an opportunity to increase that 10%. This is one avenue that allows us to do that.

Vincent Timpano: The second thing is more niche, but it's to serve the industrial market. Those players, manufacturers and caterers that use juice-based products as an ingredient, we have the ability to now serve those in bulk formats through the capability that we built as an organization. So we just think there's an opportunity as we continue to evolve our development within it. Luke will start to give you some more context around just size of opportunity, but it's still early days. But what I would say as well is that the early response has been positive. And on the last part, Vince, right on the industrial piece, it helps us leverage our strategic ability to procure ingredient at a good cost.

Speaker Change: The second thing is more niche, but it is to serve the industrial market those players manufacturers and caterers that use juice based products as an ingredient we have the ability to now serve those in bulk formats through the capability that we built this organization. So we just.

Speaker Change: There is an opportunity as we continue to evolve our development within it look we'll start to give you some more context around just size of opportunity, but it's still early days, but what I would say as well is that the early response has been positive.

Speaker Change: And on the last part bits right on the industrial piece of it.

Speaker Change: US leverage our strategic ability to procure ingredients and good cost. So we're able to then serve people that may not have that scale with that pricing and volume that fit their needs.

Vincent Timpano: So we're able to then serve people that may not have that scale with the pricing and volume that fit their needs. Thanks.

Luke Hannan: The last question I have here, and I guess it's sort of a two-part question, but just on Summer Garden and perhaps specialty foods as a whole. So the integration of Summer Garden appears to be going well here. I noticed in your financial statements you mentioned that there was a U.S.

Speaker Change: That's helpful. Thanks, The last question I have here and I guess it it's sort of a two part question, but just on summer garden, and perhaps specialty foods as a whole so the integration of sun or some regarding appears to be to be going well here I noticed in your financial statements. You mentioned that there was a U S $5 million.

Vincent Timpano: $5 million contingent consideration payout related to labor, if you could just expand on that. But then secondly, also, can you just frame up for us, I mean, how big is specialty foods overall for you now, either in revenue or EBITDA terms, and is it worthwhile for you guys to explore perhaps segmenting that information out on a more regular basis going forward? So, let's start with the contingent consideration that was paid in April. It's a $5 million U.S. out of the 45 total potential considerations. This one is associated with certain assumptions we had on labor costs that were different than the seller, and the seller proved to be right on those assumptions, so we are happy to pay that contingent consideration, because as you may remember from what we said last year when we explained the deal, pretty much every dollar of contingent consideration that we pay, we should have a smile, because they should help us get even better outcome from this organization.

Speaker Change: Consideration payout related to labor if you could just expand on that but then secondly also can you just frame up for US I mean, how big is the specialty foods overall for you know either in revenue or EBITDA terms and is it worthwhile for you guys to explore perhaps segmenting that out that information out on a more regular basis going forward.

Speaker Change: So.

Speaker Change: Let's start with the content.

Speaker Change: Contingent consideration that was paid in April at a $5 million U S out of the 45 total potential consideration. This one is associated with certain assumption, we add on labor cost that were different than the seller and the seller proved to be right on on those assumptions. So we are happy to pay.

Speaker Change: Matt.

Speaker Change: Contingent contingent consideration because as you may remember from what.

Speaker Change: What we said last year when we explained the deal.

Speaker Change: Pretty much every dollar of contingent consideration that we paid we should have a smile because they should help us get even better outcome from this organization. So that's.

Vincent Timpano: So, that's what happened.

Vincent Timpano: Now the second part. We called that our specialty food business was about 17% of our revenue on a pro forma basis last year. along those lines in terms of importance of our organization. And of course, now you can see, because we have to disclose the effect of an acquisition. So you see the margin that we get out of a summer garden. So you can infer that it's, of course, that portfolio of product or that division is. more profitable than the other division. That being said, we believe that at the end of the day, we put liquid in a container, whether it's juice, high acidity or soft, high or low acidity.

Speaker Change: That's what Abbott now the second part.

Speaker Change: We called that.

Speaker Change: Our specialty food business was.

Speaker Change: About 17% of our revenue on a pro forma basis last year. So it's still.

Speaker Change: Along those lines in terms of importance of our organization and of course now you can see because we have to disclose.

Speaker Change: Disclose.

Speaker Change: The effect of an acquisition. So you see the margin that we get out of that at least some are guarded.

Speaker Change: So you can infer that it's of course that portfolio of product where that division is.

Speaker Change: More profitable than the entirety of the other division.

Speaker Change: That being said, we believe that at the end of the day, we put liquid in a container whether its juice I acidity ore source IR. Louis City. So we don't see ourselves splitting this in the near future and to segment. If it gets bigger one day, then maybe but I don't see that in the foreseeable.

Vincent Timpano: So we don't see ourselves splitting this in the near future into segment.

Vincent Timpano: If it gets bigger one day, then maybe, but I don't see that in the foreseeable future.

Speaker Change: Future.

Operator: Okay, I appreciate it, thank you very much. Thank you. Again, if you have a question, please press star and then 1.

Speaker Change: Okay I appreciate it. Thank you very much. Thank you. Thanks Luke.

Speaker Change: Again, if you have a question. Please press star and then one our next question comes from the Shell Shred Hart with National Bank Financial. Please go ahead.

Gabriel: Our next question comes from Vishal Shreedhar with National Bank Financial. Please go ahead. Thanks, it's Gabriel on for Vishal.

Speaker Change: Thanks, Gabriel on for Vishal I, just wanted to start as sue begin lapping those higher volumes as to whether you've gained from your buildout strategy like how should we think about the cadence of volume growth going forward.

Gabriel: I just want to start, as you begin lapping those higher volumes in the US that you gained from your Build Back strategy, how should we think about the cadence of volume growth going forward? And then, will there be, for example, a slowing of volume Q2 and then a reacceleration as your North Carolina facility hits a full run rate? How should we think about that cadence for the balance of the year? So the volume associated with BuildBack, it's mainly in the US. We saw a good pace in the first quarter on the back of new customers and new portion to a customer.

Speaker Change: And then would it be for example.

Speaker Change: Political volume Q2, and then a reacceleration Asheboro North Carolina facility hits full run rate, how should we think about the cadence for the balance of the year.

Speaker Change: So.

Speaker Change: The volume associated with build back it's mainly in the U S.

Speaker Change: <unk>.

Speaker Change: We saw good pace in the first quarter on the back of.

Speaker Change: New customers and new apportion do with customer and to some extent because we add some challenged during the quarter. This additional capacity coming from the.

Vincent Timpano: And to some extent, because we had some challenge during the quarter, this additional capacity coming from the single-serve line. Now that, knock on wood, everything seems to be working according to plan with that line. We should now get the full benefit of this additional volume that was not there last year. So we should then get a volume effect from that line in the second quarter and in the third quarter as well, because it really started. ramped up in the third quarter last year. So you'll have a volume effect there. Now in terms of The rest of the build-back plan, now we will probably start seeing lapping versus last year by mid-year because we really started to see this build-back on existing capability capacity mid-year last year.

Speaker Change: Single serve line now.

Speaker Change: That knock on wood everything seems to be.

Speaker Change: Working according to plan with that line, we should now get the full benefit of this additional volume that was not there last year. So we should then get a volume effect.

Speaker Change: That line.

Speaker Change: In the second quarter and.

Speaker Change: In the third quarter as well because it really started.

Speaker Change: Our ramp up in the third quarter last year, so you'll have a volume effect there now in terms of.

Speaker Change: The rest of the build back plan now, we will probably start seeing lapping versus last year.

Speaker Change: By mid year, because we really started to see this.

Speaker Change: Build back on existing capability capacity midyear last year.

Vincent Timpano: I'm not sure if it helps you, but I'm not going to give guidance, but... Let's go back to the guidance I gave in terms of how we are going to achieve the 10% growth. um in 2025 right 200 about there about 260 million dollar on the basis of a 10% growth versus 2024. I said about half of that will be from Summer Garden, the run rate effect, and I said the other half will be from price and volume. Now, and I said roughly equally. Now, if you look at what we've done in the first quarter, it's exactly what happened.

Speaker Change: Okay Fair if it helps you, but I'm not going to give guidance but.

Speaker Change: Go back to my Okay, Let's go back to the guidance I gave in terms of how we are going to achieve the 10% growth.

Speaker Change: In 2025, right 200, thereabout $260 million on the basis of a 10% growth versus 2024, I said about half of that will be from.

Speaker Change: Some are garden, the run rate effect and I said, the other half will be from price and volume.

Speaker Change: Now onto them and I said roughly equally now if you look at what we've done in the first quarter exactly what happened 50.

Vincent Timpano: 1% from Summer Garden and then about 25-25 from Price and Volume. A and then if you apply that again, for the back of the year, you'd see that this 50 25, or 50 and 50 still applies. And on the 50 price and volume, I would still consider a a balance between the two because there's still some price effect that will, in theory, should have a run rate effect. And then, as I said, there's going to be volume uplift as well.

Speaker Change: <unk>, 1% from Summer Garden, and then about 20 525 from a price and volume.

Speaker Change: And then if you apply that again, where the back of the year you would see that this 50 25 warrants 50, 50 still applies and under 50 price and volume I would still consider eight eight.

Speaker Change: A balance between the two because there's still some price effect that will in theory should have a run rate effect and then as I said, there is going to be volume.

Speaker Change: Uplift as well.

Gabriel: Okay, God, appreciate that that did help.

Speaker Change: Okay got it.

Speaker Change: That did help.

Gabriel: And then maybe turning to the the org change that you had highlighted in your presentation. I'm just wondering, like, is this change meant to signal more cross-border focus or opportunities? Like, how should we think about this?

Speaker Change: And then maybe turning to the Org change that you had highlighted in your presentation. I'm. Just wondering like is this change meant to signal more cross border focus our opportunities like how should we think about this.

Speaker Change: This dark cloud.

Vincent Timpano: It doesn't do that, Gabriel. What I would say, though, is it does allow us to actually look at the business. beverages across North America and leverage the capabilities across North America where it makes sense. So when you think about synergy opportunity in terms of how we think about building a portfolio strategy, how we think about innovation, how we think about leveraging R&D, there's ways for us to do things more efficiently as an organization and frankly have more impact as we think a little bit about how we organize. So that is what I would say the primary focus was as an organization.

Speaker Change: It doesn't do that gave you a what I would say, though is it does allow us to actually look at the business beverages across North America and leverage the capabilities across North America, where it makes sense.

Speaker Change: So when you think about synergy opportunity in terms of how we think about building a portfolio of strategy. How we think about innovation and how we think about leveraging R&D, there's ways for us to do things more efficiently as an organization and frankly have more impact as we think a little bit about how we organize so that is what I would say the primary focus.

Speaker Change: Was.

Speaker Change: As an organization.

Vincent Timpano: And the other thing that I would say is we will not remove the focus in the local markets. There's a reason why we call out the creation of the four business units specifically. So the two in the United States, brand and private label, in Canada, which is our flagship market, and the creation of a North America food service business unit. Their focus is to be very commercially oriented and to leverage manufacturing and supply chain that we've executed across North America as a center of excellence so that they can have reliable service at a good cost.

Speaker Change: And.

Speaker Change: The other thing that I would say is we will not remove the focus in the local markets is a reason why we call out the accretion of the four business units specifically so the two in the United States brand and private label in Canada, which is our flagship market and the creation of a North America foodservice.

Speaker Change: This unit their focus is to be very commercially oriented and to leverage manufacturing and supply chain that we've executed across North America as a center of excellence. So that they can have reliable service at a good cost that's what's really important here, but for us to be able to sort of put it all together as a beverage can finish.

Vincent Timpano: That's what's really important here. But for us to be able to sort of put it all together as a beverage division across North America, we do believe gives us the advantages of a more joined up synergistic organization. Okay, got it.

Speaker Change: And across North America, we do believe gives us the advantages of a more joined up synergistic organization.

Speaker Change: Okay got it.

Gabriel: And maybe just one more question on the Canadian food services, I was just wondering... and you may have sort of touched on this but like sort of like how do we think about the benefits of that going going forward and then your plans to grow that food service business within Canada? Sorry, can you repeat the question?

Speaker Change: And then maybe just one more question on.

Speaker Change: On the Canadian Foodservice aside I was just wondering.

Speaker Change: And you may have sort of touched on this but like sort of like how should we think about the benefits of that going.

Speaker Change: Going forward and then your plans to grow that.

Speaker Change: The foodservice business within Canada.

Speaker Change: Sorry can you repeat the question.

Vincent Timpano: Yeah, I was referring to in your disclosures, you're talking discussing the another key objective of Sorry, so for me, let me anchor it back into sort of the broader strategy, which is for us to grow through channel expansion. And there's two elements of that. We'll talk about food service, but let's also not lose sight of our focus on the single serve market as well. Like we've invested material amounts of dollars in North Carolina to frankly, further mirror the capability that we built in Canada on single serve with the septic technology. And that also allows us an opportunity to serve, you know, on the go occasions more effectively, both in Canada and the United States.

Speaker Change: Yeah, I was just referring to Hum in your disclosures you talking discussing the another key objective.

Speaker Change: Okay.

Speaker Change: Sorry, So for me, let me, let me anchored back into sort of the broader strategy, which is for us to grow through channel expansion and there is two elements of that we'll talk about foodservice, but let's also not lose sight of our focus on the single serve market as well.

Speaker Change: Like we've invested material amounts of dollars in North Carolina to frankly.

Speaker Change: <unk>.

Speaker Change: Further mirrors the capability that we built in Canada on single serve with Aseptic technology.

Speaker Change: And that also allows us an opportunity to serve.

Speaker Change: On the go occasions more effectively both in Canada, the United States Food services, another part of that.

Vincent Timpano: Food service is another part of that. And we've built a very strong proposition in Canada. We see ourselves as the leading provider of juice and juice drink solutions within the food service channel. We see this opportunity, as I mentioned to Luke earlier, in terms of bag and box capability and as far as just giving us another another avenue for us to grow in the food service channel because we're already fairly extensive in the market that we serve in Canada. As I said, this now gives us two other platforms for growth which is dispensing behind the counter for consumers plus bulk to serve industrials.

Speaker Change: And we built a very strong proposition in Canada, we see ourselves as the leading provider of juice and juice drinks solutions within the foodservice channel. We see this opportunity as I mentioned to look earlier in terms of bag in box capability.

Speaker Change: As far as just giving us another.

Speaker Change: Another Avenue for us to grow in the foodservice channel because we're already fairly extensive in the market that we serve in Canada. As I said. This now gives us two other platforms for growth, which is dispensing behind the counter where consumers plus ball to serve industrial.

Gabriel: and we'll continue to look at that opportunity within the U.S. in the future as well. God, I appreciate it.

Speaker Change: And we will continue to look at that opportunity within the U S in the future as well.

Speaker Change: Got it I appreciate it.

Gabriel: Thank you.

Operator: This concludes our question-and-answer session.

Speaker Change: This concludes our question and answer session I would like to turn the conference back over to Vince <unk> for any closing remarks.

Vincent Timpano: I would like to turn the conference back over to Vince Timpano for any closing remarks. Well, thank you for joining us this morning.

Speaker Change: Thank you for joining us. This morning, we invite you to attend our virtual annual meeting of shareholders to be held next Friday may 16th at two P. M. The webcast link is available in our management proxy circular on SEDAR plus we also look forward to speaking with you again at our next quarterly call have a great day and a great weekend everybody. Thank you.

Vincent Timpano: We invite you to attend our virtual annual meeting of shareholders to be held next Friday, May 16th at 2 p.m. The webcast link is available in our management proxy circular on CDAR Plus. We also look forward to speaking with you again at our next quarterly call. Have a great day and a great weekend, everybody. Thank you.

Speaker Change: Yes.

Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

Speaker Change: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.