Thank you, Simon. Good morning, everyone, and thank you for joining us today.

Our comments will focus on the financial results of our third quarter, which ended July 7, 2018. Joining me today is Mr.

Eric La Flèche, President and Chief Executive Officer; and François Thibault, Executive VP and Chief Financial Officer. During the call, we will present our third quarter results and comment on its highlights.

We will then be happy to take your questions. Before we begin, I would like to remind you that we will use in today discussions, different statements that could be construed as forward-looking information.

In general, any statement, which does not constitute historical fact, may be deemed as a forward-looking statement. Expressions such as expect, intend or confident that, will and other similar expressions are generally indicative of forward-looking statements.

The forward-looking statements are based upon certain assumptions regarding the Canadian food and pharmaceutical industry, the general economy and our annual budget as well as our 2017-2018 action plan. These forward-looking statements do not provide any guarantees as to the future performance of the Company and are subject to potential risks, known and unknown as well as the uncertainties that could cause the outcome to differ materially.

A description of the risks, which could have an impact on these statements, can be found under the Risk Management section of our 2017 Annual Report. We believe these statements to be reasonable and pertinent at this time and represent our expectations.

The Company does not intend to update any forward-looking information, except required by applicable law. I would now like to turn the conference to François

Thanks, Roberto, and good morning, everyone. The acquisition of the Jean Coutu Group was completed on May 11, 2018, and therefore, the Jean Coutu results have been consolidated with Metro's results for a little over eight weeks.

For this quarter and the following three quarters, we will be providing Jean Coutu sales and EBITDA figures in order to explain variances in our results. We made several adjustments to our earnings for the third quarter all related to the Jean Coutu acquisition.

The biggest one being transaction expenses. Please refer to the tables provided in the press release and the interim report for all the details.

So total sales for the third quarter totaled $4.6 billion versus $4.1 billion last year, an increase of 13.8%. Excluding $467 million of sales from Jean Coutu, sales would have been up 2.4%.

Food same-store sales were up 2% and our food basket experienced inflation of approximately 0.5%. Pharmacy same-store sales were up 1.8%, that's 0.4% for prescription drugs and 3.8% for front store sales.

The number of prescription grew by 2.4% year-over-year. These pharmacy same-store sale figures represent the weighted average of Jean Coutu and Brunet results.

Gross margins stood at 19.4% of sales in the third quarter compared to the 19.5% last year, the slight decrease is attributable mainly to the inclusion of Jean Coutu. Operating expenses as a percentage of sales came in at 12.5% versus 12.1% last year.

But when adjusted for the $25.1 million in expenses related to the Jean Coutu transaction, the ratio stands at 11.9% of sales. The lower SG&A ratio is due in part to the inclusion of Jean Coutu, which is partially offset by increases in operating expenses namely minimum wage and transportation costs.

Adjusted EBITDA stood at $345.4 million, that's up $43.9 million or 14.6% and represented 7.4% of sales. Excluding Jean Coutu's contribution of $48.5 million, adjusted EBITDA would have been $296.9 million, down $4.6 million year-over-year or negative $1.5 million.

When we take into account the negative impact of declining generic drug prices on our McMahon division and a small real estate gain last year, the performance of our food business was essentially flat, which is quite satisfactory considering the absorption of about $15 million of higher expenses due to the increase in minimum wage, in addition to rising transportation costs. The income tax expense for the quarter was $48.6 million, representing an effective tax rate of 22.5% compared with last year's effective tax rate of 24.9%.

The reduced tax rate is a result of $9.2 million tax gain, realized in connection with the disposal of the majority of our shares of Couche-Tard. We removed this gain in the calculation of adjusted net earnings.

And net earnings for the quarter were $167.5 million versus $183 million last year and earnings per share were $0.69 for the quarter versus $0.78 last year. Adjusted net earnings were $183.4 million versus $165.1 million last year and adjusted net earnings per share were $0.75 versus $0.70 last year that's up 11.1% and 7.1% respectively.

Our deleveraging plan is progressing very well in the roughly three months since the acquisition of Jean Coutu, we have reimbursed $750 million of debt by $550 million in third quarter and $200 million after. Our adjusted debt to EBITDA ratio now stand at $265 million and we are ahead of our publicly disclose schedule of two years to achieve our target leverage ratio of 2.5%.

We therefore expect to resume our share buyback program sometime in fiscal 2019. That's it for me.

I will now turn it over to Eric.

Thank you, François, and good morning, everyone. On May 11, we closed the acquisition of the Jean Coutu Group, which marks an important milestone for Metro creating a new retail leader in food, pharmacy, health and wellness.

We are excited about the future growth opportunities resulting from a stronger more diversified retail platform that will enable us to better serve the everyday needs of our customers. Together Metro and Jean Coutu are present in almost every community in Quebec bringing us ever closer to our customers.

Turning to our third quarter results, we had a good quarter overall as we achieved strong same-store sales growth, despite low inflation and a very competitive environment. We experienced an increase in traffic, average basket and tonnage.

Our internal food basket inflation was 0.5%, a bit lower than our previous quarter, but slightly higher than the CPI average. Our teams did a great job to mitigate the impact of increasing operating expenses, mainly minimum wage and higher transportation costs.

After three quarters CapEx totaled $200 million as we opened five new stores, expanded renovated or remodeled 20 stores and closed four stores for a net increase of 0.3% or 51,000 square feet. Investments in our retail network are skewed more towards renovations and customer response is very positive.

Moving on to pharmacy, our strategy following the acquisition is to maintain our two banners, Jean Coutu and Brunet both supported by a strong pharmacy division with state-of-the-art facilities, systems, and a first-rate management team. We are confident in our ability to achieve our synergy target of $75 million in three years focusing on three main categories, procurement, SG&A, and distribution.

We will begin to report on our progress starting next quarter. On the e-commerce front, we recently launched same day delivery as our e-commerce offer continues to evolve and adapt to our customers demand.

We are still planning to offer an e-commerce service in Ontario in fiscal 2019 starting in the GTA. To conclude, we had a good quarter overall with a bit more noise than usual.

Going forward, we expect the competitive environment to remain highly promotional with continued pressure on our labor and transportation costs. Recently announced tariffs or an additional headwind facing our industry and we will do everything to mitigate their impact in our ongoing negotiations with our suppliers.

That said, we expect to see some retail price inflation as a result of all those costs pressures. Finally, in the coming quarters, we will continue to execute our business plan and focus on the Jean Coutu Group integration and we are confident to grow our business and create value for our shareholders.

That's it for us and we'll be happy to take your questions.

Thanks and good morning, everyone. I was wondering if you could start by just providing us as sort of an update, you've own PJC now for June, July for three months and four days.

I'm just wondering if you could really just provide an update on your thinking, how the early stages of the integration are going? Certainly I know that it was very well planned.

So how quickly you got out of the gate in terms of execution and really any color you can provide?

So generally things are going very well. We're very happy with the combination and the potential it offers us as I said in my opening remarks.

We had sometime as you know to plan post-acquisition, so we had a lot of workstreams plan that kicked in after May 11, so there is a lot of work going on in all aspects of the business, people, systems, cost of goods, marketing, et cetera, et cetera. So there's a lot going on and it's working well.

It's going to take some time. It's still early days.

But as I said, the key point I take through the investor community is that we are confident in our $75 million target on synergies and we're working on a bunch of the things to make it happen. So just give you an example, private label will start to be introduced across banners, sometime in the late summer, early fall.

So we'll be selling SNL, the good have a brand that Coutu owns in our Brunet stores, in our - some of our Metro stores, things with some of our food products on private label will be start to be introduced at Jean Coutu. So I would say things are going very well, people are getting along, there's a good fit, and so we're very confident.

That's great. Thanks.

And just one other question if I may. Focusing on the food, really nice uptick in same-store sales.

I think it's the best period you've had since early calendar 2017. Wondering what you're seeing out there, everyone is talking about the competitive intensity, how you managed to step it up that way and whether you think it sustainable at this point?

Well, we hope it's sustainable. We had a strong quarter in a very competitive environment.

I think our merchandisers did a very good job in all of our businesses and banners to get to this number. So we don't want to give you banners, but conventional as I said on the previous call is seeing a bit stronger growth than discount in the strong economy.

We're well positioned with our Metro banner in both provinces. I think the CapEx that we've invested steadily over the last few years is resonating well with customers and we're seeing nice lift at some of those stores.

So it's a mix of several factors that's driving the topline. It is very competitive, it is very promotional.

So I think our guys did a great job to maintain gross margin given the pressure on cost of goods, pressure on transportation that which goes into cost of goods for some of the products. So all-in-all, I think a very good performance.

That's great. Thank you.

Thank you and good morning. Eric, could you help us better understand how we should think about the potential tariff impact?

And essentially our tariff driven price increases just is hard to take as price increases in the rest of the basket or that will leads you to pass-through? Any color you could share on that would be great.

So we're starting to get demands from some suppliers who's products will be - are affected by the new tariffs. So - as with any demands to increase our costs, we negotiate and we assess what's the origin, so if it's illegitimate and if its industry wide, sometimes we won't have any choice and we will have to accept.

A few cost increases have been accepted already, but very minor. But negotiations are ongoing.

So we will make sure our cost of goods are competitive and our price at retail are competitive. So I would say that it's something that's out of the control of our suppliers and that they're coming to us and we expect that there will be some cost increases that we will have to take and that the market will have to take.

And as I said earlier, we expect that should be reflected at retail. But again, we'll just have to wait to see.

We will always remain competitive at retail and we will take as we say the margin that the market will give us. So we are following it closely and we will be competitive.

Great. Thank you.

And if I could just quickly switch gears to the e-commerce and specifically e-commerce in Ontario, is there a material step up and spend needed to support that launch, or is this more about getting the right pieces in place ahead of that launch? How should we think about e-commerce capability in Ontario in 2019 and getting there?

Well for sure there is going to be some investment to start e-commerce in Ontario. There is CapEx.

There is operating expenses. There's going to be a marketing expense.

Well for sure, it's going to be an investment next year in fiscal 2019 for us. We want to go through the budgets with our Ontario division very soon and I will get the numbers.

But yes, for sure there's some investment. I won't give you a precise number in the general scheme of things of Metro, Inc.

It's not that material, but it's not insignificant. I'd like to leave it at that.

Great. Thanks very much.

I leave it there.

Just to say the platform we have so we're leveraging the investment we've made already in Quebec same platform, same system, same technology. So we have tested and learned over the past couple of years.

So we're starting from a better place in Ontario, but there will be some investment.

Great. Thanks for the color.

I leave it there.

Yes. Good morning.

So I guess, I just wanted to come back to this whole sort of balance of prices and cost in the grocery business specifically today, and you've highlighted Eric the competitive environment, but also the significant inflation that you've seen on labor costs and transportation and tariff. So I guess with the expectation of inflation accelerating around some basis in the next couple of quarters.

Is that driven predominantly by the tariff impact in your view? Or is it kind of a settling out of the market after the pressures of minimum wage earlier in the year?

Well, we've said for the past few quarters that headwinds facing our industry at some point would likely be reflected at retail all the while being competitive. So minimum wage started January 1.

It was I think likely to happen at some point. So we have yet to see the cost increases, inflation was very low in the third quarter, but we expect that the cumulative effect of all these cost pressures start to be reflected at retail.

We're just starting to see some minor price increases, nothing major, but we'll just monitor it. And as I said earlier, we will be sure to be competitive in all of our formats.

And just with regards to that, appreciating that the business models are somewhat different across formats. Do you see any difference in how this would affect conventional versus discount?

Not really. No, I can't give you more details on that.

Okay. Thanks.

And then I guess just with regards to the sort of relationship with suppliers at this point. Obviously, as you noted, some are specifically hit by the tariffs, but they're all under pressure as a result of inflation in their business.

And what's the sort of puts and takes there and can you just sort of summarize the relationship there versus maybe a year-ago? And I guess what I'm sort of wondering is does it affect your expectations around the purchasing synergies component of your $75 million target at all?

On tariffs, specifically it's one more factor that's part of the cost increase demands that happened in the normal course of the business. So negotiations with our suppliers happen every day as the business always have always will, so it's part of life, the fact that tariffs have been added to it makes the discussion more pressing for some of them.

Again, as I said earlier to the previous question, we will deal with it supplier by supplier, category by category to make sure that we have competitive in fair costs and then our retail remain competitive. How is that - does that affect the synergy work that we're doing with suppliers?

I think those are two different buckets. We are not talking about tariffs in the same discussion as we're talking about cost comparisons between Coutu and Metro with our different suppliers.

So those are two discussions.

Okay. Appreciate the comments.

Thank you.

Yes. Just want to go back to e-commerce, can you give us some ideas to how that businesses performing at this juncture and how your business might skewed between click and collect versus home delivery.

And are you getting to a point where the earnings compression - the margin compression is becoming less owners?

I'm not sure I got your margin compression point there. I'll just say that the e-commerce business in Quebec is growing nicely and it started from a zero base and I think we're seeing nice growth.

There is customer demand. As I said before it is skewed largely to home delivery versus click and collect, we offer both.

We have seven stores doing the e-commerce service, so we pick-in store and offer home delivery to about 60% of the population in Quebec. So there is a nice uptick in sales, it remains small in the general scheme of things, but it's growing nicely.

It remains a strong healthy basket that hasn't changed. So we're pleased with the performance.

We're improving our store operations model when we pick-in-store. We're improving our delivery cost situation.

So we had three stores doing it last year. We have seven now.

We're happy with the progress and looking forward to coming into Ontario with this offer. Digital Strategy, pick-in-store, hub and spoke and home delivery will be our main focus.

So is your e-commerce profitability less than your four-wall profitability would be on a similar transaction now?

Well, if you account for all the costs involved, yes, it's less profitable for sure, the backup, the technology investment, the office setup to support e-commerce. At store level per se on a variable basis, it's a comparable business.

It's the investment behind it that needs to be absorbed and with the beginning or the early days of this business, we're investing.

And you mentioned that at this point it's still a small business. So I assume that with respect to your 2% comp store sales number that it wasn't really a material contributor to that lift?

No. But it did contribute to the Metro Quebec performance marginally, but it did contribute to that banners positive same-store.

But for the total business, it's not that material, right.

On the Coutu business, the script growth number a little bit weaker than sort of the 12-month trend. Is there anything specific going on in pharmacy within Quebec that would suggest script growth is going to be more in the 3% range over the next while?

I think their current rate, the leveling offer, the moderation and the growth rate is similar to what's happening in the market. The Quebec market had high script count growth, the last couple of years due to these complaint packages, the pill boxes that increased the count of prescriptions to higher numbers last couple of years.

So that has taken effect, so we're cycling that so we're expecting more normal 2% to 3% volume growth going forward.

And on the Pro-Doc side of the equation like - is it your intention to continue to operate Pro-Doc as a standalone business? Or have you got any changes that you would expect to implement over the next 12 months?

So the answer is yes. It's business as usual for Pro-Doc and Pro-Doc will begin to offer the generic drugs to the Brunet franchisees and hopefully, that will work.

Franchisees will make their own decisions when they leverage generic drugs, but Pro-Doc is a very nice business, very higher service level, full assortment. So serving the Coutu franchisees really well and we hope that they will service Brunet franchises are going forward.

But we'll have to wait and see.

Great, thanks Eric.

Yes.

Thanks. As a result of the e-commerce effort that you have up and running now in Quebec.

You would be collecting quite a bit of data on the customers who are involved in e-commerce with you in Quebec? And I'm just wondering what you're doing with all that data, are you able to integrate it with a Metro & Moi data.

So that, which custom - able to match up the customer? And able to utilize that in terms of targeted marketing, promotions, category strategies et cetera.

Absolutely, the e-commerce customers - not perhaps 100%, but potential majority of them are Metro & Moi cardholders. So we had data of their purchases prior.

We have data of their purchases today. We see the evolution.

We're getting a bigger basket from those customers. So that's a positive and of course with all those data similar to what we do with Metro & Moi - or all Metro & Moi members, we do targeted offers and merchandising.

So yes, that's clearly part of the strategy with e-com is to be more effected in the merchandising and to serve our customers better that means getting the products that they want. So we're seeing more of their purchases - as I said getting a bigger basket from a lot this Metro & Moi customers which is good.

And then some retailers sell their data to their vendors or suppliers. Just wondering that does Metro participate in these programs and does this give you a greater opportunity to market your data?

Well, we have a relationship as you know with dunnhumby and dunnhumby interacts with our supplier community with all the data that we have from Metro & Moi and Air Miles programs. So yes, we do offer services for a fee to certain suppliers, so that includes e-commerce data.

Yes that's part of it.

Okay. Thank you.

Hi. Thanks for taking my questions.

I just wanted some simple segmentation questions here. So Brunet was taken out and that's now reported in the RX business, is that right?

Well Brunet is part of - it's a franchise business, so the stores are franchised. The wholesaling business McMahon is now part of Jean Coutu, which is our Pharma division.

So the pharmacy numbers that we reported today in terms of sales are just Jean Coutu, we're trying to explain the difference between Metro this year versus Metro last year. So the sales number and the EBITDA number we provided, that François provided earlier on are just Coutu.

The same-store, pharmacy sales that we provided those are weighted average, Brunet and Coutu, on the retail part, not the wholesale, the franchising part.

Okay. So the Metro comp, previously, did that - last year, did that include Brunet?

And this year, is it like-to-like?

The food comp - the comps that Metro is always provided only been food. We have never pharmacy comps.

We just started with the Coutu acquisition because it's a larger part of our business and Coutu obviously provided that information before. So we will maintain that disclosure.

At retail, we will provide same-store sales, front-end and commercial - front-end and RX drugs.

Okay. Thanks for that.

Just on your comments about conventional gaining a little bit of strength here versus discount, I guess you might have hinted at this quarter as well and it marks a reversal of trend that we seemingly over the few years. Are you seeing this in Quebec and Ontario, and any…?

We don't provide provincial or market data, banner data. My comment will be limited to saying that the conventional business for us is growing little stronger than our discount business.

I won't talk about the general market and I'll let you do your homework.

Okay. Thanks for that.

And on the inflation. I'm not sure if you are able to provide color on that, but you implied that you are seeing a little bit of inflation in the market.

Did you see through the quarter inflation improve as well? Any color there because one of your peers had made similar comments to you about inflation getting better as we go through the year?

Well, maybe coming out of the quarter and starting Q4, I said we are seeing slight increases on certain items not anything material. So we'll just have to wait and see that - so yes, we expect, but we don't know that inflation could accelerate at retail a little bit.

I think it will remain very competitive so - and we will be there.

Okay. And I might have missed this Eric, but could you help us which synergy is recorded in the quarter just for modeling purposes?

So we have not reported any synergies in Q3. We said that we would start to report on synergies in Q4.

Wonderful. Thanks guys.

Yes.

Yes. Good morning, everyone.

Just a quick follow-up on e-commerce, because most of my questions have been answered. You referenced the fact that you are going to be able to leverage the Quebec experience when you launch in Ontario and you noted that you've - have been with Quebec experience you've tested and learned through the process.

Is there anything you could share with us Eric in terms of what the key learnings might have been over the course of your e-commerce in Quebec?

Well for a competitive reasons I think I will be quiet on that, but I'm talking about store processes, scheduling, it's really my new details of the operations of an e-commerce business. It's complex.

And we did learn of course in our first year in Quebec, so we start from a better place in Ontario. The model will be essentially the same, but processes and systems are just going to be a little better and we expect them to continue to improve.

Delivery costs are challenging, in home delivery, again we've made progress and we're looking for more progress. So you have to wait and see.

Fair enough. So would I be correct if I paraphrased what you said there processes and et cetera that basically what you've done is you've gotten better?

We have.

Okay.

That's right. And what I thought I said, yes, we have improved.

We improved store operations, we're improving the cost of delivering that e-commerce offer. But again, we expect more.

And as we scale up, we expect that it will do better.

Thank you.

Yes. I had a couple questions just on the number presentation.

The in-store pharmacies in Ontario get included in the food comp or in the drugstore comp?

They are not included in our food comps and they're not included in the drug retail comps that we just published. So they are not reported.

Is that the honest answer. It's part of our Ontario sale, but they're not in our food comp number that we disclosed.

And then just in terms of the accounting, the customer relationships I think were valued at one - just a bit over 1 billion. Is that going to be adjusted for each quarter in the adjusted EPS?

The amortization of that intangible, yes could be adjusted every quarter.

And is that a straight line I presume?

Yes. It's a straight line over 27 years.

Great. Thank you.

Keith just to be precise, this purchase price allocation is a preliminary figure. We have a year that we can make adjustments, but so far this is where we landed at.

Great. And then just a question on the Metro & Moi, Jean Coutu uses Air Miles and use Metro & Moi Quebec.

Do you have any view as to what you'll do going forward?

That's obviously something we're going to be looking at some point, it's not priority number one. We have a lot on our plate systems wise and business wise before we get to that.

Right now Air Miles is the partner with Coutu and I expect that to remain for some time and we will evaluate it going forward. We have no announcement to make on that.

And then just on the online of Brunet and Jean Coutu. Jean Coutu has to refill your prescription and things online.

Can you just speak to where those two businesses are add-on line and where you might be going with online in the pharmacy sector?

So yes, both Brunet and Coutu offer prescription renewals on their - I would say the lab systems that the both vendor have, so that continues. Jean Contu is a small online business that goes direct to consumer, very small business.

Again, our focus is more on the food e-com for now and we will keep you posted on the developments in pharmacy, but we don't have anything really to report there.

Thank you.

Yes. I just wanted to back on to the e-commerce for a bit.

So you're targeting or you have access to 60% of Quebec population for the seven stores with your home delivery. As far as click and collect is concerned, what percentage of the population would you be able to go with?

Well, theoretically the same, but click and collect draws from a smaller radius in home delivery. So what we've seen is more home delivery then click and collect.

There are some customers very close to the stores who drive by these stores that will pick up. But more of our business is on home delivery because we can deliver to a wider area in an hour or an hour and a half an hour or something like that, whereas click and collect pick up tends to draw from closer to normal.

And as - are you only allowing for pickup at those seven stores, or do you delivering to other stores?

For now yes. Stay tuned, we're always working and it could evolve to more pickup click-and-collect locations, work in progress.

So stay tuned for now. Yes, it's only those seven.

Okay. And as you added on the same day delivery option, can you talk a little bit about how the customers reacting to that?

Are you seeing a lot of interest in same day delivery versus one or two or three day deliveries?

I don't have a precise number for competitive reasons to give you, but it can nice compliment. It's something that some customers want.

Same day delivery tends to be a smaller basket, but it's - for us, it fills some of these windows we have for picking and for delivering. So it makes sense economically for us and it makes customers happy.

So it's a win-win. So again just started early days, but it's something that promising.

We'll just have to measure it and monitor as we...

The same day delivery more expensive given that, I'd assume it must alter your delivery efficiencies to a degree since you have to - you don't have as much option to put together a bunch of multiple deliveries along the same room.

We are currently offering the same economics, for the same day delivery. Not 100% sure that Michael I'm sorry.

If the tariff is or the fee that we charge for picking and delivering, I think it's the same that I could get back to you on that.

Thank you very much.

Yes.

Hi, good mornings. Eric, did I hear you correctly that food gross margin was largely stable in the quarter?

Yes, on an adjusted basis, Metro food was basically flat on the gross margin and that's where pressure on costs. Some of the minimum wage impact is felt in cost of goods.

Transportation costs from trailers from the U.S. obviously felt in the cost of goods.

So with all of that in a very competitive retail environment, highly promotional, we maintain gross margin. So we consider that to be pretty good.

That's helpful. I guess that would imply, was your EBITDA margin down 30 basis point that would imply and most of that it come from your SG&A expenses and is the view that if when you do get some inflation back into the system, I guess that SG&A deleverage will start to improve or hopefully improve in the back half of the year.

Is that - how you look at the business?

That's it Chris. That's right.

Okay. And then just on Pro-Doc, when Jean Coutu was still public, we saw the EBITDA was under pressure from junk reforms.

Now that - a lot of the junk reform pack is already in the business. Can you shared with us, are you seeing a bit of a stabilization in the Pro-Doc business or is it actually improving now that there's lapping so much junk reforms or maybe just give us a sense of how that business is going overall from a profitability standpoint?

So it's not where they used to be and we won't segregate the Pro-Doc as Coutu did before, but it is stabilizing and it's performing to our expectations.

Okay. And Eric, can you just remind us again what the Company's intention with respect to the cannabis or marijuana market?

Is there something that you would like to pursue, if the opportunity presented itself?

Well, if the government let us know what rules of the game will be for medicinal cannabis, which we don't know, as far as we know pharmacies are have not been permitted to do sell medicine all kind of this for now. If that is authorized, we expect that we will participate in that.

On the recreational side as you know in Quebec, it's a subsidiary of the SAQ, the liquor commission in Quebec. So for Ontario, now the government has announced changes to go private sector for recreational.

So that's not been on our radar and I guess will have to look at that. But it's not our priority for now.

Okay. And then I guess my last question on the share buyback.

Is it the right way to think about? It is that once the Company reaches the 2.5 times leverage target then you'll start to do the buyback and we can assume that most of your free cash flow from then on will be used mainly for capital return purposes that you'll keep your leverage at 2.5 times eventually?

That's right Chris. It's not a perfect science, but this is the long run target that we've announced.

And so just like we did before the acquisition we will maintain that leverage around that level and we will return cash to shareholders through combination of dividends and buybacks. But given how much CapEx we have to put in the business that's how we start with our capital allocation and then whatever excess cash is let typically has been return through buybacks.

Okay, great. Thank you.

Yes, I had a question on the e-commerce business. Are you looking at or maybe you are already offering subscription services sort of automatic refill of household paper or cleaning products that sort of thing?

We do not offer that service, it's something that our e-commerce team is looking at and we will decide, I guess soon what we're going to be doing, but we don't have that right now.

And in terms of the Ontario market, I wonder if you could comment on what the impact of that selling beer in your stores has been to date?

Well, it has contributed to our same-store sales growth and to our sales. I don't have the exact number in front of me.

But yeah, it's been positive, in certain locations we are very happy with those results. So it brings traffic, it increases the basket, so we are happy to sell beer, we'd like to sell more.

So hopefully the government will let us sell more beer in more stores and we are leading more stores because that we're in a great position to do that.

And then just one last question on the capital budget. Can you speak specifically to the plans for Jean Coutu network in terms of store openings or renovations?

There won't be many store openings in the next year. As we look at our combined network of Brunet and Coutu and looking to optimize that.

So at least for the first year, we don't expect new store openings. There are renovation programs.

Franchisees renovate their stores on an ongoing basis. That will be a normal course.

And the CapEx for the company or for the Coutu business, I guess will be similar to previous years. They've invested in a new warehouse, so that's done in behind them, so the CapEx - it's a low CapEx model and we expect that to continue.

Thank you.

Thank you, everyone, for joining us today. Our next conference call will be held on November 21 for the fourth quarter results.

Thank you.