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00:37 Thank you, Celine. Good afternoon, everyone and thank you for joining us today.

Our comments will focus on the financial results of our first quarter, which ended on December 18th. With me today is Mr.

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

We will then be happy to take your questions. 01:03 Before we begin, I would like to remind you that we will use in today's discussion different statements that could be construed as forward-looking information.

In general, any statement which does not constitute a historical fact may be deemed as a forward-looking statement. Expressions such as expect, intend are 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 industries, the general economy and our annual budget as well as our 2021-2022 action plan. 01:41 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 uncertainties that could cause the outcome to differ materially.

A description of these risks, which could have an impact on these statements, could be found under the risk management section of our 2021 annual report. As with the preceding risk, the COVID-19 pandemic constitutes a risk that could have an impact on the business, operations, projects, synergies and performance of the company.

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 as required by applicable law.

02:24 I will now turn the call over to Francois.

02:27 Thank you, Sharon and good afternoon, everyone. For the quarter, total sales were $4.317 billion, an increase of 0.9% over last year and 7.1% when compared to the first quarter 2020.

Food same-store sales declined by 1.4% for the quarter, but grew by 8.5% on a two-year basis. Pharma same-store sales were up 7.7%.

Our gross margins stood at 19.9% of sales versus 19.7% for the same quarter last year led by strong performance in Pharma. 02:59 Operating expenses were down $7.4 million year-over-year and represented 10.1% of sales versus 10.4% last year.

The lower level of operating expenses is mainly due to a reduction in pandemic-related expenses, which stood at $28 million last year. Operating expenses are up 4% when compared to fiscal 2020.

EBITDA for the quarter totalled $424.1 million, up $24.9 million or 6.2%, when compared to last year's EBITDA. And as a percentage of sales, EBITDA was 9.8% versus 9.3% last year.

03:35 Adjusted net earnings were $214.2 million, compared to $197.7 million last year, an increase of 8.2%. And our adjusted net earnings per share were $0.88, up 11.4% versus last year's adjusted EPS of $0.79.

The impact of the labor conflict at Jean Coutu impacted last year's EPS by $0.05. 12-weeks into fiscal 2022, capital expenditures amounted to $141.5 million, that's up $51.6 million versus last year and as the higher level of capital expenditures is a result of our ongoing investments in the modernization of our supply chain in both provinces and in our retail store network, including in-store technology, as well as the increase in our online capacity.

The amount also includes the purchase of the prime real estate property in Ottawa where we operate a Metro store. 04:27 At the end of first quarter, we had 360 stores equipped with self-checkouts and 109 stores with electronic shelf labels.

So far, in fiscal 2022, we opened three new Food Basics. We also relocated another Metro store and carried out major renovations in three stores representing a net increase of 76,000 square feet or 0.4% of our food retail network.

On November 19, we renewed our normal course issuer with issuer bid program, sorry -- enabling us to repurchase 7 million shares between November 25, 2021 and November 24 of this year. And as at January 14, the company had repurchased 650,000 shares for a consideration of $41.2 million, representing an average share price of $0.63 and $0.38.

05:15 In closing, the Board of Directors yesterday declared a quarterly dividend of $0.275 per share, an increase of 10% versus last year. This is the 28th consecutive year of dividend growth and represents a payout of about 31% of last year's adjusted net earnings.

05:31 So that's it from me. I'll now turn over to Eric.

05:35 Thank you, Francois and good afternoon, everyone. We are pleased with our strong first quarter results, driven by continued sales growth on top of record sales last year and good expense control.

On a three-year basis, we delivered sales growth of 7.1%, adjusted EBIT of 15.3%, and adjusted EPS growth of 23.9%, all of which exceeds our long-term annual financial targets. 06:02 Food same-store sales were down 1.4% in the quarter, but up 8.5%, when compared to fiscal 2020.

Transactions were up in Q1, but are still below 2020. Average basket size was down versus last year, but remains significantly higher than two-years ago.

For the quarter, our internal food inflation was 3.5%, up from 2% in the prior quarter, driven by the meat and grocery categories. 06:31 Promotional penetration has increased as consumers manage their budgets in this inflationary environment and I assure you that our merchandisers are working hard to continue to provide great value to customers in all of our banners.

Since the end of the quarter, the spread of the Omicron variant has impacted our operations and those of our suppliers putting pressure on our supply chain. Our team has worked in collaborations with suppliers to mitigate the impacts and as more people return to work at our suppliers and in our operations, overall supply chain pressure has started to ease.

07:06 Turning to pharmacy, comparable sales were up 7.7% with continued solid growth in prescription sales and front of store sales up a strong 8.9% driven by over-the-counter medications resulting from the stronger cold and flu season, good seasonal merchandise sales, as well as lower sales last year due to the labor conflict. 07:30 Our online grocery sales were flat versus the same quarter last year, but up 167% over two years ago.

We continue to deliver against our plan with 185 Metro stores now offering click-and-collect across the provinces of Quebec and Ontario, 14 hub stores offering delivery service and one dedicated facility in the high density Montreal market. 07:53 We have recently launched a two hour express delivery service on metro.ca in the Greater Montreal and Toronto areas and will roll-out the service to more stores in Quebec and Ontario over the coming months.

We also started offering the click-and-collect service in addition to our existing delivery service in pharmacy in mid-November. And now, more than 270 pharmacies offer these service across Quebec, Ontario and New Brunswick.

We believe our flexible e-com model positions us well to meet consumer demand as it evolves. 08:30 Our supply chain projects are progressing well.

Productivity in our new Produce facility continues to improve. And I'm pleased to announce that we have reached another milestone with the completion of our new fully automated frozen food distribution center in Toronto, earlier this month.

The transition to the new facility is underway and will gradually ramp up over the next few months. 08:54 In Quebec, construction of the new fresh and frozen automated facility in Terrebonne is on track and scheduled through 2023 opening.

Looking ahead, while we can't predict exactly how the pandemic will evolve, we expect in the short term, our food sales to remain relatively flat versus last year, but they compare favorably to pre-pandemic levels. In our Pharmacy division, we expect strong comparable sales in the second quarter as we are cycling six weeks of government restrictions on the sale of non-essential goods in Q2 last year.

09:28 In closing, I invite you to take a look at our 2022-2026 corporate responsibility plan, unveiled today, which builds on the progress we achieved over the last decade and sets ambitious goals for the company in terms of sustainable development. 09:46 That's it from me.

We'll take your questions. Thank you.

10:20 Thank you and good afternoon. Eric, I wondered if you could provide some insight on how consumer response to inflationary pressures in this cycle has perhaps differ between past cycles, just given the backdrop, we're dealing with and some of the complexity, we're dealing with.

Have you seen less product substitution in these sort of the early stages inflation ramp? You've spoken to promotional penetration, but any additional insight you can provide would be really useful.

Thank you.

10:49 Thank you. Yeah.

Like I said in the opening remarks, inflation is higher than normal. It has increased quickly.

So consumers are adjusting their behavior for sure. They are buying more on promotions, they're buying more private label and so there's a bit of a trading down.

There is a shift, I would say back to pre-pandemic levels in the discount penetration versus conventional penetration in the general market. So we've seen that shift.

And the consumers are adjusting to the inflationary realities. So as I pointed out earlier at the AGM, we're working really hard to contain those inflationary pressures by offering the best value we can the merchandisers, I think are doing a great job to minimize the impact on our consumers in all of our banners.

So watching it closely. Clearly, an important issue.

11:45 Thank you. And just one quick follow-up for me.

Francois, you called out to the impact on gross margins as sort of the recovery in pharma. Can you provide any more color on the drivers there in terms of the gross margin lift that the pharmacy business provides in quarter?

12:02 Well, as you remember, we were comping a labor conflict last year in pharmacy. So, obviously, that affected sales.

And so, combined with a great seasonal -- season OTC program this year, this explains the improvement in gross margin in pharmacy.

12:22 Just to pick up on that, last year, during the conflict in Q1, we secured deliveries of Rx over commercial merchandise from the warehouse. So that was a priority, it was medications obviously.

So the sale of front-end or commercial merchandise out of our warehouse last year was impacted by the contingency plan, so this year we cycle that. So that’s clearly benefited gross margin from our pharma division.

12:52 Great. Thanks so much.

I'll get back in queue.

13:02 Good afternoon. Eric and Francois, can you talk a little more in depth about the labor situation.

You indicated that supply chain is getting a little better. I'm just wondering, if you expect it like to -- like if things are going to get tighter again given the vaccination requirements that Canada recently introduced for truckers and as well can you talk about the labor situation in your stores just anecdotally, I've been in some stores and it seems there is some big holes in the shelves and seems to be fewer cashiers.

So are you having trouble getting labor in your stores and how is that impacting your ability to stock the shelves? Do you think you're going to have to curtail store hours and how is all that going to play out?

Thanks.

13:51 Okay, there's a lot to cover there. Clearly, the pandemic has had since the beginning an impact on the supply chain mostly labor shortages across the chain from our suppliers to logistics providers to ourselves.

So I would say that there are labor pressures. They have been there pre-pandemic.

They amplified somewhat in the pandemic and they clearly amplified when the Omicron variant started to spread in late December. So I would say the last four or five weeks were really tough with the big spike in the virus.

We felt it in our operations. Our suppliers felt it.

So we have been challenged for sure and you have seen some holes. There is no panic in the stores.

I think consumers understand what's happening after two years of pandemic. There is no real hoarding, but clearly there are more holes than we would like to offer to our customers.

Working hard on that. 14:48 So the good news is the five day isolation rule for people in close contact or with the virus is helping to bring people back to work.

So, more recently we've seen more people come back in our shop and at our suppliers. So we're trying to get to a better position, which has started to happen.

So I think the worst is behind us, but with this virus you never know. So we keep a close eye on it.

So getting merchandise, stocking ourselves clearly a big priority and working in that direction. As far as labor in our stores, the pandemic affected increased absenteeism for sure, but we have labor challenges as an industry and we're addressing them.

We're recruiting as best we can. We're installing technology in our stores with self-checkouts to mitigate the impact of not finding cashiers for certain shifts, but overall I think we're managing it pretty well.

It's not perfect. Clearly, it's been tough, like I said the last few weeks, but we think it's going to get better.

16:01 On the vaccination of truckers, it's having or will have mostly an inflationary impact on the cost of merchandise coming in from the U.S. produce especially.

We saw an uptick in the transportation costs are right away, but we're getting the merchandise. So our transportation providers were able to service us for the most part.

There is always exceptions, but for the most part, we're getting the merchandise, but there is an inflationary issue that comes with that requirement. So it's a challenge, but I think we're working really hard.

I think our teams are doing, under the circumstances, a pretty good job to provide our customers the best experience that we can and we look forward to improving our in-stock position.

16:55 That's a thorough answer. Thank you.

17:07 Thanks and good morning. Sorry -- good afternoon, gentlemen.

I don't think we've quite beat this horse from every angle yet. So I was wondering about so merchandising and promotional strategies and I'm thinking here Eric about the flyer and the challenges in putting together the flyer when you don't know what you're going to get necessarily and you don't know how much you're going to get.

So can you just talk a little bit about sort of the key skillsets that your guys have that really make a difference in this kind of environment or whether we should just expect to see kind of thinner flyers.

17:47 Our flyers are not thinner than they were and we're working hard to provide as many promotions as we did before. I said penetration is increasing of the flyer in recent weeks.

With more inflation, we're seeing an increased penetration. So no, we have no intention of cutting promotions.

We're working with our suppliers to see what product can be featured and when. So there is a lot of work behind the scenes.

Again, there are some hits and misses in there and sometimes we don't get the product we're supposed to get. We get it late, so that we're not in stock as much as we'd like to be in our stores, but again, it's unusual extraordinary circumstances.

The peak in Omicron clearly had an impact, but I think the worst is behind us and I think our merchandisers have enough experience to work with the suppliers to provide a good commercial offer with great value to our customers.

18:52 That's great. Thank you, Eric.

That's really helpful. And then I was really interested in your commentary around the return of traffic to discount.

So if you think back to previous inflationary cycles like this, do you think we're kind of at in balance now or close to in balances in terms of what we should be expecting discount versus conventional?

19:16 Yeah. So the shift back to discount, I think Google was expected and was normal and I think the higher inflation has perhaps accelerated it a little bit, but as we all know, during the first phase or the most part of the pandemic, conventional supermarkets, community supermarkets benefited with the one-stop shop and did well.

So we all expected that to revert back to discount at some point and I think we're there.

19:51 Yes. Thanks so much.

19:59 Yeah. Thanks.

Good afternoon. With the trade down that you're seeing, Eric, I'm just wondering if there are certain categories that do better or worse or if it's just sort of trading around within categories and I guess maybe, I'm thinking specifically about prepared foods in HMR.

It's obviously more expensive than consumers preparing themselves, but cheaper option than restaurants. Just curious what you're seeing in that part of the store?

20:25 Yeah. Well, there is ups and downs everywhere, but I would say prepared foods in general are up versus last year.

So we’re -- I don't consider that necessarily a trading down or trading up. It's just reverting back to more normal levels.

In the fresh meat category because of certain really high cost increases, our promotional strategy, our merchandising strategy was adjusted with different cuts of meat, lower price cuts of meat sometimes. So some trading down just with our promotional mix is happening.

So things like that happen in private label and grocery, frozen and dairy as well in times like this. So that's all contributing to what's happening at the tail and in line with the inflation that we're seeing.

21:18 Okay. Great.

And I'm just wondering how the sort of challenges of accelerated inflation are different in your pharmacy business front store, if at all than in the food business. I know there is obviously a structural difference just with regards to the business model.

But commentary about inflation in pharmacy versus grocery please?

21:42 We're not seeing as higher inflation in health and beauty products that we sell mostly in our pharmacies. There is inflation, but at more normal levels in 2% range or so.

So it's clearly the spike is more on the food side. So I would call the inflation levels, trends in pharma pretty normal.

22:06 Okay. Thanks.

And then just one follow-up, Francois. Sorry, I know you don't normally comment on the segmented results specifically.

But -- and apologies if I missed this in the comments, you were talking about the benefit from the growth in pharmacy on gross margins. But could you just comment about the gross margin performance in the food business specifically?

Was it stable or up or down? Could you give us any indication?

22:37 Well, it was slightly down. I'll leave it at that, but it was slightly down.

So with the inflationary pressure that we're facing, we did not pass all of it.

22:50 Understood, understood. Thanks very much guys and all the best.

22:54 Yeah. Thank you.

23:03 Thank you. Wanted to ask about e-commerce and when we look at the trend a year ago, we saw the volume ramping up as we got into the winter months.

And so the growth rate was much higher in the winter months last year. So you just said that it was flat essentially in the first quarter.

Are you seeing it ramping up again in the second quarter or if it's not, I'd assume that would mean it would be trending lower year-over-year?

23:34 So yes, we're seeing an uptick in e-com demand and e-com sales basically since Christmas or after Christmas. I think a lot has to do with the government measures announced and the closures of restaurants and the stay at home restrictions.

I won't call it a full lockdown, but it's -- it feels like it. So with this rapid spread of Omicron, I think a lot of people stayed home and went back online or went online.

So yeah, we're seeing -- we have seen the uptick for sure in online. We -- that sort of coincided with the rollout of our click-and-collect offer in food at Metro Quebec and Metro Ontario.

So we worked hard over the summer and fall to roll it out. And volume has clearly picked up since Christmas in click-and-collect.

So that was timely. Same thing in pharmacy, we rolled it out at click-and-collect and that's also ramping up.

24:37 Okay. So when you say that it's ramping up to be to show growth year-over-year, or is it still kind of flat?

24:45 Well, the quarter is not finished and I just don't want to give you a guidance. But it feels like it should go up.

24:54 Okay. And so, you talked about the COVID costs as well.

I'd assume they are relatively stable in Q1, but in Q2, you announced another gift card. So is it the same amount that 8 million or so that we saw last time it was provided to employees?

25:15 Yes, it is.

25:18 Yeah.

25:19 Yeah. We announced it last week.

We did it three times last year. We felt the last week was the right time, right thing to do this year after the last few weeks that I just described in enough detail, it's been very challenging for our people and they've done a great job.

So we thought it was right thing to do. So it's 8 million, yes.

25:37 Okay. And apart from that, has the surge in Omicron required you to spend more in other types of COVID cost or is that stable right now?

25:52 Stable.

25:53 Perfect. All right.

Thank you very much.

25:56 Thank you, Michael.

26:03 Hi. Thanks for taking my questions.

Just related to the in-stock positions that you have in your different banner types, conventional and discount. Are they impacting one banner more than another?

26:22 No. We service our stores from them, where the same warehouses in Quebec and in Ontario.

The general in-stock position is similar between all of our banners.

26:37 Okay. And would the same comment apply for labor shortages given the smaller labor number at discount stores.

Are you finding you're more understaffed there?

26:49 Well, it's all a question of proportions. As a percentage of employees, the staff missing is pretty similar.

There is like you say less services in discount stores. So you can absorb absenteeism a little better in a discount format, but it's also a challenge there.

So as I said earlier as people return back to work, they're following the peak of Omicron and we will be in a position to fill our shelves better and offer a better experience to our customers.

27:28 Okay. And with respect to your conventional banners, have labor shortages placed pressure on some of the service counters and if so, did that impact margins in the quarter?

27:41 I wouldn't say it impacted our margin, but the granular level in store X, Y, Z, they may have cut hours in the deli or prepared foods. So in general terms, there could be some reduction of hours in certain departments which could have impacted margin in that store.

But overall for the company and the numbers we're reporting to you, I wouldn't call that one out.

28:06 Okay. And with respect to the variety of investments that Metro is making either to its supply chain investments or its store investments like shelf tags or the self-checkouts.

Is the inflation and the labor pressure that Metro is seeing curtailing the rate at which Metro can make investments in delaying projects?

28:32 No. Our capital program is staying constant and you're familiar with our supply chain projects.

We are CapEx for retail renovations and new stores, it’s pretty similar year-to-year. And the technology budget for part of that for stores.

So no, the inflationary situation is not impacting our CapEx. Although, some of these construction costs are very high these days, and we're looking at every project before we invest on the renovation, especially sizable renovations we make sure the numbers work out as construction costs are a much bigger factor.

29:14 Okay. And lastly, maybe you can just provide some extra color on the Toronto fresh DC, and the level of performance it's had and the automated frozen DC.

29:29 The automated frozen DC just started, we turned basically the operation on this past week. So we're piloting some stores out of that DC last week, just started.

So we're going to do more and more stores every week. So we see a process of four months to five months, the shorter the better but we'll do what we have to do to do it properly to transition from the old freezer to the new freezer, and it takes some time.

But I think we're in a good, in a good position since it's the second one we're doing, and I'm confident that the transition will go well. It's a lot of work, especially in the midst of a pandemic.

So not easy work, but it's going to get done. 30:12 The produce, I said in my remarks, productivity is improving.

So we're adjusting systems and processes and schedules and everything. So we're working with our unionized employees and with Vtron, our technology partner to optimize.

So again big project, a lot of changed management, but going in the right direction and I'm pleased with the improvement certainly over the last few months. We have room to grow, we're never happy.

We wanted to be better and I'm confident that it will continue to improve.

30:45 Thank you.

30:59 Thank you very much. Most of my major questions have been asked, but I do have a few minor ones.

So firstly, with respect to the supply chain disruptions, and where we've seen the holes, are they primarily in the grocery category or they also in the fresh category? Are they -- is there a focus on where those holds are, where you're seeing the shortages?

31:25 Yeah. Grocery has an issue, because there is more variety basically in centre store and that's the biggest issue.

We're getting product. People can fill out their order, but clearly, there is our SKUs missing, there is variety missing, there could be sizes missing.

As our suppliers are adjusting their production given their constraints, we don't offer there is necessarily the full variety in our center stores, so that's grocery, dairy, frozen. Those categories you tend to see a little more holes than you would see in our fresh departments.

31:57 Okay. Thank you.

And then I have two questions that are specific to Quebec now. In your outlook, when you discussed your outlook for pharmacy sales, you did mention that you expect that the rapid -- distribution of the rapid tests could be a nice tailwind for pharmacy in the near term?

And at the outset in Quebec, it was pretty chaotic that distribution, not necessarily from you guys, but from the government, getting them to where they were going to be distributed. Has that kind of calmed down and become more orderly?

32:35 Getting better we’re -- as we get more quantities and more supply. So, the government, for those who are not in Quebec puts a free distribution of rapid tests in the hands of the community pharmacies and every community pharmacy was basically getting 108 kits a day.

So that's not many kits for many pharmacies, especially a Jean Coutu which have large volumes. So that caused a lot of frustration early on, people lining up and trying to get online.

So it was hectic, it was chaotic like you said. It's getting better as supply has increased.

We would like to have more and I think the government will be in a position to supply more. So it's better every week, but it wasn't easy.

33:25 Okay. So another thing exclusive to Quebec, Eric, is the fact for the last three Sundays, the grocery stores have not been allowed to open.

It was only three Sundays, but I'm still curious what you might have seen there in terms of consumer behavior to just see people reverting more to online because of that on those days. Did you see a bigger uptick in the Saturday or was there just not any discernible difference?

33:56 No. It was another element that made our life more complicated for sure.

So three Sundays are now behind us. We were opened this past Sunday but the previous three Sundays we were closed in food, not in pharmacy, but in food.

So yes, most of the volume transferred to the Saturday or the Monday. It puts pressure on other days in an environment where we had supply chain issues that we've talked about at length today, it made it more complicated.

So it was a challenge, it's behind us and move on.

34:32 Yeah. Let's hope it stays behind you.

And then just lastly, a slight clarification. So you talked about discount reverting back.

We're getting more shoppers in the discount box. So when you say revert back, so what you're referring to there is that we're back more or less to the normal levels that we saw pre-pandemic as opposed to heightened or elevated levels?

34:57 Yeah. That's what I'm referring to.

And again, at Metro, we have a good portfolio of banners with discounts and significant discount presence in both Quebec and Ontario. We have in Adonis also and Metro provides great value.

So I think we're well positioned to serve all customers. And yeah, so the discount is reverting back, it's a market I think phenomenon and we're well positioned to capture it.

34:57 Okay. Thank you very much.

35:31 Thank you.

35:37 Hi. Good afternoon.

Eric, I know there are many moving parts and you don't have a crystal ball, but just wondering can you share with us some of the major puts and takes that you see impacting gross margin for the year. Do you believe stable margin is a reasonable expectation or do you see some downside risk because of the inability to fully pass on all the cost increases at the retail level?

Thank you.

36:03 Yeah. Well, that's a hard one and you're right, I don't have a crystal ball.

I do know that we're getting cost increases. We're getting more increases this time years than we usually -- it's usual in our industry and food to get cost increases late January, early February, so in the next days and weeks there is a significant amount of products that will have cost increases.

So how much of that will be reflected at retail, we will be very competitive. We monitor prices everywhere and we intend to remain competitive.

So I think there could be some risk short-term to gross margin rates as those cost increases come in and if we can pass them on at retail. So typically it takes a bit of time.

So we've been there before and we managed through it before, but it's something -- it's a watch out for sure on the gross margin. Other than those cost increases, which is a key element I think we're confident in our strategy, our merchandisers on the fresh side I think are going to do a good job and I think we can deliver a margin and the diversification with pharmacy I think is another helpful element.

We saw it in this quarter. So overall I think we're confident that we can deliver good gross margin numbers, but it's competitive.

37:37 Okay. That's helpful.

And maybe specifically, how big of a contributor has the increase in private label sales to the gross margin in the quarter or in the last couple of quarters. Has it been a notable contributor or not really?

37:55 Well, it's a key contributor overall always. With the uptick, private label penetration is doing well.

We're seeing this in our gross margin. I wouldn't call it out as a big difference in the gross margin that we're reporting, but it clearly, it's a contributor, but the supply chain issues that we talked about affect private label too.

Some suppliers are in difficult positions there too and we're not getting all the merchandises we need sometimes in private label. So it plays out everywhere even in private label.

38:29 Okay. Thank you for that.

And maybe just one for Francois. I apologize if you disclosed this already, but what was the COVID expenses that were incurred during the quarter?

38:38 Yeah, Chris. As we said on last call, we are no longer reporting on COVID expenses.

One, they are coming down versus the peak obviously, and two, it’s -- the line between a COVID and non-COVID expense is blurring quite a bit. It's just part of our normal operating expenses now.

So we're no longer specifically tracking that number and reporting as such because it's not as clear-cut as it was before. So that's what we indicated on the last call.

39:11 Okay. That's fair.

But I guess suffice to say, given that you guys did call out I think over 100 million of expenses last year based on your early comment that it's been sort of stabilizing, we should expect that to be a fairly good tailwind in terms of a reduction in expenses throughout the year?

39:30 Yeah. Some -- but some departments that were open post-pandemic or when restrictions were easing have more labor and services.

So it was not a dollar for dollar, but yeah, the period is the peak of COVID expense of last year, that's -- we don't expect that to be repeated.

39:47 Okay. Great.

Thank you and all the best.

39:49 Thank you, Chris.

40:04 Yeah. Hi.

Just a quick follow-up, Eric. You already spoke about the relative demand and traffic you're seeing in e-commerce with the Omicron wave.

I'm just curious though with the pickup in inflation, does that affect how people shop online at all either in terms of basket size or are you seeing the same sort of increase in promo penetration in the online business as well?

40:30 It's similar, yeah. I would not call out notable differences of buying behavior online versus in-store with the Omicron variant.

Sizable basket margins are -- it's a good basket, it's a good customer and we want to service them however they want to shop, but I wouldn't call out a big difference there.

40:58 Okay. So the same variances as sort of before inflation kind of accelerated remain in place?

41:07 Right.

41:07 Okay. Great.

Thank you.

41:17 Thank you all for your interest in Metro and we will speak again soon to discuss our second quarter results on April 20th. Thank you.