Thank you, Daniel. Good morning, everyone and welcome to Superior Plus' conference call and webcast to review our 2019 annual and fourth quarter results.

Joining me today is Luc Desjardins, President and CEO; Beth Summers, Executive VP and CFO; and Darren Hribar, Senior VP and Chief Legal Officer. Today's call is being webcast and we encourage listeners to follow along with the supporting presentation, which is also available on our website.

For this morning's call, Luc and Beth will begin with their prepared remarks and then we will open up the call for questions. Before I turn the call over to Luc, I'd like to remind you that some of the comments made today may be forward-looking in nature and are based on Superior's current expectations, estimates, judgments, projections and risks.

Further, some of the information provided refers to non-GAAP measures. Please refer to Superior's annual MD&A posted on SEDAR and Superior's website yesterday for further details on forward-looking information and non-GAAP measures.

I would encourage listeners to review the MD&A, as it includes more detail on the financial information for 2019 and the fourth quarter as we won't be going over each financial metric on today's call. This will allow us to move more quickly into the question-and-answer period.

I'll now turn the call over to Luc.

Well, thank you, Rob and good morning, everyone. Overall, I'm pleased with the fourth quarter and full year results.

The fourth quarter and full year 2019 had strong results driven primarily by our U.S. and Canadian Propane distribution businesses.

The fourth quarter adjusted EBITDA before IFRS was $165.7 million. It was a record fourth quarter for Superior, and 8% higher than the prior year quarter.

The full year 2019 adjusted EBITDA, was $485.7 million which was also a record year for Superior, and 30% higher than the 2018. The 2019 full year adjusted EBITDA included IFRS with $524.5 million, which was near the top end of our adjusted EBITDA guidance, which was $490 million to $530 million guidance.

In the fourth quarter, Canadian and U.S. Propane distribution results were higher compared to last year, primarily due to the improved wholesale propane market fundamentals and our ability to capitalize on those benefits, including effective price management and a lower price environment, realized synergy from an NGL and contribution from the tuck-ins completed in 2019.

Specialty Chemicals EBITDA from operation in the fourth quarter were obviously higher, primarily due to the impact of IFRS 16 and increased sodium chlorate results offset in part by a decrease in chlor-alkali results. In the fourth quarter, we closed on three different retail propane acquisition with operation in North Carolina, New Brunswick, Delaware and Maryland.

Following year-end, we acquired the propane distribution assets of a propane distributor in Southern California, which was our second retail propane acquisition in that space. From April 2019 to January 2020, we've made six retail propane distribution acquisition for a total consideration of $97.7 million.

We made this acquisition using cash flow from our operation, while also reducing our senior debt credit facility EBITDA leverage from 4.2 at December 31, 2018 to 3.7 at December 31, 2019. We continue to see a large number of acquisition opportunity more than ever ranging in sites in the Eastern U.S.

and in California. So we have a good pipeline of growth through acquisition, as well as organic growth, and the capital available to execute on these opportunities, where we stated our DRIPs as well which provides additional funding for more – for a pipeline of acquisition, which is very robust.

In 2019, our U.S. Propane business achieved record EBITDA from operation of $209 million, surpassing our Canadian Propane business EBITDA from operation for the first time.

We're now bigger in the States. We expect the majority of our growth in the coming year to come from U.S.

business given the opportunity to grow through acquisition and the highly fragmented market and we anticipate organic growth opportunities. Our Canadian Propane business is also expected to grow organically in Central and Eastern Canada, but we should ready to face headwind in Western Canada, due to broader economic conditions.

In the fourth quarter, we made excellent progress on our 2019 realized synergy goal related to NGL acquisition. We've achieved a run rate synergy of US$20 million exit in 2019 and we still expect to exit 2020 with US$24 million in run rate synergy.

Our U.S. Propane team has done an incredible job on our integration of NGL, which allow us to achieve our internal 2020 goal for our run rate synergy one year earlier in 2019.

On January 28, we announced the completion of a strategic review process and the potential sale of our Specialty Chemical business. The decision not to sell at this time was a difficult one, but the right decision for all stakeholders in midterm involve with Superior.

We see higher value accruing to our shareholders in continuing to run Specialty Chemical business and we may revisit the sale in the future. But for now, we're going to focus on operating the business and executing our plan for 2020.

In the fourth quarter, we faced some industry headwind in chlor-alkali business and it relates to the demand and pricing for caustic soda and hydrochloric acid. And those market fundamentals have continued into the 2020.

That is why our forecast in 2020 is less than 2019, as an overall company. We do however expect positive momentum to return caustic soda, probably by midyear 2020.

Certain industry reports are forecasting North America caustic soda market, doing good due to incremental demand in North America, as well as the recent announcement of the closing of a large producer plant in U.S. during the 2020 year.

Now, I'll turn the call over to Beth to discuss the financial results and our 2020 guidance.

Thank you, Luc and good morning everyone. The fourth quarter adjusted EBITDA, including the impact of IFRS 16 was $176.7 million, which was $23.7 million higher than the prior year quarter, primarily due to increased EBITDA from operations, partially offset by an increase in corporate costs related to LTIP costs.

The full year 2019 adjusted EBITDA including IFRS 16 was $524.5 million, which was $150.2 million higher than 2018, primarily due to increased EBITDA from operations partially offset by increased corporate costs and realized losses on foreign currency hedging contracts. The adoption of IFRS 16 had an $11 million impact on our fourth quarter results and $38.8 million impact on our 2019 full year results.

Fourth quarter adjusted operating cash flows before transaction and other costs per share was $0.83 per share, which was $0.07 higher than the prior year quarter due to increased adjusted EBITDA, partially offset by increased interest expense and cash taxes, as well as the impact of increased average shares outstanding. Interest expense increased due to the higher average debt levels related to financing tuck-in acquisitions completed in 2019 using the credit facility.

Weighted average shares outstanding increased due to the NGL acquisition financing in 2018. AOCF before transaction and other costs per share for 2019 was $2.32 per share, $0.41 higher than the prior year due to an increase in adjusted EBITDA, partially offset by an increase in interest expense, cash taxes and the weighted average shares outstanding.

From a debt leverage perspective, senior debt-to-credit facility EBITDA as at December 31, 2019 was 3.7 times, which was near the lower end of the 3.6 times to 4 times guidance range and 0.5 times lower than leverage as at December 31, 2018. Turning now to the individual business results.

Canadian Propane distribution EBITDA from operations for the fourth quarter was $75.6 million, a $17.8 million increase, primarily due to higher gross profit and the impact of IFRS 16. This is partially offset by modestly higher operating expenses.

Gross profit increased compared to the prior year quarter, primarily due to the wholesale propane market fundamentals and Superior's ability to capitalize on those benefits. Wholesale propane market fundamentals primarily benefited from the differential between the pricing at Conway compared to the Edmonton posted prices.

Average unit margins were $0.181 per liter compared to $0.152 per year in the prior year quarter, primarily due to the group's wholesale propane market fundamentals and margin management initiatives. Canadian Propane distribution EBITDA from operations for 2019 was $200.8 million, $38.3 million higher than 2018, primarily due to an increase in gross profit, partially offset by modestly higher operating expenses.

Gross profit increased $43.3 million, primarily due to the impact of wholesale propane market fundamentals and higher wholesale volumes related to contributions from UPE. Operating expenses were modestly higher due to the incremental expenses from UPE, partially offset by realized synergies from Canwest and a reduction in costs related to sales volume decline in Western Canada.

Canadian Propane distribution EBITDA from operations for 2020 is anticipated to be lower than 2019, primarily due to the -- an expected decrease in average margins and sales volume. Average margins are expected to decrease as wholesale propane market fundamentals are not expected to be as strong as they were in 2019.

Sales volumes are expected to decrease primarily due to competitive pressures in Western Canada and the assumption of normal weather for 2020, as well as the anticipated weaker economic conditions in Western Canada. Average weather for Canada as measured by degree days for 2019 was 4% colder than the five-year average.

U.S. Propane distribution EBITDA from operations for the fourth quarter was $78.2 million, an increase of $7 million compared to the prior year quarter, primarily due to higher average unit margins, partially offset by modestly higher operating expenses.

Average unit margins were $0.389 per liter compared to $0.34 per liter in the prior year quarter, primarily due to lower wholesale propane prices and effective management of pricing in a low commodity price environment. Operating expenses were modestly higher due to the impact from tuck-in acquisitions, partially offset by realized synergies.

U.S. Propane EBITDA from operations for 2019 was $209.4 million, $106.7 million higher than 2018, primarily due to the incremental contribution from NGL and the tuck-in acquisitions completed in 2018 and early 2019 and lower wholesale propane prices as well as realized synergies related to the NGL acquisition.

U.S. Propane EBITDA from operations for 2020 is anticipated to be higher than 2019, primarily due to the incremental contribution from the tuck-in acquisitions completed in 2019 and incremental synergies related to the NGL acquisition.

Turning now to Specialty Chemicals. EBITDA from operations for the fourth quarter was $34 million, a modest increase compared to the prior year quarter, driven primarily by the impact of IFRS 16.

Excluding the impact of IFRS 16, EBITDA from operations was $26.7 million, a decrease of $7.3 million compared to the prior year quarter. This was primarily due to lower chlor-alkali gross profit and higher operating expenses partially offset by higher sodium chlorate gross profit.

Specialty Chemicals 2019 EBITDA from operations was $151.9 million which was $14.3 million higher than 2018, primarily due to the impact of adopting IFRS 16 and increased sodium chlorate selling prices and sales volumes. This was partially offset by lower chlor-alkali results.

Specialty Chemicals EBITDA from operations for 2020 is anticipated to be lower than 2019 due to an expected significant increase in chlor-alkali gross profit, a modest decrease in sodium borate gross profit and a modest increase in operating expenses. Chlor-alkali gross profit is anticipated to be lower than 2019 due to the continued weakness in hydrochloric acid pricing driven by reduced oil and gas demand, a decrease in cost of potash sales volumes and pricing related to customer mix and the weakness in caustic soda pricing related to supply and demand fundamentals entering 2020 in the North American market.

Sodium chlorate gross profit is anticipated to be modestly lower than 2019 as modest improvement in sales prices are expected to be more than offset by modestly lower sales volume and the impact of a weaker U.S. dollar compared to 2019.

Lastly the corporate results and adjusted EBITDA and leverage guidance. Corporate costs were $2.2 million higher than the prior year, primarily due to an increase in LTIP expense related to the share price appreciation.

Interest expense was $25.7 million $2.1 million higher than the prior year quarter due to the increased average debt and effective interest rates as well as the impact from IFRS 16. Debt was higher primarily due to the tuck-in acquisitions completed in 2019.

In the fourth quarter Superior had cash income tax expenses of $6 million compared to a recovery of $3.3 million in the prior year quarter due to income tax true-ups and higher earnings in 2019. We're introducing our 2020 adjusted EBIT guidance range of $475 million to $515 million which implies a midpoint of $495 million.

Based on the midpoint of our 2020 guidance, this represents a 6% decrease compared to our 2019 full year results. We're facing weaker chlor-alkali markets in 2020 especially in the hydrochloric acid and caustic soda segments of our business and headwinds in our Canadian Propane distribution business in Western Canada related to competitive pressures and slower activity.

In addition, our 2019 full year results benefited from the strong wholesale propane fundamentals which aren't expected to be as strong in 2020. The low end of the range accounts for warmer-than-normal weather, reduced economic activity in Western Canada, further weakness in North American caustic soda and hydrochloric acid market and any impact on our operations related to the CN rail blockade.

The high end of the range accounts for colder-than-normal weather, wholesale propane market fundamentals similar to 2019 increased drilling activity in Western Canada and improved North American caustic soda and hydrochloric acid markets. We're also introducing our total debt-to-adjusted EBITDA leverage range for December 31, 2020 of 3.4 times to 3.8 times.

Leverage could trend to the higher end of the range if wholesale propane prices increase significantly and we complete more tuck-in acquisitions before year-end. Superior's businesses generate significant cash flows that can be used for capital expenditures, acquisitions or to repay debt.

During the year, Superior generated $406.2 million in AOCF before transaction and other costs. Transaction and other costs were $29.9 million for 2019.

After lease repayments and maintenance capital Superior had $273.5 million available for dividends, nonrecurring capital expenditures acquisitions and debt reductions. After dividends and nonrecurring capital expenditures Superior had $80.1 million available for debt reduction and acquisitions.

During 2019, Superior acquired $69.2 million in retail propane distribution assets using the cash available after capital expenditures lease repayments and dividends. With that I'd like to turn the call over for Q&A.

Good morning, folks.

Good morning.

Just looking at your guidance for the entire year with the $15 million I guess on the tail end of the range on both sides is it – we think about this should the U.S. sort of whitewash the Canadian downside such that the net impact is frankly just related to caustic soda and hydrochloric acid?

You're like –you're right on target.

Okay. And have you guys contemplated any sort of second half recovery at all in caustic, or are you – what are you assuming I guess in your caustic and hydrochloric acid assumptions?

Some improvement in third and fourth quarter for caustic price.

Okay. And the hydrochloric?

Sorry Luc I just need you to reiterate there.

None of – none in that. No way to predict the year because we don't know.

Okay. And then if you look at the acquisitions you did last year you spent $69 million and got the California early this year is that baked into your guidance?

And what was – what would be the year-over-year EBITDA impact from the acquisitions that you've executed over the past year? And did you include California?

Yes. We've include what was done before the year.

What we don't include in the forecast is new acquisition that we'll do during 2020 and our pipeline has never been that big. Hopefully, this year.

California is in there Luc then, or…

California we're at -- yes, yes, yes.

Okay. And on the balance sheet probably more Beth, but the participation rate that you're anticipating on the DRIP, is it kind of in and around 30%, or what are you thinking?

Yes. Our view we need 30% consistent with historic participation rates.

Yes. Okay.

And then we've had a really warm start this year. Obviously it's been -- January and February have been I think fairly warm.

The basis differentials that you enjoyed being -- between Conway and Edmonton, we do see that that has shrunk a little bit. But do you think it gives you a replication of what you saw in 4Q that if you saw volume softness obviously Western Canada is another story, but that you could skate on size because the margins would be fairly decent in Canada?

And the U.S. did very well as well.

I think from an overall margin perspective, you do sometimes see some offset. I think from a weather perspective warm weather will have an impact, certainly, when you look at January, February, just because they're such big months from a volume perspective.

Just to give you a bit of a sense, in the U.S. in the markets where we're, we were roughly 18% higher -- or warmer than the five-year average and that's roughly 19% warmer than 2019.

Canada is not quite as much. Overall, nationally it's roughly been 3% warmer, but that's 11% warmer in the east and roughly 3% colder in the west.

So I think from a differential perspective, there could potentially be some offsets there. We entered the year with stronger differentials than the average, but they have narrowed.

So I think going forward and what we build in our forecast is an average a five-year average similar to weather on differential performance. So that's what would be built in our forecast.

Okay. And if you look in the U.S.

obviously you must count your blessings that you acquired NGL given the retail and stickiness on the pricing, can you tell us what the dynamics are going on down there? I realize you had low propane prices and you guys have had effective margin management on that and maintain your prices.

But my understanding is that you were able to take price increases on the retail side such that consumer's bill would be kind of the same on the back it has much fees. Maybe just talk about the dynamics going down in the U.S.

on the retail pricing side?

Yes. No this -- the U.S.

looks better than ever. We have more acquisition opportunity lined up.

We've realized in the $20 million -- as you know we went up to $24 million, $25 million of synergy. We realized once we took over the enterprise that we could increase price and then lose business.

We actually have lost several business of the acquisition. Usually the first year is a bit dicey in that regard.

It's very positive. We're putting in place our marketing and sell program that we -- in the last year that we have in Canada.

We're getting internal growth in Canada beside the oilfield Western economy in every segment. And then in the U.S., it's going to in that regard going forward.

So we're not baking in additional acquisitions. That will come during the year they will.

And I can see two or three years from now a very great position in the States. We are really sure now more and more that our business model will take over the sales and marketing approach.

It's more modern, the efficiency logistics and we gained 25% of everything we buy. That's going to continue.

So of course, the hiccup this year 2020 more related like I said to the chemical world, which kind of -- we didn't expect. And then when quarter four started to happen we realized "Oh boy here we go."

But from the energy business, if you look ahead two or three years, it's going to be -- I don't know. They'll be about -- they're 70% independent.

And we're really the main acquirer that has staying and we're going to grow, grow, grow it make it a great business totally...

Okay. Last one I got you I just -- and I'll give up the line.

Luc, does this -- does your success in the U.S., does that prompt you to kind of -- because the retail is so sticky to really kind of quicken the pace on implementing sensors down there and things like that?

Yes. We've started already and this summer about more to come.

And we may then develop a new advantage with sensor and dispatching and logistics of the weather to really then maximize logistic. We're doing it in Canada in the next year to two of execution.

It's another level of gain. And of course, once we have it, we apply our best practice anywhere in North America.

It's -- we're fortunate we have a great business model that's giving us -- and we're not finished. We have more -- better information now that we can -- from a digital point connection with customer and we're bringing efficiency.

We have another level of gain coming in the next two years on both businesses.

Excellent. Thanks both.

Thanks, David.

Good morning.

Good morning.

Good morning.

Your thoughts on -- currently on caustic prices. And I know you just said that you're expecting kind of second half things are going to improve.

But there's a number of moving parts here. We just got off a call with one of your competitors talking about in the Northeast Asia spot possibly being up $50 a tonne.

I know the U.S. Gulf Coast -- or sorry the U.S.

Gulf producers are looking at raising contract price by $30 a tonne. Are you feeling a sense of optimism here and maybe you've been a bit too cautious?

Well I don't know how many quarters in 10 years we didn't make our results, but we can probably -- not too many one or two. So I think we're realistic when we start the year, but we never overpromise.

We don't like that. In a way, we have a good reputation of saying it the way that it is.

So we see opportunity and price have been discussed to be increased. We have not seen the actual increase being executed.

So we don't count on it. We're watching it every day and we hope so big time.

But nothing is baked in here that's a dream. We're realistic and we've always been.

No better, if anything else comes to mind.

The only thing that I would add Jacob just to give you a bit of a sense when we look at our overall average forecasted pricing in 2020 versus 2019, it's roughly 10% lower just to give you a sense overall. And as Luc mentioned earlier, we would expect caustic to improve in the back half of the year or that was what our expectation was.

If it happens earlier that's great. But even with that improvement our view is still year-over-year there would be a price decline of roughly 10%.

Okay. And then moving over to the rail disruptions, I guess twofold propane but also on the chlorine side.

I guess there's been some boil advisories coming out because of chlorine shortages. Maybe just talk a bit about that market dynamic and then how we should be thinking about the propane as well.

Yes. Though I - it's -- for the moment there's no doubt we're incurring additional costs because of transportation.

If you remember when the last sort of Canadian National Railway situation we were able and probably the only propane company in the East to have propane and we distributed to all our customers, nobody ran out. Same thing is happening because we have the scale.

We have a big wholesale business. We have the logistics and we have the Southeast where we're big now and we can move from American Southeast to Buckingham Québec.

And every time we're doing that as we speak. So we're still in a good position to service customer, two weeks from now probably not.

And then it's costing us more -- more transportation more logistic cost. Same thing with chemical is, we were able to continue to service that customer they are very useful transportation.

So for us no doubt there's extra cost. I want to be clear that's not a huge impact unless it continues longer.

The chlor-alkali is the real impact here. Then after that when it comes to rail so far, we're a couple of million and more.

Hopefully, it goes away soon and it gets resolved. And then from the virus we don't play that game.

We don't think that's affecting business. Well we don't go to that level of make -- making commitment that -- or comment that we don't trust and believe.

Okay. And then maybe my last question here just on the U.S.

Propane business. How should we be thinking about same-store sales basis and versus acquisition growth?

What type of growth are you looking for kind of on a same-store sales basis everything else being equal? And then...

Yes. Our marketing and sales group that we developed and have been developing for surplus in the States with the NGL acquisition we make sure everybody gets it.

And then we're pricing intelligent improvise with a marketing approach it reduced attrition in half and grows with the sales of up 2% to 3% internal growth. We've done that forever in Canada more than that these days in different segments like oilfield.

So we're putting that in place. And the acquisition, it comes and go though.

We always say just wait and you never know which quarter which month. The pipeline is -- has never been that big as it is right now.

So I think internal growth you can trust on that. We still have 2% to 3% internal growth.

We have the investment in marketing and sales in place to make that happen in company.

Thank you, I will leave it there.

Okay.

Yes, good morning guys. Just very quickly if I may to follow on the M&A concept, Luc can you perhaps just talk about -- you keep describing how flush the pipeline is.

I think that's well understood. What I'm trying to understand is where your priorities are really going to lie, if you've got such a broad set of opportunities.

You've got roughly $100 million of capital to deploy per year if last year is any indication. Where are you going to really try and focus that to get best value for that money?

Yes. I think - I mean how we will typically look at it, we obviously have the markets which from a strategic perspective we like the most where there are higher margins returns and frankly where we get higher synergies.

So if you think of where our footprint is that would be the Northeast in those markets. But fundamentally we'll approach some.

There are a lot of opportunities, but again the timing of those opportunities isn't always predictable. So we will look at them and we'll basically look at the return.

And we'll make the acquisitions where the returns look the greatest layered in with longer term where we want to build. So an example of that would be California, synergies aren't as high on acquisitions in California because we're building out that footprint but it's a great acquisition and we've got our wholesale footprint in California.

So now we're building out that retail and then we'll start getting those higher level of synergies going forward after that footprint gets built in a little bit more.

Okay. That's helpful.

And just a follow-up for me, I think your comment earlier Luc was - did you suggest you have roughly two weeks of flexibility still in your supply chain to manage through the current blockades and if it's beyond that then that's when you'll start to feel more significant impact? Is that what I heard?

Yes there will be one to two weeks I would think. And -- but it doesn't mean after that it's -- after that what happens is we're got to start to curtail.

We're going to start to look at not even filling everything full. You just straight to a level then you do more customers.

So we'll have a major, major work of logistics to do to make sure customers don't run out but you don't feel the same rate. Your goal is for you to not filling up the tank totally instead of filling it up.

So that's not that it follows-up but clear after 30 days or 10 is that it gets twice as difficult and more logistics to make sure customers don't run out.

Yeah. It's similar to the same activities with the strike where there's allocations, where there's non-critical volume, making sure that critical and heating load et cetera.

But as Luc say again we -- you don't necessarily fill the tank. You do partial fills.

So there are ways to manage through it but it becomes much more difficult to manage in the next one to two weeks on the propane side.

No understood. Thanks.

With luck we'll get some political fortitude here and get these issues dealt with sooner than later. Thanks.

Thanks.

Yeah, good morning. Luc, I appreciate the guidance for 2020 but now that the chemical sales process is complete, just curious when you'll be unveiling your next four-year plan.

And not trying to be facetious here but given the stock is down, I guess 10% now over the past three years, just wondering what you would change if you could go back to late 2016 when you came out with Evolution 2020, or I guess what might you think about implementing differently within your next four-year plan?

No. It's a good point and there are things I would do differently.

I think the Energy probably not because we're really – from a business model of opportunity for grow U.S. There's a ton of opportunity and it's going to get better by having the NGL and getting size went over $200 million EBITDA U.S., one day it will be $300 million and $400 million, which is all available and we get so much synergy every time we acquire.

Probably we have sold chemicals year-on-year. I go back to my career, there's been eight-plus big turnaround like this one.

And I mean, I don’t say when we look at changing something you often take three, six months too an often to get everybody in line to decide and move on. So just using your guess.

That three to six months, I would go back and do it a bit earlier, because we didn't expect the chlor-alkali change was reasonably good. We didn't expect a big change like that in this November and December and now sharing into 2020.

Taken by surprise on our -- the midyear 2019, we didn't see it. When we put the company in the market, we didn't know that was coming and where.

Probably we'd redo it and do it earlier.

Got it. And I guess looking back at the CPD process, I mean clearly that worked out hanging on to that business and then coming back to market 18 months later or so.

So what do we need to see I guess on the chemical front either from a macro or on asset-specific basis just in order for you to think about putting the business back on the block?

Well, there’s just twofold. First, we're confident that our ERCO team will carefully [ph] pull chemical.

They're the operators. We know it's coming back.

We know that the -- what we're going through 2020, we could see 20 years and every five years as a disconnect that doesn't even lasted full year. So we're on the disconnect.

You could have a buyer that says, I get it. That's my career, my life and I'm international and at the bottom.

So it's not a bad time to give us a call and there's an amount that we wouldn't sell at. That's why the deal didn't happen.

And I think probably retail [ph] business will come back, one year, two, I don't know. But when that's back in then you have more value.

Getting caught in the -- at the moment of the sale was pretty well done a bit like CPD. And then CPD was different for no change.

The bar changes behind the States. This forecast less and bad timing and -- but the business is good cash flow.

It's well organized. I think we're the best in the accelerate from a cost.

And now we go to market and export. So we do best job.

Chlor-alkali we're a small player with big volume for us. Our total EBITDA of -- chemical it varies.

And when it varies, it goes up, you gain $20-plus million. When it goes down we lose it.

Bad timing. So on its -- there is -- there are people out there that understand that business and there are strategic -- and then we could confirm that understand that and say, I can live with that because there's an average five years.

It's kind of okay. But you have one year every five years that brings you down.

And then you go probably higher than average on -- over time during that five year. So a good cash flow and a solid business with a great market position in chlorate.

There's people that get this and we'll come back. We're not putting it back on the market for a while because enough is enough.

Let's go to work and do our stuff. But calls do come in.

And if there's intelligent call, its hard and its values okay, we'll go back and selling it. But we want to make sure first, it would be somebody very serious that pay the right price.

If not we'll wait for that one, two years' period.

Okay. Thanks for those comment.

I’ll leave it there.

Good morning guys. So I'll start off with some questions regarding your EBITDA sensitivity.

Can you give us some sense of the U.S. wholesale pricing environment decline?

How did that impact your EBITDA for the propane division and also the wholesale market fundamentals for the Canadian environment? If you could just put that in perspective in -- for 2019.

I think from a U.S. perspective what the commodity environment allowed us to do was fundamentally retain some higher margins than you would in a rising propane cost environment.

From our perspective, we would within the U.S. been at that $0.35 average.

So our view would be it was roughly $0.03, $0.04 between underlying wholesale market fundamentals and the lower commodity price. So that's the U.S.

From a Canadian perspective, the wholesale market fundamental is allowing for that robust differential EBITDA, positive EBITDA impact. Best way to think of that is it's roughly one to two bps.

Perfect. And then if you could tell me what your sensitivity is to 1% colder weather for the propane division again.

1% I don't know.

Or like whichever way you want to describe it 5%, whichever way you want to describe it.

Typically, the way that we would describe it is a little bit more of overall. And when you think about it from an annual perspective, because we obviously forecast based on the five-year average as you would be aware of, so the best way to maybe think of it is the warmer-than-average weather or frankly colder-than-average weather could have an impact plus or minus between $10 million and $20 million.

Perfect. And then just finally Luc going back to the point that you made previously.

Is it -- did I understand this correctly that the potential buyers for the Specialty Chemicals division they will look basic devaluation based on the current macro environment, but not the average macro environment over a longer-time period? Is that the way to think about it?

Yeah. If I understand your question correctly, there was the buyer would look at five-year average but then that five-year average when 2020 -- late 2019 and 2020 forecast shows up, you saw a decline in which we were transparent about it, the decline in price in those two products and kind of figure -- oh boy, what's going on here?

They were not as knowledgeable about each product the chemical business, so they got a bit nervous. And we told them what it means and we told them what it means for 2020 and we're right about it.

And they were a bit nervous and I was not prepared to take lower value than a certain amount, because it will come back and they'll get that value.

Makes a lot of sense. Thank you so much.

That's all for me.

Are you online? I’m just wondering, Chelsea you are on mute.

Hi.

Yeah. Sorry.

I was on mute.

Okay. I thought….

Yeah. Good morning.

Yeah. So you mentioned Beth that the lower range of guidance is impacted by the CN rail issues.

So how should we look at this muted optimism for 2020 in regards to this? Like how much of your business do you think is going to be impacted?

Is it throughout 2020, or should I look at it on a quarter-by-quarter basis? Yeah.

That's what C&I.

Yeah. And for -- I just missed the first part of your question in what and how it impacts within a weather -- I just wasn't sure what variable you were asking.

Sorry. Yeah, just -- you mentioned that the lower range of your guidance is impacted by the rail issues.

So I just wanted to know how we should look at this mute optimism for 2020 and how…

We identified -- yeah. We identified that as something that could impact the range clearly, because if it extends it can have that -- a larger negative impact on transportation.

But yeah, it would be something the impact. Our expectation would be -- it would be a Q1-type item.

And as a result of that you wouldn't expect to see that later in the year that impact would be seen earlier, I mean, absent a larger impact on the Canadian economy depending on how long it continues.

And how much do you expect this is going to impact the business if you want?

It's a little too early right now from our perspective to reasonably quantify it. We just know that it's a potential headwind.

Right now, we don't view it as material. But that being said, it's very tricky and it's going to be duration-specific to the level or the impact that we feel from it.

And so your guidance that you gave us is just the lower end is just the -- that -- need a couple of them for that?

Yeah. The lower -- I mean, the lower end of the range when you think about it, there's a lot of factors that can provide headwinds to get us towards the lower end and there's a lot of factors that can be tailwinds that get you towards -- and you're going to have some one direction and some in the other direction.

So it's a little bit of anticipating, not everything is going to move the same direction. But what we feel is a reasonable variation and are pricing for the various items that could change throughout the year from expectations currently.

Okay. Perfect.

And my last question is in terms of the guidance. Does that include any more tuck-ins for 2020, or…

No, it doesn't include any more tuck-ins. That would be net positive, depending on when they occur in the year.

Perfect. Thank you.

That’s all for me.

Great. Thank you.

Great. Thanks.

Good morning everyone. Just a quick clarification on the rail impact.

You mentioned your propane side is okay for another one to two weeks, before you have to kind of implement some more kind of mitigating activities. Could you comment a bit on the chemical side?

Is that also a one to two-week range as well?

Yes. At this point in time because of where our customers are versus the current positioning of the various blockades, we haven't been strongly negatively impacted.

So from our perspective where -- we don't have issues right now. So the rail down to Buffalo and around is possible and that's how we've been doing redirect.

So, currently, on the chemical side we've got effective workarounds. But I always caution with that, because there could be some point in time when you get more congestion points on the workaround, because more and more people have to start creating workaround of -- just because of the stress that -- the stress on the overall system.

But, currently, we don't have a forward forecast when it would become more challenging on the chemical side. Propane is more time-sensitive at this point in time.

Okay. That's great.

And then, second question relates to -- I think, Luc mentioned that there's a pretty large pipeline of tuck-ins that he sees. Should we be assuming that $100 million is the minimum amount of tuck-ins we should see this year?

And I just want to see what the ceiling could be like, where you would start to kind of limit the number of tuck-ins? Like, yes, what's the range we could expect?

Yes. Probably, I'll start and Beth can add on.

We have a good cash flow business and we have the DRIP now, and we have a line. The pipeline is real and better than I've seen since we started buying in the States.

So I know that from a financial --

Yes. I think from our perspective on what we've seen in the funnel, I mean, we like the targeted expectation about $100 million from a tuck-in perspective.

If there are more opportunities, certainly, we consider them. I mean, I think, at that point in time as we look to our longer-term leverage targets, et cetera, we would obviously look at various alternatives from a capital market perspective.

But, certainly, if there are accretive transactions that make sense to us, we'd look to prudently finance those where they make sense.

Okay. That's good.

And then, another question on the chemical business. Could you give some color in terms of the EBITDA contribution mix in 2019 from chlor-alkali versus chlorate?

Like, does the chlor-alkali contribute roughly like 40%? And are we expected to see a lower contribution in 2020?

Is that how we should think about it?

Yes. Nelson, maybe the best way to think about it is, we're looking at it, because the bulk of the headwinds are in chlor-alkali.

In 2019, the chlor-alkali will be roughly 38% of EBITDA. So think of it in a 30% range in 2020.

And then, from there chlorate we're -- 2019 would be 57%, sort of that 60% to 65% range and the remainder is chloride.

Okay. Got it.

Yes. Those are all my questions.

Thanks a lot. Sorry.

One last one. I guess, I missed.

In terms of expanding the Buckingham and Valdosta facilities, what do you roughly have budgeted as the CapEx spend for 2020?

It's roughly for all the growth CapEx in ERCO $16.9 million.

Okay. Thanks.

That’s all for me.

Thank you.

Hi. Good morning.

Good morning.

Good morning.

Two questions. I'll ask in order.

First on AOCF, would we expect -- would you expect AOCF to decline 6% in 2020, or can you maybe go through some of the puts and takes that might make AOCF better or worse than the 6% EBITDA decline?

I think from an AOCF perspective you could consider cash -- like I'm just trying to think about the different impact. So, if I look at it from an adjusted EBITDA perspective, you have your midpoint come up with AOCF.

Interest expense would be similar to 2019. And then cash taxes think of being somewhere between $15 million to $20 million.

They will be higher on a year-over-year basis. So, from that perspective, I think when you look at some higher weighted average shares outstanding from DRIP, you probably have a slightly higher decline of -- than the 6%.

Like if you factor that in the 30% DRIP on the weighted average shares in those increases, I think it'll work out a little over -- it'll be somewhere in that 5% to 10%.

That's helpful. Thank you very much.

My other question is -- Luc, so I understand that late in the process the commodity outlook look worse into the buyers. Got some cold feet on the multiples you hope to achieve in specialty chem.

But considering that you are very passionate for years, how much value you can add to acquired and tuck-in propane businesses 25% better earnings? Isn't it -- why wasn't the right choice to take a lower multiple, swallow it a little bit there, but get the proceeds -- get the propane M&A strategy to where you want it to be to really be able to execute on what you think is your core competency and secret sauce?

Thanks.

Yes. I think first it's not what we think it's what we've accomplished for 10 years.

So, it's reality. It's a good question because where do you stop?

The decline in the chemical that you see in our new forecast, it's big enough that it's -- you don't get -- even including the design, you won't get the value of an average, we did in a way with this particular buyer. So, to me it's all about short or mid-term.

I always said every decision we'll make here is for the different stakeholders; the customers which we're drawing with and growth and the -- getting good service, reduce attrition; our employees who have a good time working here and within company that's building more in the States, of course, with the Energy. And our shareholders, we're -- we really work hard to get them good value.

And in 2020 enough fund that the EBITDA is not going up as what we've done for so long. And then you get to a point you say, okay, value is lower than what makes sense to us.

And we're not crazy. If it was $5 million, we would swallow it or maybe $10 million.

But when you get to a point where your EBITDA goes down next year 2020 so much, the values go down too much, then you have to take a mid-term. There is no way this business is not coming back.

There's no way that $20 million, $30 million is not coming back. And mid-long-term, if you take two, three years, shareholder, they're here for three months.

They're here for three years -- two to three years. We will end up doing it at better value.

So, if you think this year, yes, it would be great to have sold it and move on. Now, for a ton of reason, do we take -- accept what 2020 is bringing us and do the best we can with that and then two years, we're better off?

I think we will be better off with real value we'll get from that -- during that time. And then we'll end up with there being the same mid-long-term strategy and growth in department.

It's just you think you're bringing in the year because -- this year. So, it came to a point when you have all the facts that we have, you make the decision the best that the management team that looks at it.

And I can understand from an upside to say, sell it at any price and move on. You have such a great strategy opportunity.

But we don't like to take money to a certain level lower than what shareholders should have.

Thank you.

Yes. Thank you.

We're certainly all hands on deck moving -- looking ahead. And we don't spend a lot of time enjoying what we did last year because it's all about next year and the year after.

But I want to take a second to thank all the employees, management in Superior for an outstanding year that we've had. And for shareholders, if you can take more than -- 2020, we're below last year, we don't like that.

But if you're in it for the mid-long-term, there's no doubt that we're going to do a big stock. And thank you all for participation.