Empire Company Ltd Q4 2021 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Patricia A. Baker - Scotiabank Global Banking and Markets, Research Division - Analyst : Michael, I just want to follow up a little bit on a comment you made in your opening remarks. One of the underlying tenets of Project Horizon is that the initiatives that are embedded in Project Horizon are designed to drive market share increases. And you stated that you expect that you'll be able to sustain the majority of the market share increases that you saw in the last year. And I'm just curious about what would be the drivers of that? And then more importantly, are you doing anything special to try and keep the new customers? And is there anything there that you can share with us?

Question: Patricia A. Baker - Scotiabank Global Banking and Markets, Research Division - Analyst : Okay. I just have a follow-up question. It's on Voila and your plans to roll out another 90 of your store pickup in fiscal '22. I'm just curious whether that would have been in your original plans? Or will you drive it by the experience that you had with the first 30 to roll that out faster?

Question: Patricia A. Baker - Scotiabank Global Banking and Markets, Research Division - Analyst : Are you going faster than you anticipated because you might have seen good experience with the first one already open?

Question: Vishal Shreedhar - National Bank Financial, Inc., Research Division - Analyst : With respect to your promo effectiveness initiatives and your data analytics, is Empire's reliance on a partner system for loyalty data? Is that a hindrance at all? Or are you able to get all the data that you need in the manner you need it? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 23, 2021 / 4:30PM, EMPa.TO - Q4 2021 Empire Company Ltd Earnings Call

Question: Vishal Shreedhar - National Bank Financial, Inc., Research Division - Analyst : Okay. And Michael, maybe thoughts on just strategic orientation. Empire's acquisition is mainly focused on the conventional arena focused on GTA, let's say, but the fastest-growing demo is immigrants, minorities, and they tend to shop at discount more. I'm wondering if this is something that Empire reflects on? And if they feel the mix of discounted conventional is appropriate in the GTA?

Question: Peter Sklar - BMO Capital Markets Equity Research - Analyst : I just have a few quick questions on Voila. Michael Vels, you said that it lost $0.18 for the full year. And I believe you gave the loss for the third -- the fourth quarter, but I missed it.

Question: Peter Sklar - BMO Capital Markets Equity Research - Analyst : Sorry, say that again?

Question: Peter Sklar - BMO Capital Markets Equity Research - Analyst : $0.04. Okay. And then can you talk a little bit about the accounting for the launch of the Montreal CFC, like it's launching in the next calendar year. Can you -- when is the launch date? And how do you deal with costs up until that time? Is everything capitalized? Or are there expenses that are falling to the bottom line?

Question: Peter Sklar - BMO Capital Markets Equity Research - Analyst : Okay. And then Michael Medline, I believe I heard you say that you're going to try and convert people from iga.net over to Voila CFC in Montreal, is that correct?

Question: Peter Sklar - BMO Capital Markets Equity Research - Analyst : So how does that work? Because I believe IGA is a franchise system in Quebec. So how do you deal with the franchisees on that issue? Pierre St-Laurent - Empire Company Limited - Executive VP & COO - Full Service I'll take it. We had discussion with franchisee on that topic since many years. So we're all aligned on the purpose of having an automated CFC. So the franchisee are well engaged in our strategy. We're not seeing any issue by doing it. By the way, we have a huge -- in Quebec market, not only in our business, but in general, the unemployment rate is very low. There's a lot of shortage in retail in general. So dealer will use their resources to serve customers coming in a store and will serve e-commerce customers on a most -- in a more efficient way through a CFC. So it's a win-win till the CFC will have more window deliveries open. So we have more chance to meet the demand. And like Michael said, the -- when we look at the profile of these customers, they are more loyal to the entire ecosystem by 1.5x. So there's a win-win for us, for them, at lower cost and in a most -- and better efficiency. So these things have been shared with dealers over the last 2 years. So we have very good discussions. We have very strong relationship with them, and they're really well engaged in that strategy. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 23, 2021 / 4:30PM, EMPa.TO - Q4 2021 Empire Company Ltd Earnings Call