Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to the High Liner Foods Incorporated Conference Call for the results of the First Quarter and Fiscal 2019. At this time, all participants are in a listen-only mode. Following managements prepared remarks, we will conduct a question-and-answer session and instructions will be provided at that time for you to queue up for questions. [Operator Instructions] This conference call is being recorded today, Tuesday, May 14, 2019, at 2:00 P.M. Eastern Time, for replay purposes. I would now like to turn the call over to Heather Keeler-Hurshman, Vice President of Investor Relations and Communications for High Liner Foods. Ms. Keeler-Hurshman, please go ahead. Heather Keeler-Hurshman: Thank you. Good afternoon, everyone. Thank you very much for joining High Liner Foods' conference call to discuss our financial results for the first quarter of 2019. On the call today from High Liner Foods are Rod Hepponstall, President and Chief Executive Officer; and Paul Jewer, Executive Vice President and Chief Financial Officer. In a moment, I'll pass the call over to Rod, for some brief remarks before handing over to Paul who will review the company's financial performance for the first quarter. Rod will then wrap up the call with a brief update on the company's progress against its five critical initiatives. We will then open the call up to questions. I'd like to remind listeners that we use certain non-IFRS measures and ratios when discussing our financial results as we believe these are useful in assessing the company's financial performance. These measures are fully described and reconciled to IFRS measures in our MD&A. Listeners are also reminded that certain statements made in today's call may be forward-looking statements that are subject to risks and uncertainties. Management may use forward-looking statements when they discuss the company's strategy and business in the future. Actual operating and financial results could differ materially from those anticipated in these forward-looking statements. High Liner Foods includes a thorough discussion of the risk factors that can cause it's anticipated outcomes to differ from actual outcomes in its publicly available disclosure documents, particularly in its Annual Report and its Annual Information Form. Please note, that High Liner Foods is under no obligation to update any forward-looking statements discussed today. Earlier today, High Liner Foods reported its financial results for the first quarter ended March 30, 2019. That news release, along with the company's MD&A and unaudited condemned [ph], interim consolidated financial statements for the first quarter of 2019, have been filed on SEDAR, and can also be found in the Investor Information section on the High Liner Foods' website. If you'd like to receive our news releases in the future, please visit the company's website to register. Lastly, please note that the company reports its financial results in U.S. dollars, and the results to be discussed today are stated in U.S. dollars, unless otherwise noted. High Liner Foods' common shares trade on the Toronto Stock Exchange and are quoted in Canadian dollars. I will now turn the call over to Rod. Rod, please go ahead.

Thank you, Heather and good afternoon, everyone. As you know, we're executing against five critical initiatives to address the challenges facing our business and return High Liner Foods a possible organic growth. In the first quarter, we are more profitable in result, as a result of eliminating lower margin products and are seeing significant improvements in our cash flow, adjusted EBITDA and net debt to adjusted EBITDA because of efficiencies we're driving across the business. Paul, will provide a detailed review of the numbers but the key takeaway is that while markets challenges still persist, we're executing against our critical initiative plan and it's delivering the results we're hopeful at this stage in the process. I'm especially pleased with the progress we've made on our supply chain excellent initiative. We've identified the opportunity to expand the scope of this initiative and other costs savings activities to deliver significantly greater net annual run rate cost savings than the $10 million we originally estimated were associated with our critical initiative plan. We have engaged consulting firm, AlixPartners, to accelerate delivering the increased costs savings associated with our expanded scope. The cost savings that we are driving from our critical initiative plan will play - will be key in helping us offset headwinds in our business, namely ongoing volume declines. Costs savings however, are only one side of our plan and we're focused on investing in the right people, processes and product to capitalize on opportunities to further leverage our scale, increase demand for our value-added products and return to profitability organic growth. In the meantime, you will have seen our news release this morning, the Board concluded its capital allocation review and has revised the quarterly dividend to CAD0.05 per common share or CAD0.20 on an annual basis, in line with our previously disclosed dividend guidance. This will free-up approximately $10 million in annual cash flow that will support the reduction and refinancing of debt to create a stronger balance sheet. The Board will continue to review capital allocation priorities throughout the course of our turnaround plan and expects to revisit the dividend level once we've returned to profitable organic growth. Finally you're likely aware that U.S. tariffs on certain products imported from China, including seafood, will increase from 10% to 25% effective May 10, 2019. As currently drafted these tariffs apply only to a limited species sold by highlighter foods and as a result of our mitigation activities are not expected to have a significant financial impact. Follow now I'll take you through our financial performance in more detail after which I'll share further updates on our critical initiative plan. Paul? Please go ahead.

Thank you, Rod, and good afternoon everyone. Please note that all comparisons provided during my financial review of the first quarter of 2019 are relative to the first quarter of 2018. Unless otherwise noted. Before getting into the first quarter financial results, I'd like to update listeners on the recovery of losses related to the company's 2017 product recall. An $8.5 million recovery from the ingredient supplier was recognized during the first quarter of 2019 of which $5.5 million was included in adjusted EBITDA. The remaining recovery of $3 million and the $8.5 million recovery received in the third quarter of 2018 were excluded from adjusted EBITDA consistent with the treatment in fiscal 2017 when the related $11.5 million in product recall costs were excluded for the purpose of adjusted EBITDA. The company's total recovery related to the product recall was $17 million reflecting a full recovery of the $13.5 million in losses recognized during fiscal 2017 related to the recall and an additional $3.5 million related to business disruption. No further recoveries are expected. I want to highlight the company's adoption of the new lease standard IFRS 16, Leases effective December 30, 2018. The implementation of IFRS 16 has resulted in additional assets and liabilities on the consolidated statements of financial position of approximately $14.6 million and approximately $5.1 million previously accounted for as operating lease expense is now accounted for as $4.6 million of depreciation expense and $1.3 million of finance costs for the full year of fiscal 2019. The new lease standard was adopted using the modified retrospective method and therefore a comparative information for 2018 has not been restated. Sales volume decreased in the first quarter by £9.6 million to £78.5 million compared to £88.1 million in the same period in 2018. The decrease reflects lower sales volume in our food service and retail businesses, including lower sales volume as a result of a major customer loss in the latter half of fiscal 2018 and the exit of low margin business. Also, Easter was later in 2019 compared to 2018, shifting some sales volume to the second quarter of 2019 compared to the same period last year. Sales in U.S. dollars decreased in the first quarter by $41.8 million to $277.4 million mainly due to the decreased volume mentioned previously and changes in product mix partially offset by price increases related to raw material cost increases. Gross profit decreased in the first quarter by $4.5 million to $56.1 million due to lower sales volume and raw material cost increases, including tariffs on certain species imports into the U.S. from China. This decrease was partially offset by price increases, favorable product mix related to the exit of low margin business and improved plant efficiencies partially related to the supply chain excellence initiatives. In addition, the weaker Canadian dollar had the effect of decreasing the value of reported U.S. dollar gross profit from our Canadian operations in 2019 by approximately $600,000 relative to the conversion impact last year. Adjusted EBITDA increased in the first quarter of 2019 by $8 million to $32.2 million and was 11.6% of sales compared to 7.6% of sales in the prior quarter. This increase reflects $5.5 million of the product recall recovery. The impact of adopting IFRS 16, Leases and a decrease in distribution and SG&A expenses partially offset by the lower gross profit discussed previously. The impact of converting our Canadian dollar denominated operations and corporate activities to our U.S. dollar presentation currency decreased the value of reported adjusted EBITDA in U.S. dollars by $2.1 million in the first quarter of 2019 compared to $1.1 million in 2018. Reported net income increased in the first quarter of 2019 by $4.5 million dollars to $14.8 million dollars with diluted earnings per share of $0.43 compared to $0.31. The increase in net income reflects the increase in adjusted EBITDA and the additional $3 million of product recall recovery from the ingredient supplier that was excluded from adjusted EBITDA in the first quarter of 2019. This increase was partially offset by increased termination benefits related to the organizational realignment announced in November 2018. Higher income tax expense and increased finance costs and depreciation and amortization expense partially related to the new lease standard. Excluding the impact of certain non-routine and non-cash items which are explained in our MD&A including the $3 million product recall recovery excluded from adjusted EBITDA, adjusted net income increased in the first quarter by $4.2 million to $14.9 million and correspondingly adjusted diluted earnings per share increased by $0.12 to $0.44. Turning now to cash flows from operations and the balance sheet. Net cash flows from operating activities increased by $18 million to $27 million in the first quarter of 2019 primarily reflecting more favorable results from operations and favorable changes in net non-cash working capital partially offset by higher interest and income tax payments. Net debt decreased by 47.2 million to $353.4 million at the end of the first quarter of 2019 compared to $360.6 million at the end of fiscal 2018. Net debt to rolling 12-month adjusted EBITDA was 5X at the end of the first quarter of 2019 for 4.8X when calculated with trailing 12-month adjusted EBITDA for the new lease standard compared to 5.8X at the end of fiscal 2018. We expect this ratio will improve throughout the remainder of this year due in part to the reduction of the quarterly dividend rate on the company's common shares, improved cash flow management and the acceleration of cost saving activities. That concludes my financial review and I will now turn the call back to Rod for some additional color on our critical initiatives.

Thanks, Paul. And I'll briefly touch on each critical initiative and highlight some of our key actions over the last few months. In terms of our organizational realignment. I'm really proud of how well our team is performing within the new structure we put in place at the end of last year. We've right sized our resources and demonstrated a collaborative supportive of one High Liner Foods culture that I believe has broken down silos and significantly improved our processes. This is key to leveraging the advantages of our scale and I'm pleased with the progress, teamwork and commitment I'm seeing across our network. Regarding business simplification, we've developed the plan to streamline our portfolio and drive profitability. We've identified species and SKUs we intend to exit by the end of 2019 and we're also looking at opportunities to simplify raw materials, packaging and ingredients. We expect this activity will ramp up in Q2 and continue through the rest of the year and we'll be able to provide more details once we finalize the process with our customers and suppliers. We're also fully prepared to exit product lines that are not delivering the margins we need. In fact, we've already eliminated a number of products for this reason. As we saw in the first quarter, taking action on cost will impact sales volume in the short-term but I'm confident that we will - it will ultimately strengthen the overall profitability of our business. Working on our supply chain excellence initiative is advancing well and is being aided by the cross-border integration driven by our structural alignment initiative. During the first quarter of the year, supply chain improvements positively impacted EBITDA by approximately $1 million. We're casting a wide net and examining all critical supply chain connections. As I already mentioned earlier in the call, we've engaged AlixPartners and are expanding the scope of our supply excellence work to now include improvements from the plant level through to purchasing and logistics along with further reductions in SG&A expenses. In doing so, we now expect to deliver significantly higher net annualized run rate cost savings than the $10 million target we previously communicated. Rubicon is another example of work underway to extract more value from our existing business. We're implementing our collaborative go-to-market strategy and seeking to leverage opportunities to put Rubicon in front of new customer segments across our North American network. As you know, our first four critical initiatives set the foundation for our most important one, profitable organic growth. Cost savings are important in helping to offset the headwinds pressuring our top line results but they're only one side of the equation. Success there along with strengthening our balance sheet will allow us to reinvest in areas of our business and support growth moving forward. Importantly we're taking swift action to help prevent further customer losses. This includes a number of changes to our sales and marketing team to ensure we have the right mix of talent and expertise as we start to ramp up our marketing efforts to fuel growth. We've updated our customer engagement models that we're now more collaborative. My leadership team and I are engaging more closely than ever before and in many cases directly with customers and suppliers. At the same time we're actively advancing plans to develop a strong portfolio, profitable value added products with broad appeal to retail and food service customers across North America. We are collaborating with industry leading suppliers and other industry partners to ensure High Liner has on trend in industry leading innovation and we're developing and rolling out products for fast growing non-traditional areas like snacking. An example would be our Haddock Bites new product. Early results are promising. Service and quality levels are as good as they've been in recent history, based on fill rates and customer feedback tells of our latest product innovations Haddock Bites and everything-bagel, Crusted Cod have been extremely encouraging. And the rebrand of our iconic Captain High Liner launched in April was very well received by customers who appreciate this modern take on our classic branding. In summary, we're seeing progress. Our balance sheet is getting stronger, our products mix more profitable and our supply chain more efficient. But there is more work to do. We must continue to address volume declines and prepare for further pressure in this regard, including increased tariffs just put into effect by the U.S. administration. We recognize the significant task ahead of us but I'm confident based on the work done to date and the early results we're seeing, we're building the foundation we need to return to profitable organic growth. Operator, I'd like now open the call for questions. Thank you.

[Operator Instructions] The first question comes from George Doumet of Scotiabank. Please go ahead. Your line is open.

Good afternoon guys. I'd like to focus a little bit on volumes, they were down 11% a quarter. Just wondering how much of that is a deliberate exit of certain product categories and maybe how much of that you estimate was the industry on down as a whole quarter?

George, I would say without getting the specifics, over half of that was deliberate decisions on prop on customers or products that were not as profitable as we need moving forward. And we will continue to take action to improve our overall product and customer mix.

Okay, that's helpful. Maybe on the topic of volumes, I guess given that we would expect these quarters to probably mark kind of a low point in terms of growth given the Easter shift, the Easter shift and improved operations in the back half, right?

Yes, that's accurate.

Okay. Paul how much price do we take in the quarter?

Sorry?

I'm just wondering how much pricing we took in the quarter.

Well, obviously it varies across channel and species but there was quite a bit of raw material cost increases in the latter part of 2018 that we had to pass through and we did have to pass through the increase associated with the tariff when it got implemented at 10%. So there was there was quite a bit of pricing that we had to take that impacted the quarter and you see that reflected in the fact that the sales dollar decline is not as significant as the sales volume decline.

Okay. How long is that going - how long is that kind of those higher prices going to go on for another couple of quarters to Q2, Q3.

Well, it will probably depend on what continues to happen on the tariff front obviously, because as we do see further tariff action we will have to increase prices there. In terms of raw material cost, that has largely stabilized, in fact we're starting to see a little bit of a decline in one of the species. So we're not anticipating significant raw material cost increases in the balance of the year again other than subject to what may happen as a result of tariffs.

That's really helpful. Just last one if I may on the improved plant efficiencies that you guys called out for contribute to gross margins. Can you talk about what we're doing there and what still needs to be done?

Well, I think it directly speaks to one of the five critical initiatives we have and that is a comprehensive review candidly of our supplier, our entire supply chain demand and we're seeing plants run rates improve, the simplification of our business is certainly supporting those initiatives and just quite frankly better all operations in totality are driving better results for us .

The other item I would highlight, to add to that George, is we've been successful. Your colleague a year ago, we had to have some third-party co packing done, which obviously comes at an increased cost us. We've been successful at essentially moving all of that back into to our plans.

Okay. Those are my questions. Thank you.

Your next question comes from the line of Sabahat Khan of RBC Capital Markets. Please go ahead. Your line is open.

Thanks and good afternoon. Just one on the volumes. I think you indicate in the outlook that you're continuing to face ongoing volume declines and then I think earlier there's some conversation about this being sort of maybe the bottom quarter in volume decline. I guess should we expect less of a decline for the rest of the year beyond Q2? I just want to get an idea of how you're thinking about volumes for the full year.

Yes, I would say that that's probably an accurate picture. This certainly is a very dynamic marketplace for us. We have a number of initiatives underway to certainly bolster volume, some of those are new product introductions into the marketplace. We've talked about before Haddock Bites, everything-bagel, Crusted Cod product, which are performing better than expectation. We've done things like certainly refreshing packaging which you're going to begin seeing in the marketplace very soon. Certainly much more contemporary captain as well as securing roughly 14 new skews at three major retailers in the U.S. that will begin seeing in the fall during normal reset process and not to mention a repositioning of highlight product portfolio or major Canadian retailer which gives us significantly more presence in the aisle, more door space and so on. So we have a number of initiatives underway that are creating momentum not only from an innovation perspective but in addition to momentum with our customers as they see that product coming to market.

And then just maybe one on the broader industry. How are you seeing the volumes for the overall processed Seafood Market trending over the next call, I talk to 24 months and just related to that, is it any substitution benefit as African swine flu affects the pork population and there's some inflation there. Is there any maybe substitution benefit to the seafood category they're expecting at all?

Yes. I would say we are - our view on the category itself is much more stable than it maybe has been in the past. So we're not expecting any significant shifts in consumer demand or consumption. Quite frankly, we're going to be erring, we are going to create opportunity. I would say as relates to the swine flu and the impact there, we have no - I guess no perspective on at this point as we're monitoring what potentially happened there as well.

And then as you sort of rationalize a lower margin products, would you say you're largely through that process or is there still some of those sales to cycle through for the rest of the year?

Well, I think we are going to continue to raise the bar as we increase efficiency, innovation and bring new products to market. We're going to be in a continuous process to ensure that we have the right focus on margin improvement and products that contribute to the overall profitable growth of the organization.

And then one last one for me. On the capital investment side, I guess following the dividend reduction, how should we think about the capital expenditures, call it over the next 12 to 24 months once you get past the realignment initiatives?

Yes. So are our CapEx expectations for this year are about $10 million, which is a little less than what we spent on average over the last few years. I would expect that would potentially go up a little in 2020 back closer to the average but nothing significant that we're expecting on the capital front at this time, obviously as we have opportunities to invest, and get a good return, we will continue to do that. And we are, in the meantime, going to continue on reducing the leverage and reducing debt.

Our Next question comes from a line of Kyle Mixie [ph] of Cormac's securities please go head your line is open.

Hi guys, on your cost-cutting program, can you confirm how much of the previously announced $10 million a year cost-cutting would've been reflected in your Q1? Is it still just the $7 million you had already realized ending in less or did you squeeze that more?

Oh, there is more than that reflected. We've exceeded on a run rate basis in excess of the 10 that we had targeted. Obviously that you know Hits the bottom line through the year but on a run rate basis has certainly exceeded our original expectations.

Got it. Okay and then on the commentary about your customer losses in the back half of 2018. Is that the Rubicon related stuff we know about or was [technical issue] losses you got hit by.

No, there was also a loss at the high liner level as well and as well as the losses as we've referred to earlier that was planned as we talk pricing action to improve margins.

Got it okay and then you mentioned over half of your [indiscernible 26:15] all in decline was stuff they cutting their products. you also said you have more products to cut out like order of magnitude, how much of this is left I guess in Q1, you cut out 5% of your top line. How much should we expect going through the rest of the year.

Yes, Q1 as we said earlier. Q1 was the most significant impact in terms of our expectations on volume in the year that's partially driven by like timing, right. The reality is we have a lot more volume in lent [ph] that falls in the first quarter. So as we're working on margining up that business, there's a more dramatic impact in that lent [ph] period if some of that declines. and I think our focus through the balance of the year is we will continue to take it out low margin business or margin it up through pricing activity but as Rod identified we've got a number of activities underway to offset some of those losses with new profitable organic growth initiatives.

Okay and then just on the additional cost cutting that you're going to be looking for beyond that $10 million you've hired the consultant any kind of order of magnitude guidance you can offer there. Like is this we've got another 20% or are you doubling this cost-saving program.

It's probably a bit early to comment on that. What I can say is that through the early initiatives by the High Liner team we did recognize further opportunities which is why we engaged Alex [ph] partners. They certainly have expertise in driving a cost and creating efficiency within the organization. So bringing them in helps us not only accelerated the opportunities to capture that but to ensure that we are leaving the prevail no stone unturned.

But it's definitely not only 10% as you identified is significantly more opportunity.

[Operator Instructions] The next question comes from Jonathan Lammers of BMO capital markets please go head your line is open.

Good afternoon. If I could ask the Alex [ph] partners question in a different way. When did you formally engage with them?

So AlixPartners engagement started roughly, we'll call it 5 weeks ago. So they have been in for a relatively short period of time and quite frankly we're very, very pleased with the outcome already.

And when do you expect, we might see some actions taken?

Actions taken in in in what sense? Just a little bit clarity on that.

Well, I understand you're still developing a plan with Alex [ph], I'm just asking when we might start to see some Actions taken by management to execute on whatever plan you end up coming up with if you have a thought as to the timing there.

Well, I would say that we've already been taking significant action in the organization to optimize opportunities available and again AlixPartners will be coming in to help us expedite that certainly in areas broader across our complete supply chain network. That action will be taken immediately.

Do you have any examples today of an area where you think that there could be Meaningful opportunity, just at a high level?

Yes, I think it's an example where there's opportunity certainly across our indirect spends, further opportunities across our transportation warehousing. as I mentioned earlier, we are absolutely looking at every spend component within this organization to deliver on the right opportunities to do leverage and reduce debt as well as create the right opportunities from innovation and market introduction and customer engagement process to drive top line growth.

And the new products introduced this year, you know Rod I believe that you're Commentary with respect to the how do you buy it says as kind of - That the products doing a bit better than when we first we discussed it a few months ago. Are these products tracking to material impact at This point?

Well it's not results - it's probably a bit early to say as we are number 1, very pleased with the - certainly customer feedback, as well as consumer feedback on those products but these, are some of the first product that we have actually developed for complete North American product problem - north American product portfolio so as customers have different Opportunities to sell in or launch product, it'll be more of a rolling effect. But we fully anticipate with the feedback we're getting at this point in the product that we're going to certainly have success. The other thing is if you think about [indiscernible 31:04] this is a real opportunity for High Liners to quite frankly carve out an opportunity within a category that is not traditionally associated with seafood. We are leaning into the snacking and appetizer type category but specifically, this product is a great multi-platform opportunity inspecting appetizer, main meal component and so on so a little bit different for the category as well.

Rod, you mentioned the need to hire more heads to the marketing staff. Is the product development team where it needs to be and do you have any visibility to products coming down the pipe?

So I apologize I don't think I got a recall making comment, regarding hiring more staff. We recently hired - The changes in our sales marketing area. We recently hired a new VP of marketing who joined us in December. She is - hit the ground running and engaging and showing immediate results. We're very, very pleased with the talent we brought there. We have some opportunities to enhance our senior leadership level at the sales on sales level so we're in the process of recruiting for some new talent at that that level. But overall I would say I'm very pleased with the alignment and the output of both our marketing and sales organizations, again to enhance our customer engagement process and bring the innovation to market.

Are you able to provide us with a sense of the volume decline that we signed Q1. You know you broke out that maybe half of that was due to the Called the products. is the Remaining decline sort of representative of organic decline for The rest of the product portfolio and maybe within the product portfolio are there any bright spots that are growing and others that are sort of you know experiencing you know suffering more from the customer loss?

If I'd say there are 3 other components of the volume decline beyond what was in excess of the - half of the majority of it that was related to improving profitability. there was the fact and was mentioned earlier on the call that it was later lent [ph]this year so there was some shift between Q1 and Q2. So that has some impact on volume. And there was the last customer that we talked about which had an impact on the volume and then there was just some decline in the base business. I would say it was actually more significant in this quarter, in the un-process side on rather than the process side and that was beneficial to margins so as you saw that although the volume declined, we did see improvement in certainly gross margin as a percentage of sales but even more significantly EBITDA as a percentage so And in terms of the annual decline was in both retail and food service so I wouldn't highlight anything specific in terms of the channel.

And I know you're not providing segmented disclosure for the US and Canada any longer but are you able to comment on how the trends compare between the two markets.

Again, nothing that I highlight is being significantly different between the two markets.

And following that product eliminations do you have an estimate for what share of the overall Product portfolio bread and battered products would represent now versus what they would have represented in the last year.

I don't have the number in front of me but in terms of uppers, percentage is essentially it's a consistent percentage with where we were a year ago. We didn't see further declines in process in the first quarter of this year as a percentage.

The last testament I recall seeing was close to half of the overall portfolio does that was that it would that be a.

It would be high it would be higher than that process as a percentage of the overall portfolio would be probably closer to 60%.

Sorry that process would include the things like barbecue salmon strips and they're not technically breaded and battered.

Correct. That definition would include anything that essentially runs through our plants rather than just being up to our commodity product.

Thank you and you happen to have the industry IRRI data for the credit and battered declined to US retail for Q1?

I don't have it. I actually don't have it on a quarterly basis any longer but I - we don't think that they were significant either increases or declined in the category from the industry's perspective over.

Thanks for your comments.

There are no further questions at this time I'd now like to turn the call over to management for closing remarks.

Thank you, to close, I want to thank you for joining our call today and thank you for your patience as we work to strengthen the foundation of our business in order to create long term shareholder value. Thank you.

This concluded today's conference call. You may now disconnect.