Lino Saputo - Chief Executive Officer and Vice Chairman of the Board Sandy Vassiadis - Director, Corporate Communications Louis-Philippe Carriere - Chief Financial Officer

Irene Nattel - RBC Capital Markets Martin Landry - GMP Securities Michael Van Aelst - TD Securities Peter Sklar - BMO Capital Markets Mark Petrie - CIBC World Markets Patricia Baker - Scotia Capital Keith Howlett - Desjardins Securities

Ladies and gentlemen, thank you for standing by, and welcome to the Fiscal 2016 Second Quarter Results. During the presentation, participants will be in a listen-only mode. Afterwards, we’ll conduct a question-and-answer session. [Operator Instructions] As a reminder, today’s call is being recorded, Thursday, November 5, 2015. Now, I’d like to turn the conference over to Lino Saputo Junior. Please go ahead.

Thank you very much, Tommy.

Good afternoon everyone and thank you for joining us today. This call is being recorded and will be posted on our website for future reference. I’d like to specify that our listeners on the phone and on the Internet as well as journalists are on a listen-only mode. Members of the media are invited to ask their questions by phone after this call. Before we proceed, I remind you that certain statements that will be made during this call may constitute forward-looking statements within the meaning of Securities Laws. Caution should be used in the interpretation of such statements since management has made certain assumptions, including among others, assumptions regarding projected revenues and expenses and references to beliefs, expectations, objectives and strategies that are subject to a number of risks and uncertainties, which could cause actual results to differ materially from those presented in such forward-looking statements. For more information on these risks and uncertainties, please refer to the materials filed with the Canadian Securities Regulatory Authorities, including our most recent annual report available on SEDAR. Any forward-looking statements made during this call is based on management’s current reasonable estimates, expectations and assumptions, and we do not undertake to update or revise such forward-looking statements, except as required under securities laws. I’d also like to mention that in an effort to be more efficient and to focus on questions and answers, we have modified the format of the quarterly conference call. As such, in today’s call, we will not present financial highlights of the quarter as a news release detailing our 2016 second quarter results was issued earlier today and is available on www.saputo.com. Mr. Lino A. Saputo Junior, our Chief Executive Officer and Vice Chairman of the Board will begin this conference by providing his brief overview of the quarter’s key highlights, after which Lino A. Saputo Junior, and Mr. Louis-Philippe Carriere, our Chief Financial Officer will then proceed to answer the questions.

Thank you, Sandy, and good afternoon to you all. The second quarter results are aligned with our expectations. We’ve experienced challenging market conditions for a few quarters now, including lower international selling prices of cheese and their ingredients, and these conditions are anticipated to persist throughout fiscal 2016. We have however succeeded in increasing sales volumes in all sectors. Despite a competitive Canadian landscape, we’ve been holding our ground and growing our volumes in all categories. As well our logistics project is progressing well as our Montreal DC continues to make important strides forward. In the US, both the Cheese and Dairy Foods divisions had generated strong and steady results. In the international sector, though faced with tough market conditions we remain focused on developing additional international markets, and growing export sales volumes while controlling costs and increasing efficiencies. On the acquisition front, we remained active. A month ago, we acquired the companies forming Woolwich Dairy. We’re delighted about this latest addition as it allows us to welcome 190 new employees to our family and three North American manufacturing facilities into our network. With Woolwich, Saputo is now positioned as a leader in the goat cheese category in North America. The last few months have also been busy from a regulatory perspective, more specifically, Canada’s announcements related to the Trans-Pacific Partnership agreement. Indeed, last October, an agreement in principle was reached. The parties are now seeking to conclude the formal text and its ratification, which is estimated to take about two years. And TPP’s implementation is expected to be completed gradually over a five-year period. Given our platforms based in four main dairy-producing countries, three of which are key member nations of the TPP agreement, we believe we are well positioned to adjust to and in certain cases benefit from this historic agreement. We are firm believers we have the capacity to adapt to an ever changing market. Be it regulatory in nature or perhaps the ever-changing desires of our consumers, we will find innovative solutions to thrive. For this reason, I’m still very bullish about the dairy industry as a whole and our potential within this space. On that note, I now open the floor to your questions. Tommy?

Thank you very much. [Operator Instructions] And we proceed with our question in the line from Irene Nattel, RBC Capital Markets. Go right ahead.

Thanks and good afternoon, everyone. It looked as though you guys delivered some very nice sequential improvement across all three of your operating divisions, and I was just wondering if you could walk through the key factors and in each geography, they contributed to the sequential improvement, notwithstanding the fact that the byproduct prices remained extremely well.

So, Irene, your assessment is correct, we have seen improvements in all of our sectors of activities. So, on the Canadian front, we did progress dramatically when it comes to operation, controlling the controllables in a sense. Our Montreal DC is running much better, although our costs are still not in line with where we had projected it to be after the project, but we have progressed on a year-over-year basis, and our order fill rates have gone up to 99%. So, we’re extremely delighted about the progress we’re achieving in Montreal DC. But beyond that in Canada, the market competition is still as ferocious as it’s been historically, but we have found ways to mitigate some of that - some of the fights and we have found ways to mitigate some of the price reductions that we had to give to the market by way of operational excellence and efficiencies. Carl Colizza took over this division at the beginning of the fiscal year. I think, Carl and his team are focusing on some very key variables that will drive profitability for Canada. So we have grown dramatically I think on a year-over-year basis from an efficiency standpoint. Perhaps, if I can give you a little bit of an outlook for Canada as well. I suspect that the markets will continue to be competitive, but I have full confidence that our team is going to take the right decisions to make sure that we mitigate whatever impact that would have on our results. If I move on to our US platform, of course, we’ve got the two divisions. We have Saputo Cheese USA and we have the Dairy Foods space. Saputo Cheese USA, again, Terry Brockman and his group, a very experienced group of individuals, are running the U.S. platform. They’re doing a fantastic job, again mitigating some of those factors like the California milk price change. They found ways to add different types of ingredients or other initiatives from an operational perspective, so that we don’t have that big an impact in our rising cost of milk in California. And there are a couple of other initiatives that they’ve looked at it, including going out and growing our base of business and growing our volume that we sell. On the Dairy Foods side, Paul Corney and his group have done a fantastic job of just implementing, just the little things that make a big difference. Our raw material control, spoils and dumps, negotiations with our suppliers and our customers, that would provide - allow us to be a good provider of product for a long time to come. So, Paul is just executing with his team the little things that once you add them up to a larger structure make a huge difference and a big impact. On the international side, I would say that the markets have not gotten that much better, although there has been a little bit of stability in terms of the market prices on the international level. What we have done over the course of this last quarter, both in Australia and in Argentina is, we’ve renegotiated our milk costs with our providers and our suppliers. I was out in Australia in the month of July when we announced the new price of milk, which was a reduction versus last year’s calendar milk price. That went over extremely well with the dairy farmers. They understand as they’re well-tuned into the international markets. They understand why we had to reduce our price of milk. And that has had a positive effect on the Australian business and so too has the ERP, rather the Everyday Cheese, EDC acquisition in Australia. So, that plant now is in our hands, is in our control and is adding some value for us. And then on the Argentinean side, contrary to popular belief, we had the ability to be able to also go down to the farm level, meet with ministers of government and explain why a milk reduction was necessary for the health of processors and we’ve been pretty effective at reducing milk prices in Argentina as well. So, I think if you look at it as a whole, the market dynamics this year versus last year were a lot more challenging and yet if we look at our overall EBITDA generation, our numbers have not gone down dramatically and I think that that has a lot to do with the quality of our management team and every one of our sectors, whether that would be Kai in the international, whether that would be Terry in US, Paul in Dairy Foods and Carl in Canada. I think we really do have a winning team.

And that’s very helpful. One more question if I might ask, in the U.S., in the release documentation the discussion around the U.S. is talking about the improvements that you’ve made on the Dairy Foods side which you acknowledged, but there is also some language in there about striving to become - to make sure that they become low-cost producer, the way also if you’d like this is liked to be. So, if you identify who or what do you think the low cost level is, if that’s 100, where do you think the Dairy division in U.S. is today, is it 105, is it 110, is it 103, like what’s the delta that gets you there?

Well, I think we’re probably at 80% completion if I can put it that way. I think by and large, a lot of our facilities are running effectively and efficiently, although we have identified some improvements in some of the facilities yet to come. I think that from a raw material control perspective, we’re a long ways away from where we used to be. So, maybe if I put it in different terms, I’d say, we’re about 80% completed to where we think we should be.

That’s great. Thank you very much.

Thank you. [Foreign Language - French] Our next question comes from the line of Martin Landry with GMP Securities. Go ahead.

Hi, good afternoon. In Canada, you mentioned that higher admin expense have impacted your profitability. I was just wondering if you could give us a bit of more color on that. Louis-Philippe Carriere: Yes, especially what we refer over and above the admin expense, we referred essentially throughout the MD&A discussion that was provided to the market today, essentially reference to the ERP system as it was essentially note in Q1 also. So, versus last year, certainly as we discussed at the year-end, we are essentially in line to incur about $12 million of additional expense throughout the year. So, that’s in an essence in the continuity of what essentially we’re seeing.

Okay. Okay. And do you expect - when we look at your profitability on a year-over-year basis in Canada, do you expect it to stabilize next quarter? When do you think we’re going to see that stabilize?

Well, if you look at our year-over-year profitability in Canada, it has stabilized. You have to keep in mind that last year we had the bakery business as part of the EBITDA generation, which is not there this year. So, if I exclude bakery and I exclude the ERP system cost, I would say that Canada is on an uptrend.

Okay. Okay. And you do mention that your volumes were up both in Canada and the U.S., can you quantify these increases?

I would say on a volume perspective, in Canada, we’re probably about 2% ahead of last year overall. When you consider the market is either stagnant or declining, that’s I would say pretty impressive. And in the U.S., I’d say we’re probably closer to about 5% growth in volume.

Okay. And that would be ahead of the market as well?

And that would be ahead of the market as well, yes.

Okay. Okay. That’s it for me. Thank you very much.

Thank you, Martin.

Thank you. [Foreign Language - French] Our next question is from the line of Michael Van Aelst of TD Securities. Go ahead.

Thank you. Just a few follow-ups to start, in Argentina you talked about negotiating lower raw milk prices. Did we see that fully in this quarter or is there more still to come?

There still is a little bit more to come. This is a progressive reduction of our milk costs. And again, it has a lot to do with the international market factors. So, in the coming quarters there should still be some reduction, but the majority of it has been taken in Q2.

Okay. And then, in the U.S. the margin did go up year-over-year. But then in your comments you say that depressed dairy ingredient prices will put pressure on margins, and you said the same thing in Q1. So, is that something you expect to impact more as the year goes on, or is it something I’m misunderstanding?

Yes, well, if you look at the market themselves, block in the butter which should have an impact on us, and we as well now in the milk cost in California. They’re always is a volatile market and they go up and they go down. Based on what we’re seeing, given the supply and demand cycle in the U.S., there is a lot of milk out there. And the demand isn’t always as strong as the amount of milk that’s being grown. So, we anticipate that both on the block and perhaps even on the butter that there will be a decline. Now having said that, one of the reasons why you haven’t seen the impact on our results is that we do have offsets for those things. Normally, Cheese USA is offsetting Dairy Foods USA, if there is a decline in both block and cream. So there are offsets between the two divisions that do help mitigate it. And, of course, then there are other initiatives that each division will take upon themselves to try to be more effective and more efficient.

Okay. And are there any favorable pricing contracts that extend a few quarters or are they short-term?

Most of them are short-term, and block-related or market-related.

Okay. And just finally, you talk about export opportunities coming from U.S. business. And can you talk about some of those export initiatives; particularly you mentioned flavored cheese and meat? And I don’t think I’ve ever heard you talk about meat coming out of the U.S. before?

Well, it’s actually - that’s for the Canadian - sorry, for the U.S. platform, where we’ve got a string cheese and a stick of, how can I put it in better terms, a stick of salami that is packaged side-by-side and put it in a bag. So, we don’t manufacture the meat, but we do package them, co-pack the products together, so you have one multi-value pack offering to the consumer. With respect to the international sales, it is all cheese products. And in the international sales, we saw commodity products bulk, like mozzarella and cheddars, and other products. But we also do sell some retail product to some key select markets like the string cheese. So, sometimes we take on these commitments with international customers to be their supplier of specialty goods, and whether the markets are high or low, we’re going to supply them the product.

All right. Thank you.

Thank you very much. [Foreign Language - French] Our next question is from the line of Peter Sklar of BMO. Go right ahead.

Lino, I just have some questions on the TPP, if I may. So, the 3.25% I think is less than what industry people feared. And as well, you laid out the timeline, which is two years to implementation, probably five years to phase-in. So given all that, do you think that - given that and as well as the additional TRQs from CETA, do you think that Canadian industry can just kind of skate through this and just grow into these additional imports, or do you think the industry and the processors will feel some pressure from this?

I think that dairy farmers are going to feel the pressure on this. If you look at the incremental access to the Canadian market, so you got about 3.5% from the TPP, and perhaps another 3.5% coming from the CETA; so, you’re looking about 7% of total dairy solid access to Canada’s market. Canada’s consumption is not growing at a rate of 7%. So, somewhere along the line, there is going to be less milk produced in Canada. That’s my perspective. So, it’s going to be a hit to the dairy farmers. There is in the TPP agreement a compensation of $4.3 billion that is going to go to the dairy farmers for whatever losses they may have with both of these agreements, but the net reality is, is that I suspect once this is fully in place, there is going to be less milk produced in Canada. Having said that though, Peter, I’d like to say that if you look at Saputo’s platforms, with our operations in Canada and our operations in the U.S. and Australia who are all three TPP members, we will find the right avenue to make this deal work for us. As a processor, as a dairy company who has infrastructure in Canada, we can bring in either if it’s fluid milk, if it’s powdered, or if it’s a block product. We can bring product into the Canadian market under the TPP regulations and allow us to effectively bring those products to market. So, the first question that you had was related to the industry itself, I think it’s going to be penalized. Saputo as a company, I think will find a way to navigate through this.

And do you have any idea yet, how the TRQs are going to be administered?

None at all. In fact, if you think back to the CETA deal, which was probably a year, year-and-a-half behind us, we still have no idea how that TRQs were assigned or will be assigned in CETA. And I think it will even take a longer time to see how the TRQs will be assigned in the TPP.

Right. And then just lastly on this TPP business, I understand also that, like no protein isolates are completely opened up, so, not like in the U.S., but now Europe under CETA and Australia, New Zealand are under TPP can bring in these milk protein isolate. So the industry is going to be flooded with these. Can you just think through how that’s going to impact the industry, and is there any potential impact on Saputo?

Yes. Well, again, it all goes into the matter what form the solids are coming in. Solids are all be coming in at a cap rate of 7%, let’s say, if I combine again CETA and TPP together. So that’s going to have an effect right down to the milk production. Again, at the end of the day, it’s all going to be about economics. What is the most economic solid you will have access to, how can you bring that into your system, and how can you get high quality products to consumers. So, the economics ultimately are going to dictate what solids are coming in and from what country

Okay. And just lastly, I’m switching topics here, can you talk a little bit about the Saputo still aspire to have a substantial footprint, processing footprint in Europe than where you are on that in terms of your thinking?

Yes, I would never exclude Europe because Europe, the EU-27 is the largest milk pool in the world. And then, so if we want to be a player on a global scale, we cannot exclude Europe, and we cannot say that we will never be in Europe. Now, based on the experience that we’ve had in Europe, and I bring you back to 2005, 2006, and 2007, where we had our operations in Germany and in the UK, we were a very small player with one category of product. We didn’t control our own destiny, we had very, very little branding. We had some good technology, but we had very, very little branding. And so, every time there was a milk price increase, we would go to the retail and say, well, we’ll have to increase the price of our goods, because our raw material costs have gone up and the retailer use to push back and say, well, I’ve got 10 people waiting in line to manufacture my private label mozzarella balls, so Saputo, what is your decision. And effectively, we found ourselves in a position, where we were not controlling our own destiny. If we were to go to Europe, it would have to be under the right conditions. We would need to identify a company that was broad enough in terms of product portfolio, that was strong enough in terms of branding, and that was diverse enough to allow us the opportunity to be able to navigate properly within those waters. We didn’t have that when we went to Europe the first time. So, Europe would still be on our radar screen, but it would have to be really a compelling reason for us to be in Europe.

Okay. Thanks for your comment.

Thank you. [Foreign Language - French] Our next question from Mark Petrie of CIBC. Go right ahead.

Hey, good afternoon. Just a couple of follow-up questions. With regard to the volume trends in the U.S., could you just give a little bit more color in terms of by channel?

Yes. So what we’re seeing in the U.S. is, we’re seeing actually all of our channels growing, be it the foodservice and that would include the quick serve restaurants, be it the ingredient channels and the retail channels. So, all of our channels are performing extremely well in the U.S.

Do all pretty close to that 5% number?

No, varying numbers, but collectively is 5%.

Okay. For the Montreal DC, when do you expect to be at full efficiency there to reach your initial targets in terms of cost savings?

So to get to the cost savings, we had announced at the beginning of this project, I think we’d still might go into another year-and-a-half of operation.

Okay. And then just in the U.S., I mean, I know that milk supply has been pretty healthy but I think California milk production has come off a little bit and you guys have obviously significant assets there. Have you had any issues in terms of access to milk supply in California, and do you think that will be an issue going forward?

No. We’ve had no interruption in our milk supply, and I don’t anticipate it being a problem going forward.

Okay. Thank you very much.

Don’t forget the California was exporting some of their milk out-of-state. So all this does, is that excess milk that was going out of state is now staying within California.

Got it. Thanks a lot.

All right.

[Foreign Language - French] Our next question from Patricia Baker of Scotia Capital. Go right ahead.

Thank you. Actually my questions already been answered, but I will thank you for changing the format of the call and permitting a longer Q&A period. Really appreciate it. Thanks.

Well, Patricia, we try to be as effective and as efficient as possible in everything we do, including conference call.

Brilliant, Lino.

Thank you. [Foreign Language - French] Our next question from Keith Howlett of Desjardins Securities. Go right ahead.

Yes, I was wondering what level of access you had to the Trans-Pacific partnership deal and I gather there’s quite a few side letters. Have you been given a copy or been briefed or how extensive is your information?

Keith, you may be surprised of my answer, but we were kept in the dark in this. I - there was very, very little consultation. Of course, we had some discussions with our dairy association, DPAC, but Saputo as a company, we were kept in the dark. I think, DPAC, to a certain extent was also kept in the dark. I’m not sure that dairy farmers of Canada, how much they were in the loop, but it almost seems like the processors will figure it out after the deal. So - and we’re okay with that, that’s not an issue. We’re not in the political game. We’re in the game of trying to be as effective and as efficient as possible within the rules of engagement.

And if I could just follow-up on the protein isolate question, my understand the 3.25%, say under the TPP, that’s sort of agnostic as to what form it comes in, is that the idea that you could bring in as a block or power?

My understanding of what I’ve read so far is that there are going to be categories that will be allowable. So there is going to be a certain amount of fluid coming in, a certain amount of powders coming in, and a certain amount of solid like block cheese coming in, in different shapes and forms. So I think that that will be defined in the TRQ.

I see. I just had a question on Canada, and I guess the answer perhaps is on the face of it, no, but I was just wondering whether you have any - face any competitive disadvantage and not being a vendor in a significant way of yogurt versus say the other two big players in the dairy market in Canada.

Well, yogurt was at one-time a growing category, and it was at one-time a very, very profitable category. And we do manufacture, and we did manufacture yogurts after the Dairyland acquisition. Western Canada, we do have some presence there, but we are a fringe player in yogurt. We are not leaders in that category. We don’t have the R&D technique or savvy to be leaders in that category. There are others that are there. But I would say in the last couple of years, the category itself has been under pressure. I’m not sure if the profitability is as high as it used to be. I know, the consumption is not as great as it once was. And like all good things, the party comes to an end, and we’re quite happy to be in the dairy categories that we are in.

And then, just on the goat cheese category, it’s a naive question, but is goat cheese covered by all of these restrictions on normal cheese products?

There is no milk supply managed system in goat. As long as the farmers can produce it, we’re happy to take that milk and we’ve indicated to the goat farmers that as much as you can produce we’re prepared to process.

Thanks. And then just on the $37 million impact of market factors in the U.S. in the quarter, could you just indicate what the biggest couple of factors there were? Louis-Philippe Carriere: The biggest one would be essentially relate to the dairy ingredient price on the international market, essentially followed by the realization of inventory.

Great. Thank you. And then just one last question on the IT project, how far away are you from choosing the system that you’re planning to implement?

So let me just give you a little bit of background on this whole ERP, because it is a big commitment on our part. We hired someone from the outside to run this whole program for us, Richard, who has been with us now probably over a year, little over a year now, and Richard when he came in, had to develop a template for us similar to what he has developed in the past in a successful integrations of an ERP program in its former life. So we had a lot of discussions early on about what is key and fundamental to Saputo, what types of information we need to have coming off of the plant floor, and what we need to have in our binders at the end of every month. And so, Richard took notes for a further better part of a year. Now rolling into this year, we chose our consultants. So we hired the two consultants, and they helped us identify a platform and we have negotiated with SAP and we’re going with an SAP platform. So again, we’re taking very small steps and very prudent steps to get this done right. Before we see any implementation in any one of our facilities, it might be three or four years down the road and that’s okay, we want to make sure that we’re dotting our I’s and crossing our T’s and making sure we’re taking care of all the elements so as to avoid any potential failure in the system.

Thanks very much.

Thank you. [Foreign Language - French] [Operator Instruction] We do have a follow-up question from the line of Ms. Irene Nattel of RBC Capital Markets. Go right ahead.

Thanks, and hello again. Didn’t think you’re going to get away without this question, did you Lino? What about the acquisition environment? On the last call, we were talking about the fact that perhaps the challenging byproduct prices could be - could lead to a few greater opportunities. If you could talk about the pipeline, what you’re seeing geographically in the regions that you’re most keenly interested in at this point?

Yes, Irene, there still is a lot of activity, and then there is a lot of interested people approaching us about potential sale of their business. Again, and without going into too much detail, I will talk about the regions. So we are looking at interesting assets in Brazil; we’re looking at interesting assets in Australia; we’re looking at interesting assets in the U.S., so the one in Canada, as always concluded. I don’t know if it was related to TPP or not, but there was quite a bit of interest in Canada in terms of assets that became available. We thought that Woolwich was the most effective and the most valuable one for us. But outside of that, Irene, what I would say is that we will continue to be disciplined. We need to make sure that we’re paying the right multiples for the assets that we’re acquiring. We need to make sure that this strategic value is there. And sometimes, you may have a preliminary discussion with someone who is showing some great interest to sell and as we get into more detail and further discussion, either - the evaluation is either too high or the strategic value is too low. And so, again, I will say this again, there are always three or four files on our table at any given time, and we will materialize those ones that we believe that we can get at the right price with the right strategic value.

That’s very helpful. And if we could just spend a minute talking about Woolwich and the attractiveness of the goat cheese segment about and beyond the fact that you can buy as much goat milk as you want and that therefore - and then you’re the leader in the space. Is it your understanding that there is greater demand and there was supplies as a key category that you work in but also there was something more [doors to you] [ph]. Can you just talk about the strategic importance of something like a Woolwich?

So there is more demand and there is supply of milk, and that is for sure. So if the dairy farmers are going to be producing more milk, we would be very, very happy to take on more solid, so we can produce more products. But just let me talk to you a little bit about Woolwich and I’m glad you asked that question, because it is a platform that is strategic for us. It doesn’t move the needle all that much because when you look at the overall sales, it’s not a big, big, big acquisition, but from a strategic nature, we acquired three plants. So, you’ve got a plant in Ontario, a plant in Quebec, and a plant in the United States, all of whom really complement our specialty platforms. So, the U.S. plant will be a real complement to DCI, and the two Canadian plans are going to be a complement to our specialty division here in Canada. There is a number on goat cheese provider in Canada, with a wide range of specialty products, very, very innovative products and we’re really excited about having these products within the portfolio of products we have on the specialty side. So besides the fact that there still is room for us to grow in this business, we inherit a very good solid company that has some very good foundations.

On the subject - I’m sorry, I sometimes find myself having trouble talking about this in a straight base, but in terms of the R&D, did I have sort of to give an angle, you have a great deal of strength in R&D in goat cheese that you can may be apply to other products or other geographies?

Well, the real strength of the goat cheese R&D would be more in terms of the product diversification. As an example, they’ve got a goat cheese in a tub that is made with strawberry jam [ph] as an example. The same tub of goat cheese is going to have red peppers. So, two different consumption usages for the same type of product. So the marketing team, the R&D team are looking at what’s the next angle that consumers want to have. It’s not so much, I mean of course, as you understand, our business, the technology is extracting the highest percentage of the yield of cheese for the same amount of milk, and that is whether you’re processing goat cheese or you’re processing cow cheese, it’s the same principles. What is really nice about the goat cheese business is that with the same curds, you can make out a multitude of different products, with different consumption patterns, at different times of the day. So some of the goat cheese is good for breakfast, some of the goat cheese is good for lunch and some of the goat cheese is good for as a dessert. So, that’s the diversity that Woolwich brings to us.

That’s fascinating. Thank you.

Thank you very much, Irene.

We go to our next question. We do have a follow-up question from the line of Keith Howlett of Desjardins Securities. Go right ahead.

Yes, just following on that conversation, in terms of the specialty cheese division, how important is organic cheese or cheese made from milk with no hormones, that sort of thing?

Yes, it is a very small segment of the market, but it is growing. And we do have - we do taking organic milk in Canada and in the United States. The real challenge there is getting organic milk off the farms, but we do have organic products amongst the portfolio of products.

Thanks.

Thank you very much. And Mr. Saputo, we have no further questions on the line, I’ll turn it back to you.

Thank you very much, Tommy.

We thank you for taking part in this conference call. We hope you’ll join us for the presentation of our fiscal 2016 third quarter results on February 4. Have a nice day.

Thank you very much, and ladies and gentlemen, this concludes conference call for today. We thank you for participation. I ask you to disconnect your lines. Have a good day everyone.