Steven Bromley - Chief Executive Officer Robert McKeracher - Chief Financial Officer and Vice President Hendrik Jacobs - President and Chief Operating Officer

Bob Gibson - Octagon Capital Mitchell Brad Pinheiro - Imperial Capital Chris Krueger - Lake Street Capital Eric Gottlieb - D.A. Davidson Christine Healy - Scotiabank

Good morning and welcome to SunOpta's Second Quarter 2015 Earnings Conference Call and Business Update. By now, everyone should have access to the earnings press release that was issued this morning. The release is available on the Investor Relations' page of SunOpta's website at www.sunopta.com. This call is being webcast and its transcription will be available on the Company's website. As a reminder, please note that the prepared remarks, which will follow, contain forward-looking statements, and management may make additional forward-looking statements in the response to your questions. These statements do not guarantee future performance and therefore, undue reliance should not be placed upon them. We refer you to all risk factors obtained in SunOpta's press release issued yesterday, the Company's Annual Report filed with the Form 10-K, and other filings with the Securities and Exchange Commission for more detailed discussions of the factors that could cause actual results to differ materially from those projections in any forward-looking statements. Finally, we would like to remind listeners that the Company may refer to certain non-GAAP financial measures during the teleconference. A reconciliation of these non-GAAP financial measures was included with the Company's press release issued earlier today. Also, please note that unless otherwise stated, all figures discussed today are in U.S. dollars and are occasionally rounded to the nearest million. And now, I’d like to turn the conference over to SunOpta's CEO, Steve Bromley.

Good morning, everyone. On the call with me today are Rob McKeracher, our Vice President and Chief Financial Officer; and Rik Jacobs, our President and Chief Operating Officer, who as you know will takeover from me as CEO as of October. 2015 has been a very busy and exciting year for all of us at SunOpta as we accelerate our transformation to a global leader in natural and organic foods. In the last six months, we have announced three strategic accretive acquisitions, Citrusource, Sunrise Growers, and our most recent announcement today on the acquisition of Niagara Natural Fruit Snack Company. We also opened our new innovation center and became the first company in the US to receive USDA non-GMO process verified recognition. Rik will discuss these activities in greater detail in a few moments. From an operational standpoint, we remain committed to making further improvements to better position our business for long-term revenue and profitability growth. We continue to significantly invest in our value-added foods operations with the continued expansion of our healthy beverages platform and specifically our integrated aseptic beverage and refrigerated juice operations in San Bernardino, which officially became operational in the second quarter. The Allentown aseptic processing and filling expansion activities remain on track with the scheduled start-up in the first quarter of 2015. And when complete, it will position us with strategically located processing facilities in the west, mid-west and the east. In addition, we expect to complete our capability upgrades in our Carson City nutritional bio-facility by the end of August and are in the process of completing packaging and efficiency upgrades at a number of other operations. As mentioned, we became the first company in the US to have a food manufacturing facility received PVP verified non-GMO recognition from the USDA. This is consistent with our commitment to non-GMO and organic food products, which are in high demand with today’s consumers. We look forward to implementing the USDA PVP program at other SunOpta facilities across our vertically integrated platform. There is a very tight supply of organic raw materials, and we continue to take proactive steps to secure ingredients from all over the world to support our global customers. As demand continues, that outpaced supply. During the quarter, we increased our ownership position in our organic sesame hulling joint venture in Ethiopia, assuming management control of the operation in order to expand volumes and improve profitability. Our Global Ingredients segment exports these materials to worldwide markets to be used in the food industry including our own business and we believe this is an important step as we continue to leverage our global sourcing portfolio. Another exciting development is the opening of our new SunOpta Innovation Center at our offices in Edina, Minnesota. We strongly believe product innovation is a key element of our strategy to bring compelling and for our customers. Thus far, we are receiving great feedback from the development of this strategic initiative which enhances the way we do R&D taking innovative ideas, proactively to our extensive customer base, as well as through the traditional more reactive partnerships we’ve developed. Focusing on the second quarter results, our Global Ingredients segment continue to perform very well as we leverage our platform across the company. But this performance wasn’t enough to offset a challenging quarter in the Consumer Products segment. Our adjusted earnings were $0.08 per diluted common share, excluding the results of non-core and discontinued operations, as well as severance and acquisition-related expenses. Rob will discuss our financial performance in greater detail in a moment. We realize we have work to do in order to get our Consumer Products segment where we expect it to be, but we believe the future outlook is positive based on the number of opportunities in our pipeline, as well as we diversify the business and better position for our long-term growth. Our foundation is in place and our transformation is accelerating. We are playing in the right markets at the right time with organic and better for you ingredients and consumer products increasingly important to today’s consumer. To conclude, we have accomplished a great deal in the first six months of 2015 and our team remains focused on enhancing our performance in Consumer Products segment integrating and realizing the benefits of our acquisitions and growth projects, as well as the continued execution of our core strategies across our portfolio to better leverage our integrated platform over the next several years. With that, I will turn the call over to Rik who will provide further details on our Food business. Rik?

Thanks, Steve, and good morning, everyone. I first focus on the performance of our two reporting segments within SunOpta Foods, Global Ingredients and Consumer Products. Then I review the accretive strategic acquisitions that position us well for the future and how they help us transform our company. First, our Global Ingredients segment continued to perform well. The revenue and internationally sourced organic raw materials and ingredients grew 19% on a like-for-like basis, driven by higher volume of coco, sweeteners, fruits and vegetables, as well as Asian grains. On the Domestic side, strong volumes in feed and non-GMO corn and soy were offset by lower sunflower sales, as a result of our facility rationalization and the strong US dollar that drove our export sales. On a like-for-like basis, revenue here has declined about 3% but became more profitable as we exited low margin business. Operating margins were strong at 6.4% and well within the long-term target range of 6% to 8%, keep in mind that the second quarter is typically the strongest for the segment from a margin perspective as there is a higher mix of crop input sales in the April to June timeframe. Nonetheless, we are extremely pleased to see this segment accelerate as progress toward the long-term operating margin targets that we’ve established and so far, our 2015 North American crops are doing well. The key to further top and bottom-line growth for this segment is excess to the right raw materials at the right time and at the right cost. Given our extensive worldwide expertise and network, we are confident that we can do so better than anyone in the business. Now moving on to our Consumer Products segment, we had a challenging quarter where revenue was down 7.3% versus the same quarter last year and gross margins were significantly better. The primary cause for this was lower volume in our aseptic plants where our biggest customer was down more than 20%, as a result of them losing distribution with a key natural food retailer, a re-design of their package, coupled with an increase in their shelf price with all other retailers mainly due to an increase in their input cost. At the same time, as you know, our capacity went up following the commissioning of new equipment and the net result was lower fixed cost absorption in our aseptic plants. Lower fixed cost absorption also furthered our frozen food business, partially as a result of taking meaningful price increases, volumes slowed down temporarily due to heavy customer buying in advance to price increase going into effect. And finally, we’ve been staffing up our San Bernardino plant where we are now bottling and extracting citrus products but until we get to increased rates of utilization, facility profitability will be challenged. Despite a difficult quarter in Consumer Products, we are confident that the business will begin to demonstrate year-over-year revenue increases in the back half of 2015 with increased acceleration as we approach 2016. Our confidence stems from our rebuild pipeline which was only possible by our investment in incremental capacity and capabilities. Our job now is to convert this pipeline of opportunities to real sales volumes. Filling up the plants where we have underutilization, especially the aseptic and juice plants is a key first steps towards reaching our long-term target margins for the segment. Our pipeline in Consumer Products is made up of significant retailers and branded food companies and much of the growth is attributed to our focus on providing the lowest landed cost for our customers, as well as our proactive innovation efforts. While we don’t expect all of this to convert to sales in 2015, we will see growth and believe our positioning with many of these key accounts bodes well for us in 2015 and beyond. Now, add to that, our recent and transformative acquisitions of Citrusource, Sunrise Growers and Niagara Natural and all of you will appreciate that we are building a strong Consumer Product segment with leadership positions in three key categories, healthy beverages, healthy frozen fruits and healthy snacks. Citrusource is part of our healthy beverage category which also encompasses our aseptic offerings and other shelf stable beverages. Growing our citrus platform with the key talent acquired with Citrusource is expected to fill-up our San Bernardino plant over time and we are happy to report that Citrusource is performing in line with our expectations. Our investments in aseptic facilities both in Allentown and Modesto, positions us to provide an ever-growing customer base with the lowest landed cost covering a truly national footprint. For example, in our Modesto facility, we expect to more than double the number of customer service from that facility by the end of 2015. As volumes to these customers ramp up, it will mitigate the impact of any individual customer not performing to expectation as was the case in this quarter. The Sunrise Growers acquisition will be the largest acquisition we have undertaken and we see it as truly transformative. Sunrise is expected to position us as a leader in the $1 billion plus and rapidly growing frozen food category. This category is dominated by private-label which is estimated to hold more than a 65% share, combined with emerging consumer trends and potential for substantially increased household penetration, we believe this acquisition presents us with a tremendous opportunity, which is both accretive and synergistic to our base business. We expect to realize over $10 million in procurement logistical and other operating synergies by the end of 2017 and Sunrise Growers allows us to deepen our relationship with a number of large customers. They will also bring with it a new set of customers in both the retail and food service channel, which we believe provides us with another avenue to further expand our Consumer Product and ingredient offerings. Now, finally, the accretive agreement announced today to acquire Niagara Natural Fruit Snack Company is a highly complementary and strategic acquisition to build out our healthy snacks category. With Niagara Natural, we will now be able to extend our market presence in fruit snacks with coverage both on the east and the west coast, providing a competitively positioned platform to improve our customer service and generate operational and logistical synergies. The owners of Niagara Natural have been in the fruit snacking business for more than 20 years and they will be in a tremendous asset to our company. All three categories, healthy beverages, healthy frozen fruit, and healthy snacks, take full advantage of our vertically integrated platform as the vast majority of product inputs can be procured by leveraging our global sourcing capabilities. We also have aligned our R&D resources with these categories to ensure we will be at the forefront of innovation that satisfied emerging consumer trends. We believe our focus on these key categories in conjunction with our efforts to further streamline our portfolio will expand our operating margins and accelerate our top-line growth. With additional top-line growth, we also expect to increasingly benefit from leveraging our scalable cost base. So that concludes my review. I’ll turn the call over to Rob for a more detailed review of our financials.

Thanks, Rik and good morning, everyone. I will focus more specifically on our financial results for the first quarter of 2015 I am sorry, at the second quarter of 2015. Please note that the financial figures referenced on this call exclude the fiber and starch business which was sold on December 22, 2014 and is reported as a discontinued operation. Revenues for the second quarter of 2015 was $307 million as compared to $328 million for the second quarter of 2014. After adjusting for the extra week, as well as the impact of changes including commodity prices, foreign exchange rates, and product rationalization, consolidated revenues decreased 3.2%, revenues at OptaMinerals decreased 11.5% and SunOpta Foods revenues decreased 2.2% versus the prior year. The decrease in revenues is primarily due to lower volumes of aseptic beverages, snacks and frozen retail products in the Consumer Products segment, decreased sunflower sales as a result of our footprint rationalization in that business in 2014. The effect of the decline in the euro on translating foreign revenues, and lower volumes of certain steel and industrial mineral products in OptaMinerals. Partially offsetting these declines were increased sales of organic raw materials, and increased refrigerated juice sales as a result of the March 2015 acquisition of Citrusource. We generated operating income of $9.7 million or 3.2% of revenues in the second quarter, compared to $16.7 million or 5.1% of revenues in the second quarter of 2014. The decline in operating income was primarily due to lower sales volume in consumer products which also contributed to decreased plant efficiency via lower production volumes in our aseptic and frozen fruit plants, increased cost associated with the ramp up of our premium juice operations, cost associated with our aseptic expansion in Allentown, and lower volumes of higher margin steep products at OptaMinerals. These pressures were partially offset by increased sales volume of organic ingredients, and improved performance across our rationalized sunflower operations. SunOpta Foods’ operating income including corporate services, was $9 million or 3.2% of revenues compared to $15.1million or 5.2% of revenues in the second quarter of 2014. Earnings for second quarter of 2015 were $2 million or $0.03 per diluted common share compared to $8.7 million or $0.13 per diluted common share in the second quarter of 2014. Excluding the results of non-core and discontinued operations, as well as severance and acquisition-related expenses, adjusted earnings were $0.08 per diluted common share in the second quarter of 2015. These earnings include approximately $300,000 of incremental costs related to expansion activities at the Allentown aseptic facility scheduled to come online in the fourth quarter of 2015 and as Rik alluded to previously, we continue to incur incremental cost as we ramp up our San Bernardino premium juice facility. From a cash flow perspective, in the first half of 2015, we used $16.6 million in cash from continuing operations, compared to $20.8 million of cash provided from continuing operations during the first half of 2014. The decrease in cash provided from operations is mainly due to increased working capital levels as we continue to strategically secure organic raw materials that are often in short supply, thus fueling growth in our Global Ingredients segment. From an investing perspective during the first half of 2015, we used $28.7 million in cash of which $14 million was used to fund acquisition of Citrusource and our increased ownership stake in Selet Hulling. While $15.4 million was used to fund capital expenditures, mainly within our Consumer Products segment to expand our healthy beverages footprint and capabilities. Our balance sheet remains strong and at July 4, 2015, our consolidated debt net of cash was $153.5 million, reflecting a net debt-to-equity ratio of 0.43 to 1.00. Of this net debt, $42.5 million belongs to OptaMinerals which is non-recourse to SunOpta. Excluding this amount, our net debt to equity ratio is 0.31 to 1.00 within our core foods business at July 4, 2015. Our acquisition of Niagara Natural which is announced today, consisted of upfront cash consideration of approximately $6.7 million, financed via our existing North American credit facility. Looking ahead, we expect to complete the previously announced acquisition of Sunrise Growers in the fall of 2015. Our intention is to finance the acquisition through a combination of debt and equity. We have received committed financing in support of the transaction from our lenders subject to customary conditions. The transaction is valued at approximately $450 million and following close, we expect to continue to have access to capital to support further strategic growth and acquisition initiatives aided by the increased collateral base and the expanded free cash flow that is expected to come within the combined business. I'll now turn the call over to Steve, for some closing remarks. Steve?

Thanks Rob. We believe SunOpta’s strategic foundation is in place and we have many exciting growth opportunities ahead as we continue to transform our business. Our Board of Directors and management have confidence in SunOpta’s strategies and competitive positioning in growing sectors through our Global Ingredients and Consumer Products segments. SunOpta’s focus has been and must continue to be on leveraging the competitive advantages of the integrated global operating platform we have created to accelerate growth and performance. I am proud of what we have accomplished at SunOpta including re-focusing and realigning our business on core growing segments, disposing of non-core assets and creating competitive advantage through our global operating platform. I wanted to take this opportunity to congratulate Rik on his promotion to CEO this fall. I have worked hand-in-hand with Rik over the last three years. He is a dynamic talented leader and is well suited to lead SunOpta with his relentless focus on execution to facilitate our next level of growth. Many of you know Rik from your exposure to him through quarterly conference calls or at industry trade shows. What you may not have as much visibility into is the extraordinary work Rik has undertaken since he joined SunOpta in late 2012. Together we have enhanced and revitalized our strategies and operating targets, improved processes and changed the structure and the talent required to execute. In addition to his deep insight and knowledge of SunOpta and the industry, Rik has exceptional global food industry experience, developed over many years internationally at Tetra Pak, PepsiCo, Royal Dutch Ahold and the Coca-Cola Company. I look forward to his future contributions as CEO and I will continue to support him and the board in the transition and on key corporate development activities as the year unfolds. In the coming weeks and months, the two of us look forward to meeting with many of you from the investment community. Going forward, our management team remains focused on our three key drivers to improve our overall business. One, to grow areas of our business that offer the highest margins, and enhance our integrated field to table business model. Two, cost management, with over a 150 active cost reduction projects identified, primarily as we evaluate efficiencies across our supply chain. And three, increased platform leverage as we accelerate our growth and optimize our existing infrastructure. So that concludes our prepared remarks. I’d like to thank you for joining us on the call today. And with that, Rob, Rik and I will turn it back over to the operator and we are available to take your questions. Operator?

[Operator Instructions] Our first question comes from the line of Bob Gibson from Octagon. Please proceed with your question.

Good morning everybody.

Hey, Bob.

A couple of quick things. First on your recent acquisition, I just noticed that they’ve got a sales facility in England. Do you think this might be a big push for you as far as Europe? And just some color on that?

Yes, they did have a small sales office there. But they’ve sort of consolidated that in with their existing operations. So in fact, they – I don’t believe that exists anymore although they still - in that market.

Okay, and maybe you could just kind of quantify the effects of foreign exchange, commodity prices in your top-line?

Dave, it’s Rob. The biggest impact for us on – in terms of foreign exchange of course is a large component of the Global Ingredients segment is, European functional currency. So, the effect of the rate this year versus last year is between $9 million and $10 million on our top-line. And from a commodity perspective and rationalization, that would equally size mainly in that segments, of course than lot of the commodities that we handle, whether it be soy, corn, or even some of the organic commodities are generally trended down across the board versus a year ago.

Okay, great. Thanks very much guys.

Thanks, Bob.

And our next question comes from the line of Mitch Pinheiro from Imperial Capital. Please proceed with your question.

Good morning, Mitch

Good morning. Hey, I was staying on the last question, so equally sized, the commodity and the SKU rationalization. How big those two be together? Could you?

Yes, so the $9 million to $10 million in the foreign exchange and…

Right.

A little bit less than that would have in the commodities and the footprint rationalization which to me is sums as SKU rationalization. So, you are talking $15 million $16 million there, Mitch.

$15 million, $16 million in total of the commodity and the rationalization?

Yes, exactly.

So, I mean that sum, that’s key to takeaway obviously and that’s why we report the adjusted revenue number, because certainly that segment of ours more than any other one can be heavily influenced by those market factors in commodity prices and foreign exchange.

Okay. Now, so – a couple questions, one on San Bernardino, why is that still being commissioned? I mean, shouldn’t that be commissioned last quarter and ready to roll or and why – I would think it wouldn’t just be ramping, wouldn’t should be bringing back in the business sets you’ve sort of – you’ve said to third-parties, wouldn’t that be coming back in by now?

Yes, you are absolutely right. In the second quarter, we did commissioned it. We did start to ramp up. The ramp up is going to take a little bit of time with both our volume as well as the Citrusource volume. One other key element of San Bernardino is extraction, which is basically more than 50% of that facility if you look at the revenue, with the profitability stream, and on that one, we are having a solid pipeline over there, but have not yet converted enough of that to keep pace with the ramp up that we’ve been doing in terms of the cost base that we’ve established on that. So, we expect that to continue to ramp on the bottling side for sure. That’s growing very rapidly now and on the extraction side as we basically get more customers and especially, on the organic side when it comes to both orange and lemon.

So, when does San Bernardino, I mean, this is probably been a question on every conference call for the last two years, but when does San Bernardino become – reach the right level of ROI that that was expected at the beginning – excuse me, at the beginning of the project?

Yes, that’s what happened in 2015. So, I would say that, going forward, San Bernardino will stop taking away as much as it has been over the last two years as you pointed out and in 2016, it will start contributing.

Okay. But it will still be a drag to the remainder of this year?

As we ramp up, depending on the speed of converting the pipeline, it will be a drag or be a zero, maybe towards the end of the fourth quarter, 2016 it should contribute.

Okay. And then, with regard to Modesto, I think you talked about, you expect that to ramp up, but what gives you the confidence in that? I mean to have an order book that’s full or why does Modesto ramped when the whole aseptic business has been struggling here last couple of quarters?

Well, I think, as I alluded to in my prepared remarks, it’s not the entire business that’s been struggling. It’s been our largest customer that has struggled very, very significantly as a result of them taking a price increase while others did not and which made them obviously a lot less attractive on the shelf. The reason that I have the confidence is because of our order book and order book consists of contract signed as well as the pipeline which consists of customers that we will confirm – convert and don’t have a contract yet. I am confident that we will grow that business in Q3 and Q4.

Okay. And as far as Allentown, I forgot, what you said about Allentown, I know it’s – there is some expansion cost there, but, do you talk about when you think it’s going to be up and running?

Yes, it will be up and running in the fourth quarter is what we said. We expect it to be up and running by the middle of October. But basically, if you were to go there now, the processing equipment is in, the line is in, and this is all about doing the proper testing right now before we run the food products across the line.

Okay. Thanks for your time.

Thanks, Mitch.

Our next question comes from the line of Chris Krueger from Lake Street Capital. Please proceed with your question.

Hi, good morning.

Hey Chris.

You indicated, went through this quickly on the call – on your presentation on the aseptic beverage, you talked about, I believe you said your largest customer was down 20%. Can you go over that again? And is it expected to come back?

Yes, I can go over that again. So the largest customer, they decreased by 20% that we already saw some of those trends in Q1 accelerated into Q2, three primary reasons, one they lost distribution with a significant natural fruits retailer, two, they went through a redesign of their packaging, which means that, you try and run your inventories down to zero before you build them back up again and number three, they took a price increase across the retail landscape in order to keep up with their increased input costs. It’s basically, it’s in the non-dairy segments and it’s on a nut-based non-dairy segment. I can’t say more than that.

Okay, Hendrik. Can you give us an update on the aseptic pouch business? I don’t think you said much about it.

The aseptic pouch business is good and facilities are full, well are fairly full and in fact, we will be launching new pouches with the two largest retailers in the land in Q4.

Okay. And then last, can you remind me what your operating margin goal is for the Consumer Products segment and when do you think you can get to that range?

Yes, the targets have not changed. We’ve basically said - go ahead Rob sorry.

Yes, well, of course, first 11% to 13% is our target operating margin range and we are staying firm in that to 2017 timeframe to achieve that.

All right, thanks. That’s all I got.

Thanks a lot Chris.

[Operator Instructions] Our next question comes from the line of Eric Gottlieb. Please proceed with your question.

Yes, hi. Trying to get some details into – you mentioned the volume was down in aseptic beverages, snacks and frozen retail. Can you detail exactly how much it was down each one of those?

Yes, and this will be published as our 10-Q gets filed – expected to be filed no later than tomorrow. In terms of the beverage side of the business, you are looking at about a $9.4 million decrease quarter-over-quarter really driven by – the main reasons that Rik has already alluded to, I guess on the questions fielded by the last few callers, the balance of that, you are looking at – so across our fruit business and consumer frozen fruits, well, we have a – the fruit ingredients, fruit toppings that was about a $2.7 million decline and about $4.9 million in the rest of our snack business. Not really comprising the bulk of the change quarter-over-quarter in the Consumer Products segment.

Okay, and how much…

All I said towards the increase in the juice as a result of our Citrusource acquisition.

Okay, and how much of that – I’ll get to that offline. Utilization rate of Modesto, how much was it down? And what do you think it exactly costs you?

Well, I think it’s – well I can turn it Rob, but I mean, what we have to do in the quarter because of the declined volumes, we actually have go darken our facility for about a week and obviously we have to change our shift pattern as well. But, as we look at Modesto right now, with the new shift pattern, it is full and it’s looking forward to as we convert that pipeline to then going back to full 24/7 schedule.

Okay, great. And then, that large customer that was down 20%, that price cap on shelf that they experience due to their price increase, have you seen their competitors come up and meet them at all?

No, we have not and that’s the biggest issue why they have such a significant slowdown.

Okay, fair enough. And, turning back to your business, you’ve recently mentioned packaging and efficiency projects underway, how much do you plan on gaining on those and at what cost?

Well, I mean if you look at the packaging projects that we got underway, we have basically, we are in the process of installing three different stand-up pouch lines at three different facilities right now. And that is really a package that is ramping up. If you look at our efficiency projects, I think Steve in his closing comments alluded to that we have 150 cost projects ongoing. I think the most significant ones are those that are – that should be coming to fruition to – are sitting in the logistics and the supply chain. We have outsourced our volume to a third-party logistics provider that is consolidating. Just as a reminder, logistics is about $40 million cost for the company, if you include warehousing in that. So, we see that that is a very significant, one of the more significant and close-in opportunities to reduce our cost in the supply chain.

Got it.

I think the other one that I think is obviously that is the biggest – the impact on cost as everybody will realize, is getting the right absorption in your factories and that’s driven by getting the right volume, that’s driven by making sure you have the right pipeline.

Okay. And then lastly, you mentioned that the cost of fruit increased, I am wondering, why you weren’t able to pass along those cost and is there a lag there? Do you expect to recoup some of that in Q3?

What we did in Q2 is we did increase the prices. What we had a lag while we didn’t increase the prices in Q1 which is why the results in Q1, we’ve done in Q2, we increased the prices and that has led to a temporary volume decline as the retailers basically lowered in a cheaper prices, let’s put it that way.

Got it. And any specific fruit, or any specific category or just general?

No, that’s basically on our IQS fruit business which is a significant business. That’s about $70 million on the menu basis in terms of its revenue. So, when you look at the temporary revenue decline in that segment, it’s because of the load in, but obviously the load in was at a low price and now that we’ve taken the price increases, we should see that volume starting to come back in Q3.

Got it, all right. Thanks for the color. I’ll pass it on.

Thanks a lot.

Our next question in the queue comes from the line of Christine Healy from Scotiabank. Please proceed with your question.

Hi, good morning. I think we’ve gone over a lot of the key operating questions. I have some questions for Rob, actually just on the financials. I guess, first, I notice that you guys adjusted your earnings to exclude OptaMinerals. I think this is the first time I’ve seen you guys do this, I covered you quite a while. So I am just wondering if we should read something into this. If there is any particular reason why you did that? Couldn’t help I noticed that Opta was forced to report today and they didn’t. So, maybe you can tell me why you guys did that?

Yes – I mean, we’ve – to be honest, Christine, for the most part as we’ve been having sort of a gesturing whether it be in non-cash impairments or things that are truly – what we believe non-recurring, more often that comes from minerals. We thought that was meaningful for investors to see more deeply into what the core business is doing and to that reason, we said why don’t we – as part of our definition, adjusted earnings take minerals out off together or at least highlight what the true contribution in this case, cake was that impact of the quarter.

Okay, fair enough. And then, a couple of more questions to you Rob. Normally, I would ask these offline, because there are more housekeeping, but in this case, there are pretty big differences and kind of drove a good chunk of the EPS and that’s for me anyways, the first is your interest expense was quite a bit higher and your – secondly, your tax rate was 80% in the quarter. So maybe you can speak to those two?

Yes, sure and the – like I said, the deviation from expectation is really again a minerals effect. So minerals certainly reported a much larger – contributing much more interest expense on us this quarter, a big factor of that has to do with the acceleration of the amortization of their deferred financing fees which typically amortized through the interest expense line. So that caused a spike there. Again, on the adjusted earnings side, that is removed. And, similarly from a tax perspective, minerals was forced to take a valuation allowance against some of the tax assets thereby increasing our tax rate. So I believe 80% in the quarter. I suggest, without that, without the valuation allowance in the discrete tax adjustments they took, our effective tax rate was more in the range of 34%, 35%. So, all the anomalies there are minerals-driven.

Okay, thanks. That’s really helpful, normally I had to pick through the financials already. And then, I guess, just lastly, your CapEx it’s trending below, I guess, where you guys kind of said you’d be for the year. So has there been change in your spending timing or should we expect except to maybe to pick up more in the second half?

Yes, no you can, certainly there has been change, I can say in the projects, so to speak. Of course, we got some fairly sizable ones on the going and most notably, Allentown expansion. So you should see some pick up there through the back half. There is no big deviations, certainly an expectation on our capital investments.

So, $35 million to $40 million, that’s still kind of where you are targeting?

Yes, in the $40 million give or take range, I think would be a fair expectation.

Okay, thanks so much. I appreciate it.

Great.

Take care.

[Operator Instructions] Ladies and gentlemen, this concludes today’s question-and-answer session. I would now like to turn the call back over to Mr. Bromley for any closing remarks.

Okay. well, thanks very much everyone for joining the call today. We look forward to speaking with everyone over the next period of time. Hope you a great day and we’ll talk soon. Thank you.

Ladies and gentlemen, thank you for your attending today's conference. This does conclude today’s program, You may now disconnect. Everyone have a great day.