To further realize synergies from the Schneider Foods/Maple Leaf merger, we will begin to execute on plant and distribution network optimization opportunities in 2007. The goal is to further improve operating efficiencies at our 23 further processed manufacturing facilities and seven distribution centres, which will include some consolidation of facilities and investment in new assets, such as the newly-acquired further processed plant in Brampton, Ontario. By 2008, we expect to have consolidated our existing warehousing and distribution facilities in Western Canada into two high efficiency centres.

Our fresh bakery business has achieved outstanding results, benefiting from an emphasis on nutrition, innovation, brand leadership, and continuous cost improvement, while maintaining the discipline to pass through price increases to cover rapidly rising input costs. The focus in 2007 will be growing the top line through more innovation and expansion into new product categories, supported by our strong national distribution capabilities. The strategy includes greater ethnic product offerings, where market growth is outpacing traditional breads and rolls, and expanding into ready-to-eat fresh sandwich and sweet goods. Our successful fresh pasta business fits well into our plans to expand in the meal solutions category, and we anticipate leveraging the strength of the Olivieri brand by extending it to other food categories.