領先汽車配件 (AAP) 2023 Q3 法說會逐字稿

Hello, and welcome to the Advance Auto Parts Third Quarter 2023 Conference Call. Before we begin Elisabeth Eisleben, Senior Vice President, Communications and Investor Relations, will make a brief statement concerning forward-looking statements that will be discussed on this call.

您好，歡迎參加 Advance Auto Parts 2023 年第三季電話會議。在我們開始之前，傳播和投資者關係高級副總裁 Elisabeth Eisleben 將就本次電話會議將討論的前瞻性陳述發表簡短聲明。

Good morning, and thank you for joining us to discuss our Q3 2023 results. I'm joined by Gene Lee, our Interim Executive Chair; Shane O’Kelly, President and Chief Executive Officer; and Tony Iskander, Interim Chief Financial Officer. Following Shane and Tony's prepared remarks, we will turn our attention to answering your questions.

早安，感謝您加入我們討論 2023 年第三季的業績。我們的臨時執行主席吉恩李 (Gene Lee) 也加入了我的行列。總裁兼執行長謝恩‧奧凱利 (Shane O’Kelly)；臨時財務長托尼·伊斯坎德(Tony Iskander)。在肖恩和托尼準備好的發言之後，我們將集中精力回答你們的問題。

Before we begin, please be advised that remarks today will contain forward-looking statements. All statements other than statements of historical fact are forward-looking statements, including, but not limited to, statements regarding our ongoing strategic and operational review, initiative plans, projections and future performance. Actual results could differ materially from those projected or implied by the forward-looking statements.

在我們開始之前，請注意，今天的言論將包含前瞻性陳述。除歷史事實陳述外的所有陳述均為前瞻性陳述，包括但不限於有關我們正在進行的策略和營運審查、舉措計劃、預測和未來業績的陳述。實際結果可能與前瞻性陳述中預測或暗示的結果有重大差異。

Additional information about factors that could cause actual results to differ can be found under the captions, Forward-looking Statements and Risk Factors in our most recent Form 10-K and subsequent filings made with the commission. Now let me turn the call over to Shane.

有關可能導致實際結果不同的因素的更多信息，請參見我們最近向委員會提交的 10-K 表格和後續文件中的標題、前瞻性陳述和風險因素。現在讓我把電話轉給謝恩。

Good morning, everyone, and thank you for joining us. I'm pleased to be here for my first earnings call as the CEO of Advance. We have several topics to discuss with you this morning. But before I begin, I'd like to thank all of Advance's team members who I've come to know during my first 60 days with the company.

大家早安，感謝您加入我們。我很高興能作為 Advance 執行長參加我的第一次財報電話會議。今天早上我們有幾個主題要與您討論。但在開始之前，我要感謝所有在我加入公司的前 60 天中認識的 Advance 團隊成員。

During that time, I visited our stores across multiple markets, met with numerous customers, spent time in our distribution centers, got to know our Carquest independents and attended our annual vendor summit where I had the chance to meet with many of our major suppliers. Through all of this, I came away impressed with the passion and dedication of our frontline team members and I remain optimistic about the future of the company.

在那段時間裡，我參觀了我們在多個市場的商店，會見了眾多客戶，在我們的配送中心待了一段時間，認識了我們的Carquest 獨立人士，並參加了我們的年度供應商峰會，在那裡我有機會見到了我們的許多主要供應商。透過這一切，我對第一線團隊成員的熱情和奉獻精神印象深刻，我對公司的未來保持樂觀。

In addition to spending time in the field, I have partnered closely with the Board and management team to make progress on our strategic and operational review. As the new CEO, I placed a premium on capabilities learned during my time in the military. This includes aligning the company around fewer measurable goals while ensuring discipline and accountability in the process to achieve those goals.

除了在現場工作之外，我還與董事會和管理團隊密切合作，以在我們的策略和營運審查方面取得進展。作為新任首席執行官，我非常重視在軍隊期間學到的能力。這包括使公司圍繞更少的可衡量目標進行調整，同時確保實現這些目標的過程中的紀律和問責制。

During my review of Advance, we identified the need to simplify our overall strategy while also improving execution, both of which will create value. Consistent with that, we are moving forward with a sense of urgency to help stabilize the company and return to profitable growth. Today, we are announcing decisive actions that we have initiated to achieve these objectives.

在我對 Advance 的審查中，我們發現需要簡化整體策略，同時提高執行力，這兩者都將創造價值。與此一致的是，我們正帶著緊迫感繼續前進，以幫助穩定公司並恢復獲利成長。今天，我們宣佈為實現這些目標而採取的果斷行動。

Those actions are: number one, the initiation of a sale process for Worldpac; number two, the initiation of a separate sales process for our Canadian business; number three, significant cost reductions; number four, reinvestment in the field; and number five, the appointment of a new CFO as well as other organizational updates.

這些行動是：第一，啟動 Worldpac 的銷售流程；第二，為我們的加拿大業務啟動單獨的銷售流程；第三，顯著降低成本；第四，對該領域的再投資；第五，任命新的財務長以及其他組織更新。

These decisive actions are further reinforced with a renewed and vigorous commitment of selling auto parts. That is our core business. This includes eliminating numerous initiatives that were distracting us from a clear focus on the most fundamental aspects of our business. We believe our success will come from disciplined execution across the blended box model, where we service both professional installers and DIY customers from our Advance and Carquest locations.

這些果斷行動因新的、積極的汽車零件銷售承諾而進一步強化。這是我們的核心業務。這包括消除許多分散我們注意力的舉措，這些舉措分散了我們對業務最基本面的明確關注。我們相信，我們的成功將來自於混合盒模式的嚴格執行，我們在 Advance 和 Carquest 地點為專業安裝人員和 DIY 客戶提供服務。

Let's take a moment and further describe our 5 decisive actions beginning with the decision to initiate the sale process for Worldpac. Worldpac is a high-performing business and, as you know, is very different than our core blended box model. As we get back to the fundamentals of servicing our professional and DIY customers, we view now as the right time to simplify our model.

讓我們花點時間進一步描述我們的 5 個決定性行動，首先是決定啟動 Worldpac 的銷售流程。 Worldpac 是一家業績出色的企業，如您所知，它與我們的核心混合盒模型有很大不同。當我們回到為專業和 DIY 客戶提供服務的基礎上時，我們認為現在是簡化我們模型的最佳時機。

The Worldpac business still operates relatively independently from Advance and we believe that the sale process will not create a distraction. Next, let's talk about our business in Canada, which goes to market under the Carquest banner. Today, we are announcing a separate sales process for that business. Like Worldpac, our Canadian business also runs largely independently and predominantly serves professional customers. We do not believe this sales process will cause a distraction for our U.S. business.

Worldpac 業務仍然相對獨立於 Advance 運營，我們相信出售過程不會造成乾擾。接下來，我們來談談我們在加拿大的業務，它以 Carquest 的名義進入市場。今天，我們宣布該業務的單獨銷售流程。與 Worldpac 一樣，我們的加拿大業務也基本上是獨立經營，主要為專業客戶提供服務。我們認為這項銷售流程不會幹擾我們的美國業務。

Third, as part of our operational review, we have launched a new cost reduction program that we expect will generate a minimum of $150 million in savings on an annualized basis. These savings will be primarily driven by simplifying our organizational structure, minimizing duplicative efforts and eliminating investments that are not core to supporting our frontline team members and customers.

第三，作為我們營運審查的一部分，我們啟動了一項新的成本削減計劃，預計每年將節省至少 1.5 億美元。這些節省主要是透過簡化我們的組織結構、最大限度地減少重複工作以及消除非支援第一線團隊成員和客戶的核心投資來實現的。

Fourth, while we expect to see the benefits of these cost reductions beginning next year, we recognize that we must take action to improve the retention of our frontline teams and ensure we have experienced team members to serve our customers. In line with this, we expect to reinvest approximately $50 million of our savings back into the business, inclusive of wages and training enhancements.

第四，雖然我們期望從明年開始看到這些成本削減的好處，但我們認識到，我們必須採取行動來提高一線團隊的保留率，並確保我們有經驗豐富的團隊成員來為客戶服務。據此，我們預計將約 5,000 萬美元的儲蓄重新投資到業務中，其中包括薪資和培訓改進。

In fact, we began making changes to our frontline compensation structure in Q3 and are already seeing a reduction in turnover in targeted frontline roles. And fifth, following a robust search, I am pleased to announce that we have appointed a new CFO. We're thrilled that Ryan Grimsland will be joining the Advance family from Lowe's to lead our finance organization. Ryan has more than 20 years' experience leading high-performing teams in omnichannel retail businesses serving both Pro and DIY customers. He has a strong track record of driving organizational improvements while implementing best practices to resolve complex issues. I look forward to Ryan joining us later this month and partnering with him and the entire leadership team to drive the needed change for Advance.

事實上，我們從第三季開始改變第一季薪資結構，並且已經看到目標第一線職位的人員流動率下降。第五，經過嚴格的搜尋，我很高興地宣布我們已經任命了一位新的財務長。我們很高興 Ryan Grimsland 將加入 Lowe's 的 Advance 家族，領導我們的財務組織。 Ryan 擁有 20 多年領導高績效團隊的全通路零售業務經驗，為專業客戶和 DIY 客戶提供服務。他在推動組織改進、同時實施最佳實踐來解決複雜問題方面擁有良好的記錄。我期待 Ryan 在本月稍後加入我們，並與他和整個領導團隊合作，推動 Advance 所需的變革。

In addition to our CFO announcement, we've taken action to streamline our management structure. We have reorganized parts of my leadership team and transition responsibilities for our marketing, merchandising and e-commerce functions to the appropriate leaders in our organization who will drive enhanced collaboration and accountability. We have made additional organizational adjustments in several other areas to help us operate more effectively.

除了宣布財務長的任命外，我們還採取了精簡管理結構的行動。我們重組了部分領導團隊，並將行銷、銷售和電子商務職能的職責移交給組織中適當的領導者，他們將推動加強協作和問責制。我們在其他幾個領域進行了額外的組織調整，以幫助我們更有效地運作。

I would also note, as part of our strategic review, we are taking a disciplined approach to the evaluation of all assets, including corporate stores, independently owned Carquest locations and our distribution network, all to enhance productivity. This may include the rationalization of unprofitable assets to better allocate resources focused on core fundamentals. We are early in this process and expect to share more as we progress in the thorough evaluation of our entire business.

我還想指出，作為我們策略審查的一部分，我們正在採取嚴格的方法來評估所有資產，包括公司商店、獨立擁有的 Carquest 地點和我們的分銷網絡，所有這些都是為了提高生產力。這可能包括對無利可圖的資產進行合理化，以更好地分配專注於核心基本面的資源。我們處於這一過程的早期階段，並希望隨著我們對整個業務的全面評估的進展，分享更多資訊。

As I emphasized earlier, we are sharpening our focus on the fundamentals. As an example, last month, we held our annual partner Growth Summit and our team spent a few days with hundreds of representatives from key suppliers who are critical to how we better serve our customers. This annual event is a valuable opportunity for us to collaborate and share updates on our strategy.

正如我之前所強調的，我們正在加強對基本面的關注。例如，上個月，我們舉行了年度合作夥伴成長高峰會，我們的團隊花了幾天時間與來自主要供應商的數百名代表進行了會面，他們對我們如何更好地服務客戶至關重要。這次年度活動對我們來說是一次合作和分享策略更新的寶貴機會。

This year's summit was a great venue for us to articulate to our vendors how we are turning the page as an organization and we are excited to return to growth with their partnership. We recognize that having the right inventory availability is crucial for our team members' ability to serve customers, which would not be possible without the strong support of our vendor partners.

今年的高峰會是我們向供應商闡明我們作為一個組織如何翻開新一頁的絕佳場所，我們很高興能夠與他們的合作夥伴關係恢復成長。我們認識到，擁有適當的庫存可用性對於我們的團隊成員為客戶提供服務的能力至關重要，如果沒有供應商合作夥伴的大力支持，這是不可能實現的。

Finally, before I hand the call off to Tony, I'd like to thank him for his dedication and incredible work over the past few months serving as our interim CFO in addition to his role as Treasurer. His servant leadership has been instrumental across our finance organization. I look forward to continuing to partner with Tony as we build Advance and capture the immense opportunity ahead of us.

最後，在我把電話交給托尼之前，我要感謝他在過去幾個月擔任我們的臨時財務長以及財務主管期間所做的奉獻和出色的工作。他的僕人式領導在我們的財務組織中發揮了重要作用。我期待著繼續與托尼合作，共同建立 Advance 並抓住我們面前的巨大機會。

With that, I'd like to now turn the call over to Tony to discuss our Q3 results and provide an update on our outlook for the full year. Tony?

現在，我想將電話轉給托尼，討論我們第三季的業績，並提供我們全年展望的最新情況。托尼？

Thanks, Shane, and good morning. I would also like to thank all our team members for their continued dedication and focus on the customer. In Q3, our net sales of $2.7 billion increased 2.9% compared with Q3 2022 due to continued strength across our professional business.

謝謝，肖恩，早安。我還要感謝我們所有團隊成員的持續奉獻和對客戶的關注。由於我們專業業務的持續強勁，我們第三季的淨銷售額為 27 億美元，較 2022 年第三季成長 2.9%。

Comparable store sales increased 1.2%. All of our regions were positive during the quarter with the West, Florida and Northeast regions posting mid-single-digit growth. From a category perspective, we saw strength in filters, engine management, motor oil and batteries.

可比商店銷售額成長 1.2%。我們所有地區在本季度都表現積極，其中西部、佛羅裡達和東北地區實現了中個位數成長。從品類角度來看，我們看到了濾網、引擎管理、機油和電池的優勢。

Importantly, we've delivered meaningful growth in heating and cooling as we significantly improved our in-stock levels year-over-year.

重要的是，隨著我們的庫存水準逐年顯著提高，我們在供暖和製冷領域實現了有意義的成長。

In terms of the cadence of the quarter, both Pro and DIY omnichannel saw strength in the first 2 periods and softened the last 4 weeks of the quarter. Our Pro business was positive throughout Q3 and outperformed DIY omnichannel as transactions continued to improve and were up mid-single digits from the previous year on top of the improvement in Q2.

就本季的節奏而言，Pro 和 DIY 全通路在前兩個時期都表現強勁，但在本季的最後 4 週表現疲軟。我們的專業業務在整個第三季度表現良好，並且表現優於 DIY 全渠道，因為交易量持續改善，並且在第二季度改善的基礎上，比上一年增長了中個位數。

As expected, average ticket in Pro was down slightly as part of our ongoing efforts to maintain competitive price targets. However, units have increased slightly year-over-year. DIY omnichannel average ticket was up mid-single digits with transactions down low single digits in Q3.

正如預期的那樣，專業版的平均門票略有下降，這是我們持續努力保持有競爭力的價格目標的一部分。然而，單位數量較去年同期略有增加。第三季度，DIY 全通路平均門票價格上漲了中個位數，而交易量則下降了低個位數。

Before turning to the balance of our P&L, we've made strong progress towards remediating the material weakness and as part of our diligence in this process, we uncovered nonmaterial issues with our previously reported financial results. The balance of our financial results will compare our Q3 actual results to the corrected results for the prior year. The remediation of our material weakness remains a top priority.

在轉向損益表平衡之前，我們在彌補重大缺陷方面取得了巨大進展，作為我們在過程中盡職調查的一部分，我們發現了先前報告的財務業績中的非重大問題。我們的財務業績餘額將第三季的實際業績與前一年的修正結果進行比較。補救我們的物質弱點仍然是首要任務。

Despite improving top line trends, our gross profit margin was negatively impacted by several factors and deleveraged 830 basis points compared with Q3 2022. First, in line with the decisive actions Shane highlighted earlier, and as part of our operational review of the business, we implemented a change in estimate regarding our excess inventory reserves and incurred a onetime impact of approximately $119 million.

儘管收入趨勢有所改善，但我們的毛利率受到多種因素的負面影響，與2022 年第三季度相比，去槓桿化了830 個基點。首先，根據Shane 之前強調的果斷行動，並且作為我們業務營運審查的一部分，我們對我們的超額庫存儲備的估計進行了更改，並產生了約 1.19 億美元的一次性影響。

Further, like previous quarters, we experienced approximately $80 million in higher product costs that were not fully covered by pricing actions as we sustain our CPI targets. In addition, wage inflation and increased volume resulted in elevated supply chain expenses. These headwinds were partially offset by a reduction in LIFO-related expenses as we recognized a $56 million benefit this quarter compared with $67 million of expense in the same period last year. While SG&A dollars in the quarter increased year-over-year as a percent of net sales, SG&A leveraged nearly 30 basis points.

此外，與前幾季一樣，我們在維持 CPI 目標的過程中經歷了約 8,000 萬美元的產品成本上漲，但定價行動並未完全涵蓋這些成本。此外，薪資上漲和銷售增加導致供應鏈費用增加。這些不利因素被後進先出相關費用的減少部分抵消，因為我們認識到本季的收益為 5,600 萬美元，而去年同期的費用為 6,700 萬美元。雖然本季的 SG&A 美元佔淨銷售額的百分比同比有所增長，但 SG&A 槓桿率卻上升了近 30 個基點。

Our Q3 operating income margin deleveraged approximately 810 basis points compared with the prior year quarter. As you saw in our release this morning and as Shane discussed, we are taking action to significantly reduce costs in the business that has increased faster than sales over the past few years.

與去年同期相比，我們第三季的營業利潤率去槓桿化了約 810 個基點。正如您在今天早上的新聞稿中看到的以及肖恩所討論的那樣，我們正在採取行動大幅降低業務成本，該業務在過去幾年中的增長速度快於銷售額的增長速度。

We expect to see the full annualized savings of a minimum of $150 million in 2024 with approximately $50 million reinvested in our frontline team members. Diluted loss per share was $0.82 in Q3 compared with diluted earnings per share of $1.92 in the prior year quarter.

我們預計到 2024 年，每年可節省至少 1.5 億美元，其中約 5,000 萬美元將再投資於我們的第一線團隊成員。第三季稀釋後每股虧損為 0.82 美元，去年同期稀釋後每股收益為 1.92 美元。

Free cash flow in the quarter was an inflow of $148 million and year-to-date was an outflow of nearly $157 million. As we continue to focus on our working capital metrics, our AP ratio expanded 470 basis points from Q2 2023 to 79.8%.

本季自由現金流流入 1.48 億美元，年初至今流出近 1.57 億美元。隨著我們繼續關注營運資本指標，我們的 AP 比率從 2023 年第二季擴大了 470 個基點，達到 79.8%。

Before turning to guidance, let me touch on supply chain finance. We have maintained a similar level of capacity in our supply chain finance program thanks to the strong bank partners that continue to support us and our vendors. As you saw in our release this morning, we are updating our full year guidance. We are adjusting the top end of our net and comparable store sales ranges. However, as mentioned, there are several onetime factors impacting margins in the back half of the year. This includes the change in our excess inventory estimate in Q3 and costs we expect to incur related to our organizational restructuring in Q4.

在轉向指導之前，讓我先談談供應鏈金融。由於強大的銀行合作夥伴繼續支持我們和我們的供應商，我們的供應鏈融資計劃保持了類似的能力水準。正如您在今天早上的發布中看到的，我們正在更新全年指導。我們正在調整我們的淨銷售範圍和可比商店銷售範圍的上限。然而，如前所述，有幾個一次性因素會影響今年下半年的利潤率。這包括我們對第三季過剩庫存估計的變化以及我們預計與第四季度組織重組相關的成本。

Accordingly, we are reducing our operating income margin, diluted EPS and free cash flow guidance ranges. We are taking decisive actions to improve our cost structure now and we'll continue to evaluate further opportunities as we make additional progress on our strategic and operational review. As a result, we are updating our 2023 guidance ranges to include: net sales of $11.25 billion to $11.3 billion; comparable store sales of minus 0.5% to flat; GAAP operating income margin of 1.8% to 2%; income tax rate of 25%; diluted earnings per share of $1.40 to $1.80; capital expenditures of $200 million to $250 million; positive free cash flow of $50 million to $100 million; and 55 to 65 new store and branch openings.

因此，我們正在降低營業利潤率、稀釋每股盈餘和自由現金流指導範圍。我們現在正在採取果斷行動來改善我們的成本結構，隨著我們在策略和營運審查方面取得更多進展，我們將繼續評估進一步的機會。因此，我們正在更新 2023 年指引範圍，其中包括： 淨銷售額 112.5 億美元至 113 億美元；可比商店銷售額下降-0.5%至持平； GAAP 營業利益率為 1.8% 至 2%；所得稅稅率為25%；稀釋後每股收益為 1.40 美元至 1.80 美元；資本支出2億至2.5億美元；正自由現金流為 5,000 萬至 1 億美元；開設 55 至 65 家新店和分店。

With that, I'd like to turn the call back to Shane.

說到這裡，我想把電話轉回謝恩。

As I mentioned earlier, we recognized there is substantial work to be done and are focused on executing a strategy centered on our customers and our frontline team members while continuing to look at additional opportunities to simplify our operations. We are taking and will continue to take decisive action to stabilize the business and position Advance for long-term sustainable success.

正如我之前提到的，我們認識到還有大量工作要做，並專注於執行以客戶和第一線團隊成員為中心的策略，同時繼續尋找其他機會來簡化我們的營運。我們正在並將繼續採取果斷行動來穩定業務並為長期可持續成功奠定基礎。

All of us at Advance the Board and the entire management team are committed to returning to profitable growth and creating value for shareholders. I look forward to providing you with further updates on our next earnings call. I would now like to open it up to address your questions. Operator?

Advance 董事會和整個管理團隊的所有人都致力於恢復獲利成長並為股東創造價值。我期待在下一次財報電話會議上為您提供更多最新資訊。我現在想打開它來回答您的問題。操作員？

(Operator Instructions) Our first question today goes to Michael Lasser of UBS.

（操作員說明）我們今天的第一個問題是向瑞銀集團的麥可拉瑟提出的。

Shane, I know it's been very early in your tenure at Advance Auto Parts, but there's so many moving pieces in the business right now. As you think about the long term, what's the realistic operating margin for the core business, excluding some of the businesses that you're looking to sell? And it seems like the implied gross margin is going to settle around the 41% range. Is that the correct run rate that we should think about for the long term?

Shane，我知道您在 Advance Auto Parts 任職還很早，但目前該行業有很多變化。當您考慮長期目標時，排除您想要出售的一些業務，核心業務的實際營業利潤率是多少？隱含毛利率似乎將穩定在 41% 左右。這是我們應該長期考慮的正確運行率嗎？

Michael, thanks for the question. It's too early for me to set what the long-term OI looks like for this company other than to say that I'm optimistic about where it can go. And that if we do these 5 decisive actions as we implement them, they'll all help in boosting where we sit there. And then same for margin. Early days, but know that we are absolutely focused on where we can increase the margins, and we'll be looking to do that in '24.

邁克爾，謝謝你的提問。對我來說，現在確定這家公司的長期 OI 是什麼樣子還為時過早，只能說我對它的發展方向持樂觀態度。如果我們在實施時採取這 5 項決定性行動，它們都將有助於提升我們的地位。然後保證金也是如此。雖然還處於早期階段，但要知道我們絕對專注於可以增加利潤的地方，我們將在 24 年實現這一目標。

Just one other small comment there, a way to help think about making that happen is with our org structure, where one dimension of that is having merchandising be a direct report to me. And they view that as a critical component for managing margin in a retail company.

還有一個小評論，幫助思考實現這一目標的一種方法是我們的組織結構，其中一個方面是讓銷售直接向我報告。他們認為這是管理零售公司利潤的關鍵組成部分。

Okay. And my follow-up question is, are you seeing any impact from the negative credit rating downgrade? And how are you thinking about capital needs of the business? And if anything, you could comment around the size of Worldpac or the Canadian business that will help that as you go through the process?

好的。我的後續問題是，您是否看到負面信用評級下調帶來的影響？您如何考慮企業的資本需求？如果有的話，您可以評論一下 Worldpac 或加拿大業務的規模，這將有助於您完成整個流程？

So a lot there. I'm going to ask Tony to comment, but we don't have liquidity issues or issues on supply chain financing. And then I'm not going to comment on the size of Worldpac or Canada. We've engaged Centerview to manage that process and interested parties can reach out to them. But Tony, can you tell us about the liquidity and financing?

那裡有很多。我將請托尼發表評論，但我們沒有流動性問題或供應鏈融資問題。然後我不會評論 Worldpac 或加拿大的規模。我們已聘請 Centerview 來管理流程，有興趣的各方可以聯繫他們。但是托尼，你能告訴我們流動性和融資方面的情況嗎？

Yes. Michael, good to talk to you again. We -- as you heard in my prepared remarks, we have continued to maintain the same level or very similar levels for our supply chain finance program, which really supports our vendors and our finance program. So we're not seeing any impact. And as you saw in our earnings release, we continue to grow cash flow. Our cash balance on the balance sheet grew, and we did not have any outstanding on the revolver as we have paid that down during the quarter as well.

是的。邁克爾，很高興再次與你交談。正如您在我準備好的演講中聽到的那樣，我們的供應鏈金融計劃繼續保持相同的水平或非常相似的水平，這真正支持我們的供應商和我們的財務計劃。所以我們沒有看到任何影響。正如您在我們的收益報告中看到的那樣，我們的現金流繼續增長。我們的資產負債表上的現金餘額有所增長，而且我們沒有任何未償還的左輪手槍，因為我們也在本季度支付了這筆款項。

And that last question...

最後一個問題...

There's no -- Michael, there's no urgency or requirements around the sale of Worldpac or Canada. They're both good businesses. This is really around our strategy and what we want to focus on as a company going forward, which is that domestic blended box model.

沒有——邁克爾，對於出售 Worldpac 或加拿大沒有任何緊迫性或要求。他們都是好生意。這實際上是圍繞著我們的策略以及我們作為一家公司未來想要關注的重點，即國內混合盒子模式。

And our next question goes to Chris Horvers of JPMorgan.

我們的下一個問題是向摩根大通的克里斯·霍弗斯提問。

It's Christian Carlino now on for Chris. I guess stepping back, how would you characterize what went wrong with the supply chain? And any color on the path forward in terms of the time line or the cost to fix it? You laid out the time line for the cost saves, but it seems like you'll also be paring back maybe some of the smaller Carquest DCs. So will you then need to add more modern or better located facilities? Or is it more on the operational front fixing the inventory management process?

現在由克里斯蒂安·卡利諾取代克里斯。我想退一步來說，您如何描述供應鏈出現的問題？就時間軸或修復成本而言，前進的道路上有什麼顏色嗎？您制定了節省成本的時間表，但似乎您還將削減一些較小的 Carquest DC。那麼您是否需要添加更現代化或位置更好的設施？或者更多的是在營運方面修復庫存管理流程？

So a lot there. Thanks for the question. The first thing I'll say is you know that our supply chain stems from the 2 entities from Carquest and from Advance. That will be one of the next areas where I'll be putting focus is really around validating the design of our future supply chain. And as we do that, there'll be some rationalization. There may be some facility additions, but we're comfortable we'll develop that plan as we go forward.

那裡有很多。謝謝你的提問。我要說的第一件事是，您知道我們的供應鏈源自 Carquest 和 Advance 的兩個實體。這將是我接下來要重點關注的領域之一，實際上是驗證我們未來供應鏈的設計。當我們這樣做時，就會有一些合理化。可能會增加一些設施，但我們很高興我們會在前進的過程中製定該計劃。

In terms of availability, those efforts can be discrete of just what occurs on the actual supply chain design and there's been a lot of work going on there, which we've improved across a number of areas. Think about that as under car engine management, heating and cooling brakes. And that comes from the pick-and-shovel work going on with the merchandise and inventory teams.

就可用性而言，這些努力可以與實際供應鏈設計中發生的事情無關，並且已經進行了大量工作，我們在許多領域都進行了改進。可以將其視為汽車引擎管理、加熱和冷卻煞車。這來自於商品和庫存團隊正在進行的挑選和鏟子工作。

Got it. That's helpful. And then just one quick one on the guide. What are you including for the onetime reorganization costs in 4Q? And then I guess, also in terms of how you're managing the supply chain finance program, is the implication that you're maybe giving suppliers back some margin in exchange for holding the payable days somewhat constant? How should we think about the puts and takes there?

知道了。這很有幫助。然後只是指南上的一篇快速文章。第四季的一次性重組成本包括哪些？然後我想，就您如何管理供應鏈融資計劃而言，這是否意味著您可能會向供應商返還一些保證金，以換取保持應付天數保持一定不變？我們該如何考慮那裡的看跌期權和索取期權？

Yes. Chris. Two good questions. So first, let's address the supply chain financing. We are not seeing that kind of impact in our programs. We have very strong bank partners and we have a tremendous amount of support from our key vendors. So we are not seeing any of that at this time. So in terms of that, we feel good. In terms of the guide in the back half, we have not laid out the impact from the restructuring. It is included in our guide. We're really not commenting on that just due to the sensitivity around our team members as we kick this off.

是的。克里斯。兩個好問題。首先，我們來談談供應鏈融資。我們在我們的計劃中沒有看到這種影響。我們擁有非常強大的銀行合作夥伴，並且得到了主要供應商的大力支持。所以我們目前還沒有看到任何這樣的情況。因此，就這一點而言，我們感覺很好。在後半部的指引中，我們並沒有列出重組的影響。它包含在我們的指南中。我們真的不會對此發表評論，只是因為我們的團隊成員在我們開始這項工作時很敏感。

Yes. Those reorganization dimensions are taking place this week, and we want to be sensitive to our associates, that's a difficult process for any company to go through.

是的。這些重組工作將於本週進行，我們希望對我們的員工保持敏感，這對任何公司來說都是一個艱難的過程。

The next question goes to Elizabeth Suzuki of Bank of America Merrill Lynch.

下一個問題是由美國銀行美林銀行的伊麗莎白鈴木提出的。

Just a question on the decision to increase the new store opening piece. I mean, particularly in the context of simplifying the business and preserving cash flow. Just curious what you're seeing in terms of new store profitability and whether that's been exceeding your expectations?

只是關於增加新店開業的決定的問題。我的意思是，特別是在簡化業務和保留現金流的情況下。只是好奇您對新店盈利能力的看法以及這是否超出了您的預期？

Yes. So Liz, good to talk to you again. We increased that based on a couple of opportunities that we have had in terms of opening stores or accelerating some of those openings -- new store openings. So we believe that we will continue to be very prudent in our approach to new stores, and we will continue to focus on asset productivity that we've talked about the last 2 quarters, and that's an important part of our business.

是的。莉茲，很高興能再次與你交談。我們增加了這個數字，這是基於我們在開設商店或加速其中一些開設新店方面所擁有的一些機會。因此，我們相信，我們將繼續對新店保持非常謹慎的態度，我們將繼續關注過去兩個季度討論的資產生產力，這是我們業務的重要組成部分。

And just a question on the businesses that you're planning to sell and what was acquired back in 2014. Just thinking about how that -- how those assets have evolved? And whether -- because -- so you're selling the Canadian part of the Carquest business, but keeping the U.S. part and selling the Worldpac part of the GPI acquisition. So just trying to frame or size those businesses as much as possible just for our analysis.

只是一個關於您計劃出售的業務以及 2014 年收購的業務的問題。想想這些資產是如何演變的？以及是否——因為——所以你要出售 Carquest 業務的加拿大部分，但保留美國部分，並出售 GPI 收購中的 Worldpac 部分。因此，只是為了我們的分析而盡可能地框架或確定這些業務的規模。

We don't do segment reporting, so not prepared to break those out now. But just reiterating they're both good businesses. and that sales process is -- we're just starting that now. So we'll do price discovery with potential suitors. No requirement to sell the business if we're not satisfied with what we see in the market. And so we're just starting that now.

我們不做分部報告，所以現在不準備將其分解。但只是重申一下，它們都是好企業。銷售流程是──我們現在才剛開始。因此，我們將與潛在的追求者一起進行價格發現。如果我們對市場上的情況不滿意，則無需出售業務。所以我們現在才剛開始。

The next question goes to Steven Zaccone of Citigroup.

下一個問題是花旗集團的史蒂文·扎科恩 (Steven Zaccone)。

To follow up on the prior question, could you at least talk about the Worldpac business is it much higher than the reported operating margin that you have today? And then help us think about the priorities for the cash proceeds from these sales, how would you rank using that cash?

為了跟進上一個問題，您至少可以談談 Worldpac 業務嗎？它比您今天報告的營業利潤率高得多嗎？然後幫助我們考慮這些銷售的現金收益的優先順序，您如何使用這些現金進行排名？

Yes. So good question. Unfortunately, back on the segment reporting, I'm not going to talk about the business other than to say it's a great business. We don't have a requirement to sell it. Selling it lets us simplify our approach going forward, which is to that blended box model. Your question on the proceeds is a good one. And first and always in a business if you have the economic dollars from an event like this. We're going to deploy it to initiatives that clear our internal rates for what we want to do with the business. So there's an investment for our business, the growth of the remaining business. We're excited about that.

是的。好問題。不幸的是，回到分部報告，我不會談論這項業務，只是說這是一項很棒的業務。我們沒有要求出售它。出售它可以讓我們簡化未來的方法，即混合盒模型。你關於收益的問題問得很好。如果你從這樣的活動中獲得了經濟收入，那麼首先並且始終在商業中。我們將把它部署到一些計劃中，以明確我們想要對業務做什麼的內部費率。因此，我們需要對我們的業務進行投資，促進剩餘業務的成長。我們對此感到興奮。

Secondly, always prudent to deploy funds to strengthen the balance sheet. So that becomes an option for the proceeds. And then third, we can look at shareholders and where excess capital might be returned to that. Those would be the 3 major efforts of how we think about that.

二是始終審慎配置資金強表。因此，這成為收益的選擇。第三，我們可以看看股東以及多餘的資本可能會回饋給股東。這些將是我們對此的看法的三個主要努力。

Okay. Understood. My follow-up question is just on the DIFM side. So with your fresh perspective on the business, why do you think the core Advance business has been losing share in DIFM? And I guess, specifically there, average ticket has been a bit of a drag. How long do you expect that to be a drag to the Pro side of the business?

好的。明白了。我的後續問題只是關於 DIFM 方面。那麼，以您對業務的全新視角，您認為為什麼核心 Advance 業務在 DIFM 中的份額一直在流失？我想，特別是在那裡，平均票價有點拖累。您預計這會拖累專業版業務多久？

Yes. So I'm going to ask Tony to break out a bit of flavor on our DIY versus DIFM performance. But know that my focus coming into the organization is to take those decisive actions that help us simplify the business and then provide the focus at that store level for both the DIY and DIFM customer. And as we do that, I think that's where we gain success. But Tony, can you just characterize what you're seeing on DIFM right now?

是的。因此，我將請托尼對我們的 DIY 與 DIFM 性能進行一些分析。但要知道，我進入組織的重點是採取那些幫助我們簡化業務的決定性行動，然後為 DIY 和 DIFM 客戶提供商店層級的重點。當我們這樣做時，我認為這就是我們成功的地方。但是托尼，您能描述一下您現在在 DIFM 上看到的情況嗎？

Yes, correct. So as you've heard us talk about the last 2 to 3 quarters, we continue to focus on a very targeted CPI number. And as part of that, that will bring down our average ticket. And as a result, though, our transactions continue to increase.

是，對的。因此，正如您聽到我們談論過去 2 到 3 個季度一樣，我們繼續關注非常有針對性的 CPI 數字。作為其中的一部分，這將降低我們的平均票價。但結果是，我們的交易量持續增加。

The next question goes to Greg Melich of Evercore ISI.

下一個問題將詢問 Evercore ISI 的 Greg Melich。

The next question goes to Bret Jordan of Jefferies.

下一個問題將問 Jefferies 的布雷特喬丹 (Bret Jordan)。

I guess coming into this -- coming into this sort of -- looking at the business with fresh eyes. And obviously, the perception has always been this sort of a mash-up of various supply chain systems. How close do you see this to being sort of consolidated to being a common supply chain across all of the stores ex-Worldpac. We had real progress been made from a system standpoint.

我想進入這個領域──進入這種領域──用新的眼光來看待這個產業。顯然，人們的看法一直是各種供應鏈系統的混搭。您認為這與整合成為 Worldpac 以外的所有商店的共同供應鏈有多接近。從系統的角度來看，我們取得了真正的進步。

Yes. So the supply chain team is diligently on tasked for that. And for me, that you think about the 5 decisive actions we covered, that's where my immediate focus is, a pivot to supply chain shortly after that. And my sense is we'll come back to you on future calls on what the time line looks like, but we're working on it. It's not something that will be done overnight. But confident that we can get to a unified supply chain for the company.

是的。因此，供應鏈團隊正在努力完成這項任務。對我來說，你想想我們所涵蓋的 5 項決定性行動，這就是我目前關注的焦點，不久後轉向供應鏈。我的感覺是，我們會在未來的電話會議上回覆您，了解時間表，但我們正在努力解決這個問題。這不是一朝一夕就能完成的事。但我們有信心為公司建立統一的供應鏈。

Okay. And then I guess on Worldpac, what do you see, I guess, a dis-synergy in the sale? Were there common customers or sales to advance that were a result of your having the Worldpac business that you might lose? Or is it relatively separate?

好的。然後我想在 Worldpac 上，您認為銷售中存在什麼不協同效應？是否有可能因失去 Worldpac 業務而導致共同客戶或銷售額增加？或者說是相對獨立的？

So it is a different business, and it runs as a separate business. So I really don't see dis-synergies there, but what I see for us as we sell that business, is a simplification of our focus. And going back to the fundamentals of we're going to sell auto parts out of a blended box model. We think that's a good recipe for success. And as we do that, Worldpac doesn't fit in that future model. So we'll explore the sales process, which we're kicking off today.

因此，這是一項不同的業務，並且作為一項獨立的業務運作。所以我真的沒有看到那裡的協同效應，但是當我們出售該業務時，我看到的是我們的重點的簡化。回到我們將透過混合盒模型銷售汽車零件的基本原理。我們認為這是成功的一個很好的秘訣。當我們這樣做時，Worldpac 並不適合未來的型號。因此，我們將探討今天開始的銷售流程。

Okay. And a quick housekeeping for Tom (sic) [Tony], what was the price contribution to comp? What was inflation versus traffic?

好的。湯姆（原文如此）[東尼]的快速內務管理，價格對補償的貢獻是多少？通貨膨脹與交通流量有何關係？

Yes. I think that's for Tony. In terms of price inflation, we priced just enough to cover portion of cost. So it was very minimal to our comp in the third quarter.

是的。我想那是給托尼的。就價格通膨而言，我們的定價剛好足以涵蓋部分成本。因此，我們第三季的業績非常小。

The next question goes to Scot Ciccarelli of Truist.

下一個問題將詢問 Truist 的 Scot Ciccarelli。

Scot Ciccarelli. I wanted to ask about the restatements under the -- where there's smoke, there's fire concept. What gives you guys confidence there aren't bigger issues in your historical financials because it seems like what you disclosed today was uncovered after a pretty short stint for the new finance team. So could we end up in a situation where more digging reveals more issues?

斯科特·西卡雷利。我想詢問有關「哪裡有煙，哪裡就有火」概念的重述。是什麼讓你們相信你們的歷史財務數據中沒有更大的問題，因為你們今天披露的內容似乎是在新財務團隊任職很短一段時間後發現的。那麼，我們最終是否會陷入更多挖掘揭示更多問題的情況？

Scot, Tony here. We're meeting the material weakness is our top priority in finance, and we continue to dig in and we are committed to getting this material weakness remediated and behind this as quick as possible. It is possible, but it is possible to not either. So we'll continue to share as we find more information, but we will keep you abreast of that material weakness remediation as well.

斯科特，托尼在這裡。我們正在解決重大弱點，這是我們在財務方面的首要任務，我們將繼續深入研究，並致力於盡快糾正這一重大弱點。有可能，但也有可能不會。因此，當我們發現更多資訊時，我們將繼續分享，但我們也會讓您隨時了解重大缺陷的補救措施。

Got it. And then can you repeat the comments you made on LIFO? Did your numbers this quarter actually include a sizable year-over-year benefit from LIFO? Is that what I heard?

知道了。那麼您能重複一下您對 LIFO 的評論嗎？您本季的數據是否確實包含了後進先出法帶來的可觀的年比收益？這是我聽到的嗎？

That's correct, Scot.

沒錯，斯科特。

The next question goes to Simeon Gutman of Morgan Stanley.

下一個問題將問摩根士丹利的西蒙古特曼。

This is Jackie Sussman on for Simeon. You guys mentioned in your prepared remarks that some of the cost savings will go towards reinvesting to improve employee retention. In your view, has advanced kind of done enough to retain its best people and what are some areas of improvement that you see or conversely areas where you feel like you're executing pretty well.

我是西蒙的傑姬·蘇斯曼。你們在準備好的發言中提到，部分成本節省將用於再投資，以提高員工留任率。在您看來，該公司是否已經做得足以留住最優秀的人才，以及您看到哪些方面需要改進，或者相反，您認為自己在哪些方面執行得很好。

So as I've been in the field, I'm impressed with our frontline associates. We've got energized team members engaging every day, doing their level best to take care of customers. What we found is in certain key positions in the company where we were from a wage perspective was below where we wanted to be.

因此，當我在該領域工作時，我對我們的一線同事印象深刻。我們的團隊成員充滿活力，每天都積極參與，盡力照顧客戶。我們發現，在公司的某些關鍵職位上，從薪資角度來看，我們的薪資低於我們想要的水平。

So we've started to make some of those investments and we see correspondingly where we make the investment, the turnover is reduced. And so we think taking some of the monies from the cost reduction and putting that into wage will help further reduce turnover for key positions. But the initiative will extend beyond wage. And as our team, our field team and our HR teams work together, we also think that training, career pathing, showing folks how they can develop over time with advance, that's all part of it as well. And the idea is that for our frontline associates that they come in, they're energized to be here and then they feel that they can have their career with the company and they can see where they can go. So that's all part of the program that we're putting together and the early read from early investments is that it's doing exactly what we want it to do.

因此，我們已經開始進行一些投資，我們相應地看到，在我們進行投資的地方，營業額有所減少。因此，我們認為從成本削減中取出一些資金並將其計入工資將有助於進一步減少關鍵職位的流動率。但這項舉措將不僅限於薪資。當我們的團隊、我們的現場團隊和我們的人力資源團隊一起工作時，我們也認為培訓、職業道路、向人們展示他們如何隨著時間的推移而不斷進步，這也是它的一部分。我們的想法是，對於我們的第一線員工來說，他們來到這裡充滿活力，然後他們覺得他們可以在公司發展自己的職業生涯，他們可以看到自己可以去哪裡。這就是我們正在整合的計劃的一部分，從早期投資中可以看出，它正在做我們想要它做的事情。

Got you. That's super helpful. And just one more kind of housekeeping question regarding to the cost savings that you mentioned. Where will that kind of fit in across the P&L? Is that mostly on the SG&A side or mostly on gross as well? I mean if you can give some color on that.

明白你了。這非常有幫助。還有一種關於您提到的成本節約的內務問題。這種情況在損益表中處於什麼位置？這主要是在SG&A方面還是主要在毛額方面？我的意思是如果你能對此給出一些顏色。

Yes. It's predominantly in SG&A. You'll see most of that savings come through there.

是的。主要是在SG&A 方面。您會發現大部分節省都是透過那裡實現的。

The next question goes to Chris Bottiglieri of BNP Paribas.

下一個問題將由法國巴黎銀行的 Chris Bottiglieri 提出。

I was hoping you could elaborate more on this inventory write-down. Like I appreciate you guys are cleaning counting up. I think it's really great to see it's someone like concerns for a while now. But is this at all related to like the capitalized supply chain costs that have been growing for years and beyond kind of like the onetime write-down. Was there some overearning in prior periods because of this adjustment. I just want to kind of understand what the impact is going forward.

我希望您能詳細說明庫存減記的情況。就像我很感激你們正在清理計數一樣。我認為很高興看到有人關心了一段時間。但這是否與多年來一直成長的資本化供應鏈成本有關，甚至超出了一次性減記的範圍。前期是否有因本次調整而產生的超額效益？我只是想了解未來的影響。

Chris, it's Tony. Good to talk to you. We changed the way we estimate excess inventory. And as a result, we took a onetime change or charge to our P&L of $119 million. It's not relevant to say that it's part of the -- capitalized supply chain costs. The capitalized supply chain costs continue. Those are in and out as a result of how much inventory we buy or sell. So this is just a pure result of our change in estimate.

克里斯，是東尼。很高興和你說話。我們改變了估算過剩庫存的方式。因此，我們對損益表進行了 1.19 億美元的一次性變更或費用。說它是資本化供應鏈成本的一部分是不相關的。資本化的供應鏈成本仍在持續。這些資金的進出取決於我們購買或出售的庫存量。所以這只是我們改變估計的純粹結果。

Got you. Okay. That's really helpful. And then just second, what do you think like the right SG&A growth rate of this business is moving forward? It seems like peers are kind of ramping up their investment in terms of an SG&A per store. I think it's great that you're reinvesting $50 million of the $150 million, but what are all $150 million? Like how do you think about reinvestment? It seems like if you're cutting costs and your peers are accelerating investments. I think it's been one of the challenges the business has faced in the last 5 years.

明白你了。好的。這真的很有幫助。其次，您認為該業務的正確 SG&A 成長率是多少？同行似乎正在增加對每家商店的銷售、管理及管理費用（SG&A）的投資。我認為您將 1.5 億美元中的 5000 萬美元進行再投資是件好事，但是 1.5 億美元都是什麼呢？例如您如何看待再投資？看起來你正在削減成本，而你的同行正在加速投資。我認為這是企業在過去五年中面臨的挑戰之一。

So I'll start -- yes, it's a good question. I'll start and ask Tony to comment we're not suggesting through this cost cutting that we're not going to reinvest in the business or we're not going to invest in the business going forward. This was really around looking at the current state of the business and where we're spending money and where we were heavy or where we weren't getting productivity, but we'll absolutely be investing for growth in the future. I think that's a key part of it. And then on SG&A, the way I think about just retail businesses in general, we want to be creating leverage as we go forward. But Tony, if you have any character on how we think about that, that would be great.

所以我要開始——是的，這是一個很好的問題。我首先請托尼發表評論，我們並不是透過這次成本削減建議我們不會再投資於該業務，或者我們不會投資於未來的業務。這實際上是為了審視當前的業務狀況，以及我們在哪裡花錢、在哪裡投入大量資金或在哪裡沒有提高生產力，但我們絕對會為未來的成長進行投資。我認為這是其中的關鍵部分。然後，在銷售、管理和行政費用（SG&A）方面，我對一般零售業務的看法是，我們希望在前進的過程中創造槓桿。但是托尼，如果你對我們的看法有任何了解，那就太好了。

Yes, Chris. So the way to think about it is over the last few years, our SG&A or our cost structure has outpaced -- has outgrown our top line. So we -- the actions we took and we're announcing today are not to stop investing in our stores or in the business. This is to stop doing certain projects or focus on what's really the fundamental of the business. So -- and that's how we approach this cost reduction program.

是的，克里斯。因此，在過去的幾年裡，我們的銷售管理費用（SG&A）或我們的成本結構已經超過了我們的營收成長。因此，我們今天所採取和宣布的行動並不是停止對我們的商店或業務的投資。這是為了停止某些專案或專注於業務的真正基礎。這就是我們實施成本削減計劃的方式。

The next question, goes to Steven Forbes of Guggenheim Partners.

下一個問題將由古根漢合夥人公司的史蒂文·福布斯提出。

Shane, I wanted to revisit the decision to sell Worldpac. Really, if we could just take a step back, Shane, so early on into the 100-day review process, why such urgency in the message and the decision to sell the Worldpac asset? What is the urgency really stemming from?

Shane，我想重新考慮出售 Worldpac 的決定。真的，Shane，如果我們能退後一步，那麼早進入 100 天審查流程，為什麼資訊和出售 Worldpac 資產的決定如此緊迫？真正的迫切性源自於什麼？

Yes. So first, I don't want you to think that these are knee-jerk decisions at the benefit of counsel and continuity from our Executive Chair, Gene also talking with stature leaders in the company in terms of assessing what the right direction is. So that perspective doesn't just come from me being in the business for 60 days. What I do bring in terms of fresh eyes is a validation of that perspective and then a bias for action. And I think that's really important. One of the things that this company needed to do to reset is to make the decisions that will set us on the trajectory for success going forward, doesn't mean I have all the answers, readily admit it. Doesn't mean that in some of these initiatives that we won't make mistakes and where we do will correct course. But clearly, as you looked at the performance of the company over time, which I did before and came in, it's clear that where we were with our status quo activities wasn't working. And so that's where that comes from. And we think strategically going forward, that blended box model is a tenant for our success.

是的。首先，我不希望您認為這些是下意識的決定，有利於我們執行主席的建議和連續性，吉恩也與公司的知名領導者討論了評估正確方向的問題。所以這種觀點不只來自於我在這個行業工作了 60 天。我所帶來的​​新鮮感是對這種觀點的驗證，然後是對行動的偏見。我認為這非常重要。這家公司需要做的重置事情之一是做出決定，使我們走上成功的軌道，並不意味著我擁有所有答案，欣然承認這一點。這並不意味著在其中一些舉措中我們不會犯錯誤，而且我們犯了錯誤就會糾正方向。但顯然，當你觀察公司隨著時間的推移的表現時（我之前做過並加入進來），很明顯我們的現狀活動沒有發揮作用。這就是它的來源。我們認為，從策略來看，混合盒模型是我們成功的基礎。

And then I appreciate that, Shane, and just a quick follow-up. I realize you're not providing financial color on the assets for sale, but I'm not sure if you can maybe help reframe what the remaining assets would be free cash flowing this year, right, as we sort of think through the $50 million to $100 million guidance for the full year. What is the -- is the core asset free cash flow positive this year?

然後我很感激，Shane，並且只是快速跟進。我知道您沒有提供待售資產的財務信息，但我不確定您是否可以幫助重新構建今年剩餘資產的自由現金流，對吧，就像我們思考 5000 萬美元一樣全年指導為 1 億美元。今年核心資產自由現金流是否為正？

Yes. Since we don't segment report, we can't break that out for you. We don't anticipate any of the sale to happen this year, so the $50 million to $100 million is inclusive of our consolidated financial operations.

是的。由於我們不細分報告，因此我們無法為您詳細說明。我們預計今年不會進行任何出售，因此 5,000 萬至 1 億美元包括我們的合併財務業務。

The next question go to Seth Basham of Wedbush.

下一個問題將由韋德布希 (Wedbush) 的塞思·巴沙姆 (Seth Basham) 提出。

My question is around gross margin. If you could please give us some more color on the step down gross margin from last quarter, this quarter, even excluding the inventory charge, we saw a step down. I'm just trying to understand what's the right -- is your gross margin?

我的問題是關於毛利率的。如果您可以的話，請給我們更多關於毛利率較上季度下降的信息，本季度，即使不包括庫存費用，我們也看到了毛利率的下降。我只是想了解什麼是正確的——你的毛利率是多少？

Yes, I'll take that. So when you look at -- when you look at the -- you exclude the inventory, there's a couple of key factors. One is we continue to not cover cost with price, cost is what we called out. And that's predominantly the bigger chunk, excluding the inventory. We've also seen some additional deleverage in our supply chain costs, but the predominant cost structure is really coming from not covering costs. And then the other that I'd add to that is really the channel mix. As we continue to see our Pro rebound, that does have lower margins than our DIY business.

是的，我會接受的。因此，當你查看——當你查看——排除庫存時，有幾個關鍵因素。一是我們仍然不以價格來覆蓋成本，成本就是我們所說的。這主要是較大的部分，不包括庫存。我們也看到供應鏈成本出現了一些額外的去槓桿化，但主要的成本結構實際上來自於未覆蓋成本。然後我要添加的另一個實際上是渠道組合。隨著我們繼續看到 Pro 業務反彈，其利潤率確實低於 DIY 業務。

So on a per unit basis, are you seeing your costs continue to rise? And is that partly due to higher financing costs for your vendors under the supply chain financing program?

那麼，以單位計算，您是否發現成本持續上升？這是否部分是由於供應鏈融資計劃下供應商的融資成本較高？

No, we're not -- it's not that there's inflationary costs that are already built in, but we are not building an additional price to cover that cost.

不，我們不是——這並不是說已經存在通貨膨脹成本，而是我們不會制定額外的價格來彌補該成本。

The next question goes to Zack Fadem of Wells Fargo.

下一個問題將問富國銀行的紮克法德姆。

So first of all, Shane, congrats on the first earnings call. So the question, could you talk a bit about the game plan for growing your do-it-for-me business today? And whether you think the current 60-40-ish do-it-for-me DIY mix is optimal. And then as you think about balancing growth and profitability, should we expect a culling of the business to remove less profitable customers for? Is there a plan to prioritize the top line over profitability? Any color there?

首先，肖恩，恭喜第一次財報電話會議。那麼問題是，您能談談今天發展您的「為我做事」業務的計劃嗎？以及您是否認為目前 60-40 左右的 DIY 組合是最佳選擇。然後，當您考慮平衡成長和獲利能力時，我們是否應該期望對業務進行淘汰以消除利潤較低的客戶？是否有計劃將營收置於獲利之上？那裡有什麼顏色嗎？

It's great. So let's talk about those each in turn. First, on growing the Pro, we certainly want to have the Pro be a prominent part of our growth. And the way you do that is engagement in the market. It starts with the CPPs in the stores. Those are store-based Pro representatives. Also our field-based representatives are CAMs. And so we've done some moves in terms of how we're organizing that Pro part of our business under Junior award. And so we've made some streamlined moves, and in particular, as we get ready to divest Worldpac. So that will help us on the Pro side of the house, and we'll have that focus there. Obviously, it also means we got to have the right parts on hand for the Pros. In this business, you want to be first call. And that's where we're aligning our efforts so that as our pro customers need product, they call us and we go ahead and get it.

這很棒。那麼讓我們依次討論這些。首先，在發展 Pro 方面，我們當然希望 Pro 成為我們發展的重要組成部分。而你做到這一點的方式就是參與市場。首先是商店裡的 CPP。這些是商店的專業代表。我們的現場代表也是 CAM。因此，我們在如何組織初級獎項下的專業部分業務方面採取了一些舉措。因此，我們採取了一些簡化的舉措，特別是在我們準備剝離 Worldpac 的時候。因此，這將對我們在專業方面有所幫助，我們將重點放在那裡。顯然，這也意味著我們必須為專業人士準備合適的零件。在這個行業，你希望成為第一個打電話的人。這就是我們正在協調努力的地方，以便當我們的專業客戶需要產品時，他們會打電話給我們，我們就會繼續獲得它。

As it relates to how we think about less profitable customers, I'm going to just put this broadly under just an effort around asset assessment and utilization across the company. We just need to look at how we operate and where we operate and make rational decisions around where we can grow and grow profitably. And I don't want to just do top line without the expense of contributing operating income. I think that's important. So that's what we're looking to do. We're looking to get advanced back on a trajectory of consistent profitable growth. And as we look at all of our assets, inclusive of our stores, our supply chain, how we merchandise. And then who we sell to, I think it's appropriate to make logical decisions about -- with each of those about getting to that profitable growth.

由於它與我們如何看待利潤較低的客戶有關，因此我將把它廣泛地歸入整個公司資產評估和利用的努力之下。我們只需要看看我們的營運方式和營運地點，並圍繞我們可以成長和獲利的領域做出理性決策。我不想只做營收而不貢獻營業收入。我認為這很重要。這就是我們想要做的。我們希望重新回到持續獲利成長的軌道上。當我們審視我們的所有資產時，包括我們的商店、我們的供應鏈以及我們的銷售方式。然後我們賣給誰，我認為做出合理的決定是適當的——與每個人一起實現盈利增長。

Got it. I appreciate the color there. And then I think you suggested that your operating margin is expected to grow in 2024. So just curious if you could talk a little bit about the makeup there in more detail with respect to top line growth versus margin recovery versus structural change like taking Worldpac and other costs out of the business.

知道了。我很欣賞那裡的顏色。然後我認為您建議您的營業利潤率預計將在2024 年增長。因此，我很好奇您是否可以更詳細地談論那裡的組成，包括營收成長、利潤率恢復、結構性變化（例如採取Worldpac和業務以外的其他成本。

Yes. I think it's too soon to start talking about 2024 in terms of margin. We'll come back to you in February and provide you a lot of additional color what we have said so far is the cost reduction program that we have announced today, that will benefit full run rate in 2024. So -- but more to come in February as we continue down the strategic and operational review of our business.

是的。我認為現在開始談論 2024 年的利潤率還為時過早。我們將在2 月回覆您，並為您提供更多資訊。到目前為止，我們所說的是我們今天宣布的成本削減計劃，這將有利於2024 年的全面運行率。所以，但未來還會有更多資訊二月份，我們繼續對我們的業務進行策略和營運審查。

The next question goes to Priya Ohri-Gupta of Barclays.

下一個問題將由巴克萊銀行的 Priya Ohri-Gupta 提出。

This is [Argus] in for Priya. We have a question in terms of the credit ratings. Are you considering soliciting a Fitch rating at this moment?

這是普莉亞的[阿古斯]。我們有一個關於信用評級的問題。現在您是否正在考慮尋求惠譽評級？

Yes. As we continue to assess our overall capital structure, we will always consider what makes the most sense for the business. If we decide to solicit Fitch rating for public, we will announce that in the future. At this time, we are maintaining -- what we have today, we are focused on turning our business and we continue to improve our cash flow and working capital metrics that you've seen us announce this quarter.

是的。當我們繼續評估我們的整體資本結構時，我們將始終考慮什麼對企業最有意義。如果我們決定公開徵求惠譽評級，我們將在未來宣布。目前，我們正在維持我們今天所擁有的，我們專注於轉變我們的業務，我們繼續改善我們本季宣布的現金流和營運資本指標。

The next question goes to Michael Montani of Evercore ISI.

下一個問題將詢問 Evercore ISI 的 Michael Montani。

This is Mike Montani on for Greg Melich. I just wanted to ask, first off, on the cash flow side, if you could discuss the plans to inflect that positive for the full year. I think you're running about $150 million negative through the first 3 quarters. So is probably something simple, but how do you get that inflected positive in the fourth quarter?

我是麥克·蒙塔尼 (Mike Montani)，代表格雷格·梅利奇 (Greg Melich) 發言。我只想問，首先，在現金流方面，您是否可以討論為全年帶來積極影響的計劃。我認為前三個季度的虧損約為 1.5 億美元。這可能很簡單，但如何在第四季實現積極的轉變呢？

Yes. As you've seen over the last 2 quarters, we continue to generate positive cash flow in each of those quarters as we continue to focus on the business, focus on sales and our working capital metrics continue to improve. We expect that to continue into Q4 at this time based on what we know. And that's what we are looking at based on the recovery of all of our working capital as well as higher sales that you've seen in Q2 and Q3.

是的。正如您在過去兩個季度中看到的那樣，隨著我們繼續專注於業務、銷售以及營運資本指標的持續改善，我們在每個季度都繼續產生正現金流。根據我們所知，我們預計這種情況將持續到第四季度。這就是我們根據我們所有營運資金的恢復以及第二季和第三季的更高銷售額所看到的。

Got it. And then if I could just follow up on the sales line. You did mention some deterioration in the final period. Was curious if you could discuss if that's continued into the fourth quarter? And also if there's any color in terms of was it DIY that slowed versus Pro? Or what would have driven the slowdown?

知道了。然後我是否可以跟進銷售熱線。你確實提到了最後一段時期的一些惡化。很好奇您能否討論一下這種情況是否會持續到第四季？另外，是否有任何顏色方面的問題，DIY 是否比 Pro 速度慢？還是什麼導致了經濟放緩？

Yes. We're very conscious of the DIY consumer and the pressures that they are facing. But as we started the fourth quarter, we're actually tracking slightly better in the first 4 weeks. But we know that we have a challenging December ahead of us given the lap of last year where we had a significantly colder period than we are expecting this year, but we continue to be very conscious of the DIY consumer, and we expect Pro to continue to remain positive as well.

是的。我們非常了解 DIY 消費者以及他們面臨的壓力。但隨著第四季度的開始，我們實際上在前 4 週的跟踪情況略有好轉。但我們知道，鑑於去年的一圈，我們的寒冷時期比我們今年預期的要冷得多，我們將面臨一個充滿挑戰的 12 月，但我們仍然非常關注 DIY 消費者，我們預計 Pro 會繼續也要保持積極的態度。

Our final question is you Andrew (inaudible) of Oppenheimer.

我們的最後一個問題是奧本海默的安德魯（聽不清楚）。

It's Brian Nagel from Oppenheimer here. We appreciate it. So a couple of questions. First off, just with respect to the competitive environment, given this transition -- transformation, if you will, Advance now is pretty well documented. Are you seeing anything change competitively or whether either from your larger competitors or some of your smaller competitors, particularly on the professional side.

我是來自奧本海默的布萊恩·內格爾。我們很感激。有幾個問題。首先，就競爭環境而言，考慮到這種轉變——轉型，如果你願意的話，現在的進步已經有很好的記錄了。您是否看到競爭方面發生了任何變化，或者無論是來自您的較大競爭對手還是一些較小的競爭對手，特別是在專業方面。

And then my second question Shane, you've laid out a welcome first off, and maybe you've laid out some initial steps here in the transformation of Advance. Should we be expecting as analysts and investors watching the company, should we be expecting at some point or not too distant future kind of a longer-term operating plan from you and your team kind of indicating where this business can ultimately head.

然後是我的第二個問題，Shane，你首先表達了歡迎，也許你已經在 Advance 的轉型中提出了一些初步步驟。我們是否應該作為分析師和投資者來關注該公司，是否應該期待在某個時候或不久的將來，您和您的團隊會制定長期營運計劃，以表明該業務最終的發展方向。

So let's -- thanks, Brian. On the competitive environment, we obviously compete in a market with a number of competent larger players and smaller players but what I see notably in my early days is internal excitement with our team. And we've got great frontline team members who I think we're waiting for the unlock around simplifying our focus. And as we do these decisive actions that's what's going to occur. We're enabling our frontline to be successful with our customers, which I think helps in that competitive environment. So early days to talk about where there might be progress economically. But certainly, from a philosophy perspective and an engagement perspective, having that field first mentality, I think, is going to create momentum for us.

所以讓我們——謝謝，布萊恩。在競爭環境中，我們顯然是在一個有許多有能力的大型企業和小型企業的市場中競爭，但我在早期看到的最明顯的是我們團隊的內部興奮。我們擁有優秀的一線團隊成員，我認為他們正在等待解鎖以簡化我們的重點。當我們採取這些決定性行動時，就會發生這樣的事情。我們正在幫助我們的前線與客戶取得成功，我認為這有助於在競爭激烈的環境中。現在談論經濟上可能取得進展的領域還為時過早。但當然，從哲學的角度和參與的角度來看，我認為擁有該領域第一的心態將為我們創造動力。

On the longer-term plan, we're still mapping out my first 60 days and we certainly will be in the future, looking at what the long-term trajectory for the business is, inclusive of the initiatives that we're currently undertaking and then the future areas where I'll be [digging] in.

就長期計劃而言，我們仍在規劃我的前 60 天，而且我們肯定會在未來考慮業務的長期發展軌跡，包括我們目前正在採取的舉措以及然後是我未來將[挖掘]的領域。

That is all the questions we have today. Thank you all for joining us. We're grateful for your continued support. Wish you all a very happy Thanksgiving next week and look forward to sharing more in February. Have a nice day.

這就是我們今天的所有問題。感謝大家加入我們。我們感謝您一直以來的支持。祝大家下週感恩節快樂，並期待二月分享更多。祝你今天過得愉快。

Thank you. This now concludes today's call. Thank you all for joining. You may now disconnect your lines.

謝謝。今天的電話會議到此結束。感謝大家的加入。現在您可以斷開線路。