領先汽車配件 (AAP) 2024 Q1 法說會逐字稿

Welcome to the Advanced Auto Parts First Quarter 2024 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.

歡迎參加先進汽車零件 2024 年第一季電話會議。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 Q1 2024 results. I'm joined today by Shane O'Kelly, President and Chief Executive Officer; and Ryan Grimsland, Executive Vice President and Chief Financial Officer. Following Shane and Ryan's prepared remarks, we will turn our attention to answering your questions.

早安，感謝您加入我們討論 2024 年第一季的業績。今天，總裁兼執行長 Shane O'Kelly 也加入了我的行列。瑞安·格里姆斯蘭（Ryan Grimsland），執行副總裁兼財務長。在肖恩和瑞安準備好的發言之後，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 strategic and operational review, initiatives, plans, projections and future performance. Actual results could differ materially from those projected or implied by the forward-looking statements. Additional information about forward-looking statements and factors that could cause actual results to differ can be found under the captions, Forward-Looking Statements in our earnings release and Risk Factors in our most recent Form 10-K and subsequent filings made with the commission.

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，所有陳述均為前瞻性陳述，包括但不限於有關我們的策略和營運審查、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。有關前瞻性陳述和可能導致實際結果出現差異的因素的更多信息，請參見標題、我們的收益發布中的前瞻性陳述以及我們最近的10-K 表格和隨後向委員會提交的文件中的風險因素。

Now let me turn the call over to Shane O'Kelly.

現在讓我把電話轉給肖恩·奧凱利。

Thanks, Elisabeth. Good morning, and thank you for joining us for our first quarter earnings call.

謝謝，伊麗莎白。早安，感謝您參加我們的第一季財報電話會議。

Before we review the quarter, I'd first like to thank the entire Advance team for their continued dedication to serving our customers. Their passion and commitment make a difference each and every day. The year started off slower than anticipated across the industry. At Advance, we saw negative impact from weather, coupled with a challenged consumer, who is experiencing diminished purchasing power, higher credit card debt and uncertainty about the balance of the year in terms of macro conditions. As a result, our Q1 performance was lower than expected, with comps down 20 basis points year-over-year.

在我們回顧本季之前，我首先要感謝整個 Advance 團隊對我們客戶服務的持續奉獻。他們的熱情和承諾每天都在帶來改變。今年開局比整個產業的預期要慢。在Advance，我們看到了天氣的負面影響，再加上消費者面臨著購買力下降、信用卡債務增加以及今年剩餘宏觀狀況的不確定性等問題。因此，我們第一季的業績低於預期，年減 20 個基點。

On a positive note, our professional business saw low single-digit improvements in both comp and transactions. We believe that winning in Pro is important to our overall strategy and are pursuing that business across multiple segments, including up and down the street customers, strategic accounts, Carquest Independents and Worldpac. Regarding up and down the street customers, we are putting additional focus this year on winning with those accounts and recapturing lost customers.

從積極的方面來看，我們的專業業務在薪酬和交易方面都取得了低個位數的改善。我們相信，在 Pro 中獲勝對我們的整體策略非常重要，並且正在跨多個細分市場追求該業務，包括街頭客戶、策略客戶、Carquest Independents 和 Worldpac。對於街頭和街頭客戶，我們今年將更加重視贏得這些客戶並重新贏得失去的客戶。

In terms of our turnaround, we continue to execute against our previously outlined decisive actions designed to simplify our business. Those decisive actions are: number one, continuing the sale process for Worldpac; number two, reducing our costs to become more competitive, while investing a portion of those savings back into the front line; number three, making organizational changes to position us for success; number four, improving the productivity of all assets; and number five, consolidating our supply chain. We believe these actions will have a long-term positive impact on our business, and let me share a few important updates on each.

在轉虧為盈方面，我們繼續執行先前概述的旨在簡化業務的果斷行動。這些決定性行動是：第一，延續 Worldpac 的銷售流程；第二，降低成本以提高競爭力，同時將部分節省下來的資金投入第一線；第三，進行組織變革以使我們成功；第四，提高所有資產的生產力；第五，鞏固我們的供應鏈。我們相信這些行動將對我們的業務產生長期的正面影響，讓我分享每項行動的一些重要更新。

Starting with the potential sale of Worldpac, we are well underway with that process. We are very pleased to have healthy interest, and we are looking to conclude the process before we report our second quarter results. As a reminder, we've previously discussed the potential sale of our Canadian business, and we'll evaluate that once the Worldpac sale is complete.

從 Worldpac 的潛在出售開始，我們的進程正在順利進行中。我們很高興有健康的興趣，我們希望在報告第二季業績之前完成此過程。提醒一下，我們之前已經討論過出售加拿大業務的可能性，一旦 Worldpac 出售完成，我們將對此進行評估。

Second, reducing and controlling costs is a major focus, and we are beginning to see benefits from the actions we took in the fourth quarter. We delivered on the $150 million in annualized savings outlined on our previous calls, and this is evidenced by a reduction in our year-over-year SG&A of $21 million in this quarter despite a softer top line. We're also beginning to see benefits from the $50 million reinvested into our front line, including a more than 50% reduction in our district manager turnover, and we expect to see improvements in other key roles throughout the year.

其次，降低和控製成本是一個重點，我們開始看到第四季採取的行動帶來的好處。我們實現了先前電話會議中概述的 1.5 億美元的年化節省，這一點可以從本季度的 SG&A 同比減少 2100 萬美元中得到證明，儘管營收較疲軟。我們也開始看到前線再投資 5,000 萬美元的好處，包括區域經理流動率減少 50% 以上，並且我們預計全年其他關鍵職位將得到改善。

In addition, our indirect purchasing team is executing against our recently launched initiative to reduce a minimum of $50 million on an annualized basis. We have finished the diagnostic stage and are targeting reduced indirect expenditures in areas, such as technology, transportation costs and corporate contracts, we expect to see the bulk of the savings beginning in 2025.

此外，我們的間接採購團隊正在執行我們最近推出的計劃，每年減少至少 5,000 萬美元。我們已經完成了診斷階段，目標是減少技術、運輸成本和公司合約等領域的間接支出，預計從 2025 年開始將節省大量資金。

Next, regarding our third decisive action on organizational changes, we are excited to announce that Bruce Starnes is joining the advanced team as Executive Vice President and Chief Merchant. This is part of an orderly succession plan. And in this role, Bruce will lead all aspects of our merchandising function. Bruce is an auto enthusiast and brings deep merchandising experience, having recently served at Target for nearly 20 years, most recently as Senior Vice President of Merchandising Capabilities and Operations.

接下來，關於我們對組織變革的第三次決定性行動，我們很高興地宣布布魯斯·斯塔恩斯（Bruce Starnes）將加入高級團隊，擔任執行副總裁兼首席商務官。這是有序繼任計畫的一部分。在此職位上，布魯斯將領導我們銷售職能的各個方面。 Bruce 是一位汽車愛好者，擁有豐富的行銷經驗，最近在 Target 工作了近 20 年，最近擔任的職位是行銷能力和營運資深副總裁。

The expertise of one of our newest Board members, Tom Seboldt, who has over 30 years as a merchandising leader in the automotive aftermarket industry, will also help speed Bruce's onboarding. Bruce will be partnering with our outgoing Chief Merchant, Ken Bush, who will remain in an advisory role to help ensure continuity in the merchandising function. We want to congratulate Ken on his upcoming retirement after nearly 20 years with the company, and we want to welcome Bruce to the Advanced Auto Parts family.

我們最新的董事會成員之一 Tom Seboldt 的專業知識也將有助於加快 Bruce 的入職速度，他在汽車售後市場行業擁有 30 多年的銷售領導經驗。 Bruce 將與我們即將離任的首席採購員 Ken Bush 合作，他將繼續擔任顧問角色，以幫助確保銷售職能的連續性。我們要祝賀 Ken 在公司工作近 20 年後即將退休，並歡迎 Bruce 加入 Advanced Auto Parts 大家庭。

Turning to our fourth decisive action, regarding our asset productivity across the company. Improving this remains a top priority and includes both company stores and independently-owned Carquest locations. In the first quarter, we closed 17 underperforming stores and opened 7 new stores. Last quarter, we shared that we had notified over 100 Carquest Independent locations that we were removing them from our program, and we completed this action in Q1.

轉向我們的第四項決定性行動，涉及整個公司的資產生產力。改善這一點仍然是首要任務，包括公司商店和獨立擁有的 Carquest 地點。第一季度，我們關閉了 17 家表現不佳的門市，並開設了 7 家新店。上個季度，我們表示，我們已通知 100 多個 Carquest Independent 門市，我們將把它們從我們的計劃中刪除，並在第一季度完成了這一行動。

In addition, our IT team's focus on POS system reliability is enabling significant in-store productivity improvements for team members, and that's impacting their ability to better serve our customers. We will continue our efforts to elevate existing store operations across Advance and drive profitable growth.

此外，我們的 IT 團隊對 POS 系統可靠性的關注使團隊成員能夠顯著提高店內工作效率，從而影響他們更好地為客戶服務的能力。我們將繼續努力提升 Advance 現有商店的營運並推動獲利成長。

The last area I wanted to discuss in regard to our asset productivity is inventory. We have had recent success with the implementation of our new merchandising system. We put new leaders in charge of the project, along with additional accountability on the work plan, resulting in the achievement of several key milestones in Q1. This new system will overhaul key merchandising processes, including planogram sets and store replenishment.

關於我們的資產生產力，我想討論的最後一個領域是庫存。我們最近在實施新的銷售系統方面取得了成功。我們任命新的領導者負責該項目，並對工作計劃承擔更多責任，從而在第一季實現了幾個關鍵里程碑。這個新系統將徹底改革關鍵的銷售流程，包括貨架圖集和商店補貨。

In the first quarter, we added 130,000 SKUs in the new system across nearly 500 suppliers. And by the end of the second quarter, we expect all of our actively replenished SKUs to be converted to the new system, which is well ahead of our previous expectations to be complete by the end of the year. This is one of several steps to enhance inventory availability and productivity.

第一季度，我們在新系統中新增了近 500 家供應商的 130,000 個 SKU。到第二季末，我們預計所有積極補貨的 SKU 都將轉換為新系統，這遠遠超出了我們預計今年年底完成的情況。這是提高庫存可用性和生產力的幾個步驟之一。

And finally, our fifth decisive action to consolidate our supply chain is underway with the long-term goal of operating as a single unified network. We've now mapped with what this network will look like, and I'd like to take a few minutes to describe its components and our incremental progress. We expect our unified network to have 14 large DCs. We currently have 13 of the required replenishment DCs needed and are scouting a location for the 14. These 14 facilities averaging approximately 550,000 square feet each will serve as our nationwide replenishment nodes.

最後，我們正在採取第五次果斷行動來鞏固我們的供應鏈，其長期目標是作為一個統一的網路進行運作。我們現在已經繪製了這個網路的外觀，我想花幾分鐘時間來描述它的組件和我們的增量進度。我們預計我們的統一網路將擁有 14 個大型 DC。我們目前擁有 13 個所需的補給中心，並且正在為 14 個尋找位置。

The next component of the unified network will be market hubs. As discussed last quarter, this is a new node of our network, and we recently completed a successful pilot. Our market hubs will have an average SKU count of more than 80,000 and will enhance our existing hub network. There are 3 ways that we will be adding market hubs. Number one, converting existing stores with sufficient footprint; number two, converting smaller existing DCs; and number three, greenfielding new locations.

統一網路的下一個組成部分將是市場中心。如上季所討論的，這是我們網路的一個新節點，我們最近成功完成了試點。我們的市場中心的平均 SKU 數量將超過 80,000 個，並將增強我們現有的中心網路。我們將透過 3 種方式來增加市場中心。第一，改造現有的具有足夠佔地面積的商店；第二，改造現有的小型 DC；第三，新建新地點。

We have completed 4 store to market hub conversions utilizing the learnings from our successful pilot. By the end of 2024, we expect to have at least 20 market hubs in operation, including approximately half from the conversion of existing DCs. Three of these DC conversions are already underway, those are Baton Rouge, Raleigh and Memphis, and we expect to complete all of them by the end of the third quarter. Importantly, by using existing stores that have sufficient footprint and converting smaller legacy DCs, we believe we can accelerate this initiative with more rigor than if we were to greenfield all locations.

利用我們成功試點的經驗教訓，我們已經完成了 4 家商店到市場中心的轉型。到 2024 年底，我們預計將有至少 20 個市場中心投入運營，其中約一半來自現有配送中心的改造。其中三個 DC 改造已經開始，分別是巴吞魯日、羅利和孟菲斯，我們預計在第三季末完成所有改造。重要的是，透過使用擁有足夠佔地面積的現有商店並改造較小的遺留配送中心，我們相信我們可以比綠地所有地點更嚴格​​地加速這一計劃。

The third component of our unified network includes over 300 existing hubs that we currently operate. These hub locations currently serve and will continue to serve as sources for expanded availability for surrounding stores. On average, they have approximately 35,000 SKUs on hand compared with approximately 23,000 in our traditional blended box stores. The performance of our hubs and market hubs reinforces the benefit of having parts closer to customers. We expect the development of this unified network to take time and are planning to have the 14 large DCs and at least 60 market hubs added to our existing network of hubs by the end of 2026.

我們統一網路的第三個組成部分包括我們目前營運的 300 多個現有樞紐。這些中心地點目前並將繼續作為週邊商店擴大供應的來源。平均而言，他們手頭上有大約 35,000 個 SKU，而我們傳統的混合盒裝商店大約有 23,000 個。我們的中心和市場中心的性能強化了讓零件更接近客戶的好處。我們預計這個統一網路的開發需要時間，並計劃在 2026 年底將 14 個大型配送中心和至少 60 個市場中心添加到我們現有的中心網路中。

Let me also provide a brief update on our implementation of our warehouse management system, or WMS, across our DC network. This is a key enabler of our unification. And last quarter, we indicated that there were 3 facilities still to convert. We have recently completed the implementation at our Delaware, Ohio DC and expect to complete the remaining 2 by the end of the year. While we are making early progress with all of our decisive actions, we recognize that we have substantial work to improve our business' performance. Our entire team is committed to fostering a disciplined approach in all functions, leading to increased accountability and internal clarity of our goals.

我還簡要介紹了我們在 DC 網路中實施倉庫管理系統 (WMS) 的最新情況。這是我們統一的關鍵推動因素。上季度，我們表示仍有 3 個設施需要改造。我們最近完成了在特拉華州、俄亥俄州特區的實施，並預計在今年年底前完成剩餘的 2 個實施。雖然我們所有的果斷行動正在取得早期進展，但我們認識到，在提高業務績效方面，我們還有大量工作要做。我們的整個團隊致力於在所有職能部門中培養嚴格的方法，從而增強責任感和目標的內部清晰度。

Turning to the broader macro environment, we are fortunate to operate in an attractive needs-based industry with stable fundamentals. However, we recognize that our business will still likely feel negative impacts as customers show signs of financial distress and if macro conditions deteriorate. Even with that backdrop, we are improving execution by remaining focused on our decisive action. We know this turnaround will take time, but I am encouraged every time I visit a store or DC and meet the team members who take care of our customers. We have established clear priorities, and our leadership team is energized to deliver on our goals.

轉向更廣泛的宏觀環境，我們很幸運能夠在一個有吸引力的需求型產業中運營，且基本面穩定。然而，我們認識到，隨著客戶出現財務困境的跡像以及宏觀狀況惡化，我們的業務仍可能受到負面影響。即使在這種背景下，我們仍透過繼續專注於我們的果斷行動來提高執行力。我們知道這種轉變需要時間，但每次我參觀商店或配送中心並與照顧客戶的團隊成員見面時，我都會受到鼓舞。我們制定了明確的優先事項，我們的領導團隊充滿活力地實現我們的目標。

Now I would like to turn the call over to Ryan to review our financial performance in the quarter. Ryan?

現在我想把電話轉給瑞安，讓他回顧我們本季的財務表現。瑞安？

Thanks, Shane, and good morning, everyone. Before I move to our financials, I would also like to thank our almost 70,000 team members for their continued dedication and hard work throughout the quarter. Q1 was challenging from a year-over-year perspective. However, we have instilled renewed P&L discipline and rigor and remain confident in our ability to capitalize on the significant opportunity ahead.

謝謝謝恩，大家早安。在介紹我們的財務狀況之前，我還要感謝我們近 70,000 名團隊成員在整個季度的持續奉獻和辛勤工作。從同比角度來看，第一季充滿挑戰。然而，我們已經灌輸了新的損益紀律和嚴格性，並對我們利用未來重大機會的能力充滿信心。

In the first quarter, net sales of $3.4 billion decreased 0.3% compared with Q1 2023. The decrease was primarily driven by the reduction of independents and store closures of about $11 million as we continue our focus on improving asset productivity. Comparable store sales decreased 0.2%. While we still have room for improvement in our assortment and availability levels, we are encouraged by the actions we have taken and relative to our Pro business, helped contribute to positive transactions and comp growth in the quarter. As anticipated, we saw continued pressure on DIY in Q1, resulting in low single-digit negative comparable store sales. From a category perspective, we saw strength in batteries as well as filters and engine management, driven by improved availability.

第一季淨銷售額為 34 億美元，與 2023 年第一季相比下降 0.3%。可比商店銷售額下降 0.2%。雖然我們的品種和供應水平仍有改進的空間，但我們對我們所採取的行動以及與我們的專業業務相關的行動感到鼓舞，這些行動有助於為本季度的積極交易和競爭增長做出貢獻。正如預期的那樣，我們看到第一季 DIY 面臨持續壓力，導致可比商店銷售額出現低個位數負值。從類別角度來看，在可用性提高的推動下，我們看到了電池、濾網和引擎管理的優勢。

In the quarter, we experienced particular softness in several categories, as we are seeing consumers adjust their buying behavior and looking to stretch every dollar they spend. This was evidenced by our year-over-year decline in discretionary categories as well as deferred maintenance in the quarter, such as brakes, were often purchased in combination with tire maintenance and installations, which have been down across the industry. The West and Midwest were our top-performing regions, while the Mid-Atlantic, Southeast, including Texas and Florida, were our most challenged.

本季度，我們在幾個類別中經歷了特別疲軟的情況，因為我們看到消費者正在調整他們的購買行為，並希望充分利用他們花的每一塊錢。我們的可自由支配類別同比下降以及本季度的延期維護（例如煞車）通常與輪胎維護和安裝一起購買，而整個行業的輪胎維護和安裝都在下降，這證明了這一點。西部和中西部是我們表現最好的地區，而大西洋中部和東南部，包括德克薩斯州和佛羅裡達州，是我們面臨的最大挑戰。

As Shane mentioned, the weather impacted our sales as the country experienced a slower start to the spring season. In Q1, gross profit was $1.4 billion or 42% of net sales, which declined 82 basis points from the prior year quarter. The deleverage was primarily driven by cost, not fully offset by price. In terms of price, we've also been reassessing our relative position in the market as well as our approach to strategic pricing. We recognize circumstances where we have been notably uncompetitive and have been making appropriate adjustments focused on categories with higher visibility and elasticity.

正如肖恩所提到的，天氣影響了我們的銷售，因為該國春季的開局較慢。第一季度，毛利為 14 億美元，佔淨銷售額的 42%，比去年同期下降 82 個基點。去槓桿主要是由成本驅動的，並未完全被價格所抵銷。在價格方面，我們也一直在重新評估我們在市場中的相對地位以及我們的策略定價方法。我們認識到我們明顯缺乏競爭力的情況，並一直在針對具有更高可見性和彈性的類別進行適當調整。

In Q1, we actioned on 8,500 SKUs, an investment of approximately $40 million on an annualized basis. We are committed to driving accountability to achieve and remain competitively priced. I'm confident the restructuring to align our pricing and merchandising teams will help provide the appropriate discipline to ensure success. In Q2, we continued our merchandising excellence initiative, including securing lower pricing from our vendors, assessing our assortment and its availability as well as reviewing how we are priced in the market. Despite all of these efforts, we believe that we will see pressure in Q2 as the consumer will likely face continued uncertainty impacting our top line.

第一季度，我們對 8,500 個 SKU 採取了行動，年化投資約為 4,000 萬美元。我們致力於推動問責制，以實現並維持具有競爭力的價格。我相信，調整我們的定價和銷售團隊的重組將有助於提供適當的紀律以確保成功。在第二季度，我們繼續實施卓越的銷售計劃，包括從供應商那裡獲得較低的價格，評估我們的產品種類及其可用性，以及審查我們在市場上的定價方式。儘管做出了所有這些努力，我們相信我們將在第二季度面臨壓力，因為消費者可能會面臨影響我們營收的持續不確定性。

In addition, we will be lapping last year's actions, which will cause margin rates to be significantly more challenged than Q1. We expect to begin seeing improvement in the back half of the year as we will have cycled the prior year's pricing initiatives and begin to see an acceleration on units. In addition, we expect that our supply chain consolidation and ongoing merchandising productivity efforts, including key front room category resets and backroom hard part line reviews that were completed in Q1 will positively contribute to our supplier partner negotiations.

此外，我們將重複去年的行動，這將導致保證金率比第一季面臨更大的挑戰。我們預計將在今年下半年開始看到改善，因為我們將循環上一年的定價計畫並開始看到單位數量的加速成長。此外，我們預計我們的供應鏈整合和持續的銷售生產力努力，包括第一季完成的關鍵前台類別重置和後台硬零件生產線審查，將為我們的供應商合作夥伴談判做出積極貢獻。

In addition to pricing, warehouse capitalization costs and the planned investment in our DC consolidation negatively impacted gross margin in the quarter. Our overall supply chain productivity had partially offset the deleverage driven by improved lines per hour, replenishment frequency, reduction of independent locations and the previously announced closure of our Ashville DC.

除了定價之外，倉庫資本成本和 DC 整合的計畫投資也對本季的毛利率產生了負面影響。我們的整體供應鏈生產力部分抵消了每小時生產線的改善、補貨頻率、獨立地點的減少以及先前宣布關閉阿什維爾配送中心所帶來的去槓桿化。

SG&A was $1.3 billion in Q1 2024, down $21 million compared with Q1 2023 and improved 48 basis points as a percent of our net sales. This was driven by cost-saving efforts we discussed earlier and included a significant reduction in corporate expenditures and headcount executed in Q4 last year. Additionally, we have had onetime gain from an asset sale in Florida. As discussed previously, we are reinvesting a portion of these savings back into our frontline team members, which partially offset the savings we realized this quarter. We experienced higher year-over-year professional fees primarily related to continued remediation of our material weakness, which was a headwind to SG&A in Q1.

2024 年第一季的銷售、行政管理費用為 13 億美元，比 2023 年第一季減少 2,100 萬美元，佔淨銷售額的百分比提高了 48 個基點。這是由我們之前討論的節省成本的努力推動的，其中包括去年第四季度執行的企業支出和員工人數的大幅減少。此外，我們也從佛羅裡達州的資產出售中獲得了一次性收益。正如前面所討論的，我們將這些節省的一部分重新投資回我們的一線團隊成員，這部分抵消了我們本季實現的節省。我們經歷了同比較高的專業費用，這主要與我們對重大缺陷的持續補救有關，這對第一季的銷售、管理和管理費用構成了不利影響。

Finally, similar to many retailers, we experienced ongoing inflationary pressure related to overall wages, occupancy costs and transaction expenses. Our Q1 operating income margin decreased 34 basis points compared with the prior year quarter. In terms of the second quarter, we believe that this will be our toughest margin quarter of the year as a result of pricing actions taken last year that we are lapping. However, as the year progresses, we expect to see stronger margin improvement in the back half. Diluted earnings per share were $0.67 in Q1 compared with $0.81 in the prior year quarter. EPS was primarily impacted by the decrease in operating margin as well as a $0.05 impact related to discrete tax item related to stock-based compensation.

最後，與許多零售商類似，我們經歷了與整體薪資、入住成本和交易費用相關的持續通膨壓力。我們第一季的營業利潤率與去年同期相比下降了 34 個基點。就第二季而言，我們認為，由於我們去年採取的定價行動，這將是我們今年利潤率最困難的季度。然而，隨著今年的進展，我們預計下半年的利潤率將出現更強勁的改善。第一季稀釋後每股收益為 0.67 美元，去年同期為 0.81 美元。每股盈餘主要受到營業利潤率下降以及與股票薪酬相關的離散稅項相關的 0.05 美元影響的影響。

We have significantly increased the discipline around our capital spending process, focused on investing in high-return initiatives aligned with our decisive actions. As a result, our Q1 2024 capital expenditures were $49 million compared with $90 million in Q1 of 2023. Free cash flow for the quarter was an outflow of $46 million compared with an outflow of $470 million in the prior year quarter. This was primarily driven by lapping the timing of payables in Q1 of the previous year. Our full year guidance remains unchanged. We are committed to executing against our decisive actions and believe they will enable steady performance improvement across Advance.

我們顯著加強了資本支出流程的紀律，並專注於與我們果斷行動一致的高回報計劃。因此，我們 2024 年第一季的資本支出為 4,900 萬美元，而 2023 年第一季為 9,000 萬美元。這主要是由於前一年第一季的應付帳款時間重疊所致。我們的全年指引保持不變。我們致力於執行我們的果斷行動，並相信它們將使整個 Advance 的業績穩步提高。

Before I turn the call back to Shane and Q&A, I want to provide an update on our internal control remediation efforts. We continue to ensure we have the appropriate experienced personnel as we backfilled open roles and hired approximately 30 experienced personnel with the requisite accounting and internal controls knowledge and experience. We made some important hires in the first quarter, who were quickly onboarded and are making progress in their roles.

在我將電話轉回給 Shane 並進行問答之前，我想介紹一下我們內部控制整改工作的最新情況。我們繼續確保擁有適當的經驗豐富的人員，因為我們回補了空缺職位，並聘請了大約 30 名擁有必要的會計和內部控制知識和經驗的經驗豐富的人員。我們在第一季聘用了一些重要員工，他們很快就入職並在各自的職位上取得了進展。

In addition, we've added redundant and compensated internal controls to enhance our internal control structure. We have been thoroughly testing our remedial efforts and are committed to completing the remediation. As you will see in our Form 10-Q, a prior significant efficiency identified in Q4 2023 has been elevated to a material weakness in discrete area of controls.

此外，我們還增加了冗餘和補償性的內部控制，以增強我們的內部控制結構。我們一直在徹底測試我們的補救措施，並致力於完成補救工作。正如您將在我們的 10-Q 表格中看到的，先前在 2023 年第四季確定的顯著效率已提升為離散控制領域的重大弱點。

Similar to our material weakness regarding staffing, we are robustly testing to ensure our controls are working as designed over an appropriate amount of time. Our internal control environment remains a top priority for us, and we look forward to updating you on the completion of our remediation.

與我們在人員配置方面的重大弱點類似，我們正在進行嚴格的測試，以確保我們的控制措施在適當的時間內按設計工作。我們的內部控制環境仍然是我們的首要任務，我們期待向您通報我們的整改完成情況。

And now I'll turn it over to Shane.

現在我將把它交給謝恩。

Thank you, Ryan. We have significant work to do in terms of turning around the business, but I'm confident we are on the right path. I want to once again thank our team members for their unwavering dedication to supporting our customers, while adapting to the challenges we faced during the quarter. And in the wake of Memorial Day, it's always appropriate to reflect on the contributions of the brave men and women who gave their lives in the service of our country.

謝謝你，瑞安。在扭轉業務方面，我們還有大量工作要做，但我相信我們正走在正確的道路上。我想再次感謝我們的團隊成員堅定不移地致力於支持我們的客戶，同時適應我們在本季面臨的挑戰。在陣亡將士紀念日之後，反思那些為我們國家獻出生命的勇敢男女的貢獻總是合適的。

With that, I would like to open it up to address your questions.

說到這裡，我想打開它來回答你的問題。

(Operator Instructions) And our first question today comes from Bret Jordan at Jefferies.

（操作員說明）今天我們的第一個問題來自 Jefferies 的 Bret Jordan。

Can you talk about the cadence of the first 5 months that gives you comfort in your maintaining the comp guide for the year?

您能否談談前 5 個月的節奏，這讓您在維持全年薪資指南方面感到安心？

Yes. I think the cadence, I think we started out a little bit slower due to weather, but started to pick up throughout the quarter. I think Q2, we're seeing similar trends from Q1, but really expect the back half of the year we'll have more favorable compares and, some of the initiatives we're putting in place, Bret, we are expecting to see that continue to bear fruit, especially as we've seen in the Pro business coming out of Q1.

是的。我認為由於天氣原因，我們一開始的節奏有點慢，但整個季度開始加快。我認為第二季度，我們看到了與第一季度類似的趨勢，但確實預計今年下半年我們會有更有利的比較，而且我們正在實施的一些舉措，布雷特，我們預計會看到這一點繼續取得成果，尤其是我們在第一季的Pro 業務中看到的那樣。

Yes. As I think about positive Pro comp and transactions, I think we'll look to continue doing that. As Ryan mentioned, we've got initiatives specifically targeting Pros, notably up and down the street customer. But I also think on the DIY side, the U.S. consumer -- the U.S. consumer is facing a bit of an inflection point as they look at their personal debt loads, as they look at where their purchasing power is. And so I think there's some reticence there in terms of how they're spending and so we think that continues as well.

是的。當我考慮積極的專業補償和交易時，我認為我們會繼續這樣做。正如瑞安所提到的，我們有專門針對專業人士的舉措，尤其是街頭客戶。但我也認為在 DIY 方面，美國消費者在檢視自己的個人債務負擔和購買力時，正面臨一個轉捩點。因此，我認為他們在如何支出方面存在一些沉默寡言，因此我們認為這種情況也會持續下去。

Great. And then on the Pro side, national account versus up and down the street, the positive comp you saw in the first quarter. Was there much difference between those 2 segments?

偉大的。然後在專業方面，國民帳戶與街頭巷尾的比較，您在第一季度看到的積極補償。這兩個部分之間有很大差異嗎？

Yes. We don't like to break, Bret. I appreciate it, but we don't like to break out the specifics of those 2, but we did see positive growth -- positive comps on both sides.

是的。我們不喜歡打破，布雷特。我很欣賞，但我們不想透露這兩者的具體細節，但我們確實看到了積極的成長——雙方的積極競爭。

The next question comes from Michael Lasser from UBS.

下一個問題來自瑞銀集團 (UBS) 的 Michael Lasser。

The challenging outcome with DIY, how are you thinking about that segment over the course of the year? And what are going to be the key drivers that improve the performance of DIY sales from here?

DIY 的挑戰性結果，您在這一年中如何看待該細分市場？從這裡開始提升 DIY 銷售業績的關鍵驅動因素是什麼？

So I think there's a macro story here, and Michael, that affects where the consumer goes. I think the U.S. consumer, the good news is there's a needs-based function for our business. And so those staples where you can't put off doing things, EG, my car won't start and needs a new battery. So we'll continue to see those kinds of plays. But there's also a tendency now for consumers to defer maintenance, if they can, as they wrestle with their checkbooks at the end of the month. I don't see anything changing that in the near term. And so I think the trend that we see continues.

所以我認為這裡有一個宏觀故事，邁克爾，它影響著消費者的去向。我認為對於美國消費者來說，好消息是我們的業務有一個基於需求的功能。因此，那些你不能推遲做事的主食，例如，我的車無法啟動，需要新電池。所以我們會繼續看到這類戲劇。但現在消費者也有一種傾向，如果可以的話，他們會推遲維護，因為他們會在月底為支票簿苦苦掙扎。我認為短期內不會有任何改變。所以我認為我們看到的趨勢仍在繼續。

We're obviously doing a number of things in terms of how we get to them. We've done some creative marketing programs. We're using our website. We do training with our in-store associates in terms of how they greet customers and understand needs and do appropriate attachment sales. So there's certainly not a lack of activity on our part to make sure we're maximizing opportunities, where we interact with consumers. But I just think fundamentally, at a macro level, there's a bit of a, as I said before, an inflection point.

顯然，我們在如何實現這些目標方面做了很多事情。我們做了一些創意行銷計劃。我們正在使用我們的網站。我們對店內員工進行培訓，培訓​​他們如何迎接顧客、了解需求以及進行適當的附件銷售。因此，我們肯定不缺乏活動，以確保我們最大限度地利用與消費者互動的機會。但我只是認為，從根本上講，在宏觀層面上，正如我之前所說，存在著一個拐點。

My follow-up question is on the Worldpac sale. Is there any risk that it won't close or won't be announced in the second quarter? And can you give us some sense of what your guidance might look like for this year, if you were to close the deal before the end of the year. Obviously, the intent of the question is to get some sense of how the underlying AAP business is doing outside of Worldpac, so we can have a thesis to understand what the transformation is looking like there?

我的後續問題是關於 Worldpac 銷售的。是否存在第二季無法結束或無法公佈的風險？如果您要在年底前完成交易，您能否告訴我們今年的指導方針會是什麼樣子？顯然，這個問題的目的是了解 Worldpac 之外基礎 AAP 業務的運作情況，這樣我們就可以透過一篇論文來了解那裡的轉型情況如何？

Yes. So great question, Michael, and certainly understandable that you'd want to get behind that. We don't do segment reporting, and I've used an expression in the 40 acquisitions that I've done, deal is not a deal until a deal is a deal. So when we have something to announce, we will absolutely announce it. But I'll just go to the big picture, which I think is important for everybody, just got to respect the process. So we're very happy where we are. We're in the middle of it. We believe we'll have it wrapped up before our next earnings announcement, and that's what we've got. And as soon as something is different, EG, we complete the transaction, we'll let you know, and then we'll look to Ryan to pick what remainder company looks like.

是的。這是一個很好的問題，邁克爾，當然可以理解你想要支持這個問題。我們不做分部報告，我在自己做過的 40 筆收購中使用過這樣一句話：只有交易成為交易，交易才算交易。所以當我們有什麼要宣布的時候，我們絕對會宣布。但我只想著眼大局，我認為這對每個人都很重要，只是要尊重這個過程。所以我們對現在的處境感到非常高興。我們正處於其中。我們相信我們會在下一次財報公佈之前把它解決掉，這就是我們所得到的。一旦有什麼不同，EG，我們完成交易，我們會通知您，然後我們將請 Ryan 選擇剩餘公司的情況。

Yes, Michael, we definitely want to give you that perspective, but we've got to wait until there's actually a decision. And when we have that, we will -- if and when we do have a transaction there, we will update our guide and update the projections going forward for the [RemainCo].

是的，邁克爾，我們確實想向您提供這種觀點，但我們必須等到真正做出決定。當我們做到這一點時，如果我們確實在那裡進行了交易，我們將更新我們的指南並更新[RemainCo]未來的預測。

The next question comes from Simeon Gutman from Morgan Stanley.

下一個問題來自摩根士丹利的西蒙古特曼。

Shane, maybe 1 more try at Worldpac, and I will respect the process. Can I ask, is the decision to sell it still the decision is the right one for the business? Or is it price dependent? And then connected to that, the positive low single digits that I heard for commercial debt, I assume, does that include Worldpac? Or you're separating them out from how you're conveying the message to the Street?

Shane，也許再在 Worldpac 嘗試一次，我會尊重這個過程。請問，出售它的決定對企業來說仍然是正確的決定嗎？還是取決於價格？然後與此相關的是，我聽說商業債務的正低個位數，我想，這包括 Worldpac 嗎？還是你將它們與你向華爾街傳達訊息的方式分開了？

Yes. So Simeon, I appreciate that. We're not going to speak about Worldpac versus the rest of the business at this time. We are in the midst of working through the process here. So we'll keep that off the table until we have something where we can't speak to them. We are happy with our Pro business. We are happy with the process and where it's at to date, and we'll be able to give you more updates as we actually affirm something up. The decision on this one is still, from a strategic standpoint, we still have the same strategy. We're focused on the blended box, and Worldpac is not necessarily tied to that decision, that' why are exploring this opportunity, and we'll continue to explore. We're happy with the where it's at right now.

是的。所以西蒙，我很欣賞這一點。我們目前不會談論 Worldpac 與其他業務的比較。我們正在處理這個過程。因此，我們將不討論這個問題，直到我們有無法與他們交談的事情。我們對 Pro 業務感到滿意。我們對這個過程以及目前的進展感到滿意，當我們真正確認某些事情時，我們將能夠為您提供更多更新。這個決定仍然是，從策略的角度來看，我們還是有同樣的策略。我們專注於混合盒，而 Worldpac 不一定與該決定相關，這就是為什麼我們正在探索這個機會，我們將繼續探索。我們對它現在的處境感到滿意。

Thanks for asking the question. Go ahead.

感謝您提出問題。前進。

Sorry, yes, the follow-up, you hired a new merchant. I wanted to ask about the opportunity with merchandising, if the SKU mix is aligned properly to the vehicle population? And then how should we think about you're doing supply chain consolidation, if you decide to make changes with merchandising, does that have any -- is there a timing or sequencing effect with supply chain? Are there 2 different activities?

抱歉，是的，後續，你僱用了一個新商人。我想問一下銷售機會，SKU 組合是否與車輛數量正確匹配？然後，我們應該如何考慮您正在進行的供應鏈整合，如果您決定對銷售進行更改，這是否有任何影響 - 供應鏈是否存在時間或順序效應？有2種不同的活動嗎？

Yes. I would -- I would say there are 2 different activities. So first, thanks for asking the question. We're thrilled to have Bruce Starnes joining. And I think there's a couple of things that are worth unpacking here. First, in terms of his leadership and he is fit, his energy level, he's personally an auto enthusiast, we view that as very important. His merchandising fundamentals in terms of skills he's learned at Target, we have really, really enjoyed getting to know him in this process.

是的。我會說有兩種不同的活動。首先，感謝您提出問題。我們很高興布魯斯·斯塔恩斯加入。我認為這裡有一些東西值得解析。首先，就他的領導能力、他的健康狀況、他的精力水平而言，他個人是一名汽車愛好者，我們認為這一點非常重要。他在塔吉特學到了他的銷售基礎技能，我們非常非常高興在這個過程中了解他。

I think worth mentioning in terms of how we're doing the transition. We have Tom Seboldt on the Board, who joined us 30 years as a merchant in the industry. He will help with Bruce's onboarding. Ken Bush is sticking around through a transition period through his retirement. So this is very much an orderly transition. And so we're very excited to have him come on board.

我認為值得一提的是我們如何進行過渡。 Tom Seboldt 是我們的董事會成員，他作為一名商人加入我們已有 30 年的行業經驗。他將幫助布魯斯入職。肯·布希正在度過退休前的過渡期。所以這是一個非常有秩序的過渡。因此，我們非常高興他的加入。

There's always work we can do as it relates to the SKU mix and the vehicle population. I think there's an ocean of auto parts out there. And so as Bruce puts his mark on the merchandising team, we'll always review what our availability is and having the right part in the right time frame for our customers. So you can imagine a body of work going on there. It doesn't come at the expense of nor is it a sequencing set of activities with supply chain. So supply chain is moving now rapidly.

我們總是能做一些與 SKU 組合和車輛數量相關的工作。我認為那裡有一片汽車零件的海洋。因此，當布魯斯在銷售團隊中留下自己的印記時，我們將始終審查我們的可用性，並在正確的時間範圍內為我們的客戶提供正確的零件。所以你可以想像那裡正在進行大量工作。它不會以犧牲供應鏈的一系列活動為代價，也不是一系列活動的順序。因此，供應鏈現在正在迅速發展。

They spent -- Steve Szilagyi, Supply Chain leader, spent about a year putting our plan together. He is now running in terms of getting our large DC infrastructure established, getting everybody on WMS, introducing market hubs as a node inside of our system. And so as that process goes on, changes to our assortment can occur within it and occur within our business every day today.

他們花了大約一年的時間來制定我們的計劃。他現在負責建立我們的大型資料中心基礎設施，讓每個人都使用 WMS，引入市場中心作為我們系統內部的節點。因此，隨著這個過程的繼續，我們的品種可能會發生變化，並且今天每天都會在我們的業務中發生。

The next question comes from Gregory Melich from Evercore ISI.

下一個問題來自 Evercore ISI 的 Gregory Melich。

I wanted to follow up on inflation, deflation and specifically the price investment you referenced. So could you just help frame the 8,500 SKUs? What percentage of the total SKUs that is and the $40 million investment, assuming that's about 30 or 40 bps a year of deflation? Is the whole box still have a little bit of inflation? Or how would you frame that?

我想跟進通貨膨脹、通貨緊縮，特別是你提到的價格投資。那麼您能幫忙設計 8,500 個 SKU 嗎？假設每年通貨緊縮約 30 或 40 個基點，那麼這 4000 萬美元的投資佔 SKU 總數的百分比是多少？整個盒子還有一點點充氣嗎？或者你會如何建構它？

So the impetus for the $40 million came from both our own data assessments and then getting feedback from customers, they're pro customers and consumer customers, where we were just fundamentally out of the market in terms of being competitive. And I think this is important. I think the conduct in this industry is a rational one. We're a rational player in terms of what we do. But in instances where our pricing just simply doesn't make sense relative to the market, we made some surgical moves to make sure our pricing reflected what the market is, so that we're viewed as a legitimate source from where customers will buy. So 8,500 as a percentage of SKUs is our relatively small percentage.

因此，4000 萬美元的動力來自於我們自己的數據評估，以及來自客戶的回饋，他們是專業客戶和消費者客戶，而我們在競爭力方面從根本上被排除在市場之外。我認為這很重要。我認為這個行業的行為是理性的。就我們所做的事情而言，我們是一個理性的參與者。但在我們的定價相對於市場來說根本沒有意義的情況下，我們採取了一些外科手術措施，以確保我們的定價反映了市場的情況，以便我們被視為客戶購買的合法來源。因此，8,500 個 SKU 的百分比是我們相對較小的百分比。

Ryan, if you want to add some color.

瑞安，如果你想添加一些顏色的話。

Yes, Greg, I mean, it's about 3% of the enterprise SKU count right now. I think if we looked at Advance only it's about 8%. So it's not a significant portion of the overall, but it is just making sure that we get competitive in key areas.

是的，Greg，我的意思是，目前它大約佔企業 SKU 數量的 3%。我想如果我們只看 Advance 的話，這個比例大約是 8%。因此，這並不是整體的重要組成部分，但它只是確保我們在關鍵領域具有競爭力。

Got it. And that's $40 million, would you say that across the box that the industry is still rational, that we're still seeing slight inflation in the comp in first quarter?

知道了。那是 4000 萬美元，您是否會說整個行業仍然理性，我們仍然看到第一季的比較小幅通膨？

Yes. There's still a little bit of inflation, I think, in the industry, just slight inflation in the quarter. It is very rational. Like we said, we want to be competitive from a pricing standpoint. And I think the overall industry is fairly rational.

是的。我認為，該行業仍然存在一點通貨膨脹，本季只是輕微的通貨膨脹。這是非常理性的。正如我們所說，我們希望從定價角度具有競爭力。我認為整個行業還是比較理性的。

Yes. I would use the term disinflation. So I don't think we've hit deflation, but certainly that tempo of inflation has metered.

是的。我會使用“通貨緊縮”這個詞。因此，我不認為我們已經陷入通貨緊縮，但通膨的速度肯定已經放緩。

The next question comes from Scot Ciccarelli from Truist.

下一個問題來自 Truist 的 Scot Ciccarelli。

Can you provide any more color on the amount of margin pressure you're expecting for 2Q, just given the moving pieces out there and then help us understand the bridge to getting to better margins in the back half?

您能否提供更多關於您預計第二季度利潤壓力的信息，考慮到目前正在發生的變化，然後幫助我們了解在後半段獲得更好利潤的橋樑？

Yes, absolutely. So we are going to see a little bit more pressure in Q2. Some of these pricing actions we've taken are going to cycle a full quarter, and there's probably some more that we need to take to get competitive across the board. So we'll take additional pricing actions where it makes sense to be competitive in the marketplace. So we expect to see margin rate decelerate in Q2. Also we're cycling last year where price was a lever that was pulled last year in Q2. And so we're cycling that. So it's not as much about, a, we're just bringing prices down, but it's also about the comparison year-over-year.

是的，一點沒錯。因此，我們將在第二季度看到更大的壓力。我們採取的一些定價行動將持續整個季度，我們可能還需要採取更多行動來獲得全面的競爭力。因此，我們將在有意義的市場競爭中採取額外的定價行動。因此，我們預計第二季保證金率將放緩。此外，我們去年也在循環，價格是去年第二季拉動的槓桿。所以我們正在循環它。因此，這並不是說我們只是降低價格，而是與去年同期相比。

In Q1 of last year, it wasn't as much of a price action. In fact, they were actually trying a little bit to get more competitive last year in Q1. So the cycle in comparison wasn't as significant. But in Q2, we're comparing against some pricing actions last year. So that kind of compounds on it. I'm not going to give specifics guide around the quarter, but I would say you would expect that rate from Q1 to decelerate.

去年第一季度，價格走勢就沒那麼明顯。事實上，他們去年第一季確實在努力提高競爭力。因此相較之下，週期就沒那麼重要。但在第二季度，我們將與去年的一些定價行為進行比較。就這樣的化合物就可以了。我不會在本季度提供具體指導，但我想說，您預計第一季的成長速度會放緩。

Now what we're doing, a couple of things. One is all the PLRs that we've done in the first part of the year, we're going to start to see the benefit of those take place in the back half of the year. We're going to see the unit start to take on. We have seen where we've made changes in price, we started to see some of the unit start to take hold, but that takes a little bit of time as consumers start to see that. So we'll see some of that. And then we're continuing to work with our supplier partners on cost out that's going to help impact the second half of the year.

現在我們正在做的有幾件事。其中之一是我們在今年上半年完成的所有 PLR，我們將在今年下半年開始看到這些的好處。我們將看到該單位開始發揮作用。我們已經看到了價格的變化，我們開始看到一些產品開始佔據主導地位，但這需要一點時間，因為消費者開始看到這一點。所以我們會看到其中的一些。然後，我們將繼續與供應商合作夥伴合作降低成本，這將有助於影響今年下半年。

And then as our supply chain consolidation takes hold, we'll see some of that benefit start to hit in the back half of the year. So these things take a little bit of time to come up in the back half. We also have better comparisons in the back half than we do in the first half. We mentioned that going into the year that our first half would be more pressured than the back half really due to some of these pricing actions we're cycling and comparing against.

然後，隨著我們的供應鏈整合的鞏固，我們將看到其中一些好處在今年下半年開始出現。所以這些事情需要一點時間才能在後半段出現。我們在後半場也比上半場有更好的比較。我們提到，進入今年，由於我們正在循環和比較的一些定價行為，我們的上半年將比下半年承受更大的壓力。

Hopefully, that was helpful, Scot.

希望這對你有幫助，斯科特。

Yes. Super helpful. Just to clarify though, like you do expect 2Q operating margin could be lower than your 1Q operating margin?

是的。超有幫助。只是為了澄清一下，就像您預計第二季的營業利潤率可能低於第一季的營業利潤率一樣嗎？

Yes. Year-over-year. I mean, year-over-year...

是的。一年又一年。我的意思是，逐年...

Make sure that's sequential...

確保這是連續的...

Yes. I mean, from a year-over-year basis, right, the deleverage, yes.

是的。我的意思是，從同比來看，去槓桿化，是的。

The next question comes from Chris Horvers at JPMorgan.

下一個問題來自摩根大通的克里斯霍弗斯。

It's Christian Carlino, on for Chris. Are you thinking about what structural gross margins might look like any differently now that you're investing in price or presumably this has been part of the plan and you still have visibility to eclipsing that 42% over the near and medium term once you recapture some of the onetime costs from last year?

我是克里斯蒂安·卡利諾（Christian Carlino），替補克里斯。您是否正在考慮結構性毛利率可能會有什麼不同，因為您正在進行價格投資，或者這可能已經成為計劃的一部分，一旦您重新獲得一些利潤，您仍然可以在中短期內超越 42％去年的一次性成本是多少？

Yes. This is definitely part of the plan as we continue to investigate competitively priced, and we still are committing to our guide for the year, and we still have line of sight to that. So we're still comfortable with where we believe we'll end the year given the macro backdrop. But this is part of the plan, and we're going to invest where we can to be competitive.

是的。這絕對是計劃的一部分，因為我們將繼續研究具有競爭力的價格，並且我們仍然致力於今年的指南，並且我們仍然對此有視線。因此，鑑於宏觀背景，我們仍然對今年年底的情況感到滿意。但這是計劃的一部分，我們將盡可能進行投資以保持競爭力。

Yes. I think the pricing actions are modest, and there's the other side of that equation, which is what our merchant team can do working with our vendors to make sure they're securing the appropriate source costs for our product. So I think we've got some opportunity there, and we'll look for Bruce as he comes on board to start putting programs in place for that.

是的。我認為定價行為是適度的，而這個等式的另一面是我們的商家團隊可以與我們的供應商合作，以確保他們為我們的產品確保適當的來源成本。所以我認為我們在那裡有一些機會，我們會尋找布魯斯，因為他加入後開始為此制定計劃。

Got it. That's helpful. And understanding there's not much to update us on the transaction at this point. Could you speak to how you're thinking about the potential use of proceeds from the sale? Is there a level of leverage where you'd be more comfortable stepping up the investments in the DC conversions or some of the other turnaround efforts you're undertaking?

知道了。這很有幫助。據了解，目前我們還沒有太多關於這筆交易的最新消息。您能否談談您如何看待出售收益的潛在用途？是否存在一定程度的槓桿作用，使您能夠更放心地增加對 DC 轉換或您正在進行的其他一些週轉工作的投資？

Yes. So we think about 3 potential uses. I think the first Ryan working with our Treasurer, Tony Iskander, will look to delever the company to some degree. So they'll look at our various debt tranches and decide, which ones we'd potentially take out. So I think that's an important -- that's the first use. And then the second use, which we've started to ask our different functional areas is where we would accelerate investment for already underway initiatives that we can bring about a faster conclusion. And you could think about a couple of candidates here. So from a supply chain perspective, we've got this ongoing new market hub development, our large DC network build-out. So Steve would likely be a candidate for proceeds.

是的。所以我們考慮了 3 個潛在用途。我認為第一位與我們的財務主管托尼·伊斯坎德（Tony Iskander）合作的瑞安（Ryan）將會在某種程度上尋求對公司進行去槓桿化。因此，他們將研究我們的各種債務部分並決定我們可能會刪除哪些債務。所以我認為這是一個重要的——這是第一次使用。然後，我們已經開始詢問不同職能領域的第二個用途是我們將加快對已經正在進行的舉措的投資，以便我們可以更快地得出結論。你可以在這裡考慮幾個候選人。因此，從供應鏈的角度來看，我們正在進行新的市場中心開發，即我們的大型配送中心網路建設。因此史蒂夫很可能成為收益的人選。

Technology. We talked about POS stability. We still have some stores that are on a legacy POS system. We could do POS unification, be an example. And then as you think about stores in terms of our new store opening capability, condition of our stores, Junior Word, there would be -- there'd likely be some opportunities there. So those 3 constituents, I think, are at the top of the list of where we would put money to move faster with things that we've got going on. And so that's kind of the 2 priorities. Third, we'll be thinking about our shareholders in some way. But those are the 3.

技術。我們討論了 POS 穩定性。我們仍有一些商店使用舊版 POS 系統。我們可以做 POS 統一，舉例。然後，當你從我們的新店開業能力、商店狀況等角度考慮商店時，Junior Word，那裡可能會有一些機會。因此，我認為，這三個成分是我們將投入資金以加快我們正在進行的事情的首要因素。這就是兩個優先事項。第三，我們將以某種方式考慮我們的股東。但那是3個。

The next question comes from Zack Fadem from Wells Fargo.

下一個問題來自富國銀行的 Zack Fadem。

Can you talk a bit more about the game plan for market hub conversions? You mentioned some successful pilots. Curious what you saw that gave you confidence? And any early color you can share in terms of what you would expect in terms of lifts on the Pro or DIY customer?

能多談談市場中心轉換的遊戲計畫嗎？您提到了一些成功的飛行員。好奇你所看到的東西給了你信心嗎？您可以分享一下您對 Pro 或 DIY 客戶的提升的期望嗎？

Yes. So -- and I think you see this elsewhere in the industry. But the premise is that if you have parts closer to customers and you're more responsive, you get more orders. And so what we did is we looked at how we fit in that regard in terms of what can we get you in 30 minutes, what can we get you in 2 hours, 4 hours, same day, next day. And we found there's a significant shortfall in the number of parts that we can get you at those requisite time frames. So we said, well, how do we accelerate that? How do we be more competitive? And so what a market hub does is it pushes parts closer to the customer to where we can get it to other hubs or stores, where it would otherwise have to come from the DC. And our DC works in 2 ways. We have replenishment orders, which go to stores with some frequency. We also have developed a parts delivered quickly program for one-offs, which was expensive and time consuming.

是的。所以——我想你在業界的其他地方也看到了這一點。但前提是，如果您的零件距離客戶更近且響應速度更快，您就會獲得更多訂單。因此，我們所做的是研究如何在這方面適應，即我們可以在 30 分鐘內為您提供什麼，我們可以在 2 小時、4 小時內、同一天或第二天為您提供什麼。我們發現在這些必要的時間範圍內我們可以為您提供的零件數量嚴重不足。所以我們說，好吧，我們如何加速這一進程？我們怎樣才能更有競爭力？因此，市場中心的角色是將零件推向離客戶更近的地方，以便我們可以將其運送到其他中心或商店，否則必須從配送中心運送。我們的 DC 有兩種工作方式。我們有補貨訂單，這些訂單會以一定的頻率到達商店。我們還開發了一種一次性零件快速交付計劃，該計劃既昂貴又耗時。

And so by using the hub, we can get it to a store more quickly than if it was coming from the DC. And so that's what we've seen. And what we see both physically within that store, that actual hub, where we have those parts, we get sales. And then the surrounding stores, if you could think about that as about 100 stores, they're now getting better service because they were previously relying on only the DC. So that's the premise. I think just another comment here. Sometimes in a business, being a fast follow could be an effective strategy. And so beyond our own pilot results, I think the effectiveness with this market hub concept elsewhere in the business also points to the idea that it's a good one.

因此，透過使用該中心，我們可以比從 DC 更快地將其送到商店。這就是我們所看到的。我們在實體商店、實際中心看到的東西，在那裡我們有這些零件，我們就得到了銷售。然後是周圍的商店，如果你可以想像大約有 100 家商店，他們現在得到了更好的服務，因為他們以前只依賴 DC。這就是前提。我想這裡只是另一個評論。有時在企業中，快速跟進可能是一種有效的策略。因此，除了我們自己的試點結果之外，我認為這個市場中心概念在業務其他地方的有效性也表明它是一個很好的想法。

Got it. And then a couple clarification questions. First, on the gain on the SG&A line, any quantification of the impact there? And then second, any color on the slight notch up in the high end of your '24 sales outlook?

知道了。然後是幾個澄清問題。首先，關於 SG&A 線的收益，是否有量化影響？其次，有什麼顏色比您 24 年銷售前景的高端略有上升嗎？

Yes, Zach. I appreciate you bringing that up. When the press release was issued, we noticed immediately the error. We're going to send an amendment out. We are confirming our guide. The top end of that sales guide should be 11.4%, not 11.5%. The rest of the numbers are accurate. So you should see that come through shortly. As far as the gain, the gain was $18 million in the quarter. It was also implied in our guide that was a P1 gain.

是的，札克。我很感謝你提出這個問題。當新聞稿發布後，我們立即註意到了這個錯誤。我們將發出修正案。我們正在確認我們的指南。這份銷售指南的上限應該是 11.4%，而不是 11.5%。其餘數字都是準確的。所以你應該很快就能看到這一點。就收益而言，本季收益為 1800 萬美元。我們的指南中也暗示這是 P1 增益。

The next question comes from Aaron Reed at Northcoast Research.

下一個問題來自北海岸研究中心的亞倫·里德。

I just wanted to follow up on the sale of Worldpac, and it sounds like you have the initiative once the proceeds come in, it's the amount of reducing debt, really improving some of the stores. And it sounds like an additional component is possibly returning funds to shareholders. My question is, is that going to be largely dependent on the price that you get for it? Or is this something to where it's an order tier or debt first and then store improvement, if it's going to be? I mean how should we look at that allocation when that's all said and done?

我只是想跟進 Worldpac 的出售情況，聽起來一旦收益進來，你就擁有了主動權，這是減少債務的金額，確實改善了一些商店。聽起來一個額外的組成部分可能是向股東返還資金。我的問題是，這在很大程度上取決於您獲得的價格嗎？或者這是否是首先是訂單層或債務，然後是商店改進（如果會的話）？我的意思是，當一切都說完了之後，我們應該如何看待該分配？

Yes. I'll start and then Ryan and Tony joined us this morning. He can jump in. Debt first. I think that is the best early use of proceeds, and so we'd go there. And again, Tony and Ryan will figure out exactly where we draw the line in terms of how much we would pay off. Our sense though is that there's monies for all 3 of those potential use buckets based on our assessment of Worldpac's value.

是的。我先開始，然後瑞安和托尼今天早上加入我們。他可以介入。我認為這是收益的最佳早期使用方式，所以我們會去那裡。托尼和瑞安將再次明確我們在支付多少方面的界限。不過，我們的感覺是，根據我們對 Worldpac 價值的評估，所有 3 個潛在用途類別都有資金。

But gentlemen?

但是先生們？

Yes. So Aaron, good start again. We would first put money towards deleveraging, getting back and getting closer to our leverage targets that we've talked about publicly of closer to 2.5x over time. We would also put money towards our initiative, some of what Shane and Ryan talked about earlier in our prepared remarks. And of course, anything excess would go back to shareholders, and we would love to do that over time as well.

是的。所以亞倫，又是一個好的開始。我們首先會將資金用於去槓桿化，恢復並接近我們公開談論的槓桿目標，隨著時間的推移接近 2.5 倍。我們還將為我們的倡議投入資金，這是肖恩和瑞安之前在我們準備好的演講中談到的一些內容。當然，任何多餘的東西都會回饋給股東，隨著時間的推移，我們也很樂意這樣做。

Yes, Aaron, I think the biggest thing is we're going to be prudent on this one as well and the timing and sequencing of that. We know this is a multiyear turnaround for the company. And so the first debt priority of pay down the debt and then invest in the business for the turnaround are the top priorities for us.

是的，亞倫，我認為最重要的是我們在這件事及其時間安排和順序上也將保持謹慎。我們知道這對公司來說是一個多年的轉變。因此，首先償還債務，然後投資業務以實現扭虧為盈，這是我們的首要任務。

Okay. Great. And then I guess just a follow-up question to -- going a little closer, you trying to get that closer to that target debt ratio. Does that mean that you don't believe that with the sale and allocation, we will be able to fully achieve your target debt ratio?

好的。偉大的。然後我想這只是一個後續問題——更接近一點，你試圖讓債務比率更接近目標。這是否意味著您不相信透過出售和分配，我們能夠完全達到您的目標負債比率？

Yes. Aaron, we're not ready to talk about the actual dollar amounts that we would get from the transaction. So we'll wait to be able to share that when and if we do have a transaction, if that's all right.

是的。亞倫，我們還沒有準備好談論我們將從交易中獲得的實際金額。因此，如果可以的話，我們將等待能夠在確實有交易時分享這一點。

The next question comes from Steven Forbes of Guggenheim Partners.

下一個問題來自古根漢合夥人公司的史蒂文·福布斯。

This is Rene Marin, on for Steve Forbes. I want to focus on the DC to market hub conversion. Can you help us think through the KPIs you are focused on as you think through the ROI of such progress? And whether these conversions can drive the improvement you need?

我是雷內馬林，替史蒂夫福布斯發言。我想重點關注 DC 到市場中心的轉換。當您思考此類進展的投資報酬率時，您能否幫助我們思考您所關注的 KPI？這些轉化能否推動您所需的改進？

I missed the very last part of your sentence. If you could just say that one more time, please?

我錯過了你這句話的最後一部分。如果你能再說一遍，好嗎？

Yes. And whether these conversions are driving the improvement you need?

是的。這些轉化是否正在推動您所需的改進？

Yes, fantastic. So as we think about metrics, sales per square foot, service interval for SKUs available, sales are all important in terms of what we do it, along with the cost to convert and then the ongoing operating costs. So those are some of the key metrics. Let me also talk qualitatively about what goes on. One of the challenges in our network is we previously made the decisions that we would treat all DCs equally. So we have 38 DCs serving the boxes and the disparity in their size ended up with huge inequities in terms of what stores saw in terms of their replenishment. So you could be a store manager and have a 1 million square foot DC that's a few hours away that's servicing your store, or you could be a store manager and have a 100,000 square foot DC servicing you and your facility.

是的，太棒了。因此，當我們考慮指標、每平方英尺銷售額、可用 SKU 的服務間隔時，銷售額對於我們所做的事情都很重要，此外還有轉換成本以及持續營運成本。這些是一些關鍵指標。讓我也定性地談談正在發生的事情。我們網路中的挑戰之一是我們之前所做的決定，我們將平等對待所有 DC。因此，我們有 38 個配送中心為這些盒子提供服務，而它們的大小差異最終導致商店在補貨方面存在巨大的不平等。因此，您可以是一名商店經理，擁有一個100,000 平方英尺的DC，距離酒店幾個小時路程，為您的商店提供服務；或者您可以作為一名商店經理，擁有一個100,000 平方英尺的DC 為您和您的設施提供服務。

So the breadth and depth of what was available to you as a store was fundamentally different depending on which DC was serving you. But we declared them all to be replenishment nodes, which creates an issue. By the way, we declare them all to be intake nodes, which we would go to our vendors and say, "Hey, we need you to ship product into 38 DCs," which meant some DCs could take a truckload and other DCs would take an LTL skid. So we knew structurally, that's just not a good way to operate a supply chain.

因此，作為一家商店，您可以使用的內容的廣度和深度根本上是不同的，具體取決於哪個 DC 為您提供服務。但我們將它們全部聲明為補給節點，這就產生了一個問題。順便說一句，我們聲明它們都是進口節點，我們會去找我們的供應商說，“嘿，我們需要你們將產品運送到38 個配送中心”，這意味著一些配送中心可以裝載一卡車貨物，而其他配送中心則需要零擔打滑。所以我們從結構上知道，這不是營運供應鏈的好方法。

So with that backdrop, as we've gone in and modeled it, it also makes sense from some of the metrics that we just alluded to. So what we're doing with the market hub is, we're taking 40,000 to 50,000 square feet. And again, it comes from any one of the 3 sources. We have some larger stores that can fit this profile. We have these DC conversions. And then we also will be doing some greenfields. And then we think that 80,000-plus SKUs, give or take, some will cheat a little bit higher is the right number of SKUs. Now for these DCs that we're converting, we're in long-term leases with them at favorable rates. So economically, that's been something that's been good for us. We will partition what we need and sublease the rest. In some cases, we'll exit the facility altogether.

因此，在這種背景下，當我們對其進行建模時，我們剛才提到的一些指標也是有意義的。因此，我們在市場中心所做的就是佔用 40,000 至 50,000 平方英尺的面積。再說一遍，它來自三個來源中的任何一個。我們有一些較大的商店可以滿足這種要求。我們有這些直流轉換。然後我們還將進行一些綠地開發。然後我們認為 80,000 多個 SKU，不管多少，有些人會作弊，更高一點的 SKU 數量才是正確的。現在，對於我們正在轉換的這些 DC，我們以優惠的價格與他們簽訂長期租賃合約。所以從經濟上來說，這對我們來說是件好事。我們將劃分我們需要的部分並轉租其餘的。在某些情況下，我們會完全退出該設施。

But that's the method of how we then develop the baseline economics of the facilities. We also won't be using mechanization and think about both the ongoing maintenance and operating costs of that. And instead, this will look with a traditional racking and pick model in terms of what we'll do. And so as we've looked at what those -- what the cost to operate it and then the service that's provided, that works, but I will go back to that original big picture, which is going to our vendors and saying, "Hey, you only need to ship from -- into 14 large DCs." And then for our stores on replenishment, the full breadth and depth now available or will be available to every store that is valuable to us as well.

但這就是我們隨後開發設施的基準經濟性的方法。我們也不會使用機械化，並考慮其持續維護和營運成本。相反，就我們要做的事情而言，這將採用傳統的貨架和揀選模型。因此，當我們研究了這些內容——營運成本是多少，然後提供的服務是有效的，但我會回到最初的大局，這將向我們的供應商說：「嘿，您只需從——運送到14 個大型配送中心。然後，對於我們的商店補貨來說，現在或將向每個商店提供的全面的廣度和深度對我們也很有價值。

The next question comes from Max Rakhlenko from TD Securities.

下一個問題來自道明證券的 Max Rakhlenko。

Great. So first, the 8,500 price action SKUs, is that the biggest chunk of the SKUs? Or is it that just the start and the SKU count could ultimately look quite a bit bigger over time?

偉大的。首先，8,500 個價格行為 SKU，這是 SKU 中最大的部分嗎？或者只是開始，隨著時間的推移，SKU 數量最終可能會變得更大？

So, one of the things that we did in the company is we moved pricing into merchandising. So previously, those had been disjointed functions. And so the way I think about pricing is we want to be competitive. We don't want to lead the market down. We don't want to be inappropriately highly priced to where our customers don't want to buy from us. And I mentioned before, we think it's a logical industry with good conduct.

因此，我們在公司所做的一件事就是將定價轉移到銷售中。所以以前，這些功能都是脫節的。因此，我對定價的看法是我們希望具有競爭力。我們不想引領市場下跌。我們不想以不適當的高價來讓客戶不想向我們購買。我之前提到過，我們認為這是一個合乎邏輯、行為良好的行業。

And so what you can expect from us is good merchants will be talking to their vendors to make sure that we're sourcing at the right cost. I think we have opportunities there. And good merchants are looking at their portfolio. In some instances, they'll say, "Hey, I think were higher relative to the market and we move down." In other instances, they're going to say, actually, we have opportunity to move price up. I think the key message you could take away from us is that we'll have capable pricing teams working very closely with merchants to be at the market, and we'll look to make sure we're sourcing to hit the margins that we need to hit.

因此，您可以從我們這裡得到的是，優秀的商家將與他們的供應商交談，以確保我們以正確的成本進行採購。我認為我們在那裡有機會。優秀的商人正在關注他們的投資組合。在某些情況下，他們會說：“嘿，我認為相對於市場來說價格更高，所以我們會下跌。”在其他情況下，他們會說，實際上，我們有機會提高價格。我認為您可以從我們那裡得到的關鍵訊息是，我們將擁有有能力的定價團隊，與進入市場的商家密切合作，並且我們將確保我們的採購能夠達到我們需要的利潤打。

Yes. Max, I'll add. Of those 8,500 SKUs, some of them, we actually brought price up, right? So this is about getting right priced across the portfolio. Obviously, the bulk of them were getting -- bringing prices down and being in a competitive place. But we did bring some up to Shane's point as well. And we said it's about 3% of the overall enterprise SKUs and 8% of Advance. Will that increase as Shane said, as the new merchant comes in as merchandising works through it, I'm sure that there will be more that will add to it.

是的。麥克斯，我補充一下。在這 8,500 個 SKU 中，我們實際上提高了其中一些 SKU 的價格，對嗎？因此，這涉及整個投資組合的正確定價。顯然，他們中的大多數都在降低價格並處於競爭地位。但我們也確實提出了一些符合謝恩觀點的內容。我們說它大約佔整個企業 SKU 的 3%，佔 Advance 的 8%。正如謝恩所說，隨著新商人的加入，銷售工作的開展，這種情況會增加嗎？

Got it. It's very helpful. And then can you speak to a competitive environment and progress you're making your up and down the street accounts? And then what are some of the key initiatives besides price? And how should we think about the cadence of acceleration as the year goes on?

知道了。這非常有幫助。然後你能談談競爭環境和你在街上和街上的帳戶所取得的進展嗎？那麼除了價格之外還有哪些關鍵措施呢？隨著時間的推移，我們該如何看待加速的節奏？

Yes. So if you look at our 92-year history, I think throughout Advance's history, we view the Pro customer as a market that we have a right to participate in. And so it's a perfectly natural set of activities for us that we have a lot of steep capability. And so there's a whole series of activities going on. So first, we use outside sales team members, [CAMs]. We've rejuvenated their compensation program. And if you think about -- we've talked about investing in the front line, CAMS and CPPs. CPPs being commercial parts pros, and they're the in-store pro conduit. We're investing in both of those roles in terms of compensation. We're investing in those roles in terms of training. We're investing in those roles in terms of career trajectories.

是的。因此，如果你看看我們92 年的歷史，我認為縱觀Advance 的歷史，我們將Pro 客戶視為我們有權參與的市場。很多的陡峭能力。因此，一系列的活動正在進行中。因此，首先，我們使用外部銷售團隊成員 [CAM]。我們重新啟動了他們的薪酬計劃。如果你想一想——我們已經討論過對前線、CAMS 和 CPP 的投資。 CPP 是商業零件專業人士，它們是店內專業人士的管道。我們在薪酬方面對這兩個角色進行了投資。我們在培訓方面對這些角色進行了投資。我們正在根據職業軌跡對這些角色進行投資。

We're doing a lot in terms of understanding our market. So in the proximity to where a store exists, what are -- who are all the Pro customers? And what's our relative penetration with those customers? What is the visit frequency? What is it -- what products are we propositioning to that customer? Those are all things that go on. We have TechNet, which is a warrant service and capability builder for our Pro customers that we bring to the market. And so there's a whole litany of activities. Our Pro website, our equipment program, our recognition trips. So we -- across the spectrum of what a Pro customer would find attractive, we have an answer for their needs. And it's just about being organized and highlighting those needs, and we're really pleased with the direction that's taking place.

我們在了解市場方面做了很多工作。那麼，在商店附近，哪些人是 Pro 客戶呢？我們對這些客戶的相對滲透率是多少？訪問頻率是多少？它是什麼－我們向該客戶推薦什麼產品？這些都是持續發生的事情。我們擁有 TechNet，它是我們向市場推出的專業客戶的保證服務和功能建構器。所以就有了一連串的活動。我們的專業網站、我們的設備計劃、我們的認可之旅。因此，無論專業客戶認為有吸引力的是什麼，我們都能滿足他們的需求。這只是為了組織並強調這些需求，我們對正在發生的方向感到非常滿意。

The next question comes from Chris Bottiglieri from BNP Paribas.

下一個問題來自法國巴黎銀行的 Chris Bottiglieri。

Just a couple of clarifying ones. The $18 million, was that a sales leaseback or something else? And then on Worldpac, is there -- the accounting control or mediations, does that influence the Worldpac sale? Like does that any be resolved first? Or to the (inaudible) to be relying on? Just want curious if that's having an impact on the asset sale.

只是一些澄清的事情。這 1800 萬美元是銷售回租還是其他？然後，在 Worldpac 上，會計控製或調解是否會影響 Worldpac 的銷售？就像先解決這個問題嗎？還是要依賴（聽不清楚）？只是想知道這是否會對資產出售產生影響。

Yes, Chris. No, the Worldpac piece is not going to impact the transaction there from that perspective. That's kind of kept separate from a sale gain on asset versus sale leaseback, yes.

是的，克里斯。不，從這個角度來看，Worldpac 的文章不會影響那裡的交易。是的，這與資產銷售收益與售後回租的收益是分開的。

Sale leaseback. Okay. And then just the last one, the capitalized supply chain costs you called out this quarter. Can you quantify that and tell us what you're thinking in terms of like Q2 in the back half, that's something that should persist or not?

售後回租。好的。最後一個是您本季公佈的資本化供應鏈成本。您能否量化這一點並告訴我們您對後半部分第二季度的想法，這是否應該持續？

From an overall inflation standpoint, we expect that to be very moderate for the rest of the year from a product inflation rate. Obviously, we are in our guide originally. We said we wouldn't be able to capitalize on full inflation on the year because we were going to be taking pricing actions, and we'll continue to do that through the year.

從整體通膨的角度來看，我們預計今年剩餘時間的產品通膨率將非常溫和。顯然，我們最初是在我們的指南中。我們表示，我們將無法利用今年的全面通膨，因為我們將採取定價行動，而且我們將在今年繼續這樣做。

In fact, I think in our guide, we're talking about inflation being about 1% in the industry, and we expect that to be still around 1%.

事實上，我認為在我們的指南中，我們談論的是該行業的通膨率約為 1%，我們預計該通膨率仍將在 1% 左右。

The next question comes from (inaudible) Owen from Barclays.

下一個問題來自巴克萊銀行的（聽不清楚）歐文。

It's Seth Sigman. Hopefully, you could hear me. Just as a follow-up on the question. I guess, number one -- confusion here. So 2 quick follow-ups, and I'll just ask both up front here. So I just want the guidance for Q2, just trying to think about more pressure year-over-year on operating margin. Can you just give us a little bit more flavor? Is that more on gross margin or SG&A? Or is it really a combination of both? So let's just clarify that. And then my real follow-up question is around the store footprint. It looks like the pace of closings starting to pick up a little bit here. How do you think about that? Do you have a view on the ultimate number of store closings? And maybe any more color on what you're learning some of the characteristics of the units that you're closing, that would be great.

我是賽斯西格曼。希望你能聽到我的聲音。就像這個問題的後續行動一樣。我想，第一——這裡的混亂。所以有兩次快速跟進，我會在這裡先問這兩個問題。因此，我只想要第二季的指導，只是想考慮營業利潤率同比面臨的更大壓力。你能給我們多一點味道嗎？這更多的是毛利率還是SG&A？或者它真的是兩者的結合嗎？讓我們澄清一下。然後我真正的後續問題是圍繞商店足跡。看起來這裡關門的速度開始加快了。您對此有何看法？您對最終關店數量有何看法？也許對您正在學習的內容以及您要關閉的單元的一些特徵有更多的了解，那就太好了。

Yes. Great question, Seth. A couple of things. The pressure in Q2 will be mainly driven on gross margin. That's where we're going to see the pressure. It's mainly driven by the pricing actions of cycling those pricing actions from last year and just -- and some of the timing of us working to get some of the cost out and product costs, supply chain benefits, et cetera, and the unit lift that will take time as the consumers recognize our new pricing -- competitive pricing. So it's mainly going to be realized in gross profit on that perspective.

是的。好問題，賽斯。有幾件事。第二季的壓力將主要來自毛利率。這就是我們將看到壓力的地方。這主要是由去年和剛開始的定價行為的循環所驅動的——以及我們努力降低一些成本和產品成本、供應鏈效益等的一些時機，以及單位提升消費者認可我們的新定價——有競爭力的定價需要時間。因此，從這個角度來看，它主要將在毛利中實現。

I'll talk on the store closing. Thanks for asking the question. So first, we don't have an eye to go out and just say, "Hey, we want to shut x number of stores." It's all part of our asset productivity assessment. And so we're looking across the network. We're looking at every asset that we own and say, "Hey, what does this do for the company? And is it where it should be? And is it doing what it could be?" So when we identify it as it relates to a store, the first thing we say is, "Hey, can we turn the store around?" I mean that's the preferred lens.

我來談談商店關門的事。感謝您提出問題。因此，首先，我們不會直接出去，只是說：“嘿，我們想關閉 x 家商店。”這是我們資產生產力評估的一部分。所以我們正在透過網路尋找。我們會審視我們擁有的每一項資產，然後說：“嘿，這對公司有什麼作用？它在它應該在的地方嗎？它在做它應該做的事情嗎？”因此，當我們將其識別為與商店相關時，我們說的第一件事是，“嘿，我們可以扭轉商店局面嗎？”我的意思是這是首選鏡頭。

And so we look at what the management is and how the management is performing. We look at -- we talked about our Pro efforts, and we say, "Hey, our Pro efforts grounded there, what's going on with the outside sales, team member in that geography, the CPPs." So first flush with the store's performance is always to say, can we make this a healthy store? There are some instances where if you look at our regional market share we're just -- structurally, we're in a situation where we just can't make the math work, and that's where closing becomes an option.

因此，我們關注管理層是什麼以及管理層的表現如何。我們看看——我們談論了我們的專業工作，我們說，“嘿，我們的專業工作立足於那裡，外部銷售、該地區的團隊成員、CPP 發生了什麼。”因此，首先關注商店的業績總是要說，我們能否讓這家商店變得健康？在某些情況下，如果你看看我們的區域市場份額，從結構上看，我們正處於無法進行數學計算的情況，這就是關閉成為一種選擇的地方。

And so we don't publish a number in terms of, hey, we think this is how many we think we are going to close or could close. It's just an ongoing management of the business that's now one of the items in the toolbox. By the way, so, too, is opening a new store. And in that regard, we haven't published an NSO number, but I think I want people to know that our real estate team in terms of its capabilities is really -- we've really made a number of improvements there. We've unified real estate under one leader. We've looked at our real estate management process in terms of buy versus lease, in terms of site selection, in terms of time line to get a facility up in terms of hit out and fit out, in terms of new store opening processes. And so we're really seeing for the new stores we opened a much better process that is something that we'll look to leverage in the future.

因此，我們不會發布一個數字，嘿，我們認為這就是我們認為我們將關閉或可能關閉的數量。這只是對業務的持續管理，現在是工具箱中的項目之一。順便說一句，開一家新店也是如此。在這方面，我們還沒有公佈國家統計局的數字，但我想我想讓人們知道我們的房地產團隊的能力確實 - 我們確實在那裡做出了許多改進。我們已將房地產業務統一到一位領導者的領導下。我們從購買與租賃、選址、設施建設的時間表、裝修和新店開業流程等方面審視了我們的房地產管理流程。因此，我們確實看到我們為新店開設了一個更好的流程，這是我們未來希望利用的。

All right. Thank you all so much for joining us this morning. That is all the questions we've received. We appreciate your time and continued support. I look forward to updating you again after we report Q2. Have a nice day.

好的。非常感謝大家今天早上加入我們。這就是我們收到的所有問題。我們感謝您的時間和持續的支持。我期待在我們報告第二季度後再次向您通報最新情況。祝你今天過得愉快。

This concludes today's call. Thank you very much for your attendance. You may now disconnect your lines.

今天的電話會議到此結束。非常感謝您的出席。現在您可以斷開線路。