Gildan Activewear Inc (GIL) 2023 Q2 法說會逐字稿

Ladies and gentlemen, thank you for standing by, and welcome to the Q2 2023 Gildan Activewear Earnings Conference Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Jessy Hayem. Please go ahead.

女士們、先生們，感謝大家的支持，歡迎參加 2023 年第二季度 Gildan Activewear 收益電話會議。請注意，今天的會議正在錄製中。我現在想把會議交給 Jessy Hayem。請繼續。

Good morning, everyone. Earlier, we issued a press release announcing our results for the second quarter of 2023. We also issued our interim shareholder report with the Canadian securities and regulatory authorities and the U.S. Securities Commission, which are available on our corporate website. Joining me on the call today are Glenn Chamandy, President and CEO of Gildan; Rhod Harries, our Executive Vice President and Chief Financial and Administrative Officer; and Chuck Ward, President, Sales, Marketing and Distribution.

大家，早安。早些時候，我們發布了一份新聞稿，宣布了2023 年第二季度的業績。我們還向加拿大證券和監管機構以及美國證券委員會發布了中期股東報告，該報告可在我們的公司網站上獲取。今天和我一起參加電話會議的是 Gildan 總裁兼首席執行官 Glenn Chamandy； Rhod Harries，我們的執行副總裁兼首席財務和行政官；查克·沃德 (Chuck Ward)，銷售、營銷和分銷總裁。

This morning, Rhod will take you through the results for the quarter and a question-and-answer session will follow. Before we begin, please take note that certain statements included in this conference call may constitute forward-looking statements which involve unknown and known risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. We refer you to the company's filings with the U.S. Securities and Exchange Commission and Canadian securities regulatory authorities.

今天早上，羅德將向您介紹本季度的業績，隨後將進行問答環節。在我們開始之前，請注意，本次電話會議中包含的某些陳述可能構成前瞻性陳述，其中涉及未知和已知的風險、不確定性和其他因素，這可能導致實際結果與此類前瞻性陳述所明示或暗示的未來結果存在重大差異看起來的陳述。我們建議您參閱該公司向美國證券交易委員會和加拿大證券監管機構提交的文件。

During this call, we will also discuss certain non-GAAP financial measures. Reconciliations to the most directly comparable IFRS measures are provided in today's earnings release as well as our MD&A. And now I'll turn it over to Rhod.

在本次電話會議中，我們還將討論某些非公認會計準則財務指標。今天的收益發布以及我們的 MD&A 中提供了與最直接可比的 IFRS 指標的調節。現在我會把它交給羅德。

Thank you, Jessy. Good morning to all, and thank you for joining us on the call today. This morning, we reported our second quarter results, which came in slightly ahead of our expectations (inaudible) top line and operating margin. We ended the quarter with $840 million in net sales with better-than-expected sales volumes in activewear, which offset weaker-than-expected product mix tied to current market conditions, which I'll speak about a little later.

謝謝你，傑西。大家早上好，感謝您今天加入我們的電話會議。今天早上，我們報告了第二季度的業績，該業績略高於我們的預期（聽不清）營收和營業利潤率。本季度末，我們的淨銷售額為 8.4 億美元，運動服銷量好於預期，抵消了與當前市場狀況相關的弱於預期的產品組合，這一點我稍後會談到。

During the quarter, we believe we outperformed the industry in a challenging environment, supported by positive activewear POS trends and the breadth of our product offering, which provided flexibility in what appears to be an increasingly more price-conscious environment. This speaks to our strong competitive position and our ability to continue to drive market share gains. This said, while we continue to expect our revenues to grow year-over-year in the second half, we believe it is prudent to lower our outlook for the full year to reflect the impact of current market conditions on activewear mix as well as near-term uncertainty related to the broader macro environment.

在本季度，我們相信我們在充滿挑戰的環境中跑贏了行業，這得益於積極的運動服 POS 趨勢和我們產品供應的廣度，這在價格意識日益增強的環境中提供了靈活性。這證明了我們強大的競爭地位以及我們繼續推動市場份額增長的能力。這就是說，雖然我們繼續預計下半年的收入將同比增長，但我們認為謹慎的做法是降低全年的預期，以反映當前市場狀況對運動服組合以及近期的影響。 - 與更廣泛的宏觀環境相關的長期不確定性。

I will take you through the details of our revised 2023 outlook a little later, but first, I'd like to highlight that we remain fully committed to our capital allocation priorities having returned $175 million to shareholders year-to-date supported by strong free cash flow, which we continue to expect will exceed $425 million for the full year. As such, with our existing NCIB program expiring, we announced this morning the renewal of our NCIB program to repurchase up to 5% of the company's issued and outstanding common shares over the next 12 months.

稍後我將向您詳細介紹我們修訂後的2023 年展望，但首先，我想強調，我們仍然完全致力於我們的資本配置優先事項，在強大的自由資本支持下，今年迄今已向股東返還了1.75 億美元。我們仍然預計全年現金流將超過 4.25 億美元。因此，隨著我們現有的 NCIB 計劃到期，我們今天上午宣布續簽 NCIB 計劃，在未來 12 個月內回購最多 5% 的公司已發行和流通的普通股。

Now let me turn to the specifics of our second quarter results. Net sales for the second quarter came in at $840 million, down 6% year-over-year, reflecting a decline in activewear sales of 9%, partly offset by 8% growth in the hosiery and underwear category. In activewear, as previously communicated, we faced a strong comparative period as we cycled post-pandemic inventory replenishment. Overall, the year-over-year POS trend for the activewear category was positive during the quarter, driven by performance in North America, which improved sequentially, largely as anticipated. On the other hand, international markets remain challenged with sales in the quarter down 2% versus the prior year, with POS trends softening sequentially, which fell below our expectations.

現在讓我談談第二季度業績的具體情況。第二季度淨銷售額為 8.4 億美元，同比下降 6%，反映出運動服銷售額下降 9%，但被襪類和內衣類別 8% 的增長部分抵消。在運動服領域，正如之前所傳達的那樣，我們在疫情后的庫存補充週期中面臨著一個強勁的比較時期。總體而言，在北美業績的推動下，本季度運動服類別的 POS 趨勢呈積極趨勢，北美地區的業績連續改善，基本符合預期。另一方面，國際市場仍然面臨挑戰，本季度銷售額較上年同期下降 2%，POS 趨勢連續疲軟，低於我們的預期。

Finally, good growth in the hosiery and underwear category for the quarter was mainly driven by underwear sales volume growth, reflecting the expansion of our private label offering and the rollout of new programs in the mass retail channel. Further, while industry demand for men's underwear remained down year-over-year, it continues to improve sequentially, and we remain encouraged by the improving momentum for this product.

最後，本季度襪類和內衣類別的良好增長主要是由內衣銷量增長推動的，反映出我們自有品牌產品的擴展以及大眾零售渠道中新項目的推出。此外，儘管男士內衣的行業需求同比仍然下降，但仍持續改善，我們對該產品的改善勢頭仍然感到鼓舞。

Turning to margins. Adjusted gross margin came in at 25.8%, down 380 basis points year-over-year. This is largely a result of the anticipated flow-through impact on our cost of sales of peak fiber as well as unfavorable product mix in activewear related to shifting product preferences in this environment. SG&A expenses for the second quarter were $78 million, down $11 million versus last year mainly due to lower variable compensation expenses and our continued cost containment efforts, which more than offset the impact of cost inflation. As a percentage of sales, SG&A of 9.3% improved 70 basis points despite the impact of sales deleverage. Consequently, we generated operating income of 21.7% of sales during the quarter which included a net insurance gain of $74 million related to the 2 hurricanes that impacted the company's operations in Central America back in 2020, partly offset by restructuring charges of $30 million, which include the closure of a sowing facility in Honduras.

轉向邊緣。調整後毛利率為25.8%，同比下降380個基點。這主要是由於預期對我們峰值纖維銷售成本的流通影響，以及與這種環境下產品偏好變化相關的運動服產品組合的不利結果。第二季度的 SG&A 費用為 7800 萬美元，比去年減少 1100 萬美元，主要是由於可變薪酬費用降低以及我們持續的成本控制努力，這足以抵消成本通脹的影響。儘管受到銷售去槓桿化的影響，SG&A 佔銷售額的百分比仍為 9.3%，提高了 70 個基點。因此，我們在本季度創造了佔銷售額21.7% 的營業收入，其中包括與2020 年影響公司中美洲業務的兩次颶風相關的7,400 萬美元的淨保險收益，部分被3,000 萬美元的重組費用所抵消。包括關閉洪都拉斯的播種設施。

On an adjusted basis, operating margin of 16.5% was up 190 basis points sequentially, slightly better than expected but down 310 points compared to the prior year. After reflecting net financial expenses of $21 million and factoring in continued share repurchases, we reported GAAP and adjusted diluted EPS for the quarter of $0.87 and $0.63, respectively.

調整後的營業利潤率為 16.5%，環比上升 190 個基點，略好於預期，但比上年下降 310 個基點。在反映 2100 萬美元的淨財務費用並考慮到持續的股票回購後，我們報告的本季度 GAAP 和調整後攤薄每股收益分別為 0.87 美元和 0.63 美元。

Moving on to cash flow and balance sheet items. Cash flow from operating activities was $182 million in the second quarter, which includes the net positive effect from the insurance gain mentioned earlier. This compares to $210 million in the prior year, and the drop is primarily due to higher working capital and lower net earnings. We continue to maintain healthy inventory levels, ensuring product availability and depth. Furthermore, we expect our inventory levels to decrease sequentially as was the case in Q2 and end the year below 2022 levels. After capital expenditures of $56 million, we generated approximately $126 million of free cash flow in the second quarter. On the CapEx front, the progressive ramp-up of our new Bangladesh facilities is underway, which will continue through 2023 into 2024. We also bought back 2.6 million shares in the quarter, reflecting our strong commitment to return capital to shareholders.

接下來討論現金流量和資產負債表項目。第二季度經營活動現金流量為1.82億美元，其中包括前面提到的保險收益的淨積極影響。與上一年的 2.1 億美元相比，下降的主要原因是營運資本增加和淨利潤減少。我們繼續保持健康的庫存水平，確保產品的可用性和深度。此外，我們預計我們的庫存水平將像第二季度一樣連續下降，並在年底低於 2022 年的水平。扣除 5600 萬美元的資本支出後，我們在第二季度產生了約 1.26 億美元的自由現金流。在資本支出方面，我們正在逐步擴大孟加拉國新工廠的規模，並將持續到2023 年至2024 年。我們還在本季度回購了260 萬股股票，這反映出我們對向股東返還資本的堅定承諾。

The company ended the second quarter of 2023 with net debt of $1.17 billion and a net debt-to-EBITDA leverage ratio of 1.8x, in line with our 1x to 2x targeted debt levels.

截至 2023 年第二季度，該公司的淨債務為 11.7 億美元，淨債務與 EBITDA 槓桿率為 1.8 倍，符合我們 1 至 2 倍的目標債務水平。

Moving on to the outlook for the full year. With strong comparative periods now behind us, we continue to expect our revenues to grow in the second half of the year, supported by the planned rollout of incremental retail programs. However, despite continued market share gains, we are seeing current market conditions negatively impact activewear product mix in both North American and international markets as customers focus on lower-priced products. Combined with the near-term uncertainty related to the macro environment, we believe it is prudent to temper our previous full year 2023 expectations for revenue growth and operating margins, which now reflect the trade down occurring within our activewear product category.

接下來是全年展望。現在，強勁的比較時期已經過去，我們繼續預計，在計劃推出的增量零售計劃的支持下，我們的收入將在今年下半年實現增長。然而，儘管市場份額持續增長，但我們看到當前的市場狀況對北美和國際市場的運動服產品組合產生了負面影響，因為客戶專注於低價產品。結合與宏觀環境相關的近期不確定性，我們認為謹慎調整之前對 2023 年全年收入增長和營業利潤率的預期是謹慎的做法，這反映了我們的運動服產品類別中發生的貿易下降。

Finally, our full year 2023 outlook is also factoring in the impact of higher than previously expected financial charges for the second half. Accordingly, for 2023, we now expect revenue for the full year to be flat to down low single digits versus the prior year. We also expect full year adjusted operating margin to be slightly below the low end of our 18% to 20% annual target range. Although this said, we continue to expect sequential quarterly improvement in operating margins through the second half of 2023. We expect adjusted diluted EPS in the range of $2.55 to $2.65, including the impact of assumed share repurchase of 5% of our outstanding public float in 2023. And finally, we expect strong full year free cash flow generation above $425 million after capital expenditures, which we continue to expect to be at the lower end of our 6% to 8% target range.

最後，我們的 2023 年全年展望還考慮到了下半年財務費用高於先前預期的影響。因此，我們現在預計 2023 年全年收入將與上年持平或下降個位數。我們還預計全年調整後營業利潤率將略低於我們 18% 至 20% 年度目標範圍的下限。儘管如此，我們仍然預計到2023 年下半年，營業利潤率將逐季度有所改善。我們預計調整後攤薄後每股收益將在2.55 美元至2.65 美元之間，其中包括假定回購5% 的流通公眾持股量的影響。 2023 年。最後，我們預計扣除資本支出後，全年自由現金流將強勁增長，超過 4.25 億美元，我們仍然預計該數字將處於 6% 至 8% 目標範圍的下限。

So in conclusion, while we faced some near-term headwinds driven by the macro environment, which we can see is driving customers to focus on lower-priced products and which has largely driven the change in our 2023 outlook, we are encouraged by our performance relative to our peers as we continue to gain market share in a difficult environment. Accordingly, we remain confident that as macro pressures subside, we will be positioned to fully capitalize on our market share gains and resume our growth trajectory. This, combined with our cost structure that we believe is well under control in which we continue to improve positions us well as we work towards delivering on our financial targets and creating long-term shareholder value under the Gildan sustainable growth strategy focused on 3 key pillars of capacity-driven growth, innovation and ESG.

因此，總而言之，雖然我們面臨一些由宏觀環境驅動的近期阻力，我們可以看到這正在促使客戶關注低價產品，並在很大程度上推動了我們2023 年前景的變化，但我們的業績令我們感到鼓舞相對於我們的同行，我們在困難的環境中繼續獲得市場份額。因此，我們仍然相信，隨著宏觀壓力消退，我們將能夠充分利用我們的市場份額收益並恢復我們的增長軌跡。再加上我們相信我們的成本結構得到了很好的控制，我們將繼續改善我們的地位，努力實現我們的財務目標，並根據 Gildan 可持續增長戰略創造長期股東價值，戰略重點關註三個關鍵支柱能力驅動的增長、創新和ESG。

Thank you, and I will now turn the call back to Jessy.

謝謝您，我現在將電話轉回傑西。

Thank you, Rhod. (Operator Instructions) Josephe, you may begin the Q&A session.

謝謝你，羅德。 （操作員指示） Josephe，您可以開始問答環節了。

(Operator Instructions) Your first question comes from the line of Jay Sole.

（操作員說明） 您的第一個問題來自 Jay Sole。

I'm wondering if you can elaborate on the current market conditions that you're talking about that are unfavorably impacting the activewear. What exactly is because it's sort of a customer issue? Is it a consumer issue? Can you -- if you can elaborate, that would be very helpful.

我想知道您是否可以詳細說明您所談論的當前市場狀況對運動服的不利影響。到底是什麼因為這是客戶問題？是消費者的問題嗎？你能——如果你能詳細說明一下，那將會非常有幫助。

I'll start with that one. We look at it, I think -- what we're saying is that our market conditions are actually pretty strong ourselves. We're gaining share in the market. The overall market, we think is down low double digits in terms of activewear in the North American market. But obviously, we're gaining share with a positive 2%. The real change, and I think what we're looking at is that the customers that are buying products are actually changing the type of product they're buying. So they're buying lesser-value type products. So for example, in instead of buying a hoody sweatshirt, they're buying a crewneck sweatshirt, instead of buying some of the fringe items that we sell, they're buying more basic items.

我將從那個開始。我想，我們看看它——我們想說的是，我們自己的市場狀況實際上相當強勁。我們正在擴大市場份額。我們認為北美市場的運動服整體市場下降了兩位數。但顯然，我們的市場份額正增長 2%。真正的變化，我認為我們正在關注的是購買產品的客戶實際上正在改變他們購買的產品類型。所以他們購買的是價值較低的產品。例如，他們不再購買連帽運動衫，而是購買圓領運動衫；他們不再購買我們銷售的一些邊緣商品，而是購買更基本的商品。

And then one area we're seeing is a shift back to basic product from the fashion product as the price points are lower. So that's really what's happening. But the unit volumes are good. It's just a shift in the mix of product, which is reflecting the actual net selling prices that we sell to these consumers, but our volumes are on track. Our volumes are good. We're taking share in the market, although the market is weak and being challenged, that's really what's happened.

然後我們看到的一個領域是，隨著價格的降低，人們從時尚產品轉向基本產品。所以這確實是正在發生的事情。但單位體積很好。這只是產品組合的轉變，反映了我們向這些消費者銷售的實際淨售價，但我們的銷量已步入正軌。我們的銷量很好。我們正在搶占市場份額，儘管市場疲軟並受到挑戰，但事實就是如此。

Got it. And then Glenn, can you just talk about just the factory closure and maybe put it in context for us how that decision came about and sort of what the implications are?

知道了。然後格倫，你能談談工廠關閉的事嗎？或許可以為我們介紹一下這個決定是如何產生的以及其影響是什麼？

Well, look, we're -- I wouldn't take that factory closure as anything, but the continued optimization of our whole manufacturing supply chain and optimization in terms of really focusing on our Back to Basics. So it's not a capacity-driven thing. We're still running our capacity relatively at the same levels we were in Q1 and Q2 and where we are today. So we haven't changed our capacity. We're just continuing to optimize in these markets. I mean, we're not running at full. Like what we said last time is we're running between 85% and 90%. We're still at those levels, but we're constantly optimizing our structure, our cost structure and positioning ourselves to be low cost as we move forward into the future. So it's more of a Back to Basics approach than anything. .

好吧，看，我們——我不會把工廠關閉當作什麼，而是我們整個製造供應鏈的持續優化，以及真正專注於我們的回歸基礎的優化。所以這不是一個能力驅動的事情。我們的產能仍處於第一季度和第二季度以及今天的相對水平。所以我們沒有改變我們的容量。我們只是繼續優化這些市場。我的意思是，我們並沒有全力運轉。就像我們上次說的，我們的運行率在 85% 到 90% 之間。我們仍處於這些水平，但我們不斷優化我們的結構、成本結構，並在邁向未來的過程中將自己定位為低成本。所以這更像是一種回歸基礎的方法。 。

Your next question comes from the line of George Doumet Scotiabank.

您的下一個問題來自豐業銀行 George Doumet。

I think last quarter, you mentioned we're seeing pretty good yielded POS for fleet, I think you mentioned high single, low double. Can you just talk a little bit about how that's been trending now?

我認為上個季度，您提到我們看到車隊的 POS 收益率相當不錯，我認為您提到了高單倍率、低雙倍率。您能簡單談談現在的趨勢嗎？

Chuck will answer that.

查克會回答這個問題。

Yes, we're still -- fleece is still trending well. It's not as strong as it was. I think the big thing that Glenn mentioned is sort of we're seeing a mix change between hoods and crews, which the hood selling a slight premium to the crew. So we're seeing more of a mix shift, but fleece is still performing well.

是的，我們仍然——羊毛仍然流行。它不像以前那麼強大了。我認為格倫提到的一件大事是我們看到引擎蓋和工作人員之間的混合變化，引擎蓋向工作人員出售了輕微的溢價。因此，我們看到了更多的混合轉變，但羊毛仍然表現良好。

And the mix shift is significant. Like just to put things in perspective, the price difference is in the neighborhood of 40% differential in price between a hood and the crew. So we're selling the unit volume. The share is going up. We're still in mid-single-digit type growth in fleece. But the thing is that the price point of the items from crew to a hood is significant. It's in the neighborhood of 40% difference between crew and the hood. So they're just buying a lesser-priced item, but we're still selling the unit volume.

而且這種混合轉變是顯著的。客觀來看，引擎蓋和船員之間的價格差異約為 40%。所以我們以單位數量出售。份額正在上漲。我們的羊毛仍處於中等個位數增長。但問題是，從船員到引擎蓋等物品的價格非常高。船員和引擎蓋之間的差異約為 40%。所以他們只是購買價格較低的商品，但我們仍然按單位銷售。

Okay. That's helpful. And maybe on the 380 basis points of contraction on the gross margin, can you talk a little bit about how much of that was cotton? And just how should we think of maybe Rhod, how should we think of the second half that recovery in the margins driven by lower price cost? Anything you can maybe help us out there just to model that out.

好的。這很有幫助。也許毛利率收縮了 380 個基點，您能談談其中有多少是棉花嗎？我們應該如何看待羅德，我們應該如何看待下半年由較低的價格成本推動的利潤率復甦？任何你能幫助我們的事情都可以幫助我們建立模型。

Okay, George. So if you look at the margins, what happened in the second quarter, margin actually, our performance was better than we anticipated, right? We had said last quarter that for the second quarter, we would be up 100 to 150 basis points over the first quarter, and we actually came in a bit stronger. So I think I would say we're very pleased with that overall. And if you look at what happened with our margin, actually, mix, as we said, drove a weaker margin overall, probably about 170 basis points of headwind in those numbers. But because of our performance on our cost structure, performance on SG&A and other areas, effectively, we were able to achieve a good operating margin of 16.5%. If you look at the fiber impact, we had a headwind in the first half, and then as we go into the second half, that abates and it turns into a tailwind.

好吧，喬治。因此，如果你看一下利潤率，第二季度發生了什麼，實際上，我們的業績比我們預期的要好，對吧？上個季度我們曾說過，第二季度的業績將比第一季度增長 100 到 150 個基點，實際上我們的表現要強一些。所以我想我想說我們對整體情況非常滿意。如果你看看我們的利潤率發生了什麼，實際上，正如我們所說，混合因素導致整體利潤率下降，在這些數字中可能存在約 170 個基點的逆風。但由於我們在成本結構、SG&A 和其他領域的表現，我們能夠有效地實現 16.5% 的良好運營利潤率。如果你看一下纖維的影響，我們在上半場遇到了逆風，然後當我們進入下半場時，這種影響減弱並變成了順風。

So if you look at the second quarter, basically, if you look at cotton or fiber on our cost of sales, we had a -- we still had -- or sorry, if you go into the third quarter, if you look at what's going to go on we're still going to have a little bit of a headwind. But it's -- as we move through the quarter, basically, you're flat. And then as you go into the fourth quarter, it turns into a tailwind for us. So if you look at our margins overall, good performance in the second quarter. We're very pleased with the way it unfolded. And then if you look at the third quarter, effectively you get a sequential improvement in our margins. So if you look overall, we're probably going to be just below the low end of our target range in the third quarter from an operating margin perspective. And then as you push into the fourth quarter, we're going to get to the high end of our target range.

因此，如果你看看第二季度，基本上，如果你看看我們的銷售成本中的棉花或纖維，我們有——我們仍然有——或者抱歉，如果你進入第三季度，如果你看看有什麼繼續下去我們仍然會遇到一些逆風。但隨著本季度的進展，基本上，你的表現持平。然後當你進入第四節時，它就變成了我們的順風車。因此，如果你看看我們的整體利潤率，第二季度的表現良好。我們對它的展開方式非常滿意。然後，如果你看看第三季度，你會發現我們的利潤率實際上連續改善。因此，如果從整體上看，從營業利潤率的角度來看，我們第三季度的目標範圍可能會略低於下限。然後，當進入第四季度時，我們將達到目標範圍的高端。

And again, our cost structure is really well under control. And that really will drive us as we move into the back part of the year. And obviously, that sets us up very well as we move into 2024. So I would say we feel very good about our overall cotton position and our overall cost position as we go forward.

再說一遍，我們的成本結構確實得到了很好的控制。當我們進入今年下半年時，這確實會推動我們。顯然，這為我們進入 2024 年奠定了良好的基礎。所以我想說，隨著我們的前進，我們對我們的整體棉花狀況和整體成本狀況感覺非常好。

Your next question comes from the line of Stephen MacLeod of BMO Capital Markets.

您的下一個問題來自 BMO 資本市場的 Stephen MacLeod。

Great. Just circling back on that last question about the color you gave on the margins. Can you -- I know you were talking specifically around the operating margin. Do you have any incremental color you can provide around the gross margin and how the balance between gross and SG&A gets you into that -- those consolidated margins you're talking about?

偉大的。回到關於你在頁邊空白處給出的顏色的最後一個問題。我知道您具體談論的是營業利潤率。您是否可以提供有關毛利率的任何增量信息，以及毛利率和銷售管理費用之間的平衡如何讓您了解這一點——您所說的合併利潤率？

Yes. Look, if you look at effectively what's going to go on, it's all really going to flow through from the gross margin, right, as we go into the back half because all of that cost structure, improvement in cost structure will be reflected in gross margin. We will have the weaker mix, right, that effectively will continue in the third quarter and the fourth quarter, as we called out for the second quarter. And really, if you look at our full year outlook, our total outlook and you look at our sales outlook and the way we've moved it, it's all being driven by weaker mix. So the real move from our prior guidance to where our current guidance is flat to down low single digits. If you go to the midpoint, it's all being driven by weaker mix.

是的。看，如果你有效地觀察將要發生的事情，這一切都會真正從毛利率中流出來，對吧，當我們進入後半部分時，因為所有成本結構、成本結構的改進都將反映在毛利率中利潤。我們將擁有較弱的組合，對吧，這實際上將在第三季度和第四季度繼續，正如我們在第二季度所呼籲的那樣。事實上，如果你看看我們的全年前景、總體前景、銷售前景以及我們的調整方式，就會發現這一切都是由較弱的組合推動的。因此，從我們之前的指導到當前指導的實際變化是持平到低個位數。如果你走到中點，這一切都是由較弱的混合驅動的。

So weaker mix that is flowing through in the back half, very definitely. But our cost structure is really improving as we move through the year. And effectively, that will offset it. We get the improvement in margin, as I said. And again, as we go into 2024, we'll see what happens from a macro perspective. We'll see what happens from a mix perspective. But because of that strength in cost structure, we feel very, very good that they set up at the end of the year and as we move into '24.

後半段流經的混音非常弱，這是非常肯定的。但隨著時間的推移，我們的成本結構確實在改善。實際上，這將抵消它。正如我所說，我們的利潤率有所提高。再次，當我們進入 2024 年時，我們將從宏觀角度觀察會發生什麼。我們將從混合的角度看看會發生什麼。但由於成本結構的優勢，我們對他們在年底和進入 24 世紀時建立的體系感到非常非常好。

Okay. That's great. And then, Glenn, you mentioned that the overall market is down low double digit, but Gildan was up -- you were up 2% in activewear. Can you talk a little bit about where you're seeing those share gains? Is it partially driven by the fact that you're so much -- you have such a strong position in basics so you're capturing a trade down? Or are there any other factors influencing that?

好的。那太棒了。然後，Glenn，您提到整體市場下跌了兩位數，但 Gildan 上漲了——運動服市場上漲了 2%。您能談談您在哪些方面看到了這些份額的增長嗎？部分原因是因為你在基礎知識方面擁有如此強大的地位，所以你正在捕捉下跌交易嗎？或者還有其他因素影響嗎？

Well, Stephen, I'll take that. This is Chuck. Yes, I think we're seeing gains in multiple places. I mean we're seeing gains in the basics. But we're still gaining share in the fashion ring-spun area as well. The ring-spun is not as moving as fast as it was up a few quarters ago, but we're continuing to gain share against those competitors. Also, we're seeing more in the national (inaudible) service retail customers. They're more up mid-single digits as retailers have continued to experience improvement in sell-through and they're doing continued replenishment.

好吧，斯蒂芬，我會接受的。這是查克。是的，我認為我們在多個方面都取得了進展。我的意思是我們看到了基礎知識方面的進步。但我們在時尚環錠紡領域的份額仍在增加。環錠紡的增長速度不如幾個季度前那麼快，但我們正在繼續贏得與這些競爭對手相比的份額。此外，我們在全國（聽不清）服務零售客戶中看到了更多。由於零售商的銷售量持續改善並且他們正在持續補貨，因此它們的價格上漲了中個位數。

And then for -- this is -- and also maybe just to add to that is that our fashion is maybe not as strong as it was. It's still high single-digit positive, but our basics are now low single digits positive as well. So that was a big turnaround from what happened in the last previous quarter. So we're starting to see people trade down to, obviously, the basics, which is great. And those price differences, there's probably like 30%, 35% between a basic and a fashion. So it's just like in the same as the (inaudible) category, people are just trading down and looking for value in the market as we see it.

然後，因為——這就是——也許只是補充一點，我們的時尚可能不像以前那麼強大了。它仍然是高個位數的正數，但我們的基本面現在也是低個位數的正數。因此，這與上一季度發生的情況相比是一個巨大的轉變。因此，我們開始看到人們開始轉向基本款，這很棒。基本款和時尚款之間的價格差異可能有 30%、35%。因此，就像在（聽不清）類別中一樣，人們只是在進行降價交易並在市場中尋找我們所看到的價值。

But we're diagnostic, and it doesn't -- and I think one other key point for us is even though there's somewhat of a shift in buying preferences from a crew to -- from a hood to a crew or a fashion to a basic, we -- our manufacturing facilities are able to be very flexible to be able to support whatever selling, right, because it's all made on the same equipment, which is a key part of our flexibility in our overall manufacturing processes. So we've adapted to these types of changes, and we're continuing to service whatever the customers are buying.

但我們是診斷性的，事實並非如此——我認為對我們來說另一個關鍵點是，儘管購買偏好從船員到——從兜帽到船員，從時尚到時尚。基本上，我們的製造設施能夠非常靈活，能夠支持任何銷售，對吧，因為它們都是在相同的設備上製造的，這是我們整體製造流程靈活性的關鍵部分。因此，我們已經適應了這些類型的變化，並且我們將繼續為客戶購買的任何產品提供服務。

Your next question comes from the line of Luke Hannan of Canaccord.

您的下一個問題來自 Canaccord 的盧克·漢南 (Luke Hannan)。

I just wanted to ask a question on what the promotional environment is like. It sounds like the change in guidance is more related to, as you mentioned, Glenn, the fact that people are trading down. It sounds like volumes are still fairly healthy. I'm just curious to know if you are seeing anything from your competitors on the promotional side of things, whether now with consumers trading down, do you expect there to be a little bit more competitive pressure to be able to capture that customer?

我只是想問一下促銷環境怎麼樣。正如你提到的，格倫，聽起來指導的變化與人們的交易下降這一事實更相關。聽起來成交量仍然相當健康。我只是想知道您是否從競爭對手那裡看到了促銷方面的任何信息，現在消費者是否在降價購買，您是否預計會面臨更大的競爭壓力來吸引該客戶？

Well, we've seen some pricing action, particularly from some of the brands in the fashion category. However, even after they've adjusted some of the pricing, we're still significantly below them in the tune of 20%, 25% in certain cases, right? So we're positioned well on price. And with our product portfolio and all the different price points that we have, we think we're well-positioned that we'll see our price deteriorate on mix, we won't see it deteriorate because we're lowering prices. I mean I think that's the way to look at how we're positioned.

嗯，我們已經看到了一些定價行為，特別是來自時尚類別的一些品牌。然而，即使他們調整了一些定價，我們在某些情況下仍然明顯低於他們 20%、25%，對吧？所以我們在價格上處於有利地位。憑藉我們的產品組合和所有不同的價格點，我們認為我們處於有利地位，我們將看到我們的價格在組合上惡化，我們不會因為我們降低價格而看到它惡化。我的意思是，我認為這就是看待我們定位的方式。

Okay. So then in other words, if you look also at the rest of the competitive set, I know you've mentioned before in the past that there's been this lever where you guys can take price because you're seeing inflation, not just on fiber costs, but on a variety of different cost buckets. As it stands today, are you seeing any evidence of competitors more broadly looking to take price as a result of those -- that cost inflation abating?

好的。換句話說，如果你也看看其他競爭者，我知道你過去曾提到過，你們可以通過這種槓桿來定價，因為你看到的是通貨膨脹，而不僅僅是纖維的通貨膨脹成本，但涉及各種不同的成本類別。就目前情況而言，您是否看到任何證據表明競爭對手更廣泛地尋求通過這些措施來提高價格——從而降低通貨膨脹成本？

Well, I don't know if it's so much cost inflation, but I think that from -- like I said, some of our fashion competitors have lowered prices but are still significantly above us. It may not be because of inflationary reductions, but it's maybe more from business by business. I mean, I think that they're losing significant share. We're gaining share in this market. So one of the things that we just mentioned earlier is that the market is down it was low double digits, and we're positive low single digits. I mean, so we're obviously taking share, and there is a reaction. But we're positioned ourselves perfectly because of our product portfolio, the different levels of pricing, basics are coming back now. We're diagnostic of what's being sold. I mean hood or crew, we really don't care, and we're taking share. So I think we're well-positioned.

好吧，我不知道成本通脹是否如此之大，但我認為，正如我所說，我們的一些時尚競爭對手已經降低了價格，但仍明顯高於我們。這可能不是因為通貨膨脹的減少，但可能更多的是由於各個企業的原因。我的意思是，我認為他們正在失去大量份額。我們正在擴大這個市場的份額。因此，我們之前提到的一件事是，市場下跌，跌幅為兩位數，而我們對低個位數持樂觀態度。我的意思是，我們顯然正在分享，並且已經有了反應。但由於我們的產品組合、不同水平的定價、基礎知識現在正在回歸，我們的定位非常完美。我們對所售商品進行診斷。我的意思是引擎蓋或船員，我們真的不在乎，我們正在分享。所以我認為我們處於有利位置。

And I think more importantly, even one of the things that Rhod said that even with this mix, which is factored into our forecast, we'll be at the high end of our operating margins in Q4. And we would have been higher than that if the mix obviously would have been better because you got added a couple of like Rhod said, the impact is 200 basis points or 170 for example, in Q2. So we would have been higher than even the high end of operating margins in Q4, but we're still there. We're well-positioned. We have a good cotton position. We have good visibility on our manufacturing. So as we continue to move into the future, despite the mix change, I think we'll be well-positioned to move into '24.

我認為更重要的是，即使羅德說的一件事是，即使採用這種組合（已納入我們的預測），我們也將在第四季度達到營業利潤率的高端。如果混合顯然會更好，我們會比這個更高，因為你像羅德所說的那樣添加了一些，例如在第二季度，影響是 200 個基點或 170 個基點。因此，我們的營業利潤率甚至會高於第四季度的最高水平，但我們仍然在那裡。我們處於有利位置。我們擁有良好的棉花倉位。我們對我們的製造有良好的可見性。因此，隨著我們繼續邁向未來，儘管組合發生了變化，我認為我們將處於有利位置進入 24 年。

Your next question comes from the line of Vishal Shreedhar of National Bank Financial.

您的下一個問題來自國家銀行金融部門的 Vishal Shreedhar。

Just on the comments about being down 12%. Can you maybe elaborate on that? Is that industry units? Is that industry sales? And how does that reconcile with what you saw last quarter when the April trends were down, call it flattish to slightly down? And maybe you can give me the time period of that particular data point that you mentioned.

就關於下跌 12% 的評論。您能詳細說明一下嗎？是行業單位嗎？這是行業銷售嗎？這與您在上個季度看到的四月份趨勢下降（稱之為持平或小幅下降）的情況如何協調？也許您可以給我您提到的特定數據點的時間段。

Well, I think last quarter, we said we were slightly down. This quarter we're positive mid low single digits. But what we're referring to is that the overall market is down low double digits basically. So I think that's the question. It's the actual market itself and the conditions within the market. So we're gaining share within this market. And that answers your question.

嗯，我認為上個季度，我們說我們略有下降。本季度我們的業績為中低個位數。但我們指的是整體市場基本上呈低兩位數下跌。所以我認為這就是問題所在。這是實際的市場本身和市場內的條件。所以我們正在這個市場上獲得份額。這回答了你的問題。

Yes. Is that market -- that's market in units? And is that that's...

是的。那個市場是單位市場嗎？還有那是不是……

Yes, -- that's all you for the -- for the quarter. Yes, that's for the quarter.

是的，這就是本季度的全部內容。是的，這是本季度的情況。

How -- what July trend? Worse or stable?

七月趨勢如何？更差還是更穩定？

July for us is trending better. We're mid-single digits positive on our activewear products. Our underwear and (inaudible) products because of the new launches, we're basically probably low double digits today, and we expect that to actually grow to probably high double digits as we move into the future, Q1, Q2, Q3, Q4 as we continue to see momentum on our new products. And also, where mid-July is like mid-single digits for us, but as we also move into Q4, we're going to be comping -- easier comps for us. So we should see that grow a little bit as well just from a comp perspective. But we're continuing to take share. I think we're taking more share in beginning of Q3 than we did in Q2.

七月對我們來說趨勢更好。我們對我們的運動服產品持中個位數的積極態度。由於新產品的推出，我們的內衣和（聽不清）產品今天基本上可能處於低兩位數，我們預計隨著我們進入未來，第一季度、第二季度、第三季度、第四季度，實際上可能會增長到高兩位數我們繼續看到新產品的發展勢頭。而且，七月中旬對我們來說就像個位數左右，但隨著我們也進入第四季度，我們將進行比較——對我們來說更容易進行比較。因此，從比較的角度來看，我們應該看到它也有一點增長。但我們將繼續分享。我認為我們在第三季度初獲得的份額比第二季度更多。

Okay. And with respect to the mix shift, is that something that you deem to be more of a base that we should reflect permanently in our earnings forecast? Or is this more of a transient thing, and next year, that mix might come back a little bit? Or have to lap that in Q1 and Q2 kind of thing, and we should build our earnings off this new guidance provided.

好的。關於混合轉變，您是否認為這更像是我們應該在盈利預測中永久反映的基礎？或者這只是一個短暫的事情，明年，這種混合可能會回來一點？或者必須在第一季度和第二季度進行這樣的事情，我們應該根據提供的新指導來建立我們的收益。

Look, look, it's not -- I think it's not structural. I think it's going to come back. It's just -- it's a risk-off type environment where people have to make a decision to buy something, they're going to buy the thing that probably is the least risk for them and also looking at potentially margin impact in terms of what the end use would be or the end selling price. So there's -- in our case, you got to remember that we sell T-shirts and we sell the distributors, they sent to a printer, who sells them to somebody else, and they go down. So the average shirt that we sell for [250], ends up at $25, right? So it's going down the pipeline. So people are looking not to be stuck with inventory.

看，看，這不是——我認為這不是結構性的。我想它會回來的。只是——這是一個避險類型的環境，人們必須做出購買東西的決定，他們會購買對他們來說可能風險最小的東西，並考慮潛在的利潤影響最終用途是或最終售價。所以，在我們的例子中，你必須記住，我們銷售 T 卹，我們銷售分銷商，他們將其發送給印刷商，印刷商將其出售給其他人，然後它們就會下跌。那麼，我們以 [250] 的平均售價出售的襯衫最終售價為 25 美元，對吧？所以它正在醞釀之中。因此，人們希望不要被庫存所困。

It could be a souvenir stuff, for example, where they had tank tops or pockets or long sleeves or hoodies, for example. So they don't want to take that risk. So they're taking the risk off themselves in terms of their purchase habits today because of the macro environment. So -- but that's all going to work itself out. I think that that's part of what we're seeing. I think it's all driven by really the uncertainty in the environment. And ultimately, I think people will revert back to normal behavior as we see things subside.

例如，它可以是一件紀念品，比如有背心、口袋、長袖或連帽衫。所以他們不想冒這個風險。因此，由於宏觀環境的原因，他們現在正在規避購買習慣方面的風險。所以——但這一切都會自行解決。我認為這就是我們所看到的一部分。我認為這一切都是由環境的不確定性驅動的。最終，我認為當我們看到事情消退時，人們將恢復正常行為。

Your next question comes from the line of Brian Morrison of CE Securities.

您的下一個問題來自 CE 證券公司的布萊恩·莫里森 (Brian Morrison)。

Question for Glenn or for Chuck, the dichotomy here of your market share gains relative to the decline of low double digits for the industry. How is the channel inventory looking for both your products and maybe the industry in general, is there more destock that has to take place? Or are we now in a pretty lean position?

格倫或查克的問題是，市場份額的增長與行業低兩位數的下降之間的二分法。您的產品以及整個行業的渠道庫存情況如何，是否需要進行更多的去庫存？或者說我們現在處於相當不利的境地？

Well, look, look, the inventory at the end of Q2 was flat to Q1. It was slightly higher than we anticipated. And we believe there will be some destock in the back half of the year in our plan.

嗯，你看，你看，第二季度末的庫存與第一季度持平。它比我們的預期略高。我們相信我們的計劃將在下半年進行一些去庫存。

Okay. And then I guess 2 small questions. The sub-10% SG&A margin, is this achievable on an annual basis? And if so, is that sustainable? And then, Rhod, maybe free cash flow, what's your working capital assumption with your free cash flow guidance? Will this be positive for the year?

好的。然後我猜有兩個小問題。 SG&A 利潤率低於 10%，每年可以實現嗎？如果是這樣，這種情況可持續嗎？然後，羅德，也許是自由現金流，您的營運資本假設和自由現金流指導是什麼？這對今年來說會是積極的嗎？

Yes. I mean, look, if you look at SG&A, right now -- out there, we have a target of around 10%. We did 10% last year. This year, effectively, it's going to be around that level, right, as we finish the year. This quarter, we did 9%. And as we go forward, I mean we're going to try and drive those levels. But I think given what's going on from an overall sales perspective, you get a bit of a deleverage. But I would say, longer-term, we really are trying to drive down below that 10% level, Brian, when you think about SG&A. And we think we can do that. We think as we continue to grow and given what our business model is, we can get operating leverage off SG&A, and that's a real competitive advantage for us. So again, we're very focused on it, and we see it as an area that we can manage well as we go forward. .

是的。我的意思是，如果你看看 SG&A，現在我們的目標是 10% 左右。去年我們做了10%。今年，實際上，當我們年底的時候，它將會達到這個水平，對吧。本季度，我們做到了 9%。當我們前進時，我的意思是我們將嘗試推動這些水平。但我認為，從整體銷售的角度來看，你會得到一些去槓桿化的結果。但我想說，從長遠來看，布萊恩，當你考慮 SG&A 時，我們確實正在努力將其降至 10% 以下。我們認為我們可以做到這一點。我們認為，隨著我們的不斷發展，考慮到我們的業務模式，我們可以從銷售、管理和行政費用（SG&A）中獲得運營槓桿，這對我們來說是真正的競爭優勢。再說一次，我們非常關注它，我們認為這是一個我們在前進過程中可以很好管理的領域。 。

On the free cash flow for the full year, free cash flow, we're calling above $425 million. Effectively, if you look in the first quarter, we had negative free cash flow. We had good free cash flow in the second quarter, and we expect good cash flow in Q3 and Q4. If you look versus last year, we had inventory build going on. Now we do not have inventory build overall. We're -- or as we talked about earlier, our inventories are coming down, and that provides good support to free cash flow. So I would say we feel very good about our free cash flow. And that supports our competitive position in the market. We've got a strong balance sheet. And we're very pleased about it that we can return capital to shareholders. We had good return this past quarter, and we're planning for good return as we go forward with the announcement of the new 5% NCIB program.

關於全年的自由現金流，我們認為自由現金流超過 4.25 億美元。實際上，如果你看看第一季度，我們的自由現金流為負。第二季度我們有良好的自由現金流，我們預計第三季度和第四季度也有良好的現金流。如果你看看與去年相比，我們的庫存正在增加。現在我們總體上沒有庫存建設。我們——或者正如我們之前談到的，我們的庫存正在下降，這為自由現金流提供了良好的支持。所以我想說我們對我們的自由現金流感覺非常好。這支持了我們在市場上的競爭地位。我們擁有強大的資產負債表。我們很高興能夠將資本返還給股東。上個季度我們獲得了良好的回報，並且隨著我們宣布新的 5% NCIB 計劃，我們正計劃獲得良好的回報。

No, that's very helpful, Just the question, you have $325 million of negative working capital in the first half of the year. Where will that end up by year-end? Will that be flat, positive?

不，這很有幫助，只是問題，今年上半年您的營運資金為 3.25 億美元。到年底，這最終會走向何方？那會是平坦的、積極的嗎？

If you look at working capital, basically this quarter, we are around 45%, 46% of sales, right? If you look at it on a LTM basis. What we called out in prior calls and we're still focused on it, is effectively working capital at around 35% by the end of the year. So we'll drive that working capital basically to the, I would say, closer to our target level as we get to the end of the year. And so we do feel good about the way that's unfolding.

如果你看一下營運資金，基本上這個季度，我們大約佔銷售額的 45%、46%，對吧？如果你從 LTM 的角度來看的話。我們在之前的電話會議中指出，我們仍然關注這一點，那就是到今年年底，營運資金的有效利用率將達到 35% 左右。因此，到年底時，我們將把營運資金基本上推向更接近我們的目標水平。因此，我們確實對事情的進展感到滿意。

Your next question comes from the line of Martin Landry of Stifel.

您的下一個問題來自 Stifel 的 Martin Landry。

I just want to come back on the guidance revision. Your sales for the quarter came in ahead of expectations. Your point-of-sale trends were positive in Q2 in North America. So I'm wondering what's driving the -- what's changing in the outlook? Are things decelerating in July for you to revise your guidance lower? Anything would be helpful just to understand, given the positive trends you've seen lately?

我只想回到指導修訂上來。你們本季度的銷售額超出了預期。北美第二季度的銷售點趨勢呈積極趨勢。所以我想知道是什麼推動了前景的變化？ 7 月情況是否會放緩，導致您需要下調指導值？考慮到您最近看到的積極趨勢，有什麼有助於理解的嗎？

Yes. I mean, the simple way to think about it, Martin, overall, is it is the mix that's driving effectively the change in the outlook for the full year. So yes, we came in better than we anticipated for Q2. That was driven by volume. And as we talked about, the positive POS and activewear overall, flat POS in underwear and hosiery, which is improving now as we go into the back half. Glenn talked about the distributor inventory in the channel was flat, but it came in a bit higher than we anticipated. And that will reverse out as we go through the back half. But it's mix. Mix is the real driver ultimately of what's going on in the forecast. And if you look again for the full year, the full change in our outlook is driven by mix, and we'll see that in Q2, and we'll see it in Q3. We have -- the POS is actually performing well, as we've talked about, and we're driving market share gains in volume. If you look for year, it is exactly where we expected it to be.

是的。我的意思是，馬丁，總的來說，簡單的思考方式是，正是這種組合有效地推動了全年前景的變化。所以，是的，我們第二季度的表現比我們預期的要好。這是由數量驅動的。正如我們所討論的，整體上積極的 POS 和運動服，內衣和襪類的扁平 POS，隨著我們進入後半部分，現在正在改善。格倫談到渠道中的經銷商庫存持平，但比我們預期的要高一些。當我們進入後半段時，情況將會逆轉。但它是混合的。混合是預測中發生的事情的最終真正驅動力。如果你再次審視全年，我們前景的全面變化是由混合驅動的，我們將在第二季度看到這一點，我們將在第三季度看到這一點。正如我們所討論的，POS 實際上表現良好，並且我們正在推動市場份額的增長。如果你尋找年份，它正是我們所期望的。

So we feel very good about the business overall. But this shift in the marketplace that's going on to lower price point products, obviously, we're dealing with that. And the good news is we have the broader range to be able to deal with it, and we have the cost structure to be able to deal with it. So we are well-positioned as we move through the end of the year into 2024.

所以我們對整體業務感覺非常好。但顯然，市場正在向低價產品轉變，我們正在應對這一問題。好消息是我們有更廣泛的範圍來應對它，並且我們有足夠的成本結構來應對它。因此，在年底進入 2024 年之際，我們處於有利位置。

Okay. And then just a follow-up, just to better understand that mix shift. Is it happening across all your end markets? Because you do have end markets that have very different dynamics. You have some that are more recession resistant and more -- some that are more cyclical. Just trying to understand a little bit, is this across the board or in certain end markets?

好的。然後只是一個後續行動，只是為了更好地理解這種混合轉變。您的所有終端市場都發生這種情況嗎？因為終端市場確實具有非常不同的動態。有一些更能抵抗經濟衰退，還有一些更具週期性。只是想了解一下，這是全面的還是在某些終端市場？

Martin, I would say it was across the board. It's pretty consistent across the markets and categories.

馬丁，我想說這是全面的。各個市場和類別的情況都非常一致。

(Operator Instructions) Your next question comes from the line of Chris Li of [Desjardins].

（操作員說明） 您的下一個問題來自 [Desjardins] 的 Chris Li。

Maybe just one question left from me. I know it might be a difficult one to answer, but I'm just curious to see how confident you are that the cut is sort of -- that's it, like what sort of risk that can cause guidance to revise further lower in the back half? Just wanted to see where -- how confident are you in terms of what's on the revised guidance.

也許我只剩下一個問題了。我知道這可能是一個很難回答的問題，但我只是好奇地想知道你對這次削減有多大信心——就是這樣，比如什麼樣的風險會導致指引進一步下調一半？只是想看看您對修訂後的指南的內容有多大信心。

Okay. Chris, thanks for the question. If you look overall, effectively, as we said, we've given you a range for the full year. If you go to the midpoint of the range, we -- when we see the mix changes that are occurring, effectively, that drives us to the midpoint of the range. And then if you go to the low end, there's -- obviously, what we've effectively done is reflected macro uncertainty. Actually, even a little bit of that is in the -- probably in the midpoint. So we really do feel that we've derisked the back half with our forecast. What we tried to do is give you what we think is a very good baseline for the overall environment, the shifts that we're seeing on -- with respect to the consumer, how they are effectively trading down, and we factored in some, as we said, macro uncertainty because we know the environment is tough to forecast.

好的。克里斯，謝謝你的提問。如果你從整體上看，正如我們所說，我們已經為你提供了全年的範圍。如果你走到範圍的中點，當我們看到正在發生的混合變化時，有效地推動我們到達範圍的中點。然後，如果你走到低端，顯然，我們所做的有效工作反映了宏觀不確定性。事實上，即使是其中的一點點，也可能是在中間。所以我們確實覺得我們的預測已經消除了後半段的風險。我們試圖做的是為您提供我們認為整體環境非常好的基線，我們所看到的變化——關於消費者，他們如何有效地進行降級消費，我們考慮了一些因素，正如我們所說，宏觀不確定性是因為我們知道環境很難預測。

It's tough to know exactly what inventory levels people are going to carry especially as the year unfolds. So I would say we feel like we really have derisked the forecast for the full year, and we feel good about delivering. Actually, we feel good about performing against it. And as we said, as we come out of the back end of the year, we feel we're very well set up for 2024.

很難確切地知道人們將持有多少庫存水平，尤其是隨著時間的推移。所以我想說，我們覺得我們確實已經消除了全年預測的風險，並且我們對交付感到滿意。事實上，我們對與它對抗的表現感覺很好。正如我們所說，當我們結束今年年底時，我們覺得我們已經為 2024 年做好了充分的準備。

Your next question comes from the line of Paul Lejuez of Citi.

你的下一個問題來自花旗銀行的 Paul Lejuez。

This is Brandon Cheatham for Paul. I just wanted to see if you could give us a little more details on the underwear business you've gained. And as it relates to the Bangladesh facility opening early next year, are you having any other conversations with potential customers to try and utilize that capacity that's going to come online?

我是保羅的布蘭登·奇塔姆。我只是想看看您能否向我們提供有關您所獲得的內衣業務的更多詳細信息。由於這與明年初開業的孟加拉國工廠有關，您是否與潛在客戶進行了任何其他對話，以嘗試利用即將上線的產能？

Well, I'll answer that on. Look, the underwear programs have been rolled out a little behind schedule, I would say, in terms of actually -- not from our perspective, but just when -- how long it took for us to get the floor set that our retail partners, but they're doing very well. We're continuing to get new opportunities as we move forward. Look, Bangladesh for us is a key part of our whole strategy. I mean, look at the plant is starting this quarter. It's going to be ramped up to about 25% of its full capacity by the end of this year, which is factored into all of our working capital assumptions, our inventory levels, et cetera. And at the same time, it's going to really give us the ability to strengthen our cost structure and really go after gaining share not just in our underwear categories, but also in the fashion basics as well as our international markets.

好吧，我會回答這個問題。聽著，內衣項目的推出有點落後於計劃，我想說的是，實際上——不是從我們的角度來看，而是從什麼時候——我們花了多長時間才得到我們的零售合作夥伴的支持，但他們做得很好。隨著我們的前進，我們將繼續獲得新的機會。看，孟加拉國對我們來說是我們整個戰略的關鍵部分。我的意思是，看看這個工廠將於本季度啟動。到今年年底，該產能將提升至其全部產能的 25% 左右，這已納入我們所有的營運資本假設、庫存水平等因素中。與此同時，這將真正讓我們有能力加強我們的成本結構，並真正追求不僅在我們的內衣類別，而且在時尚基礎品以及我們的國際市場上獲得份額。

So it's really going to be something I think that's going to be very important in terms of the overall manufacturing cost structure for Gildan as we move into 2024 and 2025. So it's going to give us room to go after new programs. We actually have a stream of programs we're looking at as we move into '24. And a lot of these types of programs will be supported by as we ramp up Bangladesh.

因此，我認為，隨著我們進入 2024 年和 2025 年，這對於 Gildan 的整體製造成本結構來說確實非常重要。因此，這將為我們提供追求新項目的空間。實際上，當我們進入 24 世紀時，我們正在考慮一系列計劃。隨著我們加強孟加拉國的建設，許多此類計劃將得到支持。

Got it. And how do things shift around as that comes online? Do you shift your underwear business over there kind of wholesale? Or is it really piecemeal depending on how these conversations go?

知道了。當它上線時，事情會發生怎樣的變化？你們會把內衣業務轉移到那裡進行批發嗎？或者這真的是零碎的，取決於這些對話的進展情況嗎？

Well, we already make a lot of our underwear in Bangladesh today because we still have other operations there. So underwear is being made in that hemisphere today as well as a lot of our fashion shirts. So all of our incremental fashion, basics, underwear, all of our growth will be supported really by the development of Bangladesh as we move into the future.

嗯，今天我們已經在孟加拉國生產了很多內衣，因為我們在那裡還有其他業務。因此，今天的內衣以及我們的許多時尚襯衫都是在那個半球生產的。因此，當我們邁向未來時，我們所有增量時尚、基本款、內衣以及我們所有的增長都將得到孟加拉國的發展的真正支持。

Got it. And one more, if I can. With the shift away from fashion more towards basics, are you able to shift what you're manufacturing to kind of meet that demand? Like how quickly can you change things so that you don't get over-inventoried in a category that isn't selling through as well as you had hoped?

知道了。如果可以的話，再來一張。隨著從時尚轉向基礎款，您是否能夠改變您正在製造的產品來滿足這種需求？比如，你能多快改變一些事情，這樣你就不會在銷售不如你希望的類別中庫存過多？

Well, our cycle time is 5 weeks, so it doesn't take very long. I mean we've already adjusted all of our manufacturing. All of the products in which we manufacture if it's a T-shirt, the fashion shirt, the basic shirt, they're all made on the same machine. So we can adjust our equipment. And in the case of our fleece where we make a hood or a crew. It's all made in the same factories. There's just less operations to make a crew than the hood.

嗯，我們的周期時間是 5 週，所以不會花很長時間。我的意思是我們已經調整了所有的製造。我們生產的所有產品，無論是 T 卹、時尚襯衫、基本款襯衫，都是在同一台機器上生產的。這樣我們就可以調整我們的裝備了。就我們的羊毛而言，我們製作了兜帽或船員。都是在同一家工廠生產的。組建船員的操作比引擎蓋少。

(inaudible) it's a little more difficult to go from making more hoods than crews because it takes more labor to make this bigger hooded sweatshirt, it's a lot easier going to make more crews to be perfectly honest with you. But we have lots of flexibility in our manufacturing. Our cycle times are relatively short. We've adjusted our manufacturing to reflect all of these types of changes on a daily basis as we get POS from our customers and it goes to our planning groups. Our planning groups make the adjustment. And our manufacturing groups respond to whatever is being sold in the market. So none of that is really an issue for us. And as we've said before, look, we're well-positioned. We have good visibility despite the fact that we've seen some of these mix changes, we're going to be driving at the high end of our operating margins as we move into Q4 with our cotton position, and we've got a good visibility on our cost structure as we move into '24 even with this type of mix. So we're well-positioned and we're excited about as we go into the future.

（聽不清）製造更多的連帽衫比製造更多的連帽運動衫要困難一些，因為製造這件更大的連帽運動衫需要更多的勞動力，老實說，製造更多的連帽運動衫要容易得多。但我們的製造具有很大的靈活性。我們的周期時間相對較短。當我們從客戶那裡收到 POS 並將其發送給我們的規劃小組時，我們每天都會調整我們的製造，以反映所有這些類型的變化。我們的計劃小組進行了調整。我們的製造團隊會對市場上銷售的任何產品做出反應。所以這對我們來說都不是真正的問題。正如我們之前所說，看，我們處於有利位置。儘管我們已經看到了其中一些組合變化，但我們仍擁有良好的能見度，隨著我們的棉花頭寸進入第四季度，我們將在運營利潤率的高端保持領先地位，並且我們有良好的前景即使採用這種類型的組合，當我們進入24 世紀時，我們的成本結構仍然可見。因此，我們處於有利位置，並且對未來感到興奮。

There are no further questions at this time, Ms. Jessy I turn the call over back to you.

Jessy 女士，目前沒有其他問題，我會將電話轉回給您。

Okay. Once again, we'd like to thank everyone for joining us this morning, and we look forward to speaking to you soon. Have a great day.

好的。我們再次感謝大家今天早上加入我們，我們期待很快與您交談。祝你有美好的一天。

This concludes today's conference call. You may now disconnect.

今天的電話會議到此結束。您現在可以斷開連接。