Hillman Solutions Corp (HLMN) 2022 Q3 法說會逐字稿

Good morning, and welcome to the Third Quarter 2022 Results Presentation for Hillman Solutions Corp. My name is Therese, and I'll be your conference call operator today. Before we begin, I'd like to remind our listeners that today's presentation is being recorded and simultaneously webcast. The company's earnings release, presentation and 10-Q were issued this morning. These documents and a replay of today's presentation can be accessed on Helman's Investor Relations website at ir.hillmangroup.com. I would now like to turn the call over to Michael Koehler with Helman.

早上好，歡迎來到 Hillman Solutions Corp. 2022 年第三季度業績發布會。我叫 Therese，今天我將擔任你們的電話會議接線員。在我們開始之前，我想提醒我們的聽眾，今天的演講正在錄製中並同步進行網絡直播。公司的收益發布、介紹和 10-Q 於今天上午發布。這些文件和今天演示文稿的重播可在 Helman 的投資者關係網站 ir.hillmangroup.com 上訪問。我現在想把電話轉給 Michael Koehler 和 Helman。

Thank you, operator. Good morning, everyone, and thank you for joining us. I'm Michael Koehler, Vice President of Investor Relations and Treasury. Joining me on today's call are Doug Cahill, our Chairman, President and Chief Executive Officer; and Rocky Kraft, our Chief Financial Officer. We will begin today's call with a business update and quarterly highlights from Doug, followed by a financial review from Rocky.

謝謝你，運營商。大家早上好，感謝您加入我們。我是投資者關係和財政部副總裁 Michael Koehler。和我一起參加今天電話會議的還有我們的董事長、總裁兼首席執行官 Doug Cahill；和我們的首席財務官 Rocky Kraft。今天的電話會議將從 Doug 的業務更新和季度亮點開始，隨後是 Rocky 的財務回顧。

Before we begin, I'd like to remind our audience that certain statements made on today's call may be considered forward-looking and are subject to the safe harbor provisions of applicable securities laws. These forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties, assumptions and other factors, many of which are beyond the company's control and may cause actual results to differ materially from those projected in such statements.

在我們開始之前，我想提醒我們的聽眾，在今天的電話會議上發表的某些聲明可能被認為是前瞻性的，並受適用證券法安全港條款的約束。這些前瞻性陳述不是對未來業績的保證，並受某些風險、不確定性、假設和其他因素的影響，其中許多因素超出了公司的控制範圍，可能導致實際結果與此類陳述中預測的結果存在重大差異。

Some of the factors that could influence our results are contained in our periodic and annual reports filed with the SEC. For more information regarding these risks and uncertainties, please see Slide 2 in our earnings call slide presentation, which is available on our website at ir.hillengroup.com. In addition, on today's call, we will refer to certain non-GAAP financial measures. Information regarding our use of and reconciliations of these measures to our GAAP results are available in our earnings call slide presentation. With that, it's my pleasure to turn the call over to our Chairman, President and CEO, Doug Cahill. Doug?

一些可能影響我們結果的因素包含在我們向美國證券交易委員會提交的定期和年度報告中。有關這些風險和不確定性的更多信息，請參閱我們的收益電話幻燈片演示文稿中的幻燈片 2，該幻燈片可在我們的網站 ir.hillengroup.com 上獲取。此外，在今天的電話會議上，我們將參考某些非 GAAP 財務指標。有關我們使用這些措施以及將這些措施與我們的 GAAP 結果進行核對的信息，請參閱我們的收益電話幻燈片演示文稿。因此，我很高興將電話轉交給我們的董事長、總裁兼首席執行官 Doug Cahill。道格？

Thanks, Michael, and good morning, everyone. Today, I'm going to provide an overview of our healthy third quarter and discuss the current operating environment before I turn it over to Rocky to give an update on guidance and talk numbers. For those of you who are new to our story, Hillman is one of the largest providers of hardware products and value-added solutions at leading hardware and home improvement retailers across North America.

謝謝，邁克爾，大家早上好。今天，我將概述我們健康的第三季度，並討論當前的運營環境，然後再交給 Rocky 提供最新的指導和談話數字。對於那些不了解我們故事的人，Hillman 是北美領先的硬件和家居裝飾零售商中最大的硬件產品和增值解決方案供應商之一。

Our unique approach to innovative design, sourcing direct-to-store delivery and in-store merchandising sets us apart from our competition. This strategy has allowed us to win with our customers since our founding in 1964. We are constantly innovating our products, the majority of which are used for repair, remodel and maintenance projects, which for 58 years, has provided insulation against cyclical downturns in new home and commercial construction markets.

我們獨特的創新設計方法、採購直接到店交付和店內銷售使我們在競爭中脫穎而出。自 1964 年成立以來，這一戰略使我們贏得了客戶。我們不斷創新我們的產品，其中大部分用於維修、改造和維護項目，58 年來，這些產品為新的周期性低迷提供了絕緣家庭和商業建築市場。

Our products are in must-have basket-building high-margin categories for our retail customers. Therefore, keeping products and stock also known as fill rates is critical to the success of our customers in Hillman. Our in-store presence and direct-to-store delivery not only keep the shelf stock but also provides our customers solutions to today's challenging labor markets and certainly the unpredictable supply chains. And finally, we work closely with many of our customers on category management to optimize product mix, allowing them to increase sales and profits yet another advantage of partnering with Hillman.

我們的產品屬於零售客戶必備的購物籃高利潤類別。因此，保持產品和庫存（也稱為填充率）對於 Hillman 客戶的成功至關重要。我們的店內服務和直接到店送貨不僅保持貨架庫存，而且還為我們的客戶提供解決方案，以應對當今充滿挑戰的勞動力市場，當然還有不可預測的供應鏈。最後，我們與許多客戶在類別管理方面密切合作，以優化產品組合，使他們能夠增加銷售額和利潤，這是與 Hillman 合作的另一個優勢。

This differentiated model executed by our hard-working team at Hillman strengthened our competitive moat and drove strong results and results for the quarter. Our 1,100-member sales and service team is critical to our competitive moat and is one of the driving factors as to why we win. For example, during the quarter, we won new business in several categories, including picture hanging builders' hardware, deck crews and solid wall anchors like our new patented concrete screw that are selling very well.

我們在 Hillman 的辛勤工作團隊執行的這種差異化模式加強了我們的競爭優勢，並推動了本季度的強勁業績。我們擁有 1,100 名成員的銷售和服務團隊對我們的競爭護城河至關重要，也是我們獲勝的驅動因素之一。例如，在本季度，我們在幾個類別中贏得了新業務，包括掛畫建築五金、甲板工作人員和實心牆錨，例如我們的新型專利混凝土螺釘，銷售情況非常好。

We grew quarterly sales by 3.9%, adjusted EBITDA by 4.3% over the prior year. We were also awarded Vendor of the Year at the largest family-owned chain in the country, Castello in Long Island, New York, a great retail partner of ours. We also completed the execution of our fourth price increase, enabling us to offset $225 million in total cost increases on a dollar-for-dollar basis since the beginning of 2021. And we saw a $40 million decrease in inventory during the quarter while maintaining fill rates at 96%, with plans to continue to significantly reduce inventory over the coming quarters.

我們的季度銷售額增長了 3.9%，調整後的 EBITDA 比上年增長了 4.3%。我們還獲得了美國最大的家族連鎖店 Castello 的年度供應商獎，該連鎖店位於紐約長島，是我們的重要零售合作夥伴。我們還完成了第四次提價的執行，使我們能夠抵消自 2021 年初以來 2.25 億美元的總成本增加。我們看到本季度的庫存減少了 4000 萬美元，同時保持了填充比率為 96%，併計劃在未來幾個季度繼續大幅減少庫存。

Now turning to our financial highlights for the quarter. During the third quarter of 2022, we generated $59 million of adjusted EBITDA, up from $56.5 million in the prior year quarter. Margins were in line with Street expectations as we finalized a $50 million price increase we talked about on last quarter's call. Our dedicated sales and service team finished applying over 80 million new price labels at our traditional local hardware stores near the end of the quarter. Net sales for the quarter grew to $379 million, marking a 3.9% increase over the third quarter of 2021. For the year, net sales grew 5% to $1.14 billion. These improvements were driven by the implementation of price increases over the past year, which more than offset lighter volume.

現在轉向我們本季度的財務亮點。在 2022 年第三季度，我們產生了 5900 萬美元的調整後 EBITDA，高於去年同期的 5650 萬美元。利潤率符合華爾街的預期，因為我們最終確定了我們在上個季度的電話會議上談到的 5000 萬美元的價格上漲。接近本季度末，我們專業的銷售和服務團隊在傳統的本地五金店完成了超過 8000 萬個新價格標籤的應用。本季度淨銷售額增長至 3.79 億美元，比 2021 年第三季度增長 3.9%。全年淨銷售額增長 5% 至 11.4 億美元。這些改善是由過去一年的價格上漲推動的，這大大抵消了銷量下降的影響。

Now let me touch on performance of each business segment during the quarter. Hardware Solutions is our biggest business and makes up over 50% of our overall revenue. For the quarter, hardware saw an 11% increase in revenue compared to the third quarter of 2021. Price increases were the main driver of the top line increase, lighter volumes, which partially offset the price benefit were mainly the result of lighter foot traffic at our retailers when compared to a year ago quarter. We believe Hardware Solutions is the bellwether segment of our business.

現在讓我談談本季度每個業務部門的表現。硬件解決方案是我們最大的業務，占我們總收入的 50% 以上。本季度，硬件收入與 2021 年第三季度相比增長了 11%。價格上漲是收入增長的主要驅動力，銷量下降部分抵消了價格優勢，這主要是由於客流量減少所致與去年同期相比，我們的零售商。我們相信硬件解決方案是我們業務的領頭羊部分。

Let me share some numbers with you that will illustrate what's happening in this segment. While hardware volumes were down 3.3% for the first 6 months of 2022, we saw a comparative improvement during the third quarter of 2022, with volumes down just 1.7% for the quarter. Price was up 12.7% for a total revenue growth of 11%. This demonstrates the resiliency and consistency of the repair, remodel and maintenance end user. Year-to-date toll rates were 96%. This is an improvement from 91% during 2021 and 95% during 2020. Importantly, our retail partners trust Hillman to keep the shelf stock no matter the environment. Robotics and Digital Solutions, our RDS business makes up just shy of 20% of our overall revenue.

讓我與您分享一些數字，這些數字將說明該細分市場中正在發生的事情。雖然 2022 年前 6 個月的硬件銷量下降了 3.3%，但我們看到 2022 年第三季度的情況有所改善，該季度的銷量僅下降了 1.7%。總收入增長 11%，價格上漲 12.7%。這證明了維修、改造和維護最終用戶的彈性和一致性。年初至今的通行費率為 96%。這比 2021 年的 91% 和 2020 年的 95% 有所改善。重要的是，我們的零售合作夥伴相信 Hillman 無論環境如何都能保持貨架庫存。機器人和數字解決方案，我們的 RDS 業務僅占我們總收入的 20%。

During the quarter, lighter foot traffic in our retail customers resulted in a 3% decline in RDS revenue. engraving and auto key duplication were lighter than last year as pad adoptions slowed and used car sales decreased when compared to the third quarter of 2021. Also, as retailers continue to struggle with in-store labor, we're seeing a shift in home and office key duplication from our manual full-serve machines to our Minute key self-serve kiosks. This shift improves Hillman's and our retailers' profitability. Overall gross margin and adjusted EBITDA margins for RDS remained healthy and our market share is strong. We had a very productive quarter working with our major key duplication and engraving customers jointly developing our next-generation machines for our RDS business. 2 new engraving machines and our new smart auto duplication machine are being developed for and with our retail partners.

本季度，我們零售客戶的客流量減少導致 RDS 收入下降 3%。與 2021 年第三季度相比，由於平板電腦採用速度放緩且二手車銷量下降，雕刻和汽車鑰匙複製比去年少。此外，隨著零售商繼續與店內勞動力作鬥爭，我們看到家庭和從我們的手動全服務機器到我們的 Minute 鑰匙自助服務亭的辦公室鑰匙複製。這種轉變提高了希爾曼和我們零售商的盈利能力。 RDS 的整體毛利率和調整後的 EBITDA 利潤率保持健康，我們的市場份額很大。我們有一個非常富有成效的季度與我們的主要關鍵複製和雕刻客戶合作，共同為我們的 RDS 業務開發我們的下一代機器。正在為我們的零售合作夥伴開發 2 台新雕刻機和我們新的智能自動複製機。

The feedback and interest level has been excellent. Our 2 new engraving machines will be introduced throughout 2023, and our smart ATO5 duplication machines will be ready for the market in early 2024 on our next-generation MinuteKey self-serve kiosks. Our engineering team has just done an amazing job on this new technology and our retail partners were able to see it with their own eyes in our Tempe manufacturing and engineering facility this quarter.

反饋和興趣水平非常好。我們的 2 台新雕刻機將在 2023 年推出，我們的智能 ATO5 複印機將於 2024 年初在我們的下一代 MinuteKey 自助服務亭上投放市場。我們的工程團隊剛剛在這項新技術上取得了驚人的成就，本季度我們的零售合作夥伴能夠在我們的坦佩製造和工程設施中親眼看到它。

Regarding our nice sharpening machine reship, we'll end the year with around 1,000 machines of select ACE hardware locations across the country. And during Q1 2023, we'll test our one-of-a-kind nice sharpening machine in new channels, including specialty retailers, food service and restaurant supply, outdoor sporting and recreation retailers and a leading Canadian retailer. Our Protective Solutions business makes up just shy of 20% of our overall revenue. During the third quarter of 2022, protective revenue was down about 15% compared to the year ago quarter. However, when excluding COVID-related PPE sales from both periods, Protective revenues increased just over 5%, which is more in line with the growth expectations of this segment.

關於我們漂亮的磨刀機重新發貨，我們將在今年年底在全國范圍內擁有大約 1,000 台精選 ACE 硬件位置的機器。在 2023 年第一季度，我們將在新渠道測試我們獨一無二的優質磨刀機，包括專業零售商、食品服務和餐廳供應、戶外運動和娛樂零售商以及一家領先的加拿大零售商。我們的防護解決方案業務僅占我們總收入的 20%。 2022 年第三季度，保護性收入與去年同期相比下降了約 15%。然而，如果將兩個時期與 COVID 相關的 PPE 銷售排除在外，防護收入增長略高於 5%，這更符合該細分市場的增長預期。

Lastly, our Canadian segment, which makes up about 10% of our overall revenue built on strong momentum it has seen throughout the year. Canada posted a 16% top line increase, which drove strong bottom line results as well. Our Canadian team is just doing a great job, and they've also done an excellent job with the facility consolidation project and realigning their portfolio.

最後，我們的加拿大分部占我們總收入的 10% 左右，建立在全年強勁勢頭的基礎上。加拿大公佈了 16% 的收入增長，這也推動了強勁的利潤結果。我們的加拿大團隊做得很好，他們在設施整合項目和重新調整他們的投資組合方面也做得很好。

Now turning to our business model. We know the consumer is being impacted by inflation and higher interest rates. However, our long track record of growth through up and down cycles gives us confidence that we can achieve strong results no matter the economic environment. This is due to the competitive moat we've built and our estimate that over 90% of our product sales are into the relatively recession-resistant repair, remodel and maintenance market.

現在轉向我們的商業模式。我們知道消費者正受到通貨膨脹和更高利率的影響。然而，我們在上下週期的長期增長記錄讓我們相信，無論經濟環境如何，我們都能取得強勁的業績。這是由於我們建立了競爭性的護城河，而且我們估計我們 90% 以上的產品銷售都進入了相對抗衰退的維修、改造和維護市場。

Let's dig a little deeper on that notion. Housing inventory in the U.S. continues to age with 50% of U.S. homes over 40 years old, consumers will need to prepare and maintain these homes. Additionally, we expect to see the consumer invest in their homes, more as trends in nesting, aging in place, working from home and outdoor living remain prominent. One recent data point on aging in place from the United Disability Services states that only 1% of homes in the United States are conducive to aging in place, but more than 75% of Americans want to stay in their homes as long as possible. Our retail partners are proactively preparing to take advantage of this future demand opportunity.

讓我們更深入地研究一下這個概念。美國的房屋庫存繼續老化，50% 的美國房屋超過 40 年，消費者將需要準備和維護這些房屋。此外，隨著築巢、就地養老、在家工作和戶外生活的趨勢依然突出，我們預計會看到消費者更多地投資於他們的房屋。 United Disability Services 最近一份關於就地養老的數據指出，美國祇有 1% 的家庭有利於就地養老，但超過 75% 的美國人希望盡可能長時間地呆在家裡。我們的零售合作夥伴正在積極準備利用這一未來的需求機會。

As we think about our product sales, pickup truck Pros, local contractors and Diwires make up the vast majority of our end users. Our long history and channel strategy proved that our business is not tied to new home construction. Further driving our confidence is our unique business model, which helps differentiate us amongst the competition. Our mode consists of 3 main components: number one, over 80% of our 112,000 SKUs are delivered directly to the retailers location. In general, this means our customers do not have to worry about managing Helman inventory in their distribution centers because we ship directly to the stores.

當我們考慮我們的產品銷售時，皮卡車專業人士、當地承包商和 Diwires 構成了我們最終用戶的絕大多數。我們悠久的歷史和渠道戰略證明，我們的業務與新房建設無關。我們獨特的商業模式進一步推動了我們的信心，這有助於我們在競爭中脫穎而出。我們的模式包括 3 個主要部分：第一，我們 112,000 個 SKU 中超過 80% 直接交付到零售商所在地。一般來說，這意味著我們的客戶不必擔心在他們的配送中心管理 Helman 庫存，因為我們直接運送到商店。

Number 2, our sales and service team consisting of 1,100 associates provides world-class service at the shelf for our retail customers. This team of warriors has served that Hillman's must have high-margin products are in stock organized and optimized for our customers and their consumers. And number 3, over 90% of our revenue comes from brands that we own. This is not only important to the consumer and the Pro. It allows us to tailor our products to specific retailer strategies. At the end of the quarter, we finalized our fourth price increase since the beginning of 2021. All of these have been dollar for dollar increases to cover our cost. In total, we've implemented approximately $225 million in price increases, which breaks down to approximately $120 million in transportation and shipping, $90 million in commodities and $15 million in labor.

第二，我們的銷售和服務團隊由 1,100 名員工組成，為我們的零售客戶提供世界一流的貨架服務。這支戰士團隊服務於 Hillman's 必須為我們的客戶和他們的消費者組織和優化高利潤產品的庫存。第三，我們 90% 以上的收入來自我們擁有的品牌。這不僅對消費者和專業人士很重要。它使我們能夠根據特定的零售商策略定制我們的產品。在本季度末，我們完成了自 2021 年初以來的第四次提價。所有這些都是逐美元上漲以支付我們的成本。總的來說，我們已經實施了大約 2.25 億美元的價格上漲，其中包括大約 1.2 億美元的運輸和航運、9000 萬美元的商品和 1500 萬美元的勞動力。

During the great financial crisis and other past recessions, we've seen commodity prices fall, which we've begun to see during the recent months. We expect margin expansion once these costs flow through our income statement beginning in the second quarter of 2023 and beyond. Back in 2001, many remember lead times increased as the supply chain tightened. As such, we made the strategic decision to invest in our inventory to protect fill rates.

在金融危機和過去的其他經濟衰退期間，我們看到大宗商品價格下跌，最近幾個月我們已經開始看到這種情況。一旦這些成本從 2023 年第二季度及以後開始流經我們的損益表，我們預計利潤率將擴大。早在 2001 年，許多人都記得隨著供應鏈收緊，交貨時間增加了。因此，我們做出了投資庫存以保護填充率的戰略決策。

While improved from the end of the second quarter of 2022, we ended the third quarter of 2022 with about $140 million more inventory than we would normally need in this environment. This investment paid off and we were able to deliver 96% fill rate so far this year. Hillman was built on taking care of our customers, which is core to our moat, and we're proud to say that we have lived up to these expectations through some very challenging times. We know retailers have long memories, and we believe this investment will result in new business wins in the future.

雖然與 2022 年第二季度末相比有所改善，但我們在 2022 年第三季度末的庫存比我們在這種環境下通常需要的庫存多出約 1.4 億美元。這項投資得到了回報，今年到目前為止，我們能夠提供 96% 的填充率。 Hillman 建立在照顧客戶的基礎上，這是我們護城河的核心，我們可以自豪地說，我們在一些非常具有挑戰性的時期沒有辜負這些期望。我們知道零售商有很長的記憶力，我們相信這項投資將在未來帶來新的業務勝利。

Over the past several months, we've seen lead times from Asia settle around 160 days, which is vastly improved from the 250-plus day lead time the industry experienced in January of this year. The result is that we have started to bring down our inventory levels, and we're beginning to delever our balance sheet as we turn the inventory to cash with no impact to our industry-leading fill rates. Sequentially, our inventory decreased by $40 million compared to Q2, and we expect to bring inventory down another $25 million to $35 million by year-end. As we look to '23, we believe there will be further improve our inventory position, which will put us at a more normalized inventory level by the end of 2023. As such, we will bring down working capital and benefit from lower costs, which will result in delevering our balance sheet.

在過去的幾個月裡，我們看到亞洲的交貨時間穩定在 160 天左右，與今年 1 月該行業經歷的 250 多天的交貨時間相比有了很大改善。結果是我們已經開始降低我們的庫存水平，並且我們開始去槓桿化我們的資產負債表，因為我們將庫存轉化為現金，而不會影響我們行業領先的填充率。因此，與第二季度相比，我們的庫存減少了 4000 萬美元，我們預計到年底庫存將再減少 2500 萬美元至 3500 萬美元。展望 23 年，我們相信我們的庫存狀況將進一步改善，這將使我們在 2023 年底之前處於更加正常的庫存水平。因此，我們將降低營運資金並受益於成本降低，這將導致我們的資產負債表去槓桿化。

As we look to the fourth quarter, we continue to expect that our adjusted EBITDA will fall towards the low end of our original guidance range and to pay debt down as we bring inventory down. However, softer volumes and the traffic at retailers during the quarter have impacted our top line and cash flow timing, which Rocky will get into momentarily. That said, our focus remains on successfully navigating this challenging environment and really setting the stage for Hillman to improve our performance during 2023.

展望第四季度，我們繼續預計調整後的 EBITDA 將降至我們最初指導範圍的低端，並在我們降低庫存時償還債務。然而，本季度零售商的銷量和客流量下降影響了我們的收入和現金流時間，Rocky 將立即進入。也就是說，我們的重點仍然是成功駕馭這個充滿挑戰的環境，並真正為希爾曼在 2023 年改善我們的業績奠定基礎。

The $225 million of implemented price increases provide an opportunity for future gross margin and adjusted EBITDA expansion. We expect this will begin to read sometime during the second quarter of 2023 as we sell through our higher cost inventory and start to see lower costs flow through our P&L. It goes without saying, we have a special team of 1,100 loyal, hard-working associates that are in our customers' retail locations every day. The resilience of this team truly shines on a terrible natural disaster like Hurricane Ian hits.

已實施的 2.25 億美元價格上漲為未來毛利率和調整後的 EBITDA 擴張提供了機會。我們預計這將在 2023 年第二季度的某個時候開始閱讀，因為我們通過較高成本的庫存進行銷售，並開始看到較低的成本流經我們的損益表。不用說，我們有一個由 1,100 名忠誠、勤奮的員工組成的特殊團隊，他們每天都在客戶的零售地點工作。這支球隊的韌性真正體現在像颶風伊恩襲擊這樣可怕的自然災害上。

Everyone at Hillman is immensely proud that our Florida-based team members have been working tirelessly to be sure our customers have the products in stock so their communities can be safe and begin the rebuilding process. Our thoughts are with those impacted by the hurricane, especially those who have been displaced. We are thankful to be in the position to help Florida rebuild. Looking forward, I'm confident that our talented team and hardworking associates have proven that we can successfully navigate any challenge that comes our way. I believe we are uniquely positioned for success and focused -- and our focus remains taking care of our customers.

Hillman 的每個人都非常自豪，因為我們位於佛羅里達州的團隊成員一直在不知疲倦地工作，以確保我們的客戶有庫存產品，以便他們的社區能夠安全並開始重建過程。我們與受颶風影響的人們同在，尤其是那些流離失所的人們。我們很高興能夠幫助佛羅里達重建。展望未來，我相信我們才華橫溢的團隊和勤奮工作的員工已經證明我們能夠成功應對遇到的任何挑戰。我相信我們在成功和專注方面處於獨特的位置——我們的重點仍然是照顧我們的客戶。

Our performance for our customers over the past couple of years has positioned us to drive real value for our shareholders and our employees in 2023 and beyond. With that, let me turn it over to Rocky.

我們在過去幾年為客戶提供的業績使我們能夠在 2023 年及以後為我們的股東和員工創造真正的價值。有了這個，讓我把它交給洛基。

Thanks, Doug, and good morning, everyone. Before I provide a quick summary of our third quarter results, I'll jump into our updated guidance for the remainder of 2022. Since our last earnings call in August, we have executed on additional price increases, maintained our leading fill rates and controlled costs. As such, we are narrowing our full year adjusted EBITDA guidance range to $207 million to $211 million, which is in line with our previous guidance. Relative to our expectations during the first half of the year, sales to our retail partners have been lower due to slightly lower foot traffic.

謝謝，道格，大家早上好。在我快速總結我們的第三季度業績之前，我將跳轉到我們對 2022 年剩餘時間的最新指導。自我們上次 8 月份的財報電話會議以來，我們執行了額外的價格上漲，保持了我們領先的填充率並控制了成本.因此，我們將全年調整後的 EBITDA 指導範圍縮小至 2.07 億美元至 2.11 億美元，這與我們之前的指導一致。相對於我們上半年的預期，由於客流量略有下降，我們零售合作夥伴的銷售額有所下降。

The effect of destocking for the quarter only impacted us by about $10 million, primarily in our PS business. Altogether, this will impact our net sales and the timing of our free cash flow for the remainder of the year. With this improved visibility, we are providing the following updates. We now anticipate that our full year 2022 net sales will come in between $1.46 billion and $1.5 billion. Last quarter, we told you that we would come in near the low end of the original range, which was $1.5 billion. We expect full year 2022 adjusted EBITDA to total between $207 million and $211 million.

本季度去庫存的影響僅對我們產生了約 1000 萬美元的影響，主要是在我們的 PS 業務中。總之，這將影響我們今年剩餘時間的淨銷售額和自由現金流的時間安排。隨著可見性的提高，我們將提供以下更新。我們現在預計 2022 年全年淨銷售額將在 14.6 億美元至 15 億美元之間。上個季度，我們告訴您我們將接近原始範圍的低端，即 15 億美元。我們預計 2022 年全年調整後的 EBITDA 總額將在 2.07 億美元至 2.11 億美元之間。

Last quarter, we told you adjusted EBITDA would come in at the low end of the original guidance, which was $207 million. So we are simply putting some numbers around the directional language we provided in August. And lastly, free cash flow is expected to come in between $755 million compared to our original guidance range. This is driven by the timing of inventory reductions resulting from softer sales. Note that this guidance range excludes any cash settlement relating to the HEICO litigation as the timing of that onetime payment is uncertain. Given the lighter cash flow numbers for the remainder of the year are primarily due to the timing of inventory reductions moving into the first quarter of next year, we expect to invest less into working capital during the first quarter of 2023 versus years past.

上個季度，我們告訴過您調整後的 EBITDA 將處於最初指導的低端，即 2.07 億美元。因此，我們只是簡單地圍繞我們在 8 月份提供的定向語言添加了一些數字。最後，與我們最初的指導範圍相比，自由現金流預計將在 7.55 億美元之間。這是由銷售疲軟導致庫存減少的時機推動的。請注意，該指導範圍不包括與 HEICO 訴訟相關的任何現金結算，因為一次性付款的時間不確定。鑑於今年剩餘時間的現金流量數字較低主要是由於庫存減少時間進入明年第一季度，我們預計 2023 年第一季度的營運資本投資將比往年減少。

This is noteworthy, considering the first quarter is typically when we take on debt in order to buy more inventory for our spring bill. For example, over the past 3 years, we increased working capital about $40 million during the first quarter. During the first quarter of 2023, we are confident that we will need less than half of that figure. Now let me spend a minute on the third quarter charge related to HEICO. After a trial in Marshall, Texas in October, a jury awarded HEICO a $16 million verdict in the form of a onetime royalty payment. We have included the verdict and related legal fees in our GAAP results. We have excluded the verdict from our free cash flow expectations as it is currently unclear the final amount or timing of any settlement. We will continue to defend and protect our intellectual property and patents in our RDS business and across the company. With that, let me turn to our financial results for the quarter and future outlook.

這是值得注意的，考慮到第一季度通常是我們舉債以便為我們的春季賬單購買更多庫存的時候。例如，在過去 3 年中，我們在第一季度增加了約 4000 萬美元的營運資金。在 2023 年第一季度，我們相信我們需要的數量將少於該數字的一半。現在讓我花一分鐘時間談談與 HEICO 有關的第三季度費用。 10 月在得克薩斯州馬歇爾進行審判後，陪審團裁定 HEICO 獲得 1600 萬美元的一次性特許權使用費。我們已將判決和相關法律費用包括在我們的 GAAP 結果中。我們已將該判決排除在我們的自由現金流預期之外，因為目前尚不清楚任何和解的最終金額或時間。我們將繼續捍衛和保護我們在 RDS 業務和整個公司的知識產權和專利。說到這裡，讓我談談我們本季度的財務業績和未來展望。

Net sales in the third quarter of 2022 increased 3.9% to $378.5 million versus the prior year quarter. Hardware Solutions was the main contributor to the increase, which was up 11% to $210.9 million. Overall, the improvement was driven by a 13% price realization, partially offset by a 2% decline in volume. RDS sales decreased by 3% to $65.6 million. Lighter foot traffic, less activity in pet engraving and fewer smart AutoFi duplications were the main drivers of the decline. Protective Solutions sales were down 15% or $10.5 million, resulting from lighter volume. Excluding COVID-related PPE sales, protective sales were up 5%. COVID-related sales for the quarter were $1.3 million compared to $15.1 million during Q3 of 2021.

2022 年第三季度的淨銷售額比上年同期增長 3.9% 至 3.785 億美元。硬件解決方案是增長的主要貢獻者，增長 11% 至 2.109 億美元。總體而言，這一改善是由 13% 的價格實現推動的，部分被銷量下降 2% 所抵消。 RDS 銷售額下降 3% 至 6560 萬美元。客流量減少、寵物雕刻活動減少以及智能 AutoFi 複製品減少是導致下降的主要原因。由於銷量下降，防護解決方案銷售額下降了 15% 或 1,050 萬美元。不包括與 COVID 相關的 PPE 銷售額，防護銷售額增長了 5%。本季度與 COVID 相關的銷售額為 130 萬美元，而 2021 年第三季度為 1510 萬美元。

For the fourth quarter of 2021, COVID-related PPE sales were $19.2 million, and we do not anticipate meaningful COVID PPE sales for the remainder of 2022. Our Canadian business had terrific performance in the quarter. Sales were up 16% to $41.1 million compared to the prior year, and we significantly improved profitability for the third quarter in a row. As we have seen throughout the year, price, operational improvements, product mix and exiting unprofitable business have driven nice profit improvement in Canada.

2021 年第四季度，與 COVID 相關的 PPE 銷售額為 1920 萬美元，我們預計在 2022 年剩餘時間內不會有有意義的 COVID PPE 銷售額。我們的加拿大業務在本季度表現出色。與去年同期相比，銷售額增長 16% 至 4110 萬美元，我們連續第三個季度顯著提高了盈利能力。正如我們全年看到的那樣，價格、運營改進、產品組合和退出無利可圖的業務推動了加拿大利潤的可觀改善。

On a GAAP basis, net loss for the third quarter of 2022 totaled $9.5 million or $0.05 per diluted share compared to a net loss of $32.5 million or $0.19 per diluted share in the prior-year quarter. I would like to point out that our GAAP results include the $16 million settlement and additional related legal expenses from the HEICO litigation.

根據 GAAP，2022 年第三季度的淨虧損總計 950 萬美元或攤薄後每股 0.05 美元，而去年同期淨虧損為 3250 萬美元或攤薄後每股 0.19 美元。我想指出的是，我們的 GAAP 業績包括 1600 萬美元的和解費以及來自 HEICO 訴訟的額外相關法律費用。

Adjusted earnings per diluted share for the third quarter of 2022 was $0.14 per share compared to $0.13 per diluted share in the prior year quarter. On an adjusted basis, third quarter adjusted gross profit margin declined by 60 basis points to 43.3% versus the prior year quarter. As we have discussed on prior calls, the primary driver of the margin pressure in our hardware and Protective businesses was driven by dollar-for-dollar price increases to offset inflation, partially offset by strong margin performance in RDS in Canada.

2022 年第三季度調整後的攤薄每股收益為每股 0.14 美元，而去年同期為每股攤薄收益 0.13 美元。在調整後的基礎上，第三季度調整後毛利率較上年同期下降 60 個基點至 43.3%。正如我們在之前的電話會議上所討論的那樣，我們硬件和保護業務利潤率壓力的主要驅動因素是美元對美元價格上漲以抵消通貨膨脹，部分被加拿大 RDS 強勁的利潤率表現所抵消。

On a sequential basis compared to the second quarter of 2022, adjusted margins compressed by 80 basis points due to the timing of the price increase in our traditional local hardware stores as inflation was not yet fully offset in this portion of the business and a pull forward of promotional activity in our PS business to the third quarter. We anticipate our fourth quarter gross margins to be consistent with the rates we experienced in Q2 of 2022. We -- for the quarter, GAAP SG&A totaled $133.2 million compared to $110.4 million for the prior year quarter, driven by legal expenses related to the HEICO litigation settlement.

與 2022 年第二季度相比，調整後的利潤率壓縮了 80 個基點，原因是我們傳統的本地五金店的價格上漲時間尚未完全抵消這部分業務的通貨膨脹和拉動我們 PS 業務的促銷活動到第三季度。我們預計我們第四季度的毛利率將與我們在 2022 年第二季度的毛利率保持一致。在與 HEICO 相關的法律費用的推動下，本季度 GAAP SG&A 總計 1.332 億美元，而去年同期為 1.104 億美元訴訟解決。

Adjusted SG&A was $104.4 million compared to $103.4 million in the prior year quarter. This analysis backs out stock compensation, acquisition and integration expenses, legal fees and restructuring costs, which we feel gives a better analysis of our base expenses. Adjusted SG&A as a percentage of sales fell to 27.6% from 28.4%. While fixed costs and inflation impacted SG&A as a percentage of sales, we did a nice job managing costs during the quarter. Adjusted EBITDA in the third quarter increased 4.3% to $59 million compared to $56.5 million in the year ago quarter. This is the first time since the second quarter of 2021 that we have beat prior year EBITDA. Similar to our adjusted gross margins, adjusted EBITDA was driven by a healthy mix of price cost, partially offset by lighter volumes, higher COGS and the timing of our final piece of our price increase. Further driving the increase was a lift from strong earnings from our Canadian business.

調整後的 SG&A 為 1.044 億美元，而去年同期為 1.034 億美元。該分析排除了股票補償、收購和整合費用、法律費用和重組費用，我們認為這可以更好地分析我們的基本費用。調整後的 SG&A 佔銷售額的百分比從 28.4% 降至 27.6%。雖然固定成本和通貨膨脹影響了 SG&A 佔銷售額的百分比，但我們在本季度的成本管理工作做得很好。第三季度調整後的 EBITDA 增長 4.3% 至 5900 萬美元，而去年同期為 5650 萬美元。這是自 2021 年第二季度以來我們首次超過上一年的 EBITDA。與我們調整後的毛利率類似，調整後的 EBITDA 受到價格成本健康組合的推動，部分被銷量減少、銷貨成本增加以及我們最後一次提價的時間所抵消。進一步推動增長的是來自我們加拿大業務的強勁收益。

Now turning to our cash flow and balance sheet. For the year-to-date in 2022, operating activities generated $63.1 million of cash as compared to using $105.3 million in the prior year quarter. As Doug discussed earlier, we made the strategic decision to invest in our inventory last year, and this investment is now beginning to convert into cash. To recap, we expect to bring inventory down by another $25 million to $35 million by year-end. And for 2023, we will continue to improve our inventory position and expect a more normalized inventory level by the end of 2023. Capital expenditures for the quarter were $17.5 million compared to $14.3 million in the prior year quarter. We continue to invest in our RDS kiosk and merchandising racks, important parts of our high-return CapEx initiatives. Maintenance CapEx remained near 1% of sales as expected.

現在轉向我們的現金流量和資產負債表。 2022 年初至今，經營活動產生了 6310 萬美元的現金，而去年同期使用了 1.053 億美元。正如 Doug 之前討論的那樣，我們去年做出了投資庫存的戰略決策，這項投資現在開始轉化為現金。回顧一下，我們預計到年底將庫存再減少 2500 萬美元至 3500 萬美元。到 2023 年，我們將繼續改善我們的庫存狀況，並預計到 2023 年底庫存水平將更加正常化。本季度的資本支出為 1750 萬美元，而去年同期為 1430 萬美元。我們繼續投資於我們的 RDS 信息亭和商品架，這是我們高回報資本支出計劃的重要組成部分。正如預期的那樣，維護資本支出仍接近銷售額的 1%。

Looking forward, we have shifted some priorities within RDS due to chip shortages and market dynamics. We are seeing meaningful demand for our next-generation QuickTaG-3 engraving machines at one of our major retail partners. We expect the Quick TAG machines will be located in a very attractive in-cap location within the store, which has performed very well during tests. We are also seeing demand for Mineki 3.5 self-service kiosk machines, which will be outfitted with our first-ever smart auto fab key duplication technology, which we believe will be a meaningful future growth opportunity.

展望未來，由於芯片短缺和市場動態，我們已經改變了 RDS 的一些優先事項。我們看到我們的主要零售合作夥伴之一對我們的下一代 QuickTaG-3 雕刻機有有意義的需求。我們預計 Quick TAG 機器將位於店內一個非常有吸引力的 in-cap 位置，該位置在測試期間表現非常出色。我們還看到了對 Mineki 3.5 自助服務亭機器的需求，這些機器將配備我們有史以來第一個智能汽車工廠密鑰複製技術，我們相信這將是一個有意義的未來增長機會。

Beginning in 2023, we will begin to bring these machines to market while we continue to gather critical data on our rechart machines at ACE. Additionally, we will be testing rechart with other customers in the restaurant and sporting goods sectors. We are very excited about the opportunities for all 3 of these initiatives, which we believe will fuel high-margin growth as we look into 2023 and beyond. Considering chip shortages continue to hinder our ability to produce robotic kiosks to meet demand, we must be strategic in how we source components and deploy machines.

從 2023 年開始，我們將開始將這些機器推向市場，同時我們將繼續在 ACE 的 rechart 機器上收集關鍵數據。此外，我們將與餐廳和體育用品行業的其他客戶一起測試 rechart。我們對所有這 3 項舉措的機會感到非常興奮，我們相信這將在我們展望 2023 年及以後推動高利潤增長。考慮到芯片短缺繼續阻礙我們生產機器人信息亭以滿足需求的能力，我們必須在如何採購組件和部署機器方面具有戰略意義。

While we believe that chip availability will improve in 2023, we are implementing a strategy to widen new customer testing with a smaller number of machines. We ended the third quarter of 2022 with $922 million of total net debt outstanding, down from 931 at the end of 2021. At the end of the third quarter, we had approximately $225 million of liquidity, which consists of $195 million of available borrowing under our revolving credit facility and $29 million of cash and cash equivalents. Our net debt to trailing 12-month adjusted EBITDA ratio at the end of the quarter was 4.5x, which was in line with where we ended '21 and an improvement from 4.7x at the end of the last quarter.

雖然我們相信芯片可用性將在 2023 年得到改善，但我們正在實施一項戰略，以使用較少數量的機器擴大新客戶測試。截至 2022 年第三季度末，我們的未償淨債務總額為 9.22 億美元，低於 2021 年底的 931 美元。在第三季度末，我們擁有大約 2.25 億美元的流動資金，其中包括 1.95 億美元的可用借款我們的循環信貸額度以及 2900 萬美元的現金和現金等價物。本季度末，我們的淨債務與過去 12 個月調整後的 EBITDA 之比為 4.5 倍，與我們 21 年底的水平一致，比上一季度末的 4.7 倍有所改善。

Our long-term net debt to adjusted EBITDA ratio target remains unchanged at below 3x. Considering our lighter free cash flow guidance, we plan to reduce our leverage to the low 4x level at the end of 2022. As we talked about today, we were successful in implementing our fourth end price increase, which was finalized towards the end of the third quarter. Our dollar-for-dollar approach to covering costs has resulted in some margin rate degradation. However, historically, we have not given price back dollar for dollar when inflation cools.

我們的長期淨債務與調整後 EBITDA 比率目標保持在 3 倍以下不變。考慮到我們較寬鬆的自由現金流指導，我們計劃在 2022 年底將槓桿率降低至 4 倍的低水平。正如我們今天所說，我們成功實施了第四次最終提價，該提價已於 2022 年底完成第三季度。我們以美元換美元的方式來支付成本導致利潤率有所下降。然而，從歷史上看，當通脹降溫時，我們並沒有以美元兌美元的價格返還。

Today, we are seeing commodities, container, freight and other costs begin to moderate. We expect to benefit from this dynamic once these new costs lower costs flow through our P&L, which we believe will begin during the second quarter of 2023. looking further out, our long-term growth algorithm of 6% organic net sales and 10% organic adjusted EBITDA growth remains intact. In an economic environment where we are seeing 2% to 3% GDP growth, we have a high level of confidence in this algorithm, and we may see adjusted EBITDA growth in excess of that with some price cost tailwinds on the horizon.

今天，我們看到大宗商品、集裝箱、運費和其他成本開始下降。一旦這些新成本降低成本流經我們的損益表，我們預計將從這種動態中受益，我們相信這將在 2023 年第二季度開始。展望未來，我們的長期增長算法為 6% 的有機淨銷售額和 10% 的有機調整後的 EBITDA 增長保持不變。在我們看到 GDP 增長 2% 到 3% 的經濟環境中，我們對這個算法有很高的信心，我們可能會看到調整後的 EBITDA 增長超過該增長，同時一些價格成本的順風即將到來。

Over the long term, our business continues to benefit from the meaningful macro tailwinds in the home repair, remodel and maintenance market that Doug spoke to earlier. As we look forward, we believe that our competitive moat will allow us to continue to win new business, drive sales and allow us to perform at or above our stated growth algorithm over the long term. With that, Doug, back to you.

從長遠來看，我們的業務將繼續受益於 Doug 早些時候談到的家庭維修、改造和維護市場中有意義的宏觀順風。展望未來，我們相信我們具有競爭力的護城河將使我們能夠繼續贏得新業務、推動銷售並使我們能夠在長期內達到或超過我們規定的增長算法。有了這個，道格，回到你身邊。

Thanks, Rocky. Despite the choppy macro environment, Hillman continues to take care of its customers first and foremost, our competitive moat continues to differentiate our offering and deepen our customer relationships. Considering the challenging supply chain and inventory environment, we're really pleased with how we have executed and maintained strong performance at the shelf with our customers. Our 1,100 field sales and service folks combined with our direct-to-store delivery brings solutions to our customers' complex needs, really an offering unmatched by our competition.

謝謝，洛基。儘管宏觀環境動盪不安，但 Hillman 繼續將客戶放在首位，我們的競爭護城河繼續使我們的產品與眾不同並加深我們的客戶關係。考慮到充滿挑戰的供應鍊和庫存環境，我們對我們與客戶在貨架上執行和保持強勁表現的方式感到非常滿意。我們的 1,100 名現場銷售和服務人員與我們的直接到店交付相結合，為客戶的複雜需求提供解決方案，這是我們競爭對手無法比擬的產品。

The value we bring our customers is reflected by our customers' willingness to accept our pricing actions, granted additional shelf space and award us new business, all of which we've seen this year. As we look forward, we remain confident in our differentiated model and believe we can drive long-term value for all of our shareholders. With that, we'll begin the Q&A portion of the call. Therese, can you open up the call for questions.

我們為客戶帶來的價值體現在客戶願意接受我們的定價行為、給予額外的貨架空間並授予我們新業務，所有這些我們今年都看到了。展望未來，我們對我們的差異化模式充滿信心，並相信我們可以為所有股東創造長期價值。有了這個，我們將開始電話的問答部分。 Therese，你能打開電話提問嗎？

(Operator Instructions) Our first question today will be from David Manthey from Baird.

（操作員說明）我們今天的第一個問題將來自 Baird 的 David Manthey。

First off, I have a theoretical question here. I know it's a moving target and there's some seasonality to your business. But if your price increases that have already been announced and implemented go through and assuming that your input costs don't decline from where they are right now, all we do is we just catch up on the pricing side immediately and fully. What type of EBITDA margin would we be looking at annually? I mean, is 14 sort of the representative level? And then you'll try to improve from there as your input costs come down? Can you help us with that calculus?

首先，我在這裡有一個理論問題。我知道這是一個移動的目標，並且您的業務有一些季節性。但是，如果你已經宣布和實施的價格上漲得以通過，並假設你的投入成本不會從現在的水平下降，我們所做的就是立即和充分地趕上定價方面。我們每年要查看哪種類型的 EBITDA 利潤率？我的意思是，14 是代表級別嗎？然後隨著投入成本的下降，您會嘗試從那裡改進？你能幫我們算一下嗎？

Yes. David, it's Rocky. I think your numbers are directionally right. I think if we stay where we are and as we have visibility into the fourth quarter, obviously, we're not going to give guidance at this point for 2023, but I think it's 14-ish at current levels, and we would expect to drive that higher over time, particularly as you think about growth in the RDS business, which obviously is a much higher EBITDA rate than the remainder of the business.

是的。大衛，是洛基。我認為你的數字是正確的。我認為，如果我們保持現狀，並且由於我們對第四季度有可見性，顯然，我們不會在此時給出 2023 年的指導，但我認為目前的水平是 14 歲左右，我們預計隨著時間的推移推動更高，特別是當你考慮 RDS 業務的增長時，這顯然比其他業務的 EBITDA 率高得多。

Okay. And speaking of the robotics solutions, you've talked a lot about the pricing actions on the hardware side. Have you also adjusted any pricing on any of your robotic kiosks?

好的。談到機器人解決方案，您已經談到了很多關於硬件方面的定價行為。您是否還調整了任何機器人售貨亭的定價？

We have, David, we've done some, not a lot, but what we also look at is the difference between full serve and self-serve and the cost of the machines. So you could see some of that coming in the future as well as the cost of machinery is up. And certainly, with us having both self and full-serve machines in most of our retailers, there's an opportunity because today, the consumer ironically plays more for a key that they have to cut themselves than one that is cut for them by the labor in the store. And when you really think about that math, it doesn't make sense. So we're working on that as well.

大衛，我們已經做了一些，不是很多，但我們還關注全面服務和自助服務之間的區別以及機器的成本。所以你可以看到未來會出現一些這樣的情況，而且機器的成本也會上升。當然，由於我們在大多數零售商中同時擁有自助式和全套服務式機器，因此這是一個機會，因為今天，具有諷刺意味的是，消費者更多地是為了一把他們必須自己剪的鑰匙，而不是那些由工人為他們剪的鑰匙。商店。當您真正考慮該數學時，它就沒有意義了。所以我們也在努力。

Okay. And last question for you, one more here. Could you tell us your contracted versus spot container rates? And when do those container contracts renew? I think you've told us before but just to update us.

好的。最後一個問題，這裡還有一個。您能告訴我們您的合同集裝箱費率與現貨集裝箱費率嗎？這些集裝箱合同什麼時候續約？我想你之前已經告訴過我們，但只是為了更新我們。

Yes, everything renews for almost everybody, David, unless they did a 2-year in May of 2023. As you know, container rates have gotten soft and the spot market has dropped dramatically. We're in a good position because our contract carriers that we've used for many years don't want to lose the volume. So they're doing the right thing on a monthly basis to make sure they don't lose the volume because we have a very small exit penalty to get out of the container and go from contract to spot. And so it's kind of a no-brainer. So we're pretty much at the market, if you will, within a few percentage right now, which is great. And who knows where it's going. But man, it has definitely softened for everybody.

是的，大衛，幾乎每個人的一切都會更新，除非他們在 2023 年 5 月更新了 2 年。如你所知，集裝箱價格已經走軟，現貨市場急劇下跌。我們處於有利地位，因為我們使用多年的合同承運人不想失去數量。所以他們每個月都在做正確的事情，以確保他們不會失去數量，因為我們有一個非常小的退出懲罰來離開容器並從合同到現場。所以這很簡單。所以我們幾乎在市場上，如果你願意的話，現在只有幾個百分比，這很好。誰知道它要去哪裡。但是，伙計，它對每個人來說肯定都軟化了。

Our next question comes from Lee Jagoda from CJS Securities.

我們的下一個問題來自 CJS 證券的 Lee Jagoda。

So just to piggyback on that last question. Obviously, you're going to benefit as you go from contract to spot rates or close to spot rates. Can you just remind us of the lag in terms of the stuff that you're getting at spot today, when does that actually hit your P&L in terms of a margin benefit?

所以只是為了解決最後一個問題。顯然，當您從合同匯率轉為即期匯率或接近即期匯率時，您將受益匪淺。你能不能提醒我們你今天所獲得的東西方面的滯後，這實際上什麼時候會影響你的利潤率？

Yes. So we actually, Lee, as you think about entering into the new contracts in May, as we go through the fourth quarter and into the first quarter, we're going to see some of the highest cost inventory we have, just given the lag times. It's a challenge for us, but we've got full price in place now. And so we'll offset that. And as we said, we believe fourth quarter margin rate is going to look a lot like what we saw in the second quarter. It's really, as you think about it, it's a couple of months when we pay the bill when we float a boat and then it has to come through the inventory. So I think 5 months on average probably after that. And so as we think about current costs, right, you're thinking about kind of middle of next year, we'll begin to see that benefit from containers. And as we said in our prepared remarks, we would expect some of that just given the timing and what we've paid versus what was happening in the second quarter of this year that we'll begin to see some of that benefit in the second quarter of 2023.

是的。所以我們實際上，Lee，當你考慮在 5 月份簽訂新合同時，隨著我們進入第四季度和第一季度，我們將看到我們擁有的一些成本最高的庫存，只是考慮到滯後次。這對我們來說是一個挑戰，但我們現在已經有了全價。所以我們會抵消它。正如我們所說，我們相信第四季度的保證金率將與我們在第二季度看到的情況非常相似。真的，正如你所想的那樣，我們在漂浮一艘船時支付賬單需要幾個月的時間，然後它必須通過庫存。所以我認為可能在那之後平均需要 5 個月。因此，當我們考慮當前成本時，您正在考慮明年年中，我們將開始看到容器帶來的好處。正如我們在準備好的發言中所說的那樣，我們預計其中的一些只是考慮到時間以及我們付出的代價與今年第二季度發生的事情相比，我們將在第二季度開始看到一些好處2023 年季度。

Got it. And then just as it relates to RDS and Reshop, it sounds like you're making some pretty good progress getting machines out to ACE and then there's some new stuff in the hopper testing at some other companies or other customers. If the current supply chain related to the chip environment stays where it is, how many machines can you manufacture next year? And where are we in terms of ACE turning on more national advertising for the program?

知道了。然後就像它與 RDS 和 Reshop 相關一樣，聽起來您在將機器推出 ACE 方面取得了相當不錯的進展，然後在其他公司或其他客戶的料斗測試中有一些新東西。如果目前與芯片環境相關的供應鏈保持原樣，明年可以製造多少台機器？就 ACE 而言，我們在哪里為該計劃開啟更多的全國廣告？

Yes. So Le ACE has been awesome, and we had a great conversation with them and said, "Hey, listen, let's not drip this thing in. Let's get to 1,000. And what we'll do, Lee, is we'll have our service folks move those machines to different stores so that everybody kind of gets a feel while we take the chips we have make machines and do the testing in the accounts that we talked about. So we kind of pivoted to say, let's optimize within ACE moving machines around. Let's start to test it at the sporting goods and the specialty retailers in the food supply and restaurant and let's use those chips for those tests, then when ships become available and let's just say, second half of '23, we can rock and roll. And that's the plan.

是的。所以 Le ACE 非常棒，我們與他們進行了很好的交談，並說，“嘿，聽著，我們不要把這個東西滴進去。讓我們達到 1,000。我們要做的，Lee，我們將擁有我們的服務人員將這些機器移動到不同的商店，這樣每個人都能感受到我們製造機器的芯片並在我們談到的客戶中進行測試。所以我們有點轉向說，讓我們在 ACE 移動中進行優化周圍的機器。讓我們開始在體育用品和食品供應和餐廳的專業零售商處測試它，讓我們使用這些芯片進行這些測試，然後當船隻可用時，讓我們說，23 年下半年，我們可以搖滾然後滾動。這就是計劃。

Got it. So as it relates to more national advertising, are we thinking second half of '23 or sooner than that?

知道了。因此，由於它涉及更多的全國性廣告，我們是在考慮 23 世紀下半年還是更早？

I don't -- I think at 1,000, it's still tough math for them and us. We've said we need to be at 1,500. So I think you're really talking about latter part of the year to get to that. What I like about the strategy change is that AC was very cool saying, listen, you've given us this machine. We know others want to try it. Why don't you do that now? And then when chips become available, we can do a better rollout and get going. So I think you're really talking about probably fourth quarter for that because we are not going to have enough chips to get to that 1,500 level with what we're doing to test in other locations.

我不——我認為在 1,000 時，這對他們和我們來說仍然是一個艱難的數學。我們說過我們需要達到 1,500。所以我認為你真的在談論今年下半年才能做到這一點。我喜歡戰略變化的一點是，AC 非常酷地說，聽著，你給了我們這台機器。我們知道其他人想嘗試一下。你為什麼不現在就這樣做？然後當芯片可用時，我們可以更好地推出並開始。所以我認為你真的在談論第四季度，因為我們沒有足夠的籌碼來達到我們在其他地方進行測試的 1,500 水平。

Got it. And then one last one for me. Just any early commentary to the extent the test with service has started at that large retailer.

知道了。然後最後一張給我。就該大型零售商開始的服務測試範圍而言，只是任何早期評論。

Yes. It's interesting. I mean they have really struggled with labor in the store. Their execution -- remember, we delivered at 99.7%, crushed it. They, today, still have 400 stores that are not set. It's just crazy. And so if there's ever been a story that says it makes sense for that, it's just category and this retailer, we actually talked to them yesterday about it. But they have really struggled with some execution and it goes back to an overall labor shortage because their initial execution was only at 60% of the store rate. So they're working on it. We're working the test, and I think you'll see something like that start to come together in '23. I'm hopeful for that.

是的。這真有趣。我的意思是他們在店裡真的很掙扎。他們的執行——記住，我們交付了 99.7%，壓垮了它。時至今日，他們還有 400 家門店未設。這太瘋狂了。因此，如果有一個故事說它有意義，那隻是類別和這家零售商，我們昨天實際上與他們討論過。但他們確實在一些執行上遇到了困難，這可以追溯到整體勞動力短缺，因為他們最初的執行率僅為商店率的 60%。所以他們正在努力。我們正在進行測試，我想你會看到類似的東西在 23 年開始出現。我對此充滿希望。

Our next question comes from Brian Butler with Stifel.

我們的下一個問題來自 Stifel 的 Brian Butler。

So just, I guess, on the inventory piece, you gave some good color on kind of how it plays out. So if I understand it correctly, you have about $140 million, $20 million to $30 million is in the fourth quarter. So that leaves you $110 million. And I guess part of that is in the third -- or the first quarter of '23, maybe $20 million additional. And then that leaves you another $90 million over the rest of '23 that comes out? Is that the right way to think of it?

所以，我想，在庫存部分，你對它如何發揮作用給出了一些很好的顏色。所以，如果我理解正確的話，你有大約 1.4 億美元，第四季度有 2000 萬到 3000 萬美元。這樣一來，您就剩下 1.1 億美元。我想其中一部分是在第三季度——或者說 23 年第一季度，可能會增加 2000 萬美元。然後在 23 年剩下的時間裡還剩下 9000 萬美元？這是正確的思考方式嗎？

Yes. I think, Brian, the one thing you have to remember is we have grown the business. And so we're going to need more inventory than we had back in the beginning. So I think as we think about '23, we're not going to give guidance at this point, but we'd be very disappointed if we didn't take another $50 million out of inventory in 2023, minimum.

是的。我認為，布賴恩，你必須記住的一件事是我們已經發展了業務。因此，我們將需要比開始時更多的庫存。所以我認為，當我們考慮 23 年時，我們此時不會給出指導，但如果我們不在 2023 年至少從庫存中再減少 5000 萬美元，我們會非常失望。

Okay. So you're not going to actually get back to that whole $140 million because you've grown the business at the point?

好的。所以你不會真的拿回全部 1.4 億美元，因為你已經在這一點上發展了業務？

Yes. And I think, Brian, the other thing to keep in mind, I mentioned it last quarter, but we haven't said anything about it this quarter is -- we have to balance making sure we've got these 25-year partner suppliers that we've been doing business with all the way back to Mick and Rick Hillman. So part of why we still have 140, Rocky mentioned the sales weren't quite as strong as we had liked. But the other part is we're managing to make sure our suppliers remain healthy. So it's a balancing act. We don't want to hurt our key suppliers by just turning the spicket off and crushing them. We don't want them to let their employees go because when we start to rock and roll again, we can't afford it. We can't have them not be able to keep up. So part of this balancing act is working with our key suppliers.

是的。我認為，布賴恩，要記住的另一件事是，我在上個季度提到過，但本季度我們沒有對此發表任何評論——我們必須保持平衡，確保我們擁有這些 25 年的合作夥伴供應商從 Mick 和 Rick Hillman 開始，我們一直在做生意。所以我們仍然有 140 個的部分原因是，Rocky 提到銷售並不像我們希望的那樣強勁。但另一方面，我們正在設法確保我們的供應商保持健康。所以這是一個平衡的行為。我們不想通過關閉 spicket 並粉碎它們來傷害我們的主要供應商。我們不希望他們讓他們的員工離開，因為當我們再次開始搖滾時，我們負擔不起。我們不能讓他們跟不上。因此，這種平衡行為的一部分是與我們的主要供應商合作。

Okay. That's helpful. And then I guess one on the extra week in the fourth quarter. Can you give some color on the magnitude of that? How big from revenues and EBITDA perspective?

好的。這很有幫助。然後我猜是在第四季度的額外一周。你能給出一些顏色嗎？從收入和 EBITDA 的角度來看有多大？

Yes. I mean that's always handy. But if you really think about the retailers, they're so slammed with Christmas. They're not thinking about dexkcrews. There just isn't that much going on that week for us. Unfortunately, I wish it was an extra week in this break, right?

是的。我的意思是這總是很方便。但如果你真的想到零售商，他們會因為聖誕節而受到重創。他們沒有考慮 dexkcrews。對我們來說，那一周沒有那麼多事情發生。不幸的是，我希望這次休息多一個星期，對吧？

Yes, I agree. Brian. What I would tell you is it's actually only 3 days when you think about holidays a; and then b, there's just not a lot of activity. So it's really not that meaningful for us from a top line perspective. You could -- the only business that really gets a little bit of benefit as RDS because stores are open and those machines are there, but we're not going to ship very much product that week.

是的我同意。布萊恩。我要告訴你的是，當你想到假期時，實際上只有 3 天；然後 b，活動不多。所以從頂線的角度來看，這對我們來說真的沒有那麼有意義。你可以——唯一真正從 RDS 中獲得一點好處的企業，因為商店是開著的，那些機器在那裡，但我們不會在那週運送太多產品。

Okay. And then maybe one last one. We talked about, I guess, the container cost coming down and the benefits what about lower metal prices as that comes down, how does that work through the P&L in maybe the fourth quarter or more important than probably 2023?

好的。然後也許是最後一個。我想，我們談到了集裝箱成本的下降以及金屬價格下降帶來的好處，這在第四季度或比 2023 年更重要的時候如何通過損益表發揮作用？

Yes. So it's -- we've begun to see some softness. If you look at China steel, we would tell you Taiwan East steel is actually still pretty high relative to historic norms. And the way commodities work in our business is you think about the lead time that we have that's million for when we placed the PO, and then it's got to flow through our inventory. So it really is, call it, 160 days plus 5 or 6 months before we feel that benefit. And so even some of the POs that we've been placing in the second half of this year, we're not going to feel any benefit into the second half of '23.

是的。所以它 - 我們已經開始看到一些柔軟。如果你看看中國鋼鐵，我們會告訴你台灣東鋼實際上相對於歷史標準仍然相當高。大宗商品在我們業務中的運作方式是，您考慮我們在放置 PO 時擁有的交貨時間，然後它必須流經我們的庫存。所以它真的是，稱之為，160 天加上 5 或 6 個月，我們才感受到這種好處。因此，即使是我們在今年下半年放置的一些採購訂單，我們也不會在 23 年下半年感受到任何好處。

Our next question comes from Matthew Bouley from Barclays.

我們的下一個問題來自巴克萊銀行的 Matthew Bouley。

So you guys obviously stuck to the long-term EBITDA guide of -- in terms of 10% annual growth as we're talking about input costs and shipping costs have come down since 90 days ago, I guess the volume outlook is perhaps more dynamic. My question is what's kind of changed in your crystal ball 2023 outlook in light of these moving pieces, given that seemingly larger input cost tailwind that you guys are speaking to as of the second quarter. Could we expect EBITDA growth greater than 10% next year?

所以你們顯然堅持長期 EBITDA 指南——就 10% 的年增長率而言，因為我們談論的是投入成本和運輸成本自 90 天前以來已經下降，我想銷量前景可能更具活力.我的問題是，鑑於你們在第二季度談到的看似更大的投入成本順風，鑑於這些移動的部分，你的 2023 年水晶球前景發生了什麼樣的變化。我們能否預計明年的 EBITDA 增長率超過 10%？

Yes. I think, Matt, again, we're not going to give guidance on this call. But as you think about how the benefits from the tailwinds that you speak of are going to flow through, right? As we said in our prepared remarks, they're going to begin in the second quarter. So I think you're probably going to have a tale of 2 halves, first half with less benefit from that. And quite frankly, in the first quarter, we're going to see some of the highest costs that we've seen as we feel the flow of the May, June time frame containers through our P&L.

是的。我想，馬特，我們不會就這次電話會議提供指導。但是當你考慮你所說的順風帶來的好處將如何流動時，對嗎？正如我們在準備好的評論中所說，它們將在第二季度開始。所以我認為你可能會有一個分為兩半的故事，上半場從中受益較少。坦率地說，在第一季度，我們將看到我們看到的一些最高成本，因為我們感覺到 5 月、6 月時間框架容器通過我們的損益表流動。

That said, the second half, yes, we would expect that there are some tailwinds, and we should see some benefit in excess of what the algorithm would suggest. You put those together, and again, we talk more long term about 10%. We expect that there will be years that we're slightly below that, and there are years that were slightly above it. And again, as we said in our prepared remarks, I think as we think about the second half of '23 and into '24, we feel pretty bullish about where the business is, given the price that we've taken and what we're seeing with commodities.

也就是說，下半年，是的，我們預計會有一些順風，我們應該會看到一些超出算法建議的好處。你把它們放在一起，我們再一次談論更長期的 10%。我們預計有些年份我們會略低於它，有些年份會略高於它。再一次，正如我們在準備好的發言中所說，我認為，當我們考慮 23 年下半年和 24 年的時候，考慮到我們所採取的價格和我們所採取的措施，我們對業務狀況感到非常樂觀重新看商品。

Got it. That's super helpful. And then second one on -- so you got the lower costs coming through. You spoke earlier about obviously, customer willingness to accept these past price actions, the 4 price increases you've taken. When we think about your kind of different categories, would you expect that your retail customers would try to reduce prices in any category to drive foot traffic? And would that result in any kind of pushing back on Hillman at all from a price perspective?

知道了。這非常有幫助。然後是第二個——這樣你就可以降低成本。您之前顯然說過，客戶願意接受這些過去的價格行為，即您採取的 4 次提價。當我們考慮您的不同品類時，您是否期望您的零售客戶會嘗試降低任何品類的價格以增加客流量？從價格的角度來看，這會導致對希爾曼的任何形式的反擊嗎？

Yes. I think that when you think about our category being part of -- normally a project, it's just such a small part of it. We don't really have things that drive volume based on price with the exception of we've seen some nice benefits from being able to sell, for example, 3 pair glove for 9.99, right? In that case, Matt, that is a price point that makes sense. And when you can't hit it, you'll see volume go either way. But in the hardware solutions business, you're really not talking about any promotional activity or driving really any volume through any kind of pricing either direction. I mean it's pretty muted with the customer. They need to have it as part of the project, but it's not an expensive part of the project. And retailers will do their job. They'll make sure that we remain competitive versus the world and that they remain competitive versus their competition. That's just all part of daily hand-to-hand combat.

是的。我認為當你認為我們的類別是其中的一部分時——通常是一個項目，它只是其中的一小部分。我們並沒有真正根據價格推動銷量的東西，除了我們已經看到能夠銷售的一些不錯的好處，例如，9.99 的 3 雙手套，對嗎？在那種情況下，馬特，這是一個合理的價格點。當你無法擊中它時，你會看到音量向任何方向移動。但在硬件解決方案業務中，你真的不是在談論任何促銷活動，也不是通過任何一種定價來推動任何銷量。我的意思是它對客戶非常安靜。他們需要將它作為項目的一部分，但它不是項目的昂貴部分。零售商會做好他們的工作。他們將確保我們在與世界的競爭中保持競爭力，並確保他們在與競爭對手的競爭中保持競爭力。這只是日常肉搏戰的一部分。

That's helpful, Doug. And then last one for me. I think you mentioned the -- there was some destocking impact on the protective side. Could you just speak to the hardware side there? Should we expect to see any kind of destocking going on either in the near term or perhaps in a more recessionary scenario in that category?

這很有幫助，道格。然後最後一個給我。我想你提到了 - 對保護方面有一些去庫存影響。你能談談那裡的硬件方面嗎？我們是否應該期望在短期內或在該類別的經濟衰退情況下看到任何形式的去庫存？

Yes. Not much, Matt, at all. I mean there's -- as I said last time, there's somebody that would say, "Oh, I got some SKUs that are slow movers, I can take them down from 26 weeks to 24 weeks. We haven't really seen much of any impact in HS. And the reason, Matt, that you're seeing it with some of your other companies that you follow and the reason you would see it in PS is that's the one product that we do ship some through the retailer's distribution center. And the big change there other than the obvious Asia time is that they've been able to get things through their distribution centers from what was 28 days to get it from front to back to now about 12 days. So straight math, they just don't need the same amount of product that they had. And the majority of that 10 that we talked about is PS. And I don't anticipate we're going to have much, if any, on the HS side just because it's direct store, there's not a whole lot they can do.

是的。一點也不，馬特。我的意思是 - 正如我上次所說，有人會說，“哦，我有一些 SKU 是緩慢移動的，我可以將它們從 26 週縮短到 24 週。我們還沒有真正看到任何在 HS 中的影響。馬特，你在你關注的其他一些公司看到它的原因以及你在 PS 中看到它的原因是我們確實通過零售商的配送中心運送了一些產品。除了明顯的亞洲時間之外，那裡的最大變化是他們已經能夠通過配送中心獲得東西，從過去的 28 天到現在大約 12 天。所以直接數學，他們只是不不需要他們擁有的相同數量的產品。我們討論的那 10 種產品中的大部分是 PS。而且我預計我們不會在 HS 方面有太多，如果有的話，僅僅因為它是直接的商店，他們無能為力。

Also with what's going on in Florida, there's going to be a few dry wall and deck crew sold down that way. So we may reposition some stuff to help the retailers out because there's going to be a lot of demand down there once the insurance folks figure out whether they're in business or not.

此外，隨著佛羅里達州發生的事情，將會有一些石膏板和甲板工作人員以這種方式被出售。所以我們可能會重新定位一些東西來幫助零售商，因為一旦保險人員弄清楚他們是否在做生意，那裡就會有很多需求。

Our next question is coming from Samuel Darkatsh of Raymond James.

我們的下一個問題來自 Raymond James 的 Samuel Darkatsh。

Great but I'm just curious sort of directionally how we should think about kind of SG&A, considering 2023 sort of probably a bit of a choppier year of overall demand. Do you guys -- would you typically sort of pull back on SG&A? Or do you still need to sort of make the investments that you're making to drive growth into '24 and beyond?

很好，但我只是好奇我們應該如何考慮 SG&A 的方向性，考慮到 2023 年可能是整體需求比較不穩定的一年。你們——你們通常會取消 SG&A 嗎？或者您是否仍然需要進行投資以推動 24 歲及以後的增長？

Yes. Stephen, you know from some of the companies that you cover. -- historically, folks who have a big marketing and ad spend, they hit that first before they hit SG&A and the other buckets. For us, we don't have that bucket. So we're going to do everything we can to control what we control. We're not going to -- actually, we'll be adding people to our service network next year in our service organization. But we're going to do everything we can to control what we can control. But we don't have a bucket of marketing or advertising or big promos to hit. So you'll see us do the right thing, but you won't see dramatic cost savings or cost increases either direction. Rocky, anything on this?

是的。斯蒂芬，你從你報導的一些公司知道的。 ——從歷史上看，那些擁有大量營銷和廣告支出的人，他們首先會在 SG&A 和其他方面投入資金。對於我們來說，我們沒有那個桶。所以我們將盡我們所能來控制我們控制的東西。我們不會——實際上，明年我們將在我們的服務組織中增加人員到我們的服務網絡。但我們將盡我們所能來控制我們能控制的東西。但是我們沒有大量的營銷或廣告或大型促銷活動。所以你會看到我們做正確的事，但你不會看到顯著的成本節約或成本增加。洛基，有什麼事嗎？

No. The only thing I would add, and we talked about this on our second quarter call that we did take some actions at the end of the second quarter, early in the third that we think provide a lot of -- provide more flexibility, I should say, around our SG&A costs and our ability to pull some levers. You could see we had a nice performance in SG&A in the third quarter. We expect that to continue into the fourth, and we're going to continue to make sure that we've got the right costs in the business to drive it forward, not spending in areas that don't provide benefit, but spending in areas like Doug said, in the service organization, the sales organization to help fuel the growth that we see in the business.

不，我唯一要補充的是，我們在第二季度的電話會議上談到了這一點，我們確實在第二季度末和第三季度初採取了一些行動，我們認為這些行動提供了很多——提供更多的靈活性，我應該說，圍繞我們的 SG&A 成本和我們拉動一些槓桿的能力。你可以看到我們第三季度在 SG&A 方面的表現不錯。我們希望這種情況會持續到第四個，我們將繼續確保我們在業務中有正確的成本來推動它向前發展，而不是在不提供收益的領域支出，而是在領域支出正如道格所說，在服務組織中，銷售組織幫助推動我們在業務中看到的增長。

Okay, super. And then maybe just -- this might be a new guy question, but how should we think about sort of new business for 2023? And I would define that as, I guess, sort of SKU expansion with existing customers or adding new customers or any of that, just sort of whatever isn't driven by just end market volume trends, how does that sort of layer in going forward?

好的，超級。然後也許只是 - 這可能是一個新人問題，但我們應該如何考慮 2023 年的新業務？我將其定義為，我猜，某種 SKU 擴展與現有客戶或添加新客戶或任何其他，只是任何不受終端市場數量趨勢驅動的東西，這種層如何向前發展？

Yes. So as we think about the algorithm and our -- the 6% organic top line growth, historically, that's 2% to 3% new business wins every year. And that's principally existing products with existing customers. So it's taking additional shelf space from our competitors. There are a couple of items in play as we sit today, like construction concrete screws, new area for us, where we're taking a lot of share that we're really excited about. As we think about 2023, similar to '22 and what we've seen in the last few years, we would expect that to be 2% plus of our revenue, and we've got line of sight to that as we think about '23.

是的。因此，當我們考慮算法和我們 - 6% 的有機收入增長時，從歷史上看，每年有 2% 到 3% 的新業務獲勝。這主要是現有客戶的現有產品。因此，它從我們的競爭對手那裡佔用了額外的貨架空間。我們今天坐在一起，有幾個項目在發揮作用，比如建築混凝土螺絲，我們的新領域，我們正在分享很多我們非常興奮的份額。當我們考慮 2023 年時，類似於 22 年以及我們在過去幾年中看到的情況，我們預計這將占我們收入的 2% 以上，並且在我們考慮時我們已經看到了這一點 ' 23.

Our next question comes from Ryan Merkel with William Blair.

我們的下一個問題來自 Ryan Merkel 和 William Blair。

So my first question is on volume trends. Can you just talk about how volume trended through the quarter and into October? And really what I'm curious about is if it's sort of stable or if the trend line is sort of declining.

所以我的第一個問題是關於數量趨勢。您能談談本季度和 10 月份的成交量趨勢嗎？真正讓我好奇的是，它是穩定的還是趨勢線在下降。

Yes. When you look, Ryan, at our HS business, which I think is the best bellwether, we actually did see an improvement in Q3 and over the first half. And several of our retailers said the same thing. Now remember, part of their 15% down is as a result of the screw spring that they had. So that definitely got better. But I'll quote one retailer. It was amazing to them that after the July 4 weekend, they seem to see things get up or pick up a little bit better. So I would say they're slightly better than they've been is what we're seeing right now.

是的。 Ryan，當你看我們的 HS 業務時，我認為這是最好的領頭羊，我們實際上確實看到了第三季度和上半年的改善。我們的幾家零售商也說了同樣的話。現在請記住，他們 15% 的下降部分是由於他們擁有的螺旋彈簧。所以這肯定會變得更好。但我會引用一家零售商的話。令他們驚訝的是，在 7 月 4 日週末之後，他們似乎看到事情好轉或好轉了一點。所以我想說他們比我們現在看到的要好一些。

Got it. Yes, that was kind of my view as well. And then on gross margin, it sounds like 4Q the 44%. Can we think about that as the baseline for '23. It sounds like maybe the first half of '23 may be a little below that due to the high cost inventory, but then in the second half, is it 44% or better? Is that right?

知道了。是的，這也是我的觀點。然後就毛利率而言，第四季度聽起來像是 44%。我們可以將其視為 23 年的基準嗎？聽起來可能由於高成本庫存，23 年上半年可能會略低於該水平，但在下半年，它是 44% 還是更好？是對的嗎？

Yes. I think 44, we believe, is a good baseline for our business. And so yes, Ryan, as you think about it, the first quarter may be slightly below that, I think as we go into the second through the rest of the year, we would expect to maintain or grow that rate.

是的。我認為 44，我們相信，是我們業務的良好基準。所以是的，瑞安，正如你所想的那樣，第一季度可能會略低於這個水平，我認為隨著我們進入今年剩餘時間的第二個季度，我們預計會保持或增長這個速度。

Okay. And then last one for me. I think you put through about $225 million of costs. Just curious, how much of that do you think you can keep as costs deflate over the next 12 to 18 months?

好的。然後最後一個給我。我認為你支付了大約 2.25 億美元的費用。只是好奇，隨著成本在未來 12 到 18 個月內下降，您認為您可以保留多少？

I mean that's -- if anybody figures that out, let me know. I think the way we look at it is that we've never been here before. Now if you go back to past times, Ryan, price would go up, retails would go up, and there's never been a time where we've given back price, I think it would be very naive of us to say that there's not going to be some price given back over time. The one that I would say would be the most suspect to that and worthy of working with our retailers is if we see this container momentum downward and pricing continuing, then there's certainly a justification for the fact that, that part of it should be worked back with our customers.

我的意思是——如果有人弄明白了，請告訴我。我認為我們看待它的方式是我們以前從未來過這裡。現在，如果你回到過去，Ryan，價格會上漲，零售價會上漲，而且我們從未有過回饋價格的時候，我認為我們說不會發生是非常天真的隨著時間的推移會得到一些回報。我想說的是最值得懷疑並且值得與我們的零售商合作的一個是，如果我們看到這種集裝箱勢頭下降並且價格繼續上漲，那麼肯定有理由證明這部分應該收回與我們的客戶。

And that's the one I would say, I will look to retailers in the eye and say, let's be honest, we know what's happened. We know what was supposed to happen. What we don't know is what happens -- so we talked about this big inventory reduction that's taken place in North America as a result of the changes in lead times, that's across those guys. We don't know what's going to happen as it normalizes nor do we know what's going to happen with fuel. But that's probably the one, Ryan, that I would say you'd have to say long term that we'd work back with our customers on.

這就是我要說的，我會看著零售商的眼睛說，老實說，我們知道發生了什麼。我們知道應該發生什麼。我們不知道會發生什麼——所以我們談到了由於交貨時間的變化而在北美髮生的這種大規模庫存減少，這是在那些人身上發生的。我們不知道正常化後會發生什麼，也不知道燃料會發生什麼。但這可能就是那個，瑞安，我會說你必須說長期我們會與我們的客戶合作。

That concludes our Q&A portion of today's call. And I would like to turn the call back over to Mr. Cahill for some closing comments.

今天電話會議的問答部分到此結束。我想把電話轉回給卡希爾先生，徵求一些結束意見。

Thanks, everyone, for joining us this morning. I really want to thank our customers and suppliers and importantly, the folks that do it every day for us at Hill and it contributed to the quarter. We look forward to updating you again in the near future. And again, thanks for joining us today.

謝謝大家今天早上加入我們。我真的要感謝我們的客戶和供應商，重要的是，感謝每天在 Hill 為我們做這件事的人，他們為本季度做出了貢獻。我們期待在不久的將來再次為您更新。再次感謝您今天加入我們。

This does conclude our program. You may now disconnect. Have a wonderful day.

這確實結束了我們的計劃。您現在可以斷開連接。祝你有美好的一天。