Scotts Miracle-Gro Co (SMG) 2025 Q1 法說會逐字稿

Good morning. I'm Brad Chelton, and I would like to welcome you to the Scotts Miracle-Gro first-quarter earnings conference call. I have recently stepped in to lead Investor Relations after 17 years at Scotts in a variety of finance leadership roles. I am grateful to succeed Aimee DeLuca, who will retire from Scotts Miracle-Gro at the end of this month after a 23-year career at the company. I've appreciated the opportunity to meet many of you already, and I look forward to meeting all of you over the coming months.

早安.我是布拉德·切爾頓，歡迎您參加 Scotts Miracle-Gro 第一季財報電話會議。我在 Scotts 擔任了 17 年的各種財務領導職務之後，最近接任了投資者關係主管一職。我很高興能接替艾米·德盧卡 (Aimee DeLuca)，她將在 Scotts Miracle-Gro 公司工作 23 年後於本月底退休。我很感激有機會與你們中的許多人見面，並期待在接下來的幾個月與你們所有人見面。

Speaking today are Chairman and CEO, Jim Hagedorn; and Interim Chief Financial Officer and Chief Accounting Officer; Mark Scheiwer. Jim will provide a business update, followed by Mark with a review of our financial results. Following the webcast, President and Chief Operating Officer, Nate Baxter; and Executive Vice President and Chief of Staff, Chris Hagedorn, will join Jim and Mark for an audio-only Q&A session.

今天發言的有董事長兼執行長 Jim Hagedorn；以及臨時財務長和首席會計官；馬克·謝維爾。吉姆將提供業務更新，隨後馬克將回顧我們的財務結果。網路直播結束後，總裁兼營運長 Nate Baxter；執行副總裁兼參謀長 Chris Hagedorn 將與 Jim 和 Mark 一起參加僅有音訊的問答環節。

To listen to the Q&A, simply remain on this webcast. To participate, please join by the audio link shared in our press release. As always, today's session will be recorded. An archived version will be published on our website at investor.scotts.com. For further discussion after the call, please e-mail or call me directly.

要收聽問答，只需留在此網路廣播即可。如需參加，請透過我們新聞稿中分享的音訊連結加入。像往常一樣，今天的會議將被錄音。存檔版本將在我們的網站 investor.scotts.com 上發布。如需在通話後進一步討論，請發送電子郵件或直接致電給我。

Now I'm going to turn it over to a special guest that Jim has invited to provide commentary regarding safe harbor and forward-looking statements.

現在，我將把話題交給吉姆邀請的一位特別嘉賓，請他提供有關安全港和前瞻性聲明的評論。

What up, what up, SMG Investor? It's me, that mouse that was killed in the Tomcat commercial. Awkward. Mi amigo, Jim Hagedorn, the big cheese of Scotts Miracle-Gro, asked me to be here to help introduce this Q1 fiscal earnings call. This whole thing is a little off brand for me, but I am a versatile rodent. So today, I'm going to be super profession.

怎麼了，怎麼了，SMG 投資者？是我，Tomcat廣告裡被殺的那隻老鼠。尷尬的。我的朋友，Scotts Miracle-Gro 的大人物 Jim Hagedorn 邀請我來這裡幫忙介紹第一季財報電話會議。這整件事情對我來說有點不合時宜，但我是一隻多才多藝的囓齒動物。所以今天我要成為超級職業者。

During today's review, the company will make forward-looking statements and discuss certain non-GAAP financial measures. Please be aware that the actual results could differ materially from what is shared today. Please refer to the company's Form 10-K filed with the SEC for details of the full range of risk factors that could impact the results.

在今天的審查中，公司將做出前瞻性聲明並討論某些非公認會計準則財務指標。請注意，實際結果可能與今天分享的結果有重大差異。有關可能影響結果的所有風險因素的詳細信息，請參閱該公司向美國證券交易委員會提交的 10-K 表格。

I don't know what any of that means. So I'm going to turn it over to Jim. Yes, my man. This is going to be lit.

我不知道這些意味著什麼。所以我要把它交給吉姆。是的，我的朋友。這將會亮起。

Good morning. I hope you enjoy the mouse's intro to our call. I'll begin with how pleased I am with our first-quarter results. We're off to a very good start. We delivered on the metrics that form the foundation of our fiscal '25 plan, and we feel very comfortable with our Q2 sales load-in as retailers prepare for the lawn and garden season.

早安.我希望你們喜歡老鼠對我們通話的介紹。首先，我對我們的第一季的業績感到非常滿意。我們的開局非常好。我們實現了構成我們 25 財年計劃基礎的指標，並且隨著零售商為草坪和花園季節做準備，我們對第二季的銷售情況感到非常滿意。

They are just as bullish, if not more, on this year's season. All of this gives us great confidence in our fiscal '25 EBITDA guidance and our outlook through fiscal '27. Mark will walk through the financials as I want to discuss how we're building the company for the future.

他們對今年的賽季同樣充滿信心，甚至更加樂觀。所有這些都讓我們對 25 財年的 EBITDA 指引和 27 財年的前景充滿信心。當我想要討論如何建立公司的未來時，馬克會介紹財務狀況。

I've often said we're on a journey. And this one began when we emerged from COVID under severe financial constraints and we're forced into crisis management. We've restored the financial stability of the company, and we're set for growth and continued progress. This journey gave us an opportunity to reflect on the future of Scotts Miracle-Gro and what we want our company to be.

我常說，我們正在旅途中。而這次危機開始於我們在嚴重的財政限制下擺脫新冠疫情並被迫進行危機管理的時候。我們已經恢復了公司的財務穩定，並準備好實現成長和持續進步。這趟旅程讓我們有機會思考 Scotts Miracle-Gro 的未來以及我們對公司未來的期望。

In the Air Force, we'd say change often results from a significant emotional event, and that's what happened to us. We're at an inflection point where we're making changes to transform our organization. Let me tell you where we're going, what it means, and how we'll get there. All of our transformation work starts with our core convictions. Many years ago, we developed these core convictions to guide our associates in driving, protecting, and nurturing our very special and unique consumer business.

在空軍，我們會說改變通常是由重大的情感事件引起的，而這正是發生在我們身上的事情。我們正處於一個轉折點，我們正在做出改變來改造我們的組織。讓我告訴你我們要去哪裡、這意味著什麼以及我們如何到達那裡。我們的一切轉型工作都始於我們的核心信念。許多年前，我們就形成了這些核心信念，以引導我們的員工推動、保護和培養我們非常特殊和獨特的消費者業務。

Everyone in our company carries the core convictions on their employee badge, but we've fallen into the habit of not paying much attention to them. Our future is about bringing them to the forefront again and doubling down on our consumer franchise. We are further evolving into a consumer marketing powerhouse with competitive advantages that exceed what we already have today. We're narrowing our focus and optimizing our franchise, investing in it. This is our mission.

我們公司每個人的員工徽章上都帶有核心信念，但我們已經養成了不太重視它們的習慣。我們的未來是再次將他們帶到最前沿，並加倍增加我們的消費者特許經營權。我們正在進一步發展成為一家消費行銷巨頭，其競爭優勢超越今天。我們正在縮小關注範圍、優化我們的特許經營權並對其進行投資。這是我們的使命。

And we have a new leadership team that's aligned to it and is driving that change. Accomplishing this mission will have a significant and positive impact on our future financials. It will enable us to consistently do the following four things: one, deliver sustained sales growth of at least 3% annually that is built on higher-margin products and innovation across all channels within our consumer business; two, be the lowest cost manufacturer of high-performance products, giving us flexibility and pricing discussions with retailers and the ability to provide both differentiated and affordable solutions for our consumers; three, drive gross margin up to 35% with mid- to high single-digit EBITDA percent growth; and four, generate strong free cash flow for more shareholder-friendly actions.

我們有一個與之相一致並推動這項變革的新領導團隊。完成這項使命將對我們未來的財務狀況產生重大而正面的影響。它將使我們能夠始終如一地做到以下四件事：第一，基於高利潤產品和消費者業務各個管道的創新，實現每年至少 3% 的持續銷售成長；二、成為成本最低的高性能產品製造商，讓我們能夠靈活地與零售商進行定價討論，並能夠為我們的消費者提供差異化且價格合理的解決方案；三、毛利率達35%左右，EBITDA實現中高個位數成長；第四，產生強勁的自由現金流，採取更多有利於股東的行動。

These include a long-term commitment to significantly reduce our share count and potentially issuing special dividends down the road. There is a simple answer to why these things are achievable. Our consumer franchise is unmatched and in a category with substantial growth potential. From a demographic point of view, we have a tailwind. Homeownership is as important as ever. And there's a shift happening where millennials are becoming the largest group needing and buying homes. This younger generation is our emerging consumer.

其中包括長期承諾大幅減少我們的股票數量，並可能在未來發放特別股利。為什麼這些事情能夠實現，有一個簡單的答案。我們的消費者特許經營權無與倫比，並且屬於具有巨大成長潛力的類別。從人口統計學角度來看，我們處於順風狀態。房屋所有權比以往任何時候都更重要。現在正在發生一種轉變，千禧世代正成為需要和購買房屋的最大群體。這個年輕的一代是我們新興的消費者。

Our advantage over our competitors are our superpowers, our brands, supply chain, in-store sales force, our relationship with the largest home and garden retailers in North America, R&D, and our ability to generate significant cash flow. Our marketing is our jet fuel. We also have the most engaging creative, whether it's the Tomcat mouse you just met, to Icon Martha Stewart or actor, Kristofer Hivju, at the center of our campaigns, and they bring our brands to life. And when we integrate our advertising with our retailer programs, we drive foot traffic and in-store consumer activation at unprecedented levels. This stuff works.

我們相對於競爭對手的優勢在於我們的超能力、我們的品牌、供應鏈、店內銷售團隊、我們與北美最大的家居和花園零售商的關係、研發以及我們產生大量現金流的能力。我們的行銷就是我們的航空燃料。我們還擁有最具吸引力的創意，無論是您剛剛遇到的雄貓老鼠，還是偶像瑪莎·斯圖爾特，或是演員克里斯托弗·海維尤，他們都是我們的宣傳活動的主角，他們讓我們的品牌煥發生機。當我們將廣告與零售商計劃結合時，我們可以將客流量和店內消費者的活躍度提高到前所未有的水平。這東西有用。

We also operate within an environment where very few retailers play. Lawn and garden is absolutely essential to these retailers, representing about a fifth of their total sales and roughly 40% of their spring foot traffic. Our ability to bring consumers into their stores is critical to their success. They rely on us, and we rely on them, and we work together to drive consumer takeaway. It would be hard for anybody to build a franchise like ours.

我們也在極少零售商參與的環境中運作。草坪和花園對這些零售商來說絕對必不可少，約佔其總銷售額的五分之一和春季客流量的約 40%。我們吸引消費者進入其商店的能力對於他們的成功至關重要。他們依賴我們，我們也依賴他們，我們共同努力推動消費者外送。對於任何人來說，建立像我們這樣的特許經營權都是很困難的。

Now let me give you examples of the investments we're making to strengthen our franchise to gain market share, bring new consumers into our world and deliver growth. This year, we're putting an additional $40 million into our business, from brand support to innovation, the vast majority of it going to advertising. We're expanding our demographic reach to a broader consumer base. This includes the Hispanic population, which is a growing influence in lawn and garden. We'll launch bilingual advertising on digital media and mainstream Spanish television in conjunction with our traditional campaigns. At the same time, we're spending more on consumer activation programs run by our retailers.

現在，讓我為你舉例說明我們為加強特許經營、獲得市場份額、為我們的世界帶來新消費者和實現成長而進行的投資。今年，我們將額外投入 4,000 萬美元用於品牌支援和創新，其中絕大部分用於廣告。我們正在擴大我們的人口覆蓋範圍，以覆蓋更廣泛的消費者群體。其中包括在草坪和花園領域影響力日漸增強的西班牙裔人口。我們將結合傳統廣告活動在數位媒體和西班牙主流電視上推出雙語廣告。同時，我們在零售商開展的消費者激活計劃上投入了更多資金。

These programs represent a sizable annual investment in excess of 10% of our net sales. When you combine these retailer programs with what we're investing in our own advertising and brand support, that total investment nears 20% of sales.

這些項目代表著每年相當大的投資，超過我們淨銷售額的 10%。當將這些零售商計劃與我們在自己的廣告和品牌支援方面的投資結合時，總投資接近銷售額的 20%。

This might sound like a lot, and it is, and we're going to continue to spend even more here in over the years going forward. Let me tell you why. In exchange for our investments, retailers give us more listings, share of shelf and off-shelf displays. For every dollar we give them to promote our products, they spend even more in activation and promotion of our brands.

這聽起來可能很多，事實也確實如此，而且在未來幾年我們將繼續投入更多資金。讓我來告訴你為什麼。作為我們投資的回報，零售商為我們提供更多的商品清單、貨架份額和下架展示。我們為他們投入每美元來推廣我們的產品，他們就會投入更多來激活和推廣我們的品牌。

The impact of our integrated efforts are evident in the nearly 10% POS lift we had last year. We outperformed the category by three times, even more if you include live goods. We'll see growth again in these areas this year. It started in Q1 with double-digit POS increases and material share gains.

我們綜合努力的效果明顯地體現在去年我們實現的近 10% POS 成長中。我們的業績是同類產品的三倍，如果算上活體商品，業績甚至更高。今年我們將再次看到這些領域的成長。從第一季開始，POS 銷量就實現了兩位數成長，份額也大幅增加。

You may wonder how we can afford all this and make our numbers. This is where transformation comes in, and it begins with being the lowest cost, high-performance manufacturer. This will require us to take out cost and drive more efficiencies. At a time when pricing is hard to get, and rightly so given today's state of the consumer, our ability to reduce our cost structure and realize operational savings is more important than ever.

你也許想知道我們如何能夠負擔得起這一切並實現我們的目標。這就是轉型開始的地方，而轉型首先要成為成本最低、性能最高的製造商。這將要求我們降低成本並提高效率。在定價困難的時候，考慮到當今的消費者狀況，我們降低成本結構和實現營運節約的能力比以往任何時候都更為重要。

We're being relentless in scrutinizing our organization with an eye towards optimization and savings. We're experienced at this. Our multiyear Project Springboard initiative yielded $400 million in annual savings, of which we put $100 million back into the business for growth.

我們正堅持不懈地審查我們的組織，並專注於優化和節約。我們對此很有經驗。我們多年的 Project Springboard 計畫每年帶來 4 億美元的節省，其中 1 億美元我們重新投入業務成長。

In fiscal '25, we'll take at least $75 million out of our supply chain. That's half of the $150 million in supply chain costs that we've targeted by fiscal '27. I've asked Nate to get another $30 million in savings in other aspects of our company by eliminating anything that doesn't add value. Cross-functional work streams are examining processes for streamlining and simplification. I want to stress that we will balance cost out with key infrastructure investments in things like technology and automation. To this end, our CapEx will increase by $25 million to $100 million this year. We're also building innovation road maps that are 5 to 10 years out.

在25財年，我們將從供應鏈中拿出至少7,500萬美元。這是我們 27 財年設定的 1.5 億美元供應鏈成本目標的一半。我已經要求內特在公司的其他方面再節省 3000 萬美元，消除所有沒有增值價值的東西。跨職能工作流程正在檢查流程的精簡和簡化。我想強調的是，我們將在技術和自動化等關鍵基礎設施投資之間平衡成本。為此，今年我們的資本支出將增加 2,500 萬美元，達到 1 億美元。我們也正在製定5至10年的創新路線圖。

Nate and his team are challenging the status quo to simplify and modernize the portfolio with a priority focus on higher-margin products. The Scotch fertilizer business is an example. It's a high-margin business, and we're the market leader, but our unit volume and that of the category have declined for more than a decade. Some of this is our doing. We know our pricing has got out of whack, and we've complicated things by getting away from the annual multistep solutions. We and our retail partners heavied up in the spring with big events on single bag solutions. This year, we're shifting back to educating consumers on the value of fertilizing multiple times a year.

內特 (Nate) 和他的團隊正在挑戰現狀，簡化和現代化產品組合，優先關注利潤率更高的產品。蘇格蘭肥料企業就是一個例子。這是一項高利潤的業務，我們是市場領導者，但我們的銷量以及該類別的銷量十多年來一直在下降。其中有些是我們做的。我們知道我們的定價已經失衡，而且我們透過放棄每年多步驟的解決方案使事情變得複雜。我們和我們的零售合作夥伴在春季大力開展單袋解決方案相關大型活動。今年，我們重新將重點轉向教育消費者每年多次施肥的價值。

Climate change is also making spring weather more volatile, which impacts our lawn fertilizer business more than any other. So we'll spread our lawn spend throughout the year and put more into the fall when the weather window is more favorable and open. From a product perspective, Nate's team, supported by our strategy group, is developing a strategy for longer-term success. Among the things we're exploring are new formulations, natural fertilizers and liquids.

氣候變遷也使春季天氣更加不穩定，這對我們的草坪肥料業務的影響比其他任何業務都大。因此，我們將在全年分散草坪開支，並在秋季天氣更適宜、更開放時投入更多。從產品角度來看，Nate 的團隊在我們策略小組的支持下正在製定長期成功的策略。我們正在探索的內容包括新配方、天然肥料和液體。

When we think about growth, we're more committed than ever to channel expansion. A whole group of consumers buys only online, and a lot of them are new to our category. We have a team dedicated to maximizing our POS this year on all retailer e-comm sites. We're underpenetrated here, and we aim to turbocharge POS at the retailer.com channel.

當我們考慮成長時，我們比以往任何時候都更加致力於通路擴展。大量消費者只在網上購物，其中許多人都是第一次接觸我們的產品類別。我們有一個團隊致力於今年在所有零售商電子商務網站上最大限度地提高我們的 POS。我們的滲透率還不夠高，我們的目標是增強 retailer.com 頻道的 POS 功能。

In parallel, the consumer team is reimagining our consumer-facing digital assets with the launch of a refreshed Scotts Miracle-Gro brand website by year end. It will position us as a house of brands with direct-to-consumer functionality. Direct-to-consumer is our chance to expand our subscription and our loyalty programs. With this reinvigorated focus on our business, we're getting back to basics. And that raises a question: what about our cannabis investments?

同時，消費者團隊正在重新構想面向消費者的數位資產，並計劃在年底前推出全新的 Scotts Miracle-Gro 品牌網站。它將把我們定位為一個直接面向消費者的品牌集團。直接面向消費者是我們擴大訂閱和忠誠度計畫的機會。透過重新關注我們的業務，我們正在回歸根本。這就引出了一個問題：我們的大麻投資怎麼樣？

We believe that moving Hawthorne out of Scotts Miracle-Gro is better for everyone. For our shareholders, this would eliminate the volatility of the cannabis sector and generate a significant uplift in gross margin. We and our banks think it would make it more clear what our equity represents and could expand our price-to-earnings multiple.

我們相信，將霍桑遷出 Scotts Miracle-Gro 對每個人來說都是更好的。對於我們的股東來說，這將消除大麻產業的波動性並顯著提高毛利率。我們和我們的銀行認為，這將使我們的股權代表什麼更加清晰，並可以提高我們的本益比。

Moving Hawthorne Gardening into a dedicated marijuana business would bring tax benefits and credit capacity to that company. It would also allow the plant-touching business to work alongside Hawthorne's world-class management team with formal relationships to Scotts Miracle-Gro. I know you've heard us talk about the separation before, and you may recall that we moved off of it last year because we couldn't find a suitable partner. The difference today is there are more promising opportunities. Hawthorne is now in a position of strength after the hard work to return it to profitability. The timing is right, and we believe we can make the ship while still meeting our 2025 guidance.

將霍桑園藝轉變為專門的大麻企業將為該公司帶來稅收優惠和信貸能力。這也將使這家從事植物接觸業務的公司能夠與霍桑 (Hawthorne) 的世界級管理團隊合作，並與 Scotts Miracle-Gro 建立正式關係。我知道你之前曾聽過我們談論過分居問題，你可能還記得，我們​​去年就分手了，因為我們找不到合適的伴侶。如今的不同之處在於，我們有更多有希望的機會。經過艱苦努力，霍桑目前已恢復獲利能力，實力雄厚。時機已到，我們相信我們能夠製造出這艘船，同時也能達到 2025 年的預期。

I want to talk about another aspect of transformation. We've completely remade the management team, and it's led to new approaches and ideas. [Shira] is the most recent addition, and his integration has been seamless. He's taken a collaborative approach to working with Nate, Chris, and the rest of the team. And just this week, we're poised to continue with a refresh of our Board of Directors. Tom Kelly, a long-time director, has announced that he will retire from our Board effective January 31. Tom has done great work for almost 20 years, and he'll certainly be missed. I want to thank him for his service.

我想談談轉變的另一個面向。我們徹底改組了管理團隊，並帶來了新的方法和想法。 [Shira] 是最近加入的，他的融入非常順利。他採取合作的方式與 Nate、Chris 以及團隊的其他成員一起工作。就在本週，我們準備繼續更新董事會。長期擔任董事的湯姆凱利 (Tom Kelly) 宣布將於 1 月 31 日起退休。湯姆近 20 年來一直做出巨大貢獻，我們一定會懷念他的。我要感謝他的服務。

Later this week, I plan to nominate Nick Miaritis, Chief Client Officer at VaynerMedia, as Tom's replacement. Nick has extensive consumer brand and digital marketing experience. Nick's appointment would continue our efforts to bring new skills and perspectives to the Board, along with more diversity in terms of age, ethnicity, gender and sexual orientation.

本週晚些時候，我計劃提名 VaynerMedia 首席客戶長 Nick Miaritis 接替湯姆。Nick 擁有豐富的消費品牌和數位行銷經驗。尼克的任命將繼續我們努力為董事會帶來新的技能和視角，以及在年齡、種族、性別和性取向方面的更多多樣性。

In the past three years, we've added five Board members with expertise in leveraged finance, fast-moving consumer goods, retail, market-leading brands, growth strategies, general management and C-suite level leadership. These changes reflect where we're headed, giving us the skill sets that align with the strategy that I've described today.

在過去三年中，我們增加了五名董事會成員，他們在槓桿融資、快速消費品、零售、市場領導品牌、成長策略、整體管理和高階主管領導方面擁有專業知識。這些變化反映了我們的發展方向，為我們提供了與我今天所描述的策略一致的技能。

Good things are happening at SMG. We're driving growth and margin recovery. We continue to improve our financials. We're strengthening the most powerful franchise in lawn and garden. Scotts is an iconic American company with a rich history of market-leading brands spanning nearly 160 years. We built this category that has extraordinary financial upside, and we're continuing to re-define it. For our shareholders, this translates into greater value creation and sustainable growth.

SMG 正在發生一些好事。我們正在推動成長和利潤率復甦。我們繼續改善我們的財務狀況。我們正在加強草坪和花園領域最強大的特許經營權。Scotts 是一家標誌性的美國公司，擁有近 160 年的市場領導品牌歷史。我們建立了這個具有非凡財務優勢的類別，並且我們正在繼續重新定義它。對我們的股東來說，這意味著更大的價值創造和永續成長。

My management team and I are completely committed to this. I want to thank our retail partners, our banks, my leadership team and our associates for their commitment. Most of all, I appreciate our shareholders for sticking with us and supporting us as we take our business to the next level.

我和我的管理團隊全力致力於此。我要感謝我們的零售合作夥伴、銀行、我的領導團隊和同事的承諾。最重要的是，我感謝我們的股東在我們將業務推向新水平的過程中對我們的堅持和支持。

Now I'll turn it over to Mark.

現在我將把話題交給馬克。

Thank you, Jim, and hello, everyone. Before I get into the first-quarter financials, I'll add to Jim's comments about the transition and how well it's going.

謝謝你，吉姆，大家好。在介紹第一季的財務狀況之前，我想補充吉姆對過渡以及過渡進展的評論。

Throughout my 13-year career with Scotts Miracle-Gro, I've worked in many facets of finance, [forged] strong relationships with our external partners and collaborated with the executive team and business leads. I'm a believer in being open and transparent, and I look forward to developing relationships with the investor community. I've built on this approach in my early tenure and look forward to helping the team make progress towards our fiscal '25 and three-year growth plans.

在 Scotts Miracle-Gro 的 13 年職業生涯中，我從事過財務的許多方面工作，與我們的外部合作夥伴建立了牢固的關係，並與執行團隊和業務主管進行了合作。我堅信開放和透明，並期待與投資者社群建立關係。我在任職初期就採用了這種方法，並期待幫助團隊在實現我們的 25 財年和三年成長計畫方面取得進展。

My passion for growing this business and driving value is rooted in my own lawn and gardening experiences. I'm an avid consumer, and I can personally attest that Scotts Miracle-Gro has the best brands in the business.

我對發展這項業務和推動價值的熱情源於我自己的草坪和園藝經驗。我是一位狂熱的消費者，我可以親自證明 Scotts Miracle-Gro 擁有業界最好的品牌。

Shifting to the quarter, we are off to a great start. I am pleased that the strong first-quarter results are well ahead of expectations. While we're optimistic for the year, we are maintaining our guidance, especially since the first quarter represents less than 10% of our total POS.

進入本季度，我們取得了良好的開端。我很高興看到第一季的業績表現強勁，遠遠超出預期。雖然我們對今年的業績持樂觀態度，但我們仍維持原有的預期，尤其是因為第一季的 POS 占我們總 POS 的不到 10%。

Our second and third quarters will be the biggest contributors to our full-year performance. So you can expect us to revisit guidance later in the fiscal year, as we usually do, once the season is in full swing. What we know from our first quarter performance is that we have positive momentum and our retail partners are highly engaged. We are positioned to drive consumer takeaway with the right strategies and investments.

我們的第二季和第三季將對我們全年業績貢獻最大。因此，您可以期待我們會在財政年度晚些時候重新審視指導，就像我們通常會做的那樣，一旦賽季全面展開。從第一季的業績來看，我們保持了積極的發展勢頭，而且我們的零售合作夥伴也積極參與。我們的定位是透過正確的策略和投資來推動消費者外送。

In addition, our first-quarter results reflect the hard work by our supply chain team in order to achieve our full-year target of $75 million of cost savings, which, as a reminder, is a part of our $150 million three-year target that Jim outlined earlier.

此外，我們的第一季業績反映了我們的供應鏈團隊為實現全年 7,500 萬美元成本節約目標而做出的辛勤工作，提醒一下，這是 Jim 之前提出的 1.5 億美元三年目標的一部分。

Now let's take a look at the top line. During the first quarter, sales on a company-wide basis were $417 million, up from $410 million. US consumer volume gains increased 11% to $341 million from $307 million, offsetting planned softness in Hawthorne. This included the strength of higher consumer engagement in the fall and earlier retailer load-in for the spring season. We expect retailer load-in to be the strongest in Q1 and Q2, which typically account for a little more than half of our expected full-year net sales.

現在我們來看看最上面一行。第一季度，全公司銷售額為 4.17 億美元，高於 4.1 億美元。我們消費者銷售量增幅從 3.07 億美元增加到 3.41 億美元，成長了 11%，抵消了霍桑的計畫疲軟。其中包括秋季消費者參與度的提高和春季零售商提早入市。我們預計零售商上架量將在第一季和第二季最為強勁，這通常占我們預期全年淨銷售額的一半多一點。

Replenishment orders in Q3 and Q4 will be dependent upon the level of consumer sell-through during the peak, spring, and summer selling season. As previously shared, for the full year, we expect low single-digit core growth in US consumer sales which excludes the impact of nonrepeating fiscal '24 sales for AeroGarden and bulk seed and fertilizer raw materials. POS is another healthy story with an increase of 12% in dollars and 13% in units. Consumer takeaway was driven by our fall advertising and promotional investment along with more positive macroeconomic factors.

第三季和第四季的補貨訂單將取決於旺季、春季和夏季銷售季節的消費者銷售水準。如同先前所述，就全年而言，我們預期美國消費者銷售額的核心成長率將維持在個位數以下，這不包括 AeroGarden 和大宗種子及肥料原料 24 財年非重複銷售額的影響。POS 是另一個健康的故事，其金額增加了 12%，單位數量增加了 13%。消費者外送的銷售量受到我們秋季廣告和促銷投資以及更積極的宏觀經濟因素的推動。

Hawthorne sales declined 35% to $52 million compared to $80 million last year. A significant decline was expected because of the strategic shift Hawthorne made in April '24, to exit low-margin third-party distribution and focus on its more profitable proprietary brands.

霍桑的銷售額從去年的 8,000 萬美元下降了 35%，至 5,200 萬美元。由於霍桑於 24 年 4 月進行了戰略轉變，退出利潤率低的第三方分銷，並專注於利潤更高的自有品牌，因此預計銷售額將大幅下降。

For the full year, we expect mid-single-digit decline in Hawthorne sales. While Hawthorne's top line was down, its profitability improved significantly in the quarter, and we continue to expect that Hawthorne will contribute approximately $20 million of EBITDA for the full year. Add it all up and from a full year total company perspective, we expect our full-year net sales to be around flat to prior year.

我們預計霍桑全年銷售額將出現中等個位數下滑。雖然霍桑的營收有所下降，但本季其盈利能力大幅提高，我們仍然預計霍桑全年將貢獻約 2000 萬美元的 EBITDA。綜合考慮所有這些，從全年整個公司的角度來看，我們預計全年淨銷售額將與去年持平。

Now moving to gross margin. we achieved over 750 basis points of improvement in both GAAP and non-GAAP adjusted gross margin rates. The GAAP rate was 22.7% versus 15.2% in prior year. And the non-GAAP adjusted gross margin rate was 24% versus 13.7%. The primary drivers include lower material costs, favorable fixed cost leverage, improved product and segment mix and lower distribution costs from our prior year warehouse closures. As I mentioned earlier, we expect the $75 million of supply chain savings to contribute to our near 30% gross margin rate target for the full year.

現在轉向毛利率。我們的 GAAP 和非 GAAP 調整後毛利率均提高了 750 個基點。根據美國通用會計準則 (GAAP) 計算，本財政年度該比率為 22.7%，而上年為 15.2%。非 GAAP 調整後毛利率為 24%，而 GAAP 調整後毛利率為 13.7%。主要驅動因素包括材料成本降低、有利的固定成本槓桿、產品和細分市場組合改善、以及由於上一年倉庫關閉而降低的分銷成本。正如我之前提到的，我們預計 7,500 萬美元的供應鏈節省將有助於我們實現全年近 30% 的毛利率目標。

In terms of timing, about two-thirds of the fiscal '25 gross margin rate improvement will come in the first half of the year due to favorable material costs and the benefit of last year's warehouse and other facility closures. The remainder will mainly come in Q4 as we lap onetime inventory write-offs taken in the fiscal fourth quarter of last year. Total commodity needs for fiscal '25 are approximately 60% locked as of the end of the quarter. So we have high visibility on input costs through the remainder of the year. All in, we are tracking well to our full-year 30% gross margin rate target.

從時間角度來看，由於材料成本優惠以及去年倉庫和其他設施關閉的好處，25財年毛利率提高的約三分之二將出現在上半年。剩餘部分將主要在第四季度出現，因為我們已將去年財年第四季的一次性庫存註銷計入。截至本季末，25 財年的總商品需求已鎖定約 60%。因此，我們對今年剩餘時間的投入成本有很高的了解。總體而言，我們正在順利實現全年 30% 的毛利率目標。

Moving down the P&L. SG&A was $125 million, an increase of 9% from $115 million a year ago. The increase was mainly driven by our planned investments in our media, technology and people. As previously shared, our year-end SG&A target includes $40 million of additional investments in our business that Jim talked about.

降低損益表。銷售、一般及行政開支為 1.25 億美元，較去年同期的 1.15 億美元成長 9%。成長主要得益於我們對媒體、技術和人員的計畫投資。如同先前所說，我們年底的銷售、一般及行政開支目標包括 Jim 提到的對我們業務的 4000 萬美元額外投資。

Along with higher performance-based incentives, these investments will drive our current year SG&A to approximately 17% of net sales versus 16% last year. Adjusted EBITDA improved by nearly $30 million. For the quarter, it was income of $3.8 million versus a loss of $25.8 million last year. This reflects our Q1 gross margin recovery coupled with strong fall POS results and higher retailer shipments ahead of spring. Below the line, interest expense was down 21% to $34 million, on lower debt balances and more favorable interest rates.

加上更高的基於績效的激勵措施，這些投資將推動我們本年度的銷售、一般及行政開支佔淨銷售額的比重從去年的 16% 提高到 17% 左右。調整後的 EBITDA 增加了近 3000 萬美元。本季營收為 380 萬美元，而去年同期虧損 2,580 萬美元。這反映了我們第一季毛利率的回升，加上秋季 POS 業績強勁以及春季來臨前零售商出貨量的增加。總體而言，由於債務餘額減少和利率更優惠，利息支出下降 21% 至 3,400 萬美元。

We continue to use strong cash flow generation and working capital management to further reduce debt. We now expect interest expense for the full year to be lower by $15 million to $20 million versus prior year. For Q1, the non-GAAP adjusted tax rate was 31.4%, due to the impact of the seasonal pretax quarterly loss and the timing of discrete items. For the full year, the non-GAAP adjusted tax rate is still expected to be in a range of 27% to 29%.

我們繼續利用強勁的現金流創造和營運資本管理來進一步減少債務。我們現在預計全年利息支出將比上年減少 1500 萬至 2000 萬美元。第一季度，非 GAAP 調整後稅率為 31.4%，原因是季節性稅前季度虧損和單項項目時間的影響。全年非GAAP調整後稅率預計仍將在27%至29%之間。

Also, because Q1 is typically a lost quarter, given the seasonal nature of our business, the company is required to use the basic share count to calculate EPS. For the current quarter, this was $57.3 million compared to $56.7 million in prior year. The increase in share count is attributable to share-based compensation and is expected to increase to approximately 59 million shares on a diluted basis by fiscal year-end.

此外，由於第一季通常是一個虧損的季度，考慮到我們業務的季節性，公司需要使用基本股份數量來計算每股盈餘。本季度，該數字為 5,730 萬美元，而去年同期為 5,670 萬美元。股份數量的增加歸因於股權激勵，預計到財政年度結束將按攤薄基礎增加至約 5,900 萬股。

The first-quarter GAAP net loss was $69.5 million or $1.21 per share compared with the prior year loss of $80.5 million or $1.42 per share. Non-GAAP adjusted loss, which excludes impairment, restructuring and other nonrecurring items, improved significantly to $51 million or $0.89 per share, versus a loss of $82.2 million or $1.45 per share a year ago.

第一季 GAAP 淨虧損為 6,950 萬美元，即每股 1.21 美元，而去年同期的淨虧損為 8,050 萬美元，即每股 1.42 美元。非 GAAP 調整後虧損（不包括減損、重組和其他非經常性項目）大幅改善至 5,100 萬美元或每股 0.89 美元，去年同期的虧損為 8,220 萬美元或每股 1.45 美元。

Now moving on to certain adjustments to our GAAP numbers. For the quarter, we had $21.7 million in impairment, restructuring and other nonrecurring items. This activity included the following: first, employee severance costs, including those related to executive team changes; second, valuation losses from our fiscal '21 investment in RIV Capital; and third, the final phase of our Project Springboard cost reductions that began in fiscal '22.

現在來談談我們對 GAAP 數字的一些調整。本季度，我們的減損、重組和其他非經常性項目為 2,170 萬美元。這項活動包括以下內容：首先，員工遣散費用，包括與高階主管團隊變動相關的費用；第二，我們對 RIV Capital 的 21 財年投資造成的估值損失；第三，我們的 Project Springboard 成本削減計畫的最後階段於 22 財政年度啟動。

You may recall that our Hawthorne Collective subsidiary provided an investment in the form of convertible notes to RIV Capital, which has legal cannabis operations in the state of New York. Late in our first quarter, RIV Capital merged with Cansortium. As a result, we converted those notes to nonvoting exchangeable shares in Cansortium. Going forward, these shares in Cansortium will be accounted for as an equity method investment with our proportionate share of Cansortium net profit or loss being recorded with an equity earnings line in our P&L. We plan to record this activity on a lag starting in our third quarter of this fiscal year.

您可能還記得，我們​​的子公司 Hawthorne Collective 以可轉換票據的形式向 RIV Capital 提供了投資，後者在紐約州擁有合法大麻業務。在第一季末，RIV Capital 與 Cansortium 合併。因此，我們將這些票據轉換為 Cansortium 的無投票權可交換股份。展望未來，Cansortium 的這些股份將以權益法投資進行核算，我們在 Cansortium 淨利潤或虧損中所佔的比例將在我們的損益表中以權益收益項目記錄。我們計劃從本財年第三季開始滯後記錄這項活動。

Next, I'll move to free cash flow and the balance sheet. We continue to focus on free cash flow to further strengthen our balance sheet. And in Q1, our total debt was lower versus prior year by $337 million. Free cash flow usage for the quarter of $475 million reflects our normal seasonal build of working capital. Our strong financial results, along with the cash flow management, have helped reduce our leverage ratio another quarter turn.

接下來，我將討論自由現金流和資產負債表。我們繼續關注自由現金流，以進一步加強我們的資產負債表。第一季度，我們的總債務比去年同期減少了 3.37 億美元。本季 4.75 億美元的自由現金流使用量反映了我們正常的季節性營運資本累積。我們強勁的財務表現以及現金流管理幫助我們的槓桿率又降低了一個季度。

For the first quarter, our leverage ratio was 4.52x net debt to adjusted EBITDA. This is well below the covenant maximum of 5.5x. Note that our covenant maximum will fall throughout the year, decreasing to 5.25 in the second quarter, 5 in the third quarter and 4.75 in the fourth quarter of this fiscal year. Our expected leverage ratio will also continue on a declining path, and we have line of sight to achieving leverage in the low 4s by fiscal year-end.

第一季度，我們的槓桿率為淨負債與調整後 EBITDA 的 4.52 倍。這遠低於契約最高限額 5.5 倍。請注意，我們的契約最高限額將在全年下降，在本財年第二季降至 5.25，第三季降至 5，第四季降至 4.75。我們預計槓桿率也將繼續下降，並且我們預計在財政年度結束時實現 4% 以下的槓桿率。

As I wrap up, I want to recap our three big financial objectives this fiscal year. They include: first, invest in our brands to maintain and build upon the sales growth in fiscal '24 from additional listings and share gains; second, drive margin recovery through sales growth and supply chain cost savings; and last, strengthen the balance sheet through further debt paydown and a focus on returning to a more flexible capital allocation strategy. We will continue to make substantial progress on each of these in '25 and remain on track to our three-year growth plan.

最後，我想回顧一下我們本財年的三大財務目標。它們包括：首先，投資我們的品牌，以維持並鞏固 24 財年的銷售成長，即透過增加上市數量和份額成長來實現銷售成長；第二，透過銷售成長和供應鏈成本節約推動利潤率回升；最後，透過進一步償還債務並專注於恢復更靈活的資本配置策略來增強資產負債表。2025年，我們將在上述每個領域繼續取得實質進展，並繼續推動我們的三年成長計畫。

Lastly, we are tightly managing costs and, to echo Jim's comments, we are strengthening our core consumer franchise and what he calls our superpowers. Most importantly, we are future focused, building on greater value and creating a more shareholder-friendly environment.

最後，我們正在嚴格管理成本，並且，呼應吉姆的評論，我們正在加強我們的核心消費者特許經營權以及他所說的超能力。最重要的是，我們著眼於未來，創造更大的價值並創造更有利於股東的環境。

Thank you, and we can now start the Q&A. I'll turn it over to the operator.

謝謝，我們現在可以開始問答環節。我會將其轉交給接線員。

(Operator Instructions) Chris Carey, Wells Fargo Securities.

（操作員指示）富國銀行證券的克里斯凱裡 (Chris Carey)。

There was a comment in the press release about strong fall season across all categories and some early retailer load-in for the spring season. Do you envision any timing shifts from the March quarter into the December quarter? Are there any implications for the March quarter, number one?

新聞稿中評論稱，秋季各品類銷售均表現強勁，部分零售商提前備貨迎接春季銷售。您是否預計從 3 月季度到 12 月季度的時間表會有所轉變？首先，這對三月季度有何影響？

And then secondly, as we sit here going into February, can you maybe expand a bit on early reads that you're seeing in markets that -- I suppose there's no markets that are breaking, but how you're feeling across the country right now going into spring? And maybe just sprinkle in any comments on your exposure to the West Coast and Los Angeles County specifically. So just a little timing shift on the December versus March quarter than some early season reads.

其次，現在我們已經進入二月，您能否就您在市場上看到的早期數據稍微詳細闡述一下——我想現在市場還沒有崩潰，但是您對現在全國各地即將進入春季的感受如何？或許您也可以就您對西海岸和洛杉磯縣的具體了解發表一些評論。因此，與一些早期季度的讀數相比，12 月季度與 3 月季度的時間略有不同。

There's a lot of stuff in there, dude. Let's just start with the fall went really well. And actually, there is season happening. We're having a Board meeting in Florida where after this call were headed down there on Thursday and Friday Board meeting there, where it's forecasted to be like near 80 I think, for, I don't know, the next five or six days.

那裡面有很多東西，老兄。讓我們先從秋天的順利開始。事實上，這是一個季節正在發生。我們在佛羅裡達州召開董事會會議，這次電話會議之後，我們在週四和週五前往那裡召開董事會會議，預計那裡的氣溫將接近 80 度，具體溫度我還不清楚，但接下來的五六天裡可能會達到。

So definitely, the country is beginning to come away from a lawn and garden point of view, and the numbers continue to look good at the POS level. Nate and I were speaking to a senior merchant, very senior merchant. I guess that was last week. What we were talking about was partially in my comments that I made today and did that sound right to them, which is sort of discussions about program dollars.

因此可以肯定的是，這個國家已經開始擺脫草坪和花園的視角，而且在 POS 層面，數字繼續保持良好勢頭。內特和我正在與一位資深商人交談，非常資深的商人。我想那是上週的事了。我們所討論的內容部分包含在我今天的評論中，並且他們聽起來是正確的，即關於專案資金的討論。

But we got into just how POS looks and their view of -- based on the business that they're seeing in the fall. And so far, the spring where markets are opening. Did they have data that sort of portends in what to look forward for. And they believe that they did, and it wasn't just lawn and garden. It was just generally their sales and that they felt that this was a good indication that the consumer is alive and well and willing to buy. This is a home improvement retailer.

但我們只了解了 POS 的外觀和他們的看法——基於他們在秋季看到的業務。到目前為止，春季已經進入市場開放期。他們是否有可以預示未來發展的數據？他們相信他們確實做到了，而且不僅僅是草坪和花園。這只是他們的一般銷售情況，他們認為這是一個很好的跡象，表明消費者還活著，並且願意購買。這是一家家居裝飾零售商。

So that that felt pretty good to us. Their biggest concern, and this gets to the timing, is do they have enough inventory deployed at the store level. And so what that said to us is there's no sensitivity on load issues and there's a view -- again, go back to this based on what they were seeing with their POS data, not just in lawn and garden, but across the chain -- that the consumer appears to be in a good mood to buy stuff. And that historically, that is a good sign. So I believe it, I wanted to believe it, too. So I think that's healthy.

所以，我們感覺非常好。他們最大的擔憂（這與時間有關）是他們是否在商店層級部署了足夠的庫存。所以，這告訴我們，他們對負載問題不敏感，而且有一種觀點 — — 再說一次，根據他們從 POS 數據中看到的情況，不僅僅是在草坪和花園，而是在整個連鎖店 — — 認為消費者似乎心情很好，想要買東西。從歷史上看，這是一個好兆頭。所以我相信它，我也想相信它。所以我認為這是健康的。

I don't know what I've missed, Nate, on what I was --

我不知道我錯過了什麼，Nate，我--

No, Yes, I'll add a little more color. So coming out of last summer, lot of lawn damage in particular. And I think the fall POS really showed the consumers were engaged. We know historically that not all consumers come back and fix in the fall. So I think that gives us a little more confidence in the spring.

不，是的，我會添加一些顏色。自從去年夏天以來，草坪遭到了特別嚴重的損壞。我認為秋季 POS 確實顯示出消費者的參與度。我們從歷史經驗得知，並不是所有的消費者都會在秋天回來進行維修。所以我認為這讓我們對春季更有信心。

Coming on the West Coast, really a nonfactor for us. We're obviously deeply concerned about what's happening in those communities. But from a business perspective, not going to be material. And of course, our teams will be out there helping folks when the time is right to rebuild. I

來到西海岸，對我們來說真的不是什麼重要的事。我們顯然對這些社區發生的事情深感擔憂。但從商業角度來看，這並不重要。當然，當重建時機成熟時，我們的團隊將前往現場幫助人們。我

would add likewise, this winter weather we've had, especially in the Southeast, on the East Coast, I think the conventional wisdom among our retail partners is that will be good for lawn and garden. There will be a lot of necessary repair work in the spring. So overall, between what we saw in the fall, the load-in that's supported by our Q1 numbers from our retail partners, we feel like we're as established as we can be for a decent spring and we'll see what happens.

同樣要補充的是，我們經歷的這個冬季天氣，特別是在東南部和東海岸，我認為我們的零售合作夥伴的傳統觀點是，這對草坪和花園有好處。春季將會有大量必要的修復工作。因此總體而言，根據我們在秋季看到的情況，以及我們零售合作夥伴第一季數據所支持的裝載量，我們覺得我們已經為一個不錯的春季做好了準備，我們將拭​​目以待。

And then, Chris, just to circle back on kind of phasing of sales, the low single-digit US consumer guide that we've given you. We would expect the first half and the second half of our fiscal year to be pretty consistent as far as having that similar pattern of sales growth. So there might have been a little bit of earlier load in than maybe some of your models and all that. But I would say that generally, that low single digit, we should see that the first half of the year and then the second half of the year.

然後，克里斯，讓我們回顧一下銷售階段，我們為您提供的低個位數美國消費者指南。我們預計，本財年上半年和下半年的銷售成長模式將保持相當一致。因此，可能比您的一些模型等的載入時間要早一些。但我想說，一般來說，這個低個位數，我們應該會出現在上半年，然後是下半年。

And as far as traditional sales patterns go, we've kind of gotten back to our pre-COVID norms of the 55% to 45% -- 55% of the first half of the year being sales and then the 45% in the back half. So we've gotten back to a little more normal sales pattern on that front.

就傳統銷售模式而言，我們已經恢復到疫情之前的正常水平，即上半年銷售額佔 55%，下半年銷售額佔 45%。因此，就這方面而言，我們的銷售模式已經恢復得比較正常了。

Okay. Great. comprehensive. My follow-up is on Hawthorne. Jim, I think the concept of a strategic alternative for Hawthorne has been contemplated for a long while now, and there have been logistical challenges with actually getting something done, right?

好的。偉大的。綜合的。我的後續關注點是霍桑。吉姆，我認為霍桑的戰略替代方案的概念已經考慮了很長時間，但在實際執行過程中遇到了後勤方面的挑戰，對嗎？

And so I guess, in a way, I think there's always been some desire or increasing desire to do something with the asset over time. And so I guess the question is, are you feeling like the logistical side of actually being able to do something with the asset is getting better? Or are you simply saying you remain committed to finding an alternative for this business?

因此我想，在某種程度上，我認為隨著時間的推移，人們總是有利用資產做某事的願望，或者說越來越強烈的願望。所以我想問題是，您是否覺得實際利用資產的後勤方面正在變得更好？或者您只是想說您仍然致力於為這項業務尋找替代方案？

I'd say both. I think Matt and I probably were not exactly in the same spot if you look back when Matt was here. And I think his view is if it's profitable -- some of you guys shared this when you were out at the Investor Day here last summer, that -- first of all, it's good news that Hawthorne is back in the black, and that's decent for the equity just based on your PE. I would say PEs are higher in sort of our business than they are in sort of the screwed up public equities that are out there for cannabis. And therefore, it does add value. Where I got to, and so I'm leading with my chin a little bit here because this is probably the last 1.5 months where basically -- and we can talk about it during the call, but it's not that the market has been so kind to Hawthorne. It's been very much internal work to cut expenses and do everything they can to get where they get to.

我想說兩者都有。我認為，如果回顧馬特在這裡的時候，我和馬特可能並不處於同一位置。我認為他的觀點是，如果它有利可圖——去年夏天你們在投資者日上就分享過這一點——首先，霍桑恢復盈利是個好消息，而且僅根據你的市盈率，這對於股權來說已經很不錯了。我想說，我們業務的本益比比大麻產業中那些失敗的公開股票的本益比要高。因此，它確實增加了價值。我到了哪裡，所以我在這裡稍微領先一下，因為這可能是過去 1.5 個月基本上 - 而且我們可以在電話會議中談論它，但並不是說市場對霍桑如此友好。他們一直在進行內部工作以削減開支並盡一切努力達到目標。

And I think we're confident in the $20 million. We have -- on my mandate they are on my board for Hawthorne. It's a bigger number than Mark is using in our strategic plan numbers, meaning that -- I think it's going to be hard work for them to get to a number that I would find respectful. It doesn't mean it's impossible and they've done really, really good work, but it means it's a relatively small beer.

我認為我們對這 2,000 萬美元有信心。根據我的授權，他們是霍桑董事會成員。這個數字比馬克在我們的戰略計劃中使用的數字要大，這意味著——我認為他們要達到一個我認為可以接受的數字將會很困難。這並不意味著不可能，他們也確實做出了出色的工作，但這意味著這款啤酒的銷售量相對較小。

And I think if you look and say, with all the sort of downsides of good news, bad news, and I think hard on the shareholders. Clarity on what our equity represents, that I was talking to some of our external advisers, and I just said, the question is, this could be so much more valuable in a pure pot business than it could be with us. This is not like we're looking to get rid of it. We're looking to sort of focus our investments in sort of the best configuration possible for our shareholders. And I'm going to say, for Chris, who really -- one of the things that Chris does here is lead that business for us. And authority matters, I think, that's my view.

我認為，如果你觀察並說，有各種各樣的好消息和壞消息，我會認真考慮股東的利益。我正在與我們的一些外部顧問進行交談，以明確我們的股權代表什麼，我只是說，問題是，這在純大麻業務中可能比在我們這裡更有價值。這並不是說我們想要擺脫它。我們希望將我們的投資集中在對股東最有利的配置上。我要說的是，對於克里斯來說，他在這裡所做的事情之一就是領導我們的業務。我認為權威很重要，這是我的觀點。

And so once I made that decision, which is -- and not by myself and one of the things that we did is we sort of finalized the script here, is I wanted my entire leadership team to say, do you guys all agree? Because it's not just that I agree in a couple of our advisers. It's do you guys all agree that this is the right move. And they said, yes.

所以一旦我做出了這個決定，這不是我自己做的，我們所做的事情之一就是我們在這裡最終確定了腳本，我希望我的整個領導團隊說，你們都同意嗎？因為我並不是只是同意我們的幾位顧問的觀點。你們都同意這是正確的舉措嗎？他們說是的。

And back to now the logistical side, the logistical side was never something we couldn't do. I think we just said is it kind of worth the hassle if the decision is to keep it in there and it's positive. And remember, this is legal business. Is that the best thing. Changing, which I think helps with the profitability of the business. It's a different conversation when it's a loss-making business than when it's a stable, profitable business in which it is now.

現在回到後勤方面，後勤方面從來都不是我們不能做的事情。我想我們剛才說了，如果決定將其保留在那裡並且是積極的，那麼是否值得這麼麻煩。請記住，這是合法生意。那是最好的事嗎？改變，我認為這有助於提高企業的獲利能力。當企業處於虧損狀態時，討論的話題與企業目前處於穩定、獲利狀態時討論的話題是不同的。

So I think once we all agreed and I agreed that this was the direction then it was me asking people to say, break down the logistical issues. And we're going to talk about this with the Board. And I think the Board is -- I think, these things is going to be the request, is the Board is going to authorize me subject to a bunch of things that have to happen, working with the banks and stuff like that so that we do need approval from banks on this. But my view is all that's going to happen in the next couple of months, and we'll begin as soon as we can.

因此我認為，一旦我們都同意並且我也同意這是方向，那麼我就會要求人們分解後勤問題。我們將與董事會討論此事。我認為董事會——我認為，這些事情將是要求，董事會將授權我處理一系列必須發生的事情，與銀行合作之類的事情，所以我們確實需要銀行的批准。但我的看法是所有這些都將在接下來的幾個月內發生，我們將盡快開始。

So you may start seeing the first steps of this because there's a bunch of different assets we're talking about. Is moving them could be as soon as a month or two. So I think we're pretty much primed for action. There's agreement amongst the leadership team. I think we've got to go through the final step with our Board to make sure they authorize it. And that Mark does this thing with the banks, they approve it just from a security point of view, securitization point of view. And then I think you'll see us in action. So I think we're through both of those things. I think we feel like from a decision point of view, we're good, and logistical, as you called it, point of view, I think we're in motion.

因此，您可能會開始看到這一進程的第一步，因為我們正在討論許多不同的資產。搬遷可能需要一兩個月的時間。所以我認為我們已經做好了行動的準備。領導團隊已達成一致。我認為我們必須與董事會一起完成最後一步以確保他們能夠授權。馬克與銀行做這件事，銀行只是從安全角度、證券化角度批准了它。然後我想你會看到我們的行動。所以我認為我們已經解決了這兩件事。我認為從決策的角度來看，我們做得很好，而且從後勤角度，正如你所說，我認為我們正在行動中。

Bill Chappell, Truist Securities.

Truist Securities 的 Bill Chappell。

Does have a question, I guess, specifically for Nate and for the whole management team. I mean, we [duct] over the 20-some years I've covered the company about stepping up marketing and advertising and new R&D and stuff like that to grow sales. If I look at your business, there's two ways to grow top line. One is expanding the number of regular users and, two, would be expanding the basket size or the amount they spend per year. And I'm trying to understand, is there a quantifiable opportunity on either and which one has more opportunity? And how are you going about kind of expanding it?

我想確實有一個問題，特別是針對 Nate 和整個管理團隊。我的意思是，我在報道該公司的 20 多年裡一直致力於加強行銷、廣告和新研發等方面的工作，以增加銷售額。如果我看一下你的業務，你會發現有兩種方法可以增加營業額。一是擴大常規用戶的數量，二是擴大購物籃的規模或每年的消費金額。而我想了解，這兩者之間是否存在可量化的機會，以及哪一個擁有更多機會？您準備如何擴大它？

I'm going to jump in just at the beginning part because part of this is revisiting our core convictions and investing in the brand. Bill, I think if we look at sort of market last year, probably, I think, 3%. I think the numbers are worse [sitting in] live goods within total market. We grew at about three times that. And that was a lot of share gain in there.

我將從一開始就介入，因為這其中的一部分是重新審視我們的核心信念和對品牌的投資。比爾，如果我們看去年的市場，我想大概是 3%。我認為，在整個市場中，活體商品的數量更糟。我們的成長率大約是這個數字的三倍。這其中的份額增長了很多。

And so this was coming out of a period where we kind of wanted to get the program dollars back, retailers resisted that. We talked about -- that have created probably a lot of confusion on this discussion last year. In exchange for leaving those program dollars at the levels they were at and probably actually increasing it a little bit, we picked up a lot more shelf space and promotional -- percent of promotion that occurred in the departments. And so that was really good for us, and we see that occurring pretty much at the same levels this coming year in sort of POS units.

當時我們正處於一個想要收回專案資金的時期，但零售商卻表示抵制。我們討論過——這可能在去年的討論中造成了很多混亂。作為交換，我們將這些項目資金保持在原有的水平，甚至可能稍微增加一點，我們獲得了更多的貨架空間和促銷——在部門中進行的促銷的百分比。這對我們來說確實是件好事，而且我們預計明年 POS 單位的業績也將基本保持相同的水平。

Now it's a very fair question to say how long can I keep going, how much share is there to take. I think Nate has been very much focused on where is there additional business where we are under-penetrated. So you want to take that?

現在，這是一個非常公平的問題：我還能撐多久，能分得多少份額。我認為 Nate 一直非常關注我們尚未充分滲透的領域中還有哪些其他業務。那你想接受這個嗎？

Yes. Sure, Bill. It's a great question. And the simple headline is both are important, but let me break it down this way. I think as we go into the spring, consumers will see our focus from a messaging standpoint is on frequency.

是的。當然，比爾。這是一個很好的問題。簡單的標題是兩者都很重要，但讓我這樣分解。我認為，隨著春季的到來，消費者將會發現我們從訊息傳遞的角度關注的是頻率。

If we look at lawn fertilizer plant food, for example, we know there's opportunity. We've gotten off message in terms of our multistep and the need to feed. So that will be a big focus this year, which we think we can increase that basket size. And we'll do some cross-brand work as well. Jim alluded to our new website, and we're working with retailers on programs where -- liquid controls. For example, we can figure out a way to attach them to some of our fertilizers.

例如，如果我們看看草坪肥料植物食品，我們就知道其中有機會。就多步驟和供給需要而言，我們已經偏離了資訊。所以這將是今年的重點，我們認為我們可以增加籃子規模。我們也會做一些跨品牌的工作。吉姆提到了我們的新網站，我們正在與零售商合作進行液體控制計劃。例如，我們可以想辦法將它們附著在我們的一些肥料上。

But the user thing is important, and Jim referenced it in his opening remarks on needing to engage that next segment. If I take a step way back and just look at household penetration overall for lawn and garden, it's less than 50%. And if I look at the trends over the last decade, number of users, whether they're people stepping out of the category or new homeowners who just don't have the confidence they are engaging in the category, unfortunately, that's rising. I look at that as an opportunity.

但用戶的事情很重要，Jim 在開場白中提到需要參與下一個環節。如果我退一步來看，只看草坪和花園的整體家庭普及率，這一數字還不到 50%。如果我回顧過去十年的趨勢，不幸的是，用戶數量（不管是退出該類別的人，還是對參與該類別沒有信心的新房主）都在上升。我視此為一個機會。

So while we've gained share in the near term through innovation, listings and retailer programs, we've got to do more than that. We've got to talk about education. We've got to talk about engagement. And it's a big force lever. It's every 1% of household penetration is another $50 million in [ferts] for us, for example. But every additional one-tenth of a turn of what we call frequency or the average number of applications, that's almost an equivalent for us. So the opportunity just to some, they're both there.

因此，雖然我們在短期內透過創新、上市和零售商計劃獲得了份額，但我們必須做的更多。我們必須談論教育。我們必須討論參與度。這是一個巨大的力量槓桿。例如，每 1% 的家庭普及率就會為我們帶來另外 5,000 萬美元的肥料。但是，我們所說的頻率或平均應用次數每增加十分之一，對我們來說幾乎就是等價的。因此，對某些人來說，機會就在那裡。

In the near term, it's focused on, what I'll call, the heating frequency, and in the mid- to long term, we're absolutely focused on how to engage that consumer that we're not engaged with. And I'll add, I think there's opportunity for us in the do-it-for-me space. And I don't mean from a service standpoint right now. What I mean is getting consumers who choose to use a professional to choose our products, and that's an area that we'll be thinking about in the midterm as well.

從短期來看，我們專注於所謂的加熱頻率；從中長期來看，我們絕對專注於如何吸引那些我們尚未接觸的消費者。我還要補充一點，我認為在「為我做」領域我們也有機會。我現在不是指從服務的角度來看。我的意思是讓消費者選擇專業人士來選擇我們的產品，這也是我們在中期考慮的一個領域。

I don't think we should not bring up the sort of dotcom side. I think as we look at the business, and I think -- we got a whole new crew running our brands now, and they are hungry and enthusiastic and younger, and I love what they're doing.

我認為我們不應該談論網路泡沫方面的事情。我認為，當我們審視業務時，我們會發現——我們現在有一支全新的團隊來經營我們的品牌，他們渴望成功、充滿熱情且更加年輕，我喜歡他們所做的事情。

On the control side, I think what's really clear is we're very much underpenetrated in these sort of dotcoms, whether it's the retailer.com, it's the Amazon, marketplace, call it. And what you're seeing is, weirdly, competitors actually live there. And we're very dominant in retail. We're clearly less dominant online. And that means we have to have some products that are redesigned, but a lot of it is in the controls market. And I'm talking hundreds of millions of dollars.

在控制方面，我認為真正明顯的是，我們對這類網路公司的滲透非常不足，無論是retailer.com，還是亞馬遜、市場等等。奇怪的是，你會看到，競爭對手實際上住在那裡。我們在零售業佔據主導地位。我們在網路上的主導地位顯然不夠。這意味著我們必須重新設計一些產品，但其中許多是在控制市場。我指的是數億美元。

And so we see competitors in there. You're seeing [Procter] play a little bit with Zevo in there. And you're talking more than $100 million and not just once a couple of times. So this is a clearly low-hanging fruit for us, but we have to go after it. And I think the young crew that's working the business under Nate and with Nate's enthusiastic support, this is a big opportunity.

因此我們在那裡看到了競爭對手。你會看到 [Procter] 和 Zevo 在那裡玩了一會兒。而且你說的金額超過 1 億美元，而且不只一次或幾次。所以這對我們來說顯然是唾手可得的果實，但我們必須去追求它。我認為，對於在 Nate 手下經營這項業務的年輕團隊以及 Nate 的熱情支持下，這是一個巨大的機會。

And the part that may be nervous about it is when they define the opportunity, he was talking in like nearly $1 billion of opportunity. And this gets back to your question, Bill. And I said too, seriously, vanish that number, make it a smaller number so that you don't get out of balance where we're trying to make investments and we're chasing something that's a little bit in the ether. But there's clearly a lot of upside there.

人們可能感到緊張的是，當他們定義機會時，他談論的是近 10 億美元的機會。這又回到你的問題了，比爾。我也說過，認真地講，請讓這個數字消失，讓它變得更小，這樣當我們試圖進行投資並且追逐一些虛無縹緲的東西時，就不會失去平衡。但顯然其中還有很大的上升空間。

So I think that this retailer.com thing is a big deal, particularly with younger people who are very used to buying online, they're not going to brick-and-mortar sites as much. This doesn't go against it. I know that a lot of our biggest retailers are very active on dotcom and enthusiastic about us helping them. But there's a lot of opportunity there and penetration. And the screwed up part for me is we're letting people live under there, and we need to say that business should be ours. And so we're going to go after it.

所以我認為這個retailer.com的事情很重要，特別是對於習慣網路購物的年輕人來說，他們不太會去實體店購物。這並不矛盾。我知道，我們的許多大型零售商在網路上都非常活躍，並且熱衷於我們幫助他們。但那裡有很多機會和滲透力。對我來說，最糟糕的是，我們讓人們住在那裡，而我們必須說那塊地應該是我們的。所以我們會繼續追求它。

And just real quickly, Bill, on the investment side as they've talked about that. I mean, to me, it's very much kind of folds into our superpowers. I don't foresee this being a massive amount of long-term investment. We will continue to invest as part of our longer-term plan. But things that Nate has talked about. I mean, we've got incredible supply chain facilities, incredible distribution capabilities. We have a lot of that already in stock that it should be a pretty good return on our investment. Will we have to invest? Sure, but I think it could be easily managed.

比爾，我們很快就談談投資方面的問題。我的意思是，對我來說，這在很大程度上融入了我們的超能力。我預計這不會是一筆龐大的長期投資。作為我們長期計劃的一部分，我們將繼續進行投資。但 Nate 已經談論過這些事情了。我的意思是，我們擁有令人難以置信的供應鏈設施和令人難以置信的分銷能力。我們已經有大量庫存，這應該可以為我們的投資帶來相當不錯的回報。我們必須要投資嗎？當然，但我認為這很容易做到。

That's great. And just the follow-up. Tougher for us sometimes to see the changes in market share or whatever at the retail level during the season, we kind of hear it at the end. Is there an area of, be it lawn food, is it soils, mulch, something where you're super excited about, hey, we're really geared up, we can gain big chunks of market share and really grow faster. Or is it really kind of broad brush, we've got momentum overall.

那太棒了。這只是後續行動。有時我們很難看到市場份額的變化，或者在旺季零售層面的任何變化，我們總是在旺季結束時才聽到它。是否有一個領域，例如草坪肥料、土壤、覆蓋物，讓你感到非常興奮，嘿，我們真的準備好了，我們可以獲得很大的市場份額，並且真正更快地增長。或者說這真的是一種概括，我們整體來說是有動力的。

Okay, if you don't, we can both answer it. Because it's another one of these, I think, good question. If you look and say, where is the business? It's easy to go with the current. Controls and gardens are honking and that's good for us, okay? That's high-margin business.

好的，如果你不知道的話，我們兩個都可以回答。因為我認為這又是一個好問題。如果你看一下並說，生意在哪裡？隨波逐流很容易。控制裝置和花園都在鳴笛，這對我們有好處，好嗎？這是高利潤的業務。

I would say double digit is what we're seeing, and we expect to sort of continue. So I think that that's where you're going to see kind of share gains because that were just in the flow, and that's good news for us. We're not losing share on lawns. I think we're in a really, really, really good place. I think that everybody is now basically saying, we need unit buying back, okay.

我想說我們看到的是兩位數，我們預計這趨勢將會持續下去。所以我認為你會看到份額成長，因為這只是順勢而為，這對我們來說是個好消息。我們的草坪市佔率並未遺失。我認為我們目前處於一個非常非常好的狀態。我認為現在每個人基本上都在說，我們需要回購單位，好吧。

Remember, you don't see a big decrease in dollar sales in lawns, mostly because we've been pricing. And I think we were saying we've sort of reached the limit of that, mostly for the consumer. And it's a good profitable business for us.

請記住，您不會看到草坪銷售大幅下降，主要是因為我們一直在定價。我認為我們已經達到了極限，主要對於消費者而言。對我們來說這是一筆很賺錢的生意。

But I think this multistep get bags up, we've got a real plan. And when you talk -- this is the legacy business at this property in Marysville, and to have everybody basically be willing and open-minded to sort of critically looking at what's happening in the market and willing to make change, the entire team is in a really good place and very open-minded to change. And I think this is all healthy. I wouldn't do not read anything bad here. This is getting people to be kind of critical of the lawn business here. I don't know. It's like criticizing Horace Hagedorn or something. It's tough to do and get away with it.

但我認為，透過這個多步驟的準備，我們有一個真正的計劃。當你談論這是位於瑪麗斯維爾的這家酒店的傳統業務時，每個人都願意並且以開放的心態批判性地看待市場正在發生的事情，並願意做出改變，整個團隊都處於一個非常好的狀態，並且對改變持非常開放的態度。我認為這一切都是健康的。我不會在這裡讀任何不好的東西。這讓人們對這裡的草坪生意產生了一些批評。我不知道。這就像批評 Horace Hagedorn 之類的。這是很難做到但卻很難逃過懲罰的。

Here, everybody is open-minded. And whether it's the brand team, supply chain, R&D, the leadership team, everybody and the Board, everybody is interested in that. So that's probably the most troubled area, but I would say it's unit volume is what I would be looking at on that. And I think that would be a good thing for you to look because it's one -- if you said to me, there's top two or three things you're working on, I would just say continued recovery, margin investment in our business, and lawns, and getting resolved, getting our Hawthorne assets all put together in a place that adds the most value. That's what I'm looking at.

在這裡，每個人都思想開放。無論是品牌團隊、供應鏈、研發、領導團隊、每個人和董事會，每個人都對此感興趣。所以這可能是最麻煩的領域，但我想說我關注的是單位體積。我認為這對你來說是件好事，因為如果你問我你正在做的最重要的兩三件事，我會說繼續復甦，對我們的業務和草坪進行保證金投資，並解決問題，把我們的霍桑資產放在一個能創造最大價值的地方。這正是我所看到的。

Jon Andersen, William Blair.

喬恩·安德森，威廉·布萊爾。

Boy, there's a lot to chew on here. I did want to say that I didn't have the mouse on my bingo card this morning.

孩子，這裡有很多東西值得咀嚼。我確實想說今天早上我的賓果卡上沒有滑鼠。

You've got a bingo card. That's cool.

您有一張賓果卡。這很酷。

Maybe starting on gross margin, I'd love to hear a little bit more about the cadence that you're expecting of gross margin improvement throughout 2025, but also you've kind of established this three-year goal of getting back to the mid-30s. And I think maybe, Jim, you've characterized it as that last third which would come post 2025, I believe, will be the hardest yard -- those will be the harder yards to get. And any updated thoughts on that 2027 objective and perhaps those harder yards and how you're feeling about getting back to that level?

也許從毛利率開始，我很想聽聽您預期 2025 年毛利率改善的節奏，但您也設定了三年目標，即回到 35% 左右的水平。吉姆，我想也許你把它描述為 2025 年以後的最後三分之一，我相信，那將是最難的——那些將是最難獲得的。您對 2027 年的目標以及那些更艱難的目標有什麼最新想法嗎？

Well, let me just take before Mark starts off. There's been a lot of pressure from my Board to have a longer strategic plan out view than through '27. I've resisted pretty hard largely because of exactly what you said, like first, I believe that, which is that I want to get to kind of our new spot before we start sort of confusing ourselves with a lot of long-term objectives that I think -- not that they're not important, but I think we're not completely done fixing this business and getting it to where what I talked about.

好吧，讓我在馬克開始之前先拍一張。董事會對我施加了很大壓力，要求我們制定一個比27年更長遠的策略規劃。我一直極力反對，主要是因為你所說的，首先，我相信，在我們開始被許多長期目標所困擾之前，我想先找到新的方向——並不是說它們不重要，只是我認為我們還沒有完全修復這項業務，也沒有把它恢復到我所說的狀態。

I'm not sure that I buy that it's a lot harder because I think the team -- and I'm going to give credit to our rookie here, Shira, who's doing an absolutely fabulous job. And largely, he's just working really well with the rest of his finance team and the operating group. And so I think there's a line of sight to almost everything we're talking about here. So I don't think it's as hard as you think. I think it is going to require us to do some more hard things. But believe me when I tell you, we have line of sight to the numbers.

我不確定我是否認為這會困難得多，因為我認為團隊——我要讚揚我們的新秀 Shira，她的工作非常出色。總體來說，他與財務團隊和營運團隊的其他成員合作得非常好。所以我認為我們在這裡談論的幾乎所有事情都有其共同點。所以我不認為它像你想像的那麼難。我認為這需要我們做一些更困難的事情。但請相信我，我們已經看到了這些數字。

We're obviously pushing to a higher number than where you guys are at. And I think that's not unusual and that's, I think, what we should be doing. It's harder than you think a little bit, largely because incentive kicks in and just makes a harder number harder because the number we tell you has got the incentive already built into it. But people are pretty motivated and they're chasing it.

我們顯然正在努力實現比你們更高的目標。我認為這並不罕見，而且我認為這就是我們應該做的。這比你想像的要難一些，主要是因為激勵因素開始發揮作用，使一個更難的數字變得更加困難，因為我們告訴你的數字已經包含了激勵因素。但人們非常有動力並且正在追逐它。

So I guess that's really what I would say is not so hard line of sight. Everybody is working well together to get there. There is a bunch of stuff that has to happen, but I think people are working on it. And we're trying to springload that, especially the change, what we call transformation. We're trying to get that done as early as we can just because it's hard on the organization to go through change where they don't really know what it means, it sounds scary and maybe a little bit it is, but these are choices we have to make.

所以我想說的其實不是那麼難懂。每個人都齊心協力，努力實現這個目標。有很多事情必須發生，但我認為人們正在努力。我們正在努力推動這一點，特別是變革，即我們所說的轉型。我們正在儘早完成這項工作，因為對於組織來說，經歷變革是很困難的，因為他們並不真正了解變革意味著什麼，這聽起來很可怕，也許確實有一點可怕，但這是我們必須做出的選擇。

And it's in part to produce the results that we all, and you, want, $700 million of EBITDA in '27 or at least, but it's also to make the kind of investments and run the business that we want. And that is my view that we have an unbelievably unique consumer franchise. And part of where I've gotten my head to, it works for me, put it that way, is if you look at the multiples of proper consumer brand companies that are dominant in their space, whether it's Procter, Clorox, Colgate, Church and Dwight, I don't know, I could go through a bunch, what you're going to see is multiple expansion that's pretty significant compared to where we are.

這樣做的部分原因是為了實現我們大家和你們都希望的結果，即在 27 年至少實現 7 億美元的 EBITDA，但同時也是為了進行我們想要的投資和經營我們想要的業務。我認為我們擁有令人難以置信的獨特的消費者特許經營權。我所考慮的部分原因在於，它對我有用，可以這麼說，如果你看看在其領域占主導地位的正規消費品牌公司的倍數，無論是寶潔、高樂氏、高露潔、Church 還是 Dwight，我不知道，我可以列舉很多，你會看到，與我們現在的情況相比，倍數擴張是相當顯著的。

And where we are, we're probably lucky it's not worse given the journey we've been on. So we want that, and we know we can get that. It does mean we've got to look at ourselves hard and make some tough choices and we're going to. So part of it is about producing a financial result. Part of it is making the investments in the brand so that this franchise is extremely durable.

而考慮到我們經歷過的旅程，我們目前的情況可能還不算太糟，我們或許很幸運。所以我們想要這個，而且我們知道我們能夠得到這個。這確實意味著我們必須認真審視自己並做出一些艱難的選擇，而我們會這樣做。因此部分原因在於產生財務結果。其中一部分是對品牌進行投資，以使這個特許經營權極其持久。

Jon, just a follow-up just very specific on your two questions, phasing and long term. So for phasing for this year on gross margin, so we've talked about $75 million of cost out. We very much have line of sight to that. And as Jim said, the team is pushing to get more in the fiscal year as well. But at the end of the day, that in my prepared remarks and all that, it's about two-thirds first half of the year. That $75 million will get put in for the fiscal year. And then the other -- a third will go through the back half of the year.

喬恩，我只想針對你的兩個問題，即分階段和長期，進行後續跟進。因此，就今年的毛利率而言，我們討論了 7,500 萬美元的成本。我們非常清楚這一點。正如吉姆所說，團隊也在努力在財政年度取得更多成果。但最終，在我準備好的發言和其他所有內容中，這大約是上半年的三分之二。這7500萬美元將投入本財政年度。另外三分之一將在今年下半年進行。

So the two-thirds, the reason it's more front loaded, obviously, is commodities. Inventory. We've done a nice job, obviously, acquiring inventory at lower prices. Year over year, we've seen the commodity, deflation. And so we're now working through that cheaper inventory to where we're now on a good level playing field for the balance of the year. So year over year, we were still working through some higher cost of inventory last year, the first half of the year. And so that's why you'll see that year-over-year benefit from the lower cost of inventory.

因此，三分之二的資金主要集中在前期的原因顯然是商品。存貨。顯然，我們以較低的價格收購庫存，做得很好。年復一年，我們見證了商品通貨緊縮。因此，我們現在正在努力透過廉價的庫存，為我們在今年剩餘的時間創造一個良好公平的競爭環境。因此，與去年同期相比，去年上半年我們仍在努力解決較高的庫存成本問題。這就是為什麼您會看到庫存成本降低的同比收益。

So I would foresee additional gross margin improvement in Q2 versus prior year. Again, about two-thirds, like I said. And then third quarter, probably pretty close, and then we'll get into Q4. In Q4, we'll begin to lap the E&O charges we took around $29 million, which will be a year-over-year comparison benefit. So that's kind of how the phasing for this year goes.

因此我預計第二季的毛利率將比去年同期進一步提高。就像我說的，大約是三分之二。然後第三季度可能非常接近，然後我們將進入第四季度。在第四季度，我們將開始計入約 2900 萬美元的 E&O 費用，這將是同比收益。這就是今年分階段的實施情形。

As far as long term, I would just tell you, we were landing around 30% on a full year. If you look at the core business, it's north of that, the lawn and garden business gross margin-wise, very healthy. We are constantly doing, we call it, (inaudible) savings project activity and review, and the team is looking at that on a constant basis well out into the future. And they've already been building plans in place to deliver on the next phase of the $150 million of supply chain savings. So that will be another $75 million in '26 and '27.

就長期而言，我只想告訴你，我們全年的成長率約為 30%。如果你看看核心業務，你會發現，草坪和花園業務的毛利率非常健康。我們一直在進行所謂的（聽不清楚）儲蓄專案活動和審查，團隊正在持續關注未來。他們已經制定了計劃，以實現下一階段 1.5 億美元供應鏈節約的目標。因此，26 年和 27 年還將有 7,500 萬美元。

And the timing of that, we're still finalizing, but it would come over those two years. And it's very much going to be tied to projects and activities that we're looking at. And transformation will be a part of that, but the team has it built into their core. It's what we've always done pre-COVID. We were good at getting those costs out. And I think if you go back and look at pre-COVID US consumer type margins, we were traditionally in that 35% range. So we feel confident we can get back to those as we rightsize the supply chain infrastructure.

我們仍在最終確定具體時間，但它將在兩年內實現。它將與我們正在關注的項目和活動密切相關。轉型是其中的一部分，但團隊已將其融入核心。這就是我們在疫情之前一直在做的事情。我們很擅長消除這些成本。我認為，如果您回顧並看看新冠疫情之前美國消費者類型的利潤率，我們傳統上處於 35% 的範圍內。因此，我們有信心，只要我們調整供應鏈基礎設施的規模，我們就能重新實現這些目標。

I would say longer term, is pricing a part of that, it could be. We're going to try to be as nimble as possible around that, and that's why transformation is important to us. But I think you can see us laddering up then in getting there. Hopefully, this -- I think of '25 as a downpayment to how we get to the mid 30% range. And I think the first-quarter results kind of show that. So hopefully, it gives you a little bit extra confidence.

我想說，從長期來看，定價是其中的一部分，這是可能的。我們將嘗試盡可能靈活地應對這個問題，這就是轉型對我們如此重要的原因。但我想你可以看到我們正在逐步實現這一目標。希望如此——我認為 25 年是我們達到 30% 中間範圍的首付。我認為第一季的業績證明了這一點。希望這能帶給你一點額外的信心。

But Nate, do you have anything else?

但是 Nate，你還有其他事情嗎？

Yes, not to belabor it, but I think a few details, Jon. So I've got my business units looking at three main things. First of all, Jim referenced in simplification. I guess, we'll call it a SKU effectiveness project. But basically, I think it's been a long time since we've taken a hard look at the margins on a SKU by SKU level. And I'm not implying we're going to massively strip the portfolio down, but I think my GMs need to know where their margins are. So that's the first piece.

是的，我不想過多地談論它，但我認為需要一些細節，喬恩。因此我讓我的業務部門專注於三件主要的事情。首先，吉姆提到了簡化。我想，我們會稱之為 SKU 有效性專案。但基本上，我認為我們已經很久沒有認真研究過每個 SKU 等級的利潤率了。我並不是暗示我們要大規模削減投資組合，但我認為我的總經理需要知道他們的利潤在哪裡。這是第一部分。

Innovation. Look, innovation will drive margin accretion, and we've been trying to get that innovation engine turned back on during the pandemic. And our challenges afterwards, we were really focused on cost out. We've made some nice additions to the team to think out 5, 10 years and then, of course, the supply chain efficiencies.

創新。看，創新將推動利潤成長，我們一直在努力在疫情期間重新啟動創新引擎。我們隨後面臨的挑戰是真正關注成本。我們為團隊增添了一些優秀的人才，以考慮 5 年、10 年的未來發展，當然還有供應鏈效率。

And the other comment I want to make is we're not going to do this at the expense of retailer margins. They're our partners, and we're going to work with them to make sure that programs we put in place drive win-win for both of us. So it is all task, but I told Jim, he asked me, can we get to 35%, and I don't think I skipped a beat. I think we'll get there. I don't have every step in the way mapped out, but directionally, I'm pretty confident.

我想說的另一點是，我們不會以犧牲零售商利潤為代價來做到這一點。他們是我們的合作夥伴，我們將與他們合作，確保我們實施的計劃實現雙方共贏。所以這都是任務，但我告訴吉姆，他問我，我們能否達到 35%，我認為我沒有錯過任何節拍。我想我們會到達那裡。我並沒有規劃好每一步，但對於方向，我非常有信心。

I mean I'll just add, pricing will be a part of this, not all of it, but pricing will be a part of this. Remember, Hawthorne out, I'm going to say, is worth at least 100 basis points.

我的意思是，我只想補充一點，定價將是其中的一部分，而不是全部，但定價將是其中的一部分。請記住，我要說的是，霍桑的價值至少為 100 個基點。

Eric Bossard, Cleveland Research.

克利夫蘭研究公司的埃里克·博薩德。

I guess to start, Nate or Jim, I'm curious, strategically, as you're thinking about price and market share and gross margin and connecting those three things. You've got commodity savings this year, which is funding some gross margin expansion. Jim, you mentioned a consumer that's price sensitive. And then you also talked about market share progress. And so I'm curious, do you feel the need as we work through this year to be more promotional to spend money to -- you talked about this innovative multistep program of being more aggressive with discounts to drive consumer traffic.

我想首先，Nate 或 Jim，我很好奇，從戰略上講，你們正在考慮價格、市場份額和毛利率，並將這三者聯繫起來。今年您獲得了商品儲蓄，這可以為部分毛利率擴張提供資金。吉姆，你提到了對價格敏感的消費者。然後您也談到了市場佔有率的進展。所以我很好奇，您是否覺得我們在今年的工作中需要投入更多的促銷資金——您談到了這個創新的多步驟計劃，即通過更積極的折扣來吸引消費者流量。

Is that part of it? And obviously, there's some more private label competition out there. Or do you feel like the investment in the brand and marketing is sufficient that you can power through all of that, which is basically what you did last year. How do you think about connecting those points?

這是其中的一部分嗎？顯然，還存在著更多的自有品牌競爭。或者您是否覺得對品牌和行銷的投資足以讓您完成所有這一切，這基本上就是您去年所做的。您認為該如何將這些點連接起來？

Well, I think they're all connected, but I'll start there. Again, this is like my word evolution. So it doesn't mean it's where everybody else is around the table. There's a lot of people here. But I would say -- we looked, and I think we've talked about it with you guys that as we went through our most challenging years, there was a lot of incentive dollars to make sales happen when we wanted them and needed them. And the retailers did it, and they were big boys and girls, and it was all voluntary.

嗯，我認為它們都是有關聯的，但我將從這裡開始。再說一次，這就像我的字詞進化。所以這並不意味著每個人都坐在桌子旁邊。這裡有很多人。但我想說——我們看過了，我想我們已經和你們討論過這個問題，在我們經歷最具挑戰性的歲月裡，有大量的激勵資金讓我們在想要和需要的時候實現銷售。零售商們也這麼做了，他們都是成年人了，而且這一切都是自願的。

But I think what you saw is our margin go down and theirs go up. And now (inaudible) over and troubles over and I want my money back. That's kind of where I got to. The more I've looked at it though and the more I thought about it competitively, and this is one of the reasons I've been chatting with retailers at the senior level about it, is what we're seeing is they're working so hard to get consumers into the store that for every program dollar we put in, they're spending more than that of their money, driving our products and our brands.

但我想您看到的是我們的利潤率下降而他們的利潤率上升。現在（聽不清楚）麻煩又來了，我想要回我的錢。這就是我所到之處。然而，我對此研究得越多，從競爭的角度考慮得越多，這也是我一直與高層零售商討論這個問題的原因之一，我們看到的是，他們非常努力地吸引消費者進店，我們為項目投入的每一美元，都比他們在項目上投入的錢要多，從而推動我們的產品和品牌的發展。

And all of a sudden, I started thinking of myself if we can make our margin goals, and I don't want that money back. I just want it working hard for me. That was part of the discussion, which is I'm cool with this, but I think talking to Josh Meihls, I don't know, a couple of weeks ago, he just said we got to have very sharp elbows then, because those programs got to work, and they don't always work and sometimes they do, a lot of times they do. But that was really the discussion and the sort of journey in regard to exactly what you're asking.

突然間，我開始考慮我們是否能夠實現利潤目標，我不想要拿回那筆錢。我只希望它能為我努力工作。這是討論的一部分，我對此感到滿意，但我認為幾週前與喬什·梅爾斯 (Josh Meihls) 交談時，他說我們必須非常敏銳，因為這些程序必鬚髮揮作用，它們並不總是有效，有時它們會起作用，很多時候它們會起作用。但這其實就是針對您所問問題的討論和歷程。

What I'm seeing, Eric, is it's very virtuous. And that when you look at it that way, the investments in the brands, I'm talking our investments, at sort of activation at the store level and the money we spend behind it, you're talking north of $700 million. And from a competitive point of view, my view is I'm in the moat building business.

艾瑞克，在我看來，這是非常高尚的。從這個角度來看，對品牌的投資，我說的是我們的投入，在商店層面的激活以及我們在其背後花費的資金，總額超過了 7 億美元。從競爭的角度來看，我的觀點是，我從事的是護城河建設業務。

I want a deep moat and keep people away from what belongs to us. And we intend to keep it. And it's not like we're seeing crazy stuff except you do have Procter kind of playing around our space, and we want to throw a party for them as well, even though it's not really -- like they're not really -- it's more SCJ with the Zevo business that they're sort of playing around. And I would say if SC Johnson is listening, we could use some money to defend against them, but we're going to put our money into defense of the controls business, not that they're really looking at our stuff, but it's got us thinking about how powerful this franchise is and how important it is that we defend it.

我想要一條深護城河，讓人們遠離屬於我們的東西。我們打算保留它。我們並沒有看到什麼瘋狂的事情，只是寶潔確實在我們的領域中玩弄花招，我們也想為他們舉辦一個派對，儘管事實並非如此——他們並不是真的——他們更像是 SCJ 和 Zevo 業務在玩弄花招。我想說，如果莊臣公司在聽的話，我們可以使用一些資金來抵禦他們的攻擊，但我們將把錢投入到控制業務的防禦中，並不是說他們真的在關注我們的東西，而是它讓我們思考這個特許經營權有多麼強大，以及我們捍衛它有多麼重要。

And if we can make our gross margin numbers work and keep that money in there, I think we continue to then have outside share. And I think that's kind of how I connect it all up. So I don't really view it as an option. I don't think we're done spending. If you are looking at my Board right now, what I have in there is a, I don't know, 25% increase from today in our marketing dollars.

如果我們能夠提高毛利率並將錢存入其中，我認為我們可以繼續擁有外部份額。我想這就是我將一切連結起來的方式。所以我並不認為這是一個選擇。我認為我們的支出還沒結束。如果您現在正在看我的董事會，您會發現我們的行銷費用比今天增加了，具體來說是增加了 25%。

So this is all -- we're not done with this work. This is the work that if I was -- we leave here [to go to a] two-day Board meeting. And I think everybody is going to come back and really get into transformation. And not only achieving the business on a day-to-day basis because we're pretty much in season at this point, but I think completing the planning that's going to be required to get where we want to get to, everybody is going to really get into it.

就這樣吧——我們的工作還沒完成。如果我要做這項工作——我們離開這裡去參加為期兩天的董事會會議。我認為每個人都會回來並真正實現轉變。而我們不僅要完成日常的業務，因為此時我們正處於旺季，而且我認為，完成實現目標所需的規劃，每個人都要真正投入其中。

I think if I try to ask people today for transformation discussions that they know there's a lot of work already happening, I think they'd say, can we get to the Board meeting first. And so we're going to do that. But there very much is a correlation between all this stuff. We're not taking our foot off the gas pedal. Eric, you've been following us long enough. We've done this before. There was a year like during the financial crisis that I said, I can't really control anything. What I can show people is that we can sell more and advertise more.

我想，如果我今天試著邀請人們進行轉型討論，他們知道有很多工作已經在進行中，我想他們會說，我們能不能先召開董事會會議。所以我們會這麼做。但所有這些東西之間確實存在著一定的關聯。我們不會鬆開油門。艾瑞克，你已經跟隨我們很久了。我們以前做過這個。有一年，例如在金融危機期間，我說過，我真的無法控制任何事。我可以向人們展示的是，我們可以銷售更多產品、做更多廣告。

Now it was pretty devastating to our P&L. Now at the time, the incentive was based on two things: ad spend, our market share in POS, okay? So it didn't even include profitability just because the world suck. And so I said we're just going to -- while the world sucks, let's just prove that advertising works. We hadn't figured out how to be able to sustain that level of spend and make the money we needed to make. That was kind of what we discovered.

現在這對我們的損益來說是相當毀滅性的。現在，激勵措施基於兩件事：廣告支出，我們在 POS 的市場份額，好嗎？所以它甚至沒有包括盈利能力，因為世界很糟糕。所以我說我們只是想要──當世界很糟糕時，我們就要證明廣告是有效的。我們還沒有想出如何維持這種支出水平並賺取我們所需的錢。這正是我們所發現的。

The new version of that is we're going to make the money we need because we're going to go through this transformation, and we're going to spend it. It's just going to be a little bit different company when we're done. And it's going to be highly focused and pretty more like, I don't know, any --

新的說法是，我們將賺到我們所需的錢，因為我們將經歷這種轉型，然後我們將會花掉這些錢。當我們完成之後，它只不過會是一家略有不同的公司。而且它將高度集中，更像，我不知道，任何--

No. I second everything you say. Promotions, Eric, worked for us last year. We've leaned into it more this year. And I think the art is in sort of working from top of funnel, our media, down to consumer conversion at the shelf, and making sure along that entire path to purchase, we're spending those dollars appropriately.

不。我贊同你所說的一切。促銷部，埃里克，去年為我們工作。今年我們對此更加重視。我認為藝術在於從漏斗頂部、我們的媒體，到貨架上的消費者轉化，並確保在整個購買過程中，我們都在合理地花費資金。

So I would say as we evolve, and I have a new team here, we're spending more time thinking about, from top to bottom, how those dollars work for us. Our retail partners have been great. And just to touch on the private label, it's an important part of the business for our retailers. And of course, we support that business for them in a lot of areas. I don't see it as a threat. I see it as part of a good, better, best. And just taking a step back, if I look at private label share since 2019, it's been declining. So it's part of the equation here. I don't see it as something that's going to derail our focus on growth and margin.

因此我想說，隨著我們的發展，我這裡有一個新的團隊，我們會花更多的時間從上到下思考這些錢如何為我們服務。我們的零售合作夥伴非常棒。簡單來說，自有品牌是我們零售商業務的重要組成部分。當然，我們在許多領域為他們的業務提供支援。我並不認為這是一種威脅。我認為它是好、更好、最好的一部分。回顧一下，如果我看 2019 年以來的自有品牌份額，它一直在下降。所以它是這裡等式的一部分。我不認為這會破壞我們對成長和利潤的關注。

The only other thing, Eric, I'll circle back on is margin. All of what they said drives volume, drives fixed cost leverage, it just allows us greater flexibility. It's why you're seeing that we can do what we can do on the gross margin line this fiscal year and beyond. So I think they all play nicely. The finance team here will be focused on making sure we get the proper [align] on that and margin recovery, but balance that with the longer-term vision of the company.

艾瑞克，我唯一要回顧的另一件事就是利潤。他們所說的一切都推動了銷量，推動了固定成本槓桿，這讓我們有了更大的彈性。這就是為什麼你會看到，我們可以在本財年及以後的毛利率方面做到我們所能做的事情。所以我認為他們都玩得很好。這裡的財務團隊將專注於確保我們在這方面取得適當的調整和利潤率的恢復，但要與公司的長期願景保持平衡。

Okay. And then a second question, if I could. I think you talked about that your POS was up 9% or 10% last year and up 3% market, and you sound more optimistic going to '25 than you did '24 for a whole host of reasons. Is there a reason why both those numbers can't be better in '25?

好的。如果可以的話，我還有第二個問題。我記得您說過，去年您的 POS 上漲了 9% 或 10%，市場上漲了 3%，而且由於多種原因，您對 25 年的前景比 24 年更樂觀。有什麼原因導致這兩個數字在 25 年都無法更好呢？

Well, first of all, I think every time we get in our head that we can do better, we f*** it up, to be honest. And so I think the biggest risk factor Nate has probably in his numbers is consumer takeaway. And so it's not a shy number. It might roll up to kind of low single digits, but it's not shy. Do I think we could do better, particularly if we had a good year, which would be nice, I think the answer is yes. But I think it's a little bit like Nate saying, I think there's $1 billion of upside in all these other channels, including dotcom.

嗯，首先，老實說，我認為每次我們想著我們可以做得更好時，我們就會把事情搞砸。因此，我認為 Nate 的數據中最大的風險因素可能是消費者外送。所以這並不是一個令人驚奇的數字。它可能會上升到較低的個位數，但並不低。我是否認為我們可以做得更好，特別是如果我們有一個好年的話，那將會很好，我認為答案是肯定的。但我認為這有點像 Nate 所說的，我認為包括網路公司在內的所有其他管道都有 10 億美元的上升空間。

We are deeply in recovery in a good way. And I don't want to start chasing stuff that sounds good. But do I think there could be -- yes, I think yes, I do. I think the last year sucked, dude. It's like we -- why did we pick up some much? Because we have a lot more shelf space. That's fundamentally it. And I think we did a really good job on some of our marketing programs. The fall was fabulous and for a lot of reasons, right? The weather was great, lawns have been kind of burnt up.

我們正處於良好的深度復甦階段。我不想開始追逐那些聽起來好的東西。但是我認為可能存在嗎——是的，我認為存在，我認為存在。我覺得去年很糟糕，兄弟。就像我們——為什麼我們會撿到這麼多？因為我們有更多的貨架空間。基本上就是這樣。我認為我們在一些行銷計劃上做得非常好。秋天很美妙，原因有很多，對吧？天氣很好，草坪有點被燒焦了。

We had just great programs put together so the consumers were seeing our product, like a lot of control stuff happening, including Tomcat. So just, it really came together. And I think that shows the power of the franchise. We just got to string it all together now. So do I think there's continued upside? I don't know if I need double digit because I think it's crazy to say that, even though maybe. I think if we can just keep this going longer, which I think is the best way for us to look at it, I think it's really good for the franchise, and it keeps people.

我們剛剛整合了出色的程序，以便消費者能夠看到我們的產品，例如許多控制事物，包括 Tomcat。所以，一切真的實現了。我認為這體現了特許經營權的力量。我們現在就得把一切串連起來。那我認為它還有持續上漲的空間嗎？我不知道我是否需要兩位數，因為我認為這麼說很瘋狂，儘管有可能。我認為如果我們能夠讓這種情況持續更長時間，我認為這對我們來說是最好的看待它的方式，我認為這對特許經營權真的很好，並且可以留住人才。

Look, the problem when we say more, and it's a little bit what we saw this year, and it's the criticism a little bit we got from ISS, is we had a really great year last year. It just wasn't quite as good in the EBIT line as we thought. And I think a little bit, we were kind of out of our mind when we sort of said $600 million last year was so easy. And our incentives were based on that, just so you know. So where it really screws us up, dude, is the incentives because the incentives are pretty levered.

瞧，當我們進一步談論時，問題就在於，這有點像我們今年看到的情況，也有點像我們從 ISS 受到的批評，去年我們過得真的很棒。它的息稅前利潤並不像我們想像的那麼好。我認為，當我們說去年賺 6 億美元是如此容易的時候，我們有點失去了理智。我們的激勵措施就是基於此，這一點你們也知道。所以，兄弟，真正讓我們陷入困境的是激勵措施，因為激勵措施是相當槓桿化的。

And so we sort of convinced ourselves, we can do something. And then we have a really good year, but not quite as good as we have and the incentive crashes. And then we got a step to the Board and say we had a great year, do you think we should make an exception? And this is a joint effort with our Board. We pay a target after last year, which was a very important recovery year for us, it just paid at 100%. It would have paid less.

所以我們確信自己，我們可以做些什麼。然後我們度過了非常好的一年，但還沒有達到我們所擁有的水平，而且激勵機制也崩潰了。然後我們向董事會提出建議並說我們度過了美好的一年，你認為我們應該破例嗎？這是我們與董事會的共同努力。我們在去年之後支付了目標，這對我們來說是非常重要的復甦年，它支付了 100%。這樣得到的報酬就會更少。

That was ISS' criticism. And so we have this real deep negative leverage in our incentives that if we overpromise ourselves, everybody gets hosed. And so we got to kind of avoid that. So just throw that out for (inaudible).

這是 ISS 的批評。所以，我們的激勵措施中存在著這種真正深刻的負面槓桿作用，如果我們過度承諾自己，那麼每個人都會被欺騙。所以我們必須盡量避免這種情況。所以就把它丟掉（聽不清楚）。

William Carter, Stifel.

威廉·卡特（William Carter），斯蒂費爾（Stifel）。

This is Andrew on for William. Just wanted to ask, first off, with the kind of gross margin guidance that you gave for the year, just to understand it's got the bulk of improvement, I think, two-thirds in the first half. Then you have the fourth quarter lap, and you're kind of implying 3Q is flat, and I know you don't want to get into the granulars of it. But if I go back to 3Q of last year, that's 29.2%, which was 700 basis points below 3Q '19.

這是安德魯 (Andrew) 代替威廉 (William)。首先我想問一下，根據您給的今年毛利率預期，我認為大部分的改善都是在上半年實現的，大概是三分之二。然後你有第四節圈，你暗示第三節是平的，我知道你不想陷入其中的細節。但如果回到去年第三季度，這個數字是 29.2%，比 2019 年第三季低 700 個基點。

So I guess, I'm asking in your plan here, is there a lot of flexibility here for the mixed performance, particularly this is a lawns quarter and perhaps a more normalized lawn year or better performance could be upside the margin? But just anything in there as I'm digging in?

所以我想問的是，在您的計劃中，混合表現是否具有很大的靈活性，特別是這是一個草坪季度，也許更加規範化的草坪年或更好的表現可能會增加利潤？但當我深入研究的時候，裡面到底有什麼？

Yes. So we would still expect -- I think maybe I misspoke a little bit on saying it was completely flat. But it should be up a little bit. And you are right, we should have some flexibility there with our product lineup and as we progress into Q4.

是的。所以我們仍然期望 - 我想也許我說錯了一點，說它是完全平坦的。但應該會稍微漲一點。您說得對，隨著我們進入第四季度，我們的產品陣容應該具有一定的靈活性。

Perfect. Second question, I guess, I would ask is just to step back and level set where kind of cost savings are over the next year. Go 30% gross margins in hand. You want to go towards mid-30s, removing Hawthorne from the P&L will obviously help from that. You've got line of sight to about half of that, you said before. And then there's a, hey, go get it. And I think you also mentioned a challenge of $30 million this morning to Nate. I assume that's incremental to the $150 million.

完美的。我想問的第二個問題是回顧並確定明年的成本節約水準。手上有30%的毛利率。如果你想達到 30 年代中期的目標，那麼將霍桑從損益表中剔除顯然會有所幫助。正如你之前所說，你的視線已經到達了其中的一半。然後就會有，嘿，去拿到它吧。我記得您今天早上還提到了向 Nate 發起的 3000 萬美元的挑戰。我認為這個數字會逐漸增加至 1.5 億美元。

And then kind of a final question is you've taken kind of all these costs out, it's clear you're putting dollars back into advertising. But as you think about the supply chain and the potential stressors on it, do you see any risk there of not being able to meet the demand, and I don't think -- I hope we'll never have a COVID again. But that was a -- fill rates were below and that really stressed. But just anything you can give on kind of driving the comfort that there's not going to be a -- get to ['28], hey, we need to reinvest this business in the supply chain.

最後一個問題是，您已經把所有這些成本都剔除了，很明顯地您將錢重新投入廣告中。但當你考慮供應鏈及其潛在的壓力因素時，你是否認為有無法滿足需求的風險？但填充率很低，這確實令人感到壓力。但是，無論你如何努力，都不會再有這種安慰——到 ['28]，嘿，我們需要在供應鏈中重新投資這項業務。

Yes. Maybe I'll touch on the supply chain, Andrew. Good question.

是的。也許我會談談供應鏈，安德魯。好問題。

Let me just throw in there. Andrew, Chris was giving you the finger when you said get rid of Hawthorne.

讓我就此插話。安德魯，當你說除掉霍桑時，克里斯是在對你豎中指。

It was in a good natured way, Andrew.

這是善意的行為，安德魯。

No. Listen, you highlight exactly something that we sort of framed as we embarked really starting more than a year ago on our supply chain transformation, which is build it with the most flexibility possible. So I am not concerned about capacity either in the short term or the mid to long term. Jim talked about the incremental $25 million in CapEx. A lot of that is going into technology to help us be more efficient and give us the capacity we need.

不。聽著，您強調的正是我們在一年多前真正開始進行供應鏈轉型時所製定的目標，即以盡可能大的靈活性來建立供應鏈。因此，我並不擔心短期或中長期的產能。吉姆談到了增量的2500萬美元資本支出。其中很大一部分投入了技術中，以幫助我們提高效率並提供我們所需的能力。

I'm just proud of the team. We're down to like six distribution centers from, I think, a peak of 18 or something like that. So we are definitely making sure that we are not overcutting when it comes to those optimizations. And you'll see the investments. In fact, I'll be talking at the conference in March just about our manufacturing strategy.

我為這支球隊感到驕傲。我認為，我們的配送中心數量從高峰期的 18 個減少到了 6 個左右。因此，我們一定要確保在進行這些優化時不會過度削減。您會看到投資。事實上，我將在三月的會議上談論我們的製造策略。

So could you just talk maybe just a second about just the crew that's down there.

那麼，您能否稍微談談那裡的船員們的情況。

Yes. So the great thing about our supply chain is led by Dave for a long time, just a lot of inherent knowledge there. But Dave's done a great job hiring and we've got some young VPs, really technology forward, that if you were at our conference in July last year, you may have met David Husky. But we've got some really smart people just completely helping us reimagine this, everything from fully automated forklifts.

是的。因此，我們的供應鏈的優點在於長期由戴夫領導，並且累積了大量固有知識。但戴夫在招募方面做得很好，我們有一些年輕的副總裁，他們確實是技術先鋒，如果你參加了我們去年 7 月的會議，你可能見過大衛·赫斯基。但是我們有一些非常聰明的人完全幫助我們重新構想這一點，從全自動堆高機開始。

Probably the biggest thing we did is this core distribution center. It's a mile down the road from our Marysville manufacturing plant. All of our fertilizers distribute out of that, and it's picked up by our retailers. We've saved, like, 0.5 million miles of truck driving over a year between distribution centers. We've got a really good crew. You'll see more coming out of us in supply chain. That $3 million, Jim asked for, I would say the bulk of it probably comes out of supply chain, but it's all going to be based on a foundation of investing in technology, whether it's supply chain, field sales force, et cetera.

我們所做的最重要的事情可能就是這個核心配送中心。它距離我們的瑪麗斯維爾製造廠有一英里。我們的所有肥料都從那裡分銷出去，然後由我們的零售商回收。我們一年內節省了配送中心之間約 50 萬英里的卡車行駛里程。我們擁有一支非常優秀的團隊。你會看到我們在供應鏈中做出更多貢獻。吉姆要求的 300 萬美元，我想說其中大部分可能來自供應鏈，但一切都將建立在對技術投資的基礎上，無論是供應鏈、現場銷售團隊等等。

I'd also say, Andrew, that the entire corporation is going to contribute. And that's a little bit like let people get back after Board meeting and start sharpening the pencils, but there's a lot of teams working right now. A lot of that -- it's not just Nate. Nate has been contributing. When you look at the sort of [400 out 100] back into the business, a lot of that's come from the operating side. And God bless, but that's where a lot of money gets spent. So it's not inappropriate. The corporate is going to participate here too. And we're asking real big questions about who we want to be and how we add value here.

安德魯，我還要說，整個公司都會做出貢獻。這有點像是讓人們在董事會會議後回來開始削鉛筆，但是現在有很多團隊正在工作。很多事情都是這樣的——不只是內特。內特一直在做出貢獻。當你回顧業務中的 [400/100] 時，你會發現其中許多都來自營運方面。上帝保佑，但這就是花費大量金錢的地方。所以並沒有什麼不合適的。企業也將參與此活動。我們正在問一些真正重要的問題：我們想要成為什麼樣的人，以及我們如何在這裡增加價值。

Listen, Mark can say because he's the most important bean-counter and sort of keeping the score here. But I don't think that number is scary at all. Do you?

聽著，馬克可以這麼說，因為他是這裡最重要的會計員，並且能記錄分數。但我並不認為這個數字有什麼可怕的。你？

No, not at all. And I think to your point, it will come also at corporate and SG&A. And so some of it might get reinvested as Jim talked about on super power, some might drop to the bottom line. I think it just allows us some flexibility as we continue to do our '26 planning, which we already have started and have been focused on even while we're in season. So yes.

不，一點也不。我認為正如您所說，它也將出現在公司和銷售、一般及行政費用方面。因此，正如吉姆談到的超級大國那樣，其中一些可能會被重新投資，一些可能會落入底線。我認為這只會讓我們在繼續進行 26 年計劃時具有一些靈活性，我們已經開始了這項計劃，並且即使在賽季期間也一直專注於此。所以是的。

We'll all participate in that process. There's plenty of opportunity there. I think there's a lot of technology over the past five, seven years that have allowed us to do our jobs a lot easier and I think get more efficient. I think we've got some good ideas.

我們都將參與這項進程。那裡有很多機會。我認為過去五到七年來的許多技術讓我們的工作變得更輕鬆，而且效率也更高。我認為我們有一些好的想法。

Jonathan Matuszewski, Jefferies.

傑富瑞的喬納森‧馬圖舍夫斯基 (Jonathan Matuszewski)。

Nice results. First one was on innovation. In your prepared remarks, you referenced natural fertilizers and liquids as part of the product road map ahead. So just curious how you see those contributing to the 3% sales growth over the medium term and how you think about innovation as a contributor to US consumer segment growth ahead relative to history?

效果不錯。第一個是關於創新。在您準備好的演講中，您提到天然肥料和液體是未來產品路線圖的一部分。所以我很好奇，您如何看待這些因素在中期對 3% 銷售成長的貢獻，以及您如何看待創新相對於歷史對美國消費領域成長的貢獻？

Yes. Jim, I'm going to steal the beginning of that. It's really Nate's subject matter. But here's what I would tell you. This goes back to one of my main priorities, which is seeing progress on unit volume and loans. Remember, we're not losing share. This is a category-wide issue. One of the things, I think, that's concerned by younger people on chemicals used in the yard. And so I do think that organic is one way to avoid people being sensitive. So we know how to do this. This is not hard.

是的。吉姆，我要偷偷講一下開頭。這確實是 Nate 的主題。但我想告訴你的是。這又回到了我的主要任務之一，即看到單位數量和貸款的進展。請記住，我們的份額並沒有丟失。這是一個全類別的問題。我認為，年輕人擔心的事情之一是院子裡使用的化學物質。因此我確實認為有機是避免人們敏感的一種方法。所以我們知道該怎麼做。這並不難。

So a lot of times, you believe in organic, you put it in the field, it just doesn't sell that well -- consumers. But I think that one of the reasons people don't see it is their concern of our chemicals. And so we want to make sure we're looking hard at that and so we're going to do that. Nate can speak formulation changes, except I would say it's a very tough place to innovate when you're dealing with controls. There's not that many controls.

所以很多時候，你相信有機產品，並將其應用到田地中，但它賣得併不好——消費者。但我認為人們沒有意識到這一點的原因之一是他們對我們的化學物質的擔憂。因此，我們要確保認真研究這一點，並且我們會這樣做。內特 (Nate) 可以談論配方變化，但我想說，在處理控制時，這是一個很難創新的地方。沒有那麼多的控制。

There's not a lot of innovation in ag chemicals, to be honest. And so you tend to be using the same actives. And so I'm trying to infuse to everybody here that if this was Procter and we were talking Tide, I think they would assume the cleaning power convenience of cleaning for homemakers, all this stuff gets better over time. What world are we living in where we're sort of dealing with 30-year-old technology and thinking it's okay? EPA is trying to push us to -- because they're looking at total exposure that consumers have over a lifetime, including food they eat and their exposure to pesticides there. And so they're inhibiting the ability to put down actives as a way to mitigate lifetime what they would call risk up, which means less effectiveness.

說實話，農業化學品領域並沒有太多創新。因此您傾向於使用相同的活性成分。因此，我想讓在座的各位明白，如果這是寶潔公司，而我們談論的是汰漬公司，我想他們會認為，對於家庭主婦來說，清潔能力和便利性都會隨著時間的推移而變得更好。我們生活在什麼樣的世界裡，我們在使用 30 年前的技術，並且認為它沒什麼問題？美國環保署正試圖推動我們——因為他們正在關註消費者一生中的整體接觸情況，包括他們吃的食物和接觸的農藥。因此，他們透過抑制活性成分的釋放來降低終生風險，也就是降低有效性。

So lack of innovation in the actives, putting down less than probably is optimal to get the controls you're looking for. And I think that drives a need for real innovation. Then I'll get to this other part, which is my view of the seasons and that I think, and I cannot -- we hire really good weather people. I cannot get a really great answer as to what we're seeing in the spring is related to climate change. I think it is because we're seeing it over and over again, which is kind of [squarely] behavior in April, which is prime for this and really open fall.

因此，在活動方面缺乏創新，投入較少的資金可能是獲得您想要的控制的最佳方式。我認為這推動了真正的創新的需求。然後我要談談另一部分，這是我對季節的看法，我認為，我不能——我們僱用了真正優秀的天氣預報員。關於我們在春季看到的現像是否與氣候變遷有關，我無法得到一個非常好的答案。我認為這是因為我們一遍又一遍地看到這種情況，這在四月是一種明顯的行為，這對於秋季來說是至關重要的，也是真正開放的。

And we advertise, we stimulate business. The retailers like it too because they're in lawn and garden mode. It's their kind of spring. But what do I think? I think if you talk to a lot of researchers here, they put down in the fall, and they'll say, fall is the best time to [seed].

我們做廣告，促進商業發展。零售商也喜歡它，因為他們處於草坪和花園模式。這是屬於他們的春天。但我怎麼想呢？我想如果你和這裡的許多研究人員交談，他們會把秋天當作研究對象，他們會說，秋天是[種子]。

But we're fighting for the spring, and we're fighting for what I think is unreliable weather. Meaning that there's a lot of deviation to the forecast in the spring relative to the fall. That's what I can get out of the experts. So meaning it's -- forecast weather more frequently in the spring in April than there is in fall, particularly Midwest, Northeast. So I'm trying to push to there, and there's another thing that they do.

但我們正在為春天而戰，我們正在為我認為不可靠的天氣而戰。這意味著春季的預測與秋季的預測有很大偏差。這就是我從專家那裡能得到的。所以這意味著——四月春季的天氣預報比秋季更頻繁，特別是中西部和東北部。所以我正在嘗試推動那裡，他們還做了另一件事。

If consumers don't apply our products with a wet lawn, they're not going to get that grade control. They'll get good control, but not great control. And we want great control. If you talk to experts here, I don't care if it's supply chain people, people who know, supply chain people, R&D people, senior leadership, they're applying straight feeds with liquids, liquid pesticides, which gives a really good control because it gets right into the leaf. You don't have to apply it to a wet product, which we think some people -- a lot of people don't.

如果消費者沒有在濕草坪上使用我們的產品，他們就無法獲得該等級的控制。他們可以獲得良好的控制，但不會獲得良好的控制。我們想要更強的控制力。如果你與這裡的專家交談，我不在乎他們是供應鏈人員、知情人士、供應鏈人員、研發人員還是高級領導，他們都使用液體直接餵養，液體農藥，這可以很好地控制，因為它可以直接進入葉子。您不必將它塗抹在濕產品上，我們認為有些人 - 很多人不會這樣做。

So that's how you're hearing kind of innovation, seasonality and promotion throughout the year as opposed to all just in the spring, trying to make the fall important, organics and liquids, because we're trying to sort of get at the things that can cause people to have less great results or make it kind of complicated or deal with bad weather. So those are why you're hearing all things. But when it comes to just innovation where Nate's going, which is he's -- look, he's not me. It's good. No, he's a very process guy who has plans for everything. And innovation is a planning exercise. It's a long-term investment exercise.

所以，這就是你所聽到的全年都有創新、季節性和促銷活動，而不是只在春季，試圖讓秋季變得重要，有機產品和液體食品，因為我們試圖解決那些可能導致人們獲得不太好的結果或使事情變得複雜或應對惡劣天氣的因素。這就是你們聽到這一切的原因。但當談到內特所要進行的創新時，他──看，他不是我。很好。不，他是一個非常注重流程的人，對每件事都有計劃。創新是一種規劃活動。這是一項長期投資活動。

Yes. I mean, look, I'll break it down to sort of how we look at innovation, which is easy use for the consumer, effectiveness, value and safety. And depending on your consumer, those things, the rank order of importance changes, but I think Jim talked about it. This year, we've got our full Miracle-Gro organics line coming out. That's been a big hit in gardening and we know that that's important.

是的。我的意思是，看，我會把它分解成我們如何看待創新，即消費者易於使用、有效、有價值和安全。並且根據您的消費者，這些事情的重要性的排序會發生變化，但我認為吉姆已經談論過它了。今年，我們推出了全系列 Miracle-Gro 有機產品。這在園藝界引起了很大的轟動，我們知道這很重要。

We have some new innovation in lawns coming out. We have our OM Scotts sort of our heritage line, pesticide, herbicide free, straight food, straight seeds, it's going to be in a [curve] recyclable bag. So we're playing around with the new form factors. I mean, I certainly would like to see less plastic in the world, but it's got to work. We've got an all-natural that sort of is going to compete with the P&G offering coming out this summer.

我們在草坪方面推出了一些新創新。我們有 OM Scotts 這類傳統產品線，不含殺蟲劑、除草劑，是純天然食品，是純天然種子，均裝在[曲線]可回收袋中。因此我們正在嘗試各種新的形式因素。我的意思是，我當然希望看到世界上的塑膠減少，但這必須努力。我們有一種純天然的產品，可以與今年夏天推出的寶潔產品競爭。

And here's the thing. I want to be able to offer to whatever the consumer wants. And if we want to have a consumer that wants to be all natural, we'll have products, but we're also going to have really smart products that are effective and safe to use that contain active ingredients. And we'll talk a little bit with consumers. This goes to the education piece, and I can't stress it enough. We can invent all the great things we want. If we don't talk to the consumer, help them understand how to use these things, it will fail.

事情是這樣的。我希望能夠提供消費者想要的任何東西。如果我們想要吸引那些追求純天然的消費者，那麼我們會提供產品，但我們也會提供含有活性成分、有效且安全的智慧產品。我們會和消費者進行一些交談。這牽涉到教育部分，再怎麼強調也不為過。我們可以發明所有我們想要的偉大的東西。如果我們不與消費者交流，不幫助他們理解如何使用這些東西，它就會失敗。

So that's going to be a big piece of it. And then I'll just end with -- I think we're the only player in the category that has the horsepower to engage with some of our active suppliers, some of the big ag companies. I mean, we are looking 10 years out. We are looking at biologicals. We are engaging in sort of some of the crystal research they're doing looking for more natural ways to improve the performance, whether it's controls product, whether it's a fertilizer, plant food. So it will take time to build that, but it will absolutely -- as long as we stick to is it easy to use, is it effective, does it bring value, and is it safe, I'm pretty confident that we'll be leading the pack with innovation.

所以這將是其中很重要的一部分。最後，我想說的是——我認為我們是該類別中唯一一家有能力與一些活躍供應商、一些大型農業公司合作的參與者。我的意思是，我們的眼光是十年之後。我們正在研究生物製劑。我們正在進行一些晶體研究，尋找更自然的方法來提高性能，無論是控制產品，還是肥料還是植物食品。因此，實現這一點需要時間，但絕對可以——只要我們堅持它是否易於使用、是否有效、是否帶來價值、是否安全，我非常有信心我們將在創新方面處於領先地位。

[Why don't you] announce your new partner on innovation --

[為什麼不]宣布你的新創新夥伴--

So Rob Candelino, outstanding new Board member. He will be taking over for Tom Kelly. My team has a lot of respect for him. He's probably given us more insights in the last few months than we've had in a long time just because he's a working CEO and he's still out there fighting the good fight. So just a really great add to the Board.

所以 Rob Candelino 是一位出色的新董事會成員。他將接替湯姆·凱利。我的團隊非常尊敬他。在過去的幾個月裡，他可能給了我們比很長一段時間以來更多的見解，因為他是一名在職的首席執行官，並且仍然在外面為此奮鬥。所以這對董事會來說真的是一個很大的補充。

And while I'm deeply sorry to see Tom Kelly go, and I think we need to give Tom a lot of credit for where this company's been over the last couple of decades, we've got an all-new team and I'm pretty excited about that.

雖然我對湯姆凱利的離去深感遺憾，但我認為我們應該給予湯姆很大的讚揚，因為公司在過去的幾十年裡取得了進步，我們已經擁有了一支全新的團隊，我對此感到非常興奮。

That's great color. And just a quick follow-up. A lot of references to the opportunity in the dotcom channel with some of your major retail partners. Is there any way to dimensionalize kind of where you stand today in terms of penetration? And just help clarify the step for executing on that opportunity. I think it was referenced maybe some optimization of product sizes to work in that channel, but is there any?

顏色真棒。接下來是快速的跟進。很多時候您會參考一些主要零售合作夥伴在網路通路中尋找機會。有沒有辦法可以具體化您目前在滲透方面的狀況？並幫助澄清利用該機會執行的步驟。我認為它可能提到了對產品尺寸進行一些優化以適應該管道，但是有嗎？

Yes. I'll just say broadly, in DIY brick-and-mortar, on a unit basis, we're, call it, 40% market share across sort of all our categories. We're barely in the double digits when it comes to the e-comm play so a tremendous amount of opportunity.

是的。我只是想大致說一下，在 DIY 實體店中，按單位計算，我們在所有類別的市場份額約為 40%。在電子商務領域，我們的成長率才剛達到兩位數，因此，機會龐大。

Here's the thing. And I hate to pick on my old company, Intel, but I worked for them a long time ago, and I joined them when I thought they were the most sort of forward-looking tech company in the world. I think we all know their challenges today. One of the things that they tried to do, and I think they've learned from this is they built a perfect formula around building, designing, manufacturing, marketing and selling CDUs. And any time they try to get into adjacent businesses, they try to impose that same formula on them.

事情是這樣的。我不想挑剔我的老東家英特爾，但是我很久以前就為該公司工作過，而且當我認為他們是世界上最具前瞻性的科技公司時我就加入了他們。我想我們都知道他們今天面臨的挑戰。他們嘗試做的一件事，我認為他們從中學到的是，他們圍繞著建造、設計、製造、行銷和銷售 CDU 建立了一個完美的模式。每當他們試圖進入鄰近的行業時，他們都會試圖將相同的模式強加給他們。

I think we have to look at it the same way. We've built a beautiful franchise around DIY, brick-and-mortar lawn and garden. We are not at all giving up on that. There is growth. But for us to operate effectively, whether it's in the e-comm or omnichannel, where you need smaller, lighter packaging, you're not going to pick up a [gown of] roundup or ortho in a grocery store, but you might pick up an easy-to-use apartment size form factor, we've got to be there. And so the team is already working on that.

我認為我們必須以同樣的方式看待這個問題。我們圍繞著 DIY、實體草坪和花園建立了美麗的特許經營權。我們根本沒有放棄這一點。有增長。但為了我們能有效運營，無論是在電子商務還是全渠道，您都需要更小、更輕的包裝，您不會在雜貨店裡拿起一堆綜述或正畸產品，但您可能會拿起一種易於使用的公寓大小的包裝，我們必須滿足這一要求。所以團隊已經開始致力於此。

The other end of it is on the Pro side. We need to be able to cost effectively provide product on large scale to engage with small and medium-sized professionals. So yes, we absolutely have to reimagine it. And my only mandate for my team is that we don't impose sort of the way we do things today on those growth opportunities.

它的另一端位於 Pro 側。我們需要能夠以經濟有效的方式大規模提供產品，以吸引中小型專業人士。所以是的，我們絕對必須重新想像它。我對我的團隊的唯一要求是，我們不要把我們現在的做事方式強加於這些成長機會。

Jonathan, maybe just to dimensionalize. Just a follow up on that. You talked about around like 10% or so. It ranges single digits for some categories, slightly above into the low double digits, above 10% in other categories. So it just depends category to category. But to his point, a lot of great opportunity that we can do there, especially on the form factor and just different type of offerings and all that good stuff.

喬納森，也許只是為了維度化。這只是對此的跟進。您談到的是大約 10% 左右。對於某些類別來說，這一比例為個位數，對於其他類別來說，這一比例略高於兩位數，而對於其他類別來說，這一比例則超過 10%。所以這只是取決於類別而已。但就他的觀點而言，我們可以在那裡創造很多很好的機會，特別是在形式因素和不同類型的產品以及所有這些好東西方面。

Ladies and gentlemen, that does conclude today's presentation. We thank you for your participation. You may now disconnect, and have a wonderful day.

女士們、先生們，今天的演講到此結束。我們感謝您的參與。現在您可以斷開連接並享受美好的一天。