Scotts Miracle-Gro Co (SMG) 2025 Q2 法說會逐字稿

Good morning. Welcome to Scotts Miracle-Gro's second-quarter 2025 earnings webcast. I'm Brad Chelton, Head of Investor Relations. Speaking today are Chairman and CEO, Jim Hagedorn; and 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.

早安.歡迎收聽 Scotts Miracle-Gro 2025 年第二季財報網路廣播。我是投資者關係主管布拉德‧切爾頓 (Brad Chelton)。今天發言的是董事長兼執行長 Jim Hagedorn 以及財務長兼首席會計官 Mark Scheiwer。吉姆將提供業務更新，隨後馬克將回顧我們的財務表現。

In conjunction with our commentary today, please review our earnings release and supplemental financial presentation slides, which were published on our website at investor.scotts.com prior to this webcast. During our review, we will make forward-looking statements and discuss certain non-GAAP financial measures. Please be aware that our actual results could differ materially from what we share today.

結合我們今天的評論，請閱讀我們的收益報告和補充財務簡報幻燈片，這些幻燈片在本次網路廣播之前已發佈在我們的網站 investor.scotts.com 上。在審查過程中，我們將做出前瞻性陳述並討論某些非公認會計準則財務指標。請注意，我們的實際結果可能與我們今天分享的結果有重大差異。

Please refer to our Form 10-K filed with the SEC for details of the full range of risk factors that could impact our results.

請參閱我們向美國證券交易委員會提交的 10-K 表格，以了解可能影響我們業績的所有風險因素的詳細資訊。

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. (Event Instructions)

網路直播結束後，總裁兼營運長 Nate Baxter 和執行副總裁兼總參謀長 Chris Hagedorn 將與 Jim 和 Mark 一起參加純音訊問答環節。（活動須知）

As always, today's session will be recorded. An archive version will be published on our website at investor.scotts.com.

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。

For further discussion after the call, please email or call me directly.

通話後如需進一步討論，請透過電子郵件或直接致電給我。

Hello, and good morning. I'm Martha Stewart, and I would like to welcome all of you to the Scotts Miracle-Gro earnings call. Spring is probably one of my favorite times of the year. Everything is coming alive, and I personally can't wait to get my gardens fully planted. It's one of the many reasons why I love my role as Chief Gardening Officer. I'm working with the team to bring gardeners, including a new generation products that they will love and make part of their everyday lives, and that is a very good thing.

你好，早安。我是瑪莎·斯圖爾特，歡迎大家參加 Scotts Miracle-Gro 收益電話會議。春天可能是我一年中最喜歡的季節之一。一切都變得生氣勃勃，我個人已經迫不及待地想在我的花園裡種滿植物了。這是我熱愛首席園藝官這個職位的眾多原因之一。我正在與團隊合作，為園丁們帶來他們會喜歡並成為他們日常生活一部分的新一代產品，這是一件非常好的事情。

Now I'll turn it over to Jim Hagedorn.

現在我將把發言權交給 Jim Hagedorn。

Good morning. First of all, it's a crazy and confusing macro environment for any company today, but I can simplify things. We're good. Our outlook is unchanged, and we're reaffirming our full year guidance of $570 to $590 million of EBITDA. As for tariffs were largely unaffected in fiscal '25.

早安.首先，如今對於任何公司來說，宏觀環境都是瘋狂而混亂的，但我可以簡化事情。我們很好。我們的展望保持不變，並重申全年 EBITDA 預測為 5.7 億至 5.9 億美元。至於關稅，25財年基本上不受影響。

We see no impact in our margins or pricing for this year. Historically, our equity has been a Safe Harbor in tough times. Everything you'll hear today is centered around getting back to that. Our results through the first half reflect important progress on financial metrics that are central to our fiscal '25 plan.

我們認為今年的利潤率或定價不會受到影響。從歷史上看，我們的股權一直是困難時期的安全港。今天您聽到的一切都圍繞著這一點。我們上半年的業績反映了我們 25 財年計畫核心財務指標的重要進展。

We delivered double digit increases in consumer takeaway. Gained market share and built momentum. We're happy with our consumer product sales to retailers. They're essentially flat when you exclude AeroGarden and other one-time sales from last year.

我們的消費者外賣量實現了兩位數的成長。獲得市場份額並建立發展勢頭。我們對向零售商銷售消費品的情況感到滿意。如果排除 AeroGarden 和去年的其他一次性銷售，它們基本上是持平的。

Despite volatility and uncertainty, the core consumer is relatively healthy and our business tends to be recession resistant. To consumers, our lawn and garden category and our brands are as important as ever that goes for retailers too.

儘管存在波動性和不確定性，但核心消費者相對健康，我們的業務往往能夠抵禦經濟衰退。對於消費者來說，我們的草坪和花園類別以及我們的品牌與以往一樣重要，對於零售商來說也是如此。

Lawn and garden is among their top categories for the whole year. In my view, our equity price makes zero sense when you consider our accomplishments, our growth trajectory, and our superior position in this very important consumer space.

草坪和花園是他們全年最暢銷的類別之一。在我看來，當你考慮到我們的成就、我們的成長軌跡以及我們在這個非常重要的消費領域的優勢地位時，我們的股價毫無意義。

I can only think that our message isn't getting through to the investment community and I guess that's on me and Mark. Before I dive into our performance, it's important to look back on the past 18 months for context.

我只能認為我們的訊息沒有傳達給投資界，我想這是我和馬克的責任。在深入探討我們的表現之前，有必要回顧一下過去 18 個月的背景。

In fiscal '24, we drove nearly 9% increase in POS units and significant EBITDA growth and margin recovery. Over the past two years, we generated an excess of $1 billion in free cash flow and reduced leverage to much more acceptable levels. We cut costs and invested in the business. So far this year, we achieved a nearly 500 basis-point recovery in gross margin and a $36 million EBITDA increase.

在 24 財年，我們的 POS 單位數量增加了近 9%，EBITDA 和利潤率也實現了顯著增長。在過去兩年裡，我們產生了超過 10 億美元的自由現金流，並將槓桿率降低到了更可接受的水平。我們削減了成本並投資於業務。今年到目前為止，我們的毛利率已回升近 500 個基點，EBITDA 成長 3,600 萬美元。

Debt, interest expense, and leverage continue to decline as we improve the balance sheet and our financial flexibility. POS is a really great story.

隨著我們改善資產負債表和財務靈活性，債務、利息支出和槓桿率持續下降。POS 確實是一個很棒的故事。

We delivered a 12.1% increase in units. Our gardens business was plus 16% in POS units, and our mulch business plus 46%. Tomcat and Ortho outdoor insect each increased 14%. These gains reflect our ability to adapt to conditions.

我們的銷量增加了 12.1%。我們的花園業務在 POS 單位成長了 16%，我們的覆蓋物業務成長了 46%。Tomcat和Ortho戶外昆蟲分別增加了14%。這些進步反映了我們適應環境的能力。

In response to inconsistent weather in Q2, we worked with retailers to boost promotions and pivoted our early season advertising messages. Because favorable weather was a little late this spring, we showed up at Martha Stewart's New York house and made a commercial on the spot. Martha, our Chief Gardening Officer, passionately encouraged people to get their hands dirty, reminding everyone that spring is now.

為了應對第二季不穩定的天氣，我們與零售商合作加強促銷，並調整了早期的廣告訊息。由於今年春天好天氣來得有點晚，所以我們就來到了瑪莎·斯圖爾特在紐約的家，並在那裡拍攝了廣告。我們的首席園藝官瑪莎熱情地鼓勵人們親自動手，提醒大家春天已經到來。

This is the way we want to work. It speaks to speed and agility. Lawns is a special example. Our laws business has been dealing with unit volume declines over time. I challenged the team to first, hold the line, and second, develop a long-term solution. Early results demonstrate initial progress with more to come. At the close of Q2, our total lawns business was plus 4% in POS units. To understand what we're doing differently, it's important to address the underlying issue.

這就是我們想要的工作方式。它體現了速度和敏捷性。草坪就是一個特別的例子。我們的法律業務一直在應對業務量隨時間下降的問題。我向團隊提出挑戰，首先要堅持下去，其次要製定長期解決方案。早期結果顯示了初步進展，未來將取得更多進展。在第二季末，我們的 POS 單位草坪業務總額成長了 4%。要了解我們所做的事情有何不同，解決根本問題很重要。

Consumers want a nice lawn all season long without a lot of work. But they don't always know how to make it happen. The solution is regular feedings to create a thicker lawn that is less susceptible to weeds and disease and ultimately has less need for pesticides and fungicides. But we got away from marketing regular feedings and multi-bags in favor of one bag approach for specific problems such as weeds, bugs, or disease.

消費者希望整個季節都能擁有一片漂亮的草坪，而無需花費大量精力。但他們並不總是知道如何實現這一目標。解決方案是定期施肥，以創建更厚的草坪，使其不易受到雜草和疾病的侵害，最終減少對殺蟲劑和殺菌劑的需求。但我們不再推銷定期餵食和多袋施肥，而是採用單袋施肥方法解決雜草、蟲子或疾病等特定問題。

It was effective in selling one bag of fertilizer, but it was ineffective in giving the consumer the lawn they really want. This year we've returned to a multi-bag strategy. We're helping consumers understand the value and importance of multiple feedings. Our Scott for Scotts commercials feature real consumers talking about how to care for a lawn and the pride they have in their own lawns.

這對於銷售一袋肥料是有效的，但對於提供消費者真正想要的草坪是無效的。今年我們又恢復了多袋策略。我們正在幫助消費者了解多次餵食的價值和重要性。我們的 Scott for Scotts 廣告以真實的消費者為主角，講述如何照顧草坪以及他們對自己草坪的自豪感。

We're creating joint promotions with retailers focused on multi-step applications, and the results are solid. Turf Builder Halts, our first step in the multi-feeding program, was up 67% through the first half. In the hardware space, a third of all fertilizer sales come from multi-step programs. And in home centers, multi-bag bundles drove halt's POS unit gains as high as 100%.

我們正在與專注於多步驟應用程式的零售商進行聯合促銷活動，且效果顯著。Turf Builder Halts 是我們多重餵食計畫的第一步，上半年成長了 67%。在硬體領域，三分之一的化肥銷售額來自多步驟計畫。在家居中心，多袋捆綁銷售使 Halt 的 POS 單位收益高達 100%。

And an online deal that we did that gave consumers a free spreader with the purchase of a full season long program, exceeded projections by 185%, where we're headed makes total sense for this legacy, high margin business.

我們開展了一項線上交易，即為購買整季節目的消費者提供免費的播撒機，該交易超出了預期的 185%，對於這項傳統的高利潤業務來說，我們的發展方向完全合理。

We're reimagining our portfolio in terms of packaging, sizing, formulations, and actives to deliver more of what consumers want and need. We expect to roll out these changes in fiscal '26 and '27. This is an attitude shift. We're no longer working within the safety of the past. I'm really proud of our launch team, and I'll give you a status report at our next earnings call.

我們正在從包裝、尺寸、配方和活性成分方面重新構想我們的產品組合，以滿足消費者更多想要和需要的產品。我們預計將在 26 和 27 財年推出這些變更。這是一種態度的轉變。我們不再在過去的安全環境下工作。我對我們的發布團隊感到非常自豪，我將在下次收益電話會議上向你們提供一份現況報告。

Innovation is a component of our progress too. The expanded Miracle-Gro Organics line and new O.M. Scott natural grass seed and lawn fertilizer are contributing positively to POS and we're gaining share across the total organics category.

創新也是我們進步的一部分。擴大的 Miracle-Gro Organics 系列和新的 O.M. Scott 天然草種和草坪肥料對 POS 做出了積極貢獻，我們在整個有機產品類別中的份額正在增加。

Later this year we'll introduce flying insect traps and mosquito prevention in our Controls portfolio, a growth category with potential, especially in e-commerce. As for competition in the control space, we'll be more aggressive and hold them accountable. P&G is an example.

今年晚些時候，我們將在我們的控制產品組合中推出飛蟲陷阱和蚊蟲預防措施，這是一個具有潛力的成長類別，尤其是在電子商務領域。至於控制領域的競爭，我們將更加積極並追究他們的責任。寶潔公司就是一個例子。

I have great respect for that company, but it was unprofessional to introduce its Spruce Weed Killer product with reckless claims and in packaging that mimics Miracle-Gro. That's why we've taken legal action against Proctor for false marketing claims and trade dress infringement.

我非常尊重那家公司，但他們以不計後果的宣傳和模仿 Miracle-Gro 的包裝來推出其 Spruce Weed Killer 產品，這是非常不專業的。這就是我們對 Proctor 提起虛假行銷宣傳和商業外觀侵權訴訟的原因。

No one knows more about natural herbicides and insect and weed control than we do. We know what works and we know what doesn't. Across our categories, we see little pressure from private label. On the contrary, our retail partners have been heavily promoting our products and will continue to do so for the rest of the season. This is the result of our significantly increased investments in retailer promotion programs to activate consumers at the shelf level.

沒有人比我們更了解天然除草劑以及昆蟲和雜草控制。我們知道什麼有效，我們知道什麼無效。在我們的產品類別中，我們發現來自自有品牌的壓力很小。相反，我們的零售合作夥伴一直在大力推廣我們的產品，並將在本季剩餘時間繼續這樣做。這是我們大幅增加對零售商促銷計劃的投資以激活貨架層面消費者的結果。

Retailers in turn are putting more of their own money behind this effort. There is only one major rule to these activation investments. Retailers must use the dollars to support our products and not for their own margin support. When retailers commit to these promotions, it shows up in our numbers, and their numbers, our market share and their market share.

而零售商則為這項努力投入了更多資金。這些激活投資只有一條主要規則。零售商必須用這些錢來支持我們的產品，而不是用來支持他們自己的利潤。當零售商承諾進行這些促銷時，它會反映在我們的數量和他們的數量、我們的市場份額和他們的市場份額上。

In addition to promotion investments, we've injected significantly more into our own consumer advertising, brand support, and e-commerce activities. With this kind of firepower and most of our marketing still in front of us, we and our retail partners remain bullish on the season. Let me further explain why we're well positioned in this economy.

除了促銷投資外，我們還在自己的消費者廣告、品牌支援和電子商務活動上投入了更多資金。憑藉這種強大的火力和我們仍在進行的大部分行銷工作，我們和我們的零售合作夥伴對本季仍然充滿信心。讓我進一步解釋為什麼我們在當前的經濟狀況下處於有利地位。

Our current exposure to increased tariffs is minimal. We are a stable 157 year old American company that manufactures and assembles products in the United States. 90% of our cost of goods sold are domestically sourced. Of the 10% sourced outside of the US, at least half are exempt from tariffs. Of the rest of our goods, we have plenty of pre-tariff inventory.

目前，我們受到關稅上調的影響很小。我們是一家擁有 157 年歷史的穩定美國公司，在美國製造和組裝產品。我們 90% 的銷售成本均來自國內採購。在美國以外採購的 10% 中，至少有一半免關稅。對於我們其餘的商品，我們有大量的關稅前庫存。

For these reasons, we do not anticipate pricing actions in fiscal '25 due to tariffs, nor do we expect margin pressure. If things change in '26 and we do feel more tariff and or margin pressure, we will mitigate the impact and if necessary, take pricing.

由於這些原因，我們預期 25 財年不會因關稅而採取定價行動，也不會出現利潤壓力。如果 26 年情況發生變化，我們確實感受到更多的關稅和利潤壓力，我們將減輕影響，並在必要時採取定價措施。

During economic uncertainty, consumers gravitate to established and trusted brands. They prioritize value and reliability. That's why promotions and our iconic brands matter. In fact, consumers consider lawn and garden care essential. Our research shows that nearly 75% of all consumers surveyed perceive lawn and garden as a necessity.

在經濟不確定時期，消費者會傾向知名且值得信賴的品牌。他們優先考慮價值和可靠性。這就是為什麼促銷和我們的標誌性品牌如此重要。事實上，消費者認為草坪和花園護理至關重要。我們的研究表明，近 75% 的受訪消費者認為草坪和花園是必需品。

25% plan to shift to do it themselves this year. From a historic perspective during the Great Recession of 2008 and 2009, we drove POS unit increases of 16% and we all remember our record sales and POS during COVID.

25% 的人計劃今年自己動手做。從歷史角度來看，在 2008 年和 2009 年的大衰退期間，我們推動 POS 單位成長了 16%，我們都記得在 COVID 期間我們的創紀錄銷售額和 POS。

While numerous reports paint a dim consumer picture, our consumer is in a better place. They are homeowners with more disposable income. And when you add all this up, our franchise is resilient and has opportunities that many other CPG companies do not. I'll now update two major initiatives.

儘管許多報告都對消費者的前景進行了黯淡的描述，但我們的消費者狀況卻有所改善。他們是擁有更多可支配收入的房主。綜合以上所有因素，我們的特許經營權具有很強的韌性，並且擁有許多其他 CPG 公司所沒有的機會。我現在將更新兩項重大舉措。

The first is our transformation for cost outs and productivity improvements. Transformation supports our strategy of incrementally investing more in our brands and retailer promotions. This requires significant financial resources, and we intend to redeploy savings to grow the business and return shareholder value.

首先是我們的轉型，旨在降低成本、提高生產力。轉型支持了我們逐步增加對品牌和零售商促銷的投資的策略。這需要大量的財政資源，我們打算重新部署儲蓄來發展業務並回報股東價值。

The second is to divest our Hawthorne businesses to improve gross margin and reduce the cannabis sector's volatility on our share price. For Hawthorne, this can lead to value creation opportunities. Our transformation is being driven by a new and powerful team that is getting their sea legs, this includes my team and new talent we've added in leadership positions. Their task is not simple or easy.

第二是剝離我們的霍桑業務，以提高毛利率並降低大麻產業對我們股價的波動。對霍桑來說，這可以帶來價值創造機會。我們的轉型是由一支正在起步的新而強大的團隊推動的，其中包括我的團隊和我們在領導職位上增加的新人才。他們的任務並不簡單，也不容易。

We're building a different company. We're strengthening our financials and balance sheet while improving the health and power of our franchise, that makes transformation a necessity, and the teams are delivering.

我們正在建立一家與眾不同的公司。我們正在加強我們的財務和資產負債表，同時提高我們特許經營的健康和實力，這使得轉型成為必要，而團隊正在實現這一目標。

We're on track for more than $75 million in supply chain cost outs this year, and our larger goal of $150 million out by fiscal '27. We're committed to being the lowest cost manufacturer, and that involves bringing more automation and technology to our plants and distribution centers. This will ensure that our supply chain is nimble and responsive to market changes. Credit here goes to Nate, who's been a relentless advocate for technology throughout our supply chain.

我們今年的供應鏈成本支出預計將超過 7,500 萬美元，而我們更大的目標是到 27 財年實現 1.5 億美元的成本支出。我們致力於成為成本最低的製造商，這涉及為我們的工廠和配送中心帶來更多的自動化和技術。這將確保我們的供應鏈靈活並對市場變化做出反應。這要歸功於 Nate，他一直是我們整個供應鏈中技術的堅定倡導者。

This effort has extended to other parts of our company. In Q2, we eliminated a number of corporate and overhead positions. We expect these actions to contribute $22 million in annualized savings, with $10 million being realized this year. We're looking at everything to become a more lethal and enduring consumer goods company. We'll take our culture to the next level and it'll open up new channels for growth.

這項努力已擴展到我們公司的其他部門。在第二季度，我們裁減了一些公司和管理職。我們預計這些措施每年將節省 2,200 萬美元，其中今年將節省 1,000 萬美元。我們正在盡一切努力成為一家更有生命力和持久力的消費品公司。我們將把我們的文化提升到一個新的水平，並開闢新的成長管道。

As for Hawthorne, in Q2, we moved The Hawthorne Collective to Bad Dog Holdings, a privately held unrelated third party. The collective was established in 2021 to invest in areas of the cannabis industry, not under Hawthorne gardening. Among its holdings is an investment in a vertically integrated cannabis operator called fluent.

至於霍桑，在第二季度，我們將霍桑集體轉移到了私人控股的無關第三方 Bad Dog Holdings。該集體成立於 2021 年，旨在投資大麻產業領域，而不是霍桑園藝。該公司持有的資產包括對一家名為 fluent 的垂直整合大麻營運商的投資。

Our next step is to sell Hawthorne Gardening to a dedicated cannabis company by fiscal year-end. Hawthorne Gardening has delivered two consecutive EBITDA positive quarters and can offer value creating benefits to a cannabis company. These include a debt free balance sheet, leading brands, unique innovation, a great management team, and 280E tax benefits, and it would maintain a strategic relationship with Scotts for R&D and supply chain support.

我們的下一步是在財政年度結束前將 Hawthorne Gardening 出售給專門的大麻公司。Hawthorne Gardening 已連續兩季實現 EBITDA 正值，可為大麻公司創造價值。這些包括無債務資產負債表、領先品牌、獨特的創新、優秀的管理團隊和 280E 稅收優惠，並且它將與 Scotts 保持戰略關係以獲得研發和供應鏈支援。

For Scotts Miracle-Gro, exiting Hawthorne Gardening will allow us to accelerate tax benefits of up to $100 million over the next few years and it will help us with our banks by eliminating the de-banking risks stemming from federal regulator confusion on how to bank with companies adjacent to the cannabis industry.

對於 Scotts Miracle-Gro 來說，退出 Hawthorne Gardening 將使我們能夠在未來幾年內加速獲得高達 1 億美元的稅收優惠，並有助於我們的銀行消除因聯邦監管機構對如何與大麻行業相鄰的公司進行銀行業務混淆而產生的去銀行化風險。

Divestiture will enable our consumer business and Hawthorne to do what they each do best, creating a catalyst for growth that makes both companies better. Because the Hawthorne companies were meant to capitalize on legal cannabis, we will retain an option to recapture any of the future value should the federal government adopt pro-cannabis reforms.

剝離將使我們的消費者業務和霍桑能夠做各自最擅長的事情，從而創造促進兩家公司更好的成長的催化劑。由於霍桑公司的本意是利用合法大麻來獲利，因此，如果聯邦政府採取支持大麻的改革，我們將保留重新獲得未來價值的選擇權。

The health of the cannabis industry will be accelerated by tax relief and access to capital for investors, which could happen through cannabis rescheduling and Safer Banking Act. President Trump has supported both. Here's my final comment on Hawthorne, Mr. President. This industry needs your help.

稅收減免和投資者獲得資本的機會將加速大麻產業的健康發展，這可以透過大麻重新安排和《更安全銀行法案》實現。川普總統對兩者都表示支持。總統先生，這是我對霍桑的最後評論。這個行業需要您的幫助。

You always say promises made are promises kept. So let's reschedule cannabis and pass safer banking now, please. You're the only person who could help. I'll close with this. I'm pleased with our progress. Our path is right for our franchise and our shareholders. We will give consumers more of what they want and need.

您總是說，一旦做出承諾，就一定會兌現。因此，現在讓我們重新安排大麻並透過更安全的銀行業務。你是唯一能幫忙的人。我就以此作為結束。我對我們的進展感到滿意。我們的道路對我們的特許經營權和股東來說是正確的。我們將為消費者提供更多他們想要和需要的東西。

Everything I talked about today is part of our singular mission to grow our business and drive value. As we continue to build success each quarter, we move closer to achieving these four financial goals by the end of fiscal '27. One sustained sales growth of at least 3%. Two, gross margin rate north of 35%. Three, $700 million EBITDA. And four strong free cash flow for shared or friendly actions.

我今天談論的一切都是我們發展業務和創造價值這一獨特使命的一部分。隨著我們每個季度不斷取得成功，我們距離在 2027 財年末實現這四個財務目標更近了一步。其中一家的銷售額持續成長至少3%。二、毛利率在35%以上。三、7億美元的EBITDA。以及四個強大的自由現金流用於共享或友好行動。

Before turning things over to Mark, I want to make an announcement. A lot of you know Mark from his long relationships with our banks, auditors, and other stakeholders. He's a steady and measured financial executive with a fighter pilot attitude.

在將事情交給馬克之前，我想宣布一件事。你們中的許多人認識馬克，因為他與我們的銀行、審計師和其他利害關係人有著長期的合作關係。他是一位沉穩、有分寸的財務主管，有著戰鬥機飛行員的氣概。

As interim CFO, he's been a true partner and forged important relationships with investors and analysts. He's making an impact in our transformation for these and many other reasons, he's been named EVP and CFO. Please join me in congratulating Mark. As always, I appreciate our shareholders, banking partners, and retailers. Your support is critical to our success, and I thank you.

作為臨時財務官，他是一位真正的合作夥伴，並與投資者和分析師建立了重要的關係。由於這些以及許多其他原因，他對我們的轉型產生了影響，他被任命為執行副總裁兼財務長。請和我一起祝賀馬克。一如既往，我感謝我們的股東、銀行夥伴和零售商。您的支持對於我們的成功至關重要，我在此向您表示感謝。

Here's Mark.

這是馬克。

Thank you, Jim, and hello everyone. Jim provided an overview of our progress on the key financial metrics in our fiscal '25 plan, our significant POS gains, and our limited exposure to tariffs. Our year-to-day performance combined with our unique position in the current macroeconomy has solidified our confidence in our full year guidance for EBITDA, US consumer sales, gross margin, and leverage.

謝謝你，吉姆，大家好。吉姆概述了我們在 25 財年計劃中的關鍵財務指標方面的進展、我們顯著的 POS 收益以及有限的關稅風險。我們逐日的業績表現加上我們在當前宏觀經濟中的獨特地位，鞏固了我們對全年 EBITDA、美國消費者銷售額、毛利率和槓桿率預期的信心。

With that, I'll review the details of our second quarter and first half, starting with the top line. For the quarter, total company net sales were $1.42 billion compared to $1.53 billion a year ago, down 7%. In US Consumer net sales for the current quarter were $1.31 billion versus $1.38 billion last year, down 5%, reflecting the impact of a colder, slower start to the lawn and garden season along with non-repeating fiscal '24 sales of AeroGarden and bulk raw materials.

接下來，我將回顧我們第二季和上半年的具體情況，首先是頂線。本季，公司淨銷售額總額為 14.2 億美元，去年同期為 15.3 億美元，下降 7%。美國消費者本季淨銷售額為 13.1 億美元，而去年同期為 13.8 億美元，下降 5%，這反映了草坪和花園季節開始較冷、較慢的影響，以及 AeroGarden 和大宗原材料 24 財年銷售額不重複的影響。

This slower seasonal start has pushed some shipments from our second to our third quarter. But we've seen similar weather patterns in the past and know how to adapt to them. I'll remind everyone that we expect retailer replenishment to be strong in Q3 as weather conditions continue to improve and we shift to the peak of the season as the third quarter represents approximately 60% of the total POS for the year.

由於季節開始放緩，部分出貨量從第二季推遲到了第三季。但我們過去見過類似的天氣模式，並且知道如何適應它們。我要提醒大家，隨著天氣條件持續改善，我們進入旺季，預計第三季零售商補貨將會強勁，因為第三季約佔全年 POS 總量的 60%。

Hawthorne net's sales in the quarter declined 51% from $66 million to $33 million, including the continued hydroponic market softness combined with the expected impact of its exit from third party distribution last year. Year-to-date total net sales on a company-wide basis were $1.84 billion down 5% from $1.94 billion a year ago.

Hawthorne net 本季的銷售額從 6,600 萬美元下降了 51% 至 3,300 萬美元，其中包括水耕市場持續疲軟以及去年退出第三方分銷的預期影響。年初至今，公司總淨銷售額為 18.4 億美元，較去年同期的 19.4 億美元下降 5%。

In US Consumer net sales through the first half were $1.65 billion, down 2% from $1.69 billion a year ago. This is largely due to non-repeating fiscal '24 sales for AeroGarden and bulk raw materials. As Jim stated, when you exclude these non-repeating items, US Consumer sales are essentially flat to prior year. POS continues to be healthy as evidenced by the strong consumer takeaway in the early season. Through the second quarter, POS units exceeded prior year by 12.1%, driven by mulch, soils, fertilizer, grass seed, and controls.

美國消費者上半年淨銷售額為 16.5 億美元，較去年同期的 16.9 億美元下降 2%。這主要是由於 AeroGarden 和大宗原料的 24 財年銷售額沒有重複。正如吉姆所說，當你排除這些非重複項目時，美國消費者銷售額基本上與前一年持平。POS 持續保持健康，這從年初強勁的消費者外送表現可以看出。截至第二季度，POS 單位數量比去年同期增加了 12.1%，這主要得益於覆蓋物、土壤、肥料、草籽和控制措施。

Excluding mulch, POS units were plus 4.4% through the first six months. POS dollars through the second quarter were 1.5% higher than prior year. The difference between our unit and dollar growth is due to strong early season performance of soils and mulch products, along with increased joint promotional activity with our retail customers.

不包括覆蓋物，POS 單位在前六個月增長了 4.4%。第二季 POS 營收比去年同期高出 1.5%。我們的單位和美元成長之間的差異是由於土壤和覆蓋物產品在季節初期表現強勁，以及與零售客戶的聯合促銷活動的增加。

Looking at the month of April, we are pleased that POS trends have remained consistent with our March year-to-date results of double digit unit growth. With over 50% of the POS remaining from May through the end of the fiscal year, it gives us confidence in reaffirming our full year US consumer net sales guidance of low single digit growth.

縱觀四月份，我們很高興看到 POS 趨勢與三月年初至今的兩位數單位成長結果保持一致。從 5 月到本財年結束，仍有超過 50% 的 POS 留存，這使我們有信心重申全年美國消費者淨銷售額低個位數成長的預期。

Excluding the impact of the non-repeating fiscal '24 sales mentioned earlier. At Hawthorne, net sales for the first half were $85 million down from $147 million in the first half of fiscal '24. The decline is a result of Hawthorne's strategic exit from low margin third party distribution to focus on more profitable proprietary brands as well as the impact of the oversupply of cannabis, lack of federal action on cannabis reforms, and the rapid consolidation among cultivators in the cannabis sector.

不包括前面提到的非重複性 24 財年銷售額的影響。霍桑上半年淨銷售額為 8,500 萬美元，低於 24 財年上半年的 1.47 億美元。業績下滑的原因是霍桑公司策略性地退出低利潤的第三方分銷，轉而專注於利潤更高的自有品牌，以及大麻供應過剩、聯邦政府對大麻改革缺乏行動以及大麻行業種植者快速整合的影響。

Given this environment, we are no longer providing revenue guidance on Hawthorne. Before I move to the rest of the P&L, I do want to call out that Hawthorne has been at positive EBITDA levels for the past two quarters and year-to-date it has earned around $4 million in adjusted EBITDA.

鑑於這種環境，我們不再提供霍桑的收入指引。在介紹其餘損益表之前，我想指出的是，Hawthorne 在過去兩個季度的 EBITDA 一直處於正值，今年迄今為止，其調整後的 EBITDA 收益約為 400 萬美元。

The Hawthorne management team will continue to adjust their business model and operations to deliver a similar result in the future. Now, moving to gross margin, we delivered meaningful improvement of nearly 500 basis points through the first half and continue to track to our target of 30% gross margin rate by the fiscal year end.

霍桑管理團隊將繼續調整其商業模式和運營，以在未來取得類似的業績。現在，談到毛利率，我們在上半年實現了近 500 個基點的顯著改善，並繼續朝著財年末 30% 的毛利率目標邁進。

Primary drivers of our gross margin improvement to date include lower material costs, improved product and segment mix, and reduced manufacturing and distribution costs.

迄今為止，我們毛利率提高的主要驅動因素包括材料成本降低、產品和細分市場組合改善以及製造和分銷成本降低。

We have strong visibility here to the balance of the year, and as of the second quarter, more than 80% of our commodities are locked. Approximately two-thirds of our planned $75 million supply chain savings for fiscal '25 were realized in the first half, with the remainder expected over the course of the third and fourth quarters.

我們對今年的餘額有很強的可視性，截至第二季度，我們 80% 以上的商品已被鎖定。我們計劃在 2025 財年節省 7,500 萬美元的供應鏈成本，其中約三分之二已在上半年實現，剩餘部分預計將在第三季和第四季實現。

In addition, in our fourth quarter, we will lap one-time inventory write-offs of $29 million taken in last year's fiscal fourth quarter. For the second quarter, the GAAP gross margin rate was 38.6% versus 30.4% in the prior year, and the non-GAAP adjusted gross margin rate was 39.1% versus 35.3%. Year-to-date, the GAAP gross margin rate was 35% versus 27.2% in prior year.

此外，在第四季度，我們將彌補去年第四財季的 2,900 萬美元一次性庫存註銷。第二季度，GAAP 毛利率為 38.6%，去年同期為 30.4%；非 GAAP 調整後毛利率為 39.1%，去年同期為 35.3%。年初至今，GAAP 毛利率為 35%，去年同期為 27.2%。

And the non-GAAP adjusted gross margin rate was 35.6% versus 30.7%. Looking down the P&L, SG&A for the quarter increased 5% from $179 million to $188 million. Year-to-date, SG&A increased 7% from $294 million to $313 million.

非公認會計準則調整後的毛利率為 35.6%，去年同期為 30.7%。從損益表來看，本季銷售、一般及行政費用 (SG&A) 成長 5%，從 1.79 億美元增至 1.88 億美元。年初至今，銷售、一般及行政費用成長 7%，從 2.94 億美元增至 3.13 億美元。

This increase was planned and is attributable to higher performance-based incentive accruals as well as additional investments in our brands and transformation related investments in technology and e-commerce. We continue to expect current year SG&A to be approximately 17% of net sales versus 16% last year.

這一增長是計劃內的，歸因於基於績效的激勵額度增加以及對我們品牌的額外投資以及在技術和電子商務方面的轉型相關投資。我們繼續預期今年的銷售、一般及行政費用將佔淨銷售額的約 17%，而去年為 16%。

Moving to EBITDA in the second quarter, adjusted EBITDA improved from $396 million to $403 million through the first half of the fiscal year, adjusted EBITDA increased $36 million from $371 million in fiscal '24 to $407 million this year. This year-over-year improvement in EBITDA reflects our strong gross margin recovery driven by our planned supply chain savings, lower material costs, and improved segment mix, partially offset by higher SG&A.

轉向第二季的 EBITDA，調整後的 EBITDA 從本財年上半年的 3.96 億美元提高到 4.03 億美元，調整後的 EBITDA 從 24 財年的 3.71 億美元增加了 3,600 萬美元，達到今年的 4.07 億美元。EBITDA 年成長反映了我們強勁的毛利率復甦，這得益於我們計劃中的供應鏈節約、材料成本降低以及細分市場組合改善，但銷售、一般及行政費用的增加部分抵消了這一增長。

As Jim mentioned earlier, we are reaffirming our adjusted EBITDA guidance of $570 million to $590 million. Below the line, year-to-date interest expense continued on its downward trajectory as we lowered debt balances and benefited from more favorable interest rates.

正如吉姆之前提到的，我們重申調整後的 EBITDA 指引，即 5.7 億美元至 5.9 億美元。從離線來看，由於我們降低了債務餘額並受益於更優惠的利率，年初至今的利息支出持續呈下降趨勢。

Through our first half of the fiscal year, interest expense was down $17 million to $70 million and our total debt was $270 million lower versus prior year. Leverage ended the second quarter at 4.41 times net debt to adjusted EBITDA.

在本財政年度上半年，利息支出比上年下降了 1,700 萬美元至 7,000 萬美元，總債務減少了 2.7 億美元。第二季末，槓桿率為淨負債與調整後 EBITDA 比率為 4.41 倍。

This is comfortably below our covenant maximum of 5.25 and we remain on a path to the low fours by fiscal year end. The non-GAAP adjusted tax rate was 26% for the first six months. For the full year, the tax rate is still expected to be in a range of 27% to 29%. The second quarter GAAP net income was $217.5 million or $3.72 per share compared with the prior year of $157.5 million or $2.74 per share.

這遠低於我們約定的最高限額 5.25，到財政年度末，我們仍有望達到 4 的低點。前六個月的非公認會計準則調整稅率為26%。全年稅率預計仍將在27%至29%之間。第二季 GAAP 淨收入為 2.175 億美元，即每股 3.72 美元，去年同期為 1.575 億美元，即每股 2.74 美元。

Non-GAAP adjusted income for the quarter, which excludes impairment, restructuring, and other non-reoccurring items, was $232.2 million or $3.98 per share versus prior year of $211.9 million or $3.69 per share a year ago.

本季非 GAAP 調整後營收（不含減損、重組和其他非經常性項目）為 2.322 億美元或每股 3.98 美元，去年同期為 2.119 億美元或每股 3.69 美元。

On a year-to-date basis, GAAP net income was $148 million or $2.53 per share compared with the prior year of $77 million or $1.34 per share. Non-GAAP adjusted income year-to-date was $181.2 million or $3.09 per share versus $129.7 million or $2.26 per share a year ago. Impairment, restructuring, and other non-reoccurring charges totaled $18 million for the quarter and primarily consisted of employee severance, facility closure costs, and costs tied to our Hawthorne Collective transaction.

今年迄今為止，GAAP 淨收入為 1.48 億美元，即每股 2.53 美元，而去年同期為 7,700 萬美元，即每股 1.34 美元。年初至今的非 GAAP 調整後營收為 1.812 億美元，即每股 3.09 美元，去年同期為 1.297 億美元，即每股 2.26 美元。本季減損、重組和其他非經常性費用總計 1,800 萬美元，主要包括員工遣散費、設施關閉成本以及與我們的 Hawthorne Collective 交易相關的成本。

As we reported earlier, we have transferred our Hawthorne Collective subsidiary out of Scotts Miracle-Gro to a privately held third party in exchange for an interest-bearing promissory note. As a result of retaining an option to benefit from these assets in the future, the Hawthorne Collective investments will continue to be reflected on our balance sheet, and we will record our proportionate share of flu net profit or loss within the equity earnings line in our P&L beginning in our third quarter of this fiscal year.

正如我們之前報導的那樣，我們已將 Hawthorne Collective 子公司從 Scotts Miracle-Gro 轉讓給私人控股的第三方，以換取一張有利息的本票。由於保留了未來從這些資產中獲益的選擇權，Hawthorne Collective 的投資將繼續反映在我們的資產負債表中，並且我們將從本財年第三季度開始，在損益表中的股權收益行中記錄我們應佔的流感淨利潤或虧損的比例。

Now moving on to the second half of the year. On June 5, we will attend and provide our customary seasonal update to our fiscal year at William Blair's Annual Growth Stock Conference in Chicago.

現在進入下半年。6 月 5 日，我們將參加在芝加哥舉行的 William Blair 年度成長型股票會議，並提供我們財政年度的例行季節性更新。

At the conference, we will share US Consumer POS and shipment performance through May, as well as insight on our fiscal '25 guidance. Overall, we continue to make substantial progress and are focused on our top three financial objectives for fiscal '25, which are investing in our brands to build upon sustainable net sales growth, driving margin recovery through sales growth and cost savings, and strengthening our balance sheet through generation of strong free cash flow and continued debt pay down.

在會議上，我們將分享截至 5 月的美國消費者 POS 和出貨量表現，以及 25 財年指引的見解。總體而言，我們繼續取得實質進展，並專注於 25 財年的三大財務目標，即投資我們的品牌以建立可持續的淨銷售額增長、透過銷售成長和成本節約推動利潤率回升、以及透過產生強勁的自由現金流和持續償還債務來加強我們的資產負債表。

As we deliver on each of these, we will further strengthen our core consumer business and continue to build greater value. I'll close with this. I want to thank Jim and our board of directors for their confidence in me as CFO. I've enjoyed working with our banks, investors, analysts, and other stakeholders both in my current and previous roles. You can expect me to further advance these important relationships as I work collaboratively with Jim and the team to deliver future growth and shareholder returns.

隨著我們實現這些目標，我們將進一步加強我們的核心消費者業務並繼續創造更大的價值。我就以此作為結束。我要感謝吉姆和董事會對我擔任財務長的信任。我很高興在現任和前任職位上與我們的銀行、投資者、分析師和其他利害關係人合作。您可以期待我與 Jim 和團隊合作，進一步推進這些重要的關係，以實現未來的成長和股東回報。

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

謝謝，我將把時間交給操作員開始問答。

(Operator Instructions)

（操作員指示）

Jon Andersen, William Blair.

喬恩安德森、威廉布萊爾。

Good morning. Thank you for the questions. I'll ask both my questions off the top here and let you respond. I wanted to ask about point of sale and gross margin beginning with point of sale, could you help us understand a little bit more of the delta between the 12% growth in units and the low single digit growth in dollars.

早安.謝謝您的提問。我會在這裡提出我的問題並讓你回答。我想問一下銷售點和毛利率，從銷售點開始，您能否幫助我們更多地了解單位數量 12% 的增長與美元低個位數增長之間的差異。

Trying to understand how much of that is mix, how much of that may be retailer, investments and promotions and how you gain confidence from that, those numbers in kind of the mid-single digit growth for you as a consumer on a full year basis. And then on gross margin, I may have overread this, but I think I heard you say, Jim, that expects gross margin greater than 35% over your medium term time frame. Has anything changed there, greater visibility, greater confidence in getting to that objective. Thank you.

試圖了解其中有多少是混合，有多少可能是零售商、投資和促銷，以及如何從中獲得信心，這些數字對於您作為消費者來說，在全年基礎上實現了中等個位數的增長。然後關於毛利率，我可能讀得太多了，但我想我聽到你說，吉姆，預計中期毛利率將超過 35%。那裡有什麼變化嗎？更高的知名度，更大的信心，實現這一目標。謝謝。

Out of Hawthorne which we're committed to by fiscal year end that probably has -- I don't know if I was going to piss people off here, they it would be north of 100 basis points but let's say at least 100 basis points of positive gross margin impact. Our mission and it's up as a mandate on my board I'm looking at it right now is 35% gross margin and I use the word you did in in the sort of near term.

我們承諾在財政年度結束前實現霍桑的業績，這可能已經——我不知道我是否會在這裡惹惱人們，他們將獲得超過 100 個基點的利潤，但我們可以說至少有 100 個基點的正毛利率影響。我們的使命，也是董事會的一項授權，我現在正在考慮的是 35% 的毛利率，我用你所說的「短期」這個詞。

Hawthorne should help that the team is not volunteered to take the goal up to sort of 36% to 37% so I think they've got a little bit of room. But I would say we're committed to it. I think we have line of sight to it, and I think the Hawthorne move probably makes it a little bit easier which you can take however you want.

霍桑應該會幫助球隊不自願將目標提高到 36% 到 37%，所以我認為他們還有一點空間。但我想說，我們致力於此。我認為我們已經看到了這一點，我認為霍桑的舉動可能會讓事情變得更容易一些，你可以隨心所欲地採取任何行動。

On POS, I think it's a fabulous story, but it tells you a little bit about sort of what's happening out there. I was on Kramer show on -- I don't know what that was Friday and talked about that which is that, coming out of COVID, I wanted the promotion of ours we did to incent sales I wanted that back and what we've heard from a lot of retailers is, customer accounts down at the stores are big.

關於 POS，我認為這是一個很棒的故事，但它只是告訴您一些那裡正在發生的事情。我參加了克萊默秀——我不知道那是星期五，我談到了這一點，那就是，走出新冠疫情後，我希望我們所做的促銷活動能夠刺激銷售，我希望能夠恢復銷售，我們從很多零售商那裡聽到的是，商店的客戶帳戶很大。

Durable business is off. It's just we're suffering. It's not a great time to be sort of taking pricing, and I think we also had an issue that, our belief, not an issue, but a belief that some of our product lines, whether it was grass seed or lawn fertilizer, was getting pretty pricey.

耐用品生意停業了。只是我們正在受苦。現在不是定價的好時機，而且我認為我們也存在一個問題，我們認為，這不是一個問題，而是我們的一些產品線，無論是草籽還是草坪肥料，都變得相當昂貴。

And I ended up with Nate, and the sales team agreeing that, instead of saying we want the money back, put it to and listen this this was kind of what -- I think for me it was a big deal. I don't, maybe not for everybody else. But in sort of interrogation with sales as we talked about this issue.

最後我和 Nate 以及銷售團隊達成了一致，我們不再說要退款，而是把錢存起來，聽聽這個——我認為這對我來說是一件大事。我不這麼認為，也許對其他人來說也不這麼認為。但當我們談論這個問題時，我們會對銷售人員進行某種質疑。

It's that the retailers are promoting very heavily and they are really trying to build market share and get customer count in the store and that for all this money they're spending at least that much behind it. And so that was one of those things where I sort of got in my head and I think Nate and the sales team agreed Which is okay, use that money to promote our products and I think we're seeing that happening.

零售商正在大力促銷，他們確實在試圖擴大市場份額並增加店內顧客數量，而他們為此至少投入了那麼多錢。這就是我想到的其中一件事，我認為 Nate 和銷售團隊都同意這一點，可以用這筆錢來推廣我們的產品，我認為我們正在看到這種情況發生。

And I think it's an -- it's a very competitive place out there from sort of pricing point of view. So I know there's people here who would say mix is a part of that. I heard this kind of last week as we were prepping for this and certainly that's true. But I think what's really happening is you're seeing a very competitive consumer landscape where if you look at sort of everyday pricing.

我認為從定價的角度來看，這是一個競爭非常激烈的地方。所以我知道這裡有些人會說混合是其中的一部分。上週我們在為此做準備時我聽到了這種說法，這確實是真的。但我認為實際情況是，如果你看一下日常定價，你會發現消費者市場競爭非常激烈。

You're not seeing the velocity as what you see on promotion, and so retailers are promoting very hard when they promote hard and we're seeing that across the board that this money is being put to work by retailers the way they committed to and the way we had hoped they would.

你看不到促銷時的速度，所以零售商在大力促銷時會非常努力地促銷，我們看到零售商正按照他們承諾的方式和我們所希望的方式使用這些資金。

And that on promotion, product is selling really well and I think that, it you can view it as a positive or negative which is that I think consumers are looking for good deals right now. And that if the deals aren't there they're a little more careful but basically all retailers are promoting very heavily now, and I think that's the lion's share of what you're seeing in regard to difference between POS dollars and POS units. I think it's a fabulous story myself, which is that retailers are really pushing on a garden and they're using the money we gave, and it's working really well.

在促銷方面，產品賣得很好，我認為，你可以把它看作是積極的或消極的，因為我認為消費者現在正在尋找好的交易。如果沒有達成交易，他們會更加謹慎，但基本上所有零售商現在都在大力促銷，我認為這就是您在 POS 美元和 POS 單位之間看到的差異的最大原因。我自己認為這是一個很棒的故事，零售商正在大力推廣花園，他們正在使用我們提供的資金，而且效果非常好。

And so, when we talked about it here, there's always a bias as we prep for this call like are we talking dollars or units and I think the dollar story is just not a very interesting story. I think the unit story is what's really happening out there.

因此，當我們在這裡談論它時，我們在準備這次通話時總是存在偏見，例如我們談論的是美元還是單位，我認為美元的故事不是一個非常有趣的故事。我認為這個單位的故事就是真實發生的事情。

So I think mix a little bit, a lot of it is just very steep promotion happening right now retailers using the money we gave them and I going to say, I super appreciative and but the consumer very much alive and well, but they appear to like promotion too.

所以我認為混合了一點，很多只是現在零售商使用我們給他們的錢進行的非常大的促銷，我想說，我非常感激，但消費者非常活躍，但他們似乎也喜歡促銷。

Yeah, John, if I could just jump in and provide some context on both for some of the numbers on the mix and the dollars for POS and then the long term view on gross margin. So as Jim said, the two big drivers, mix, that's a big part of our sales growth strategy too this year, so it lines up very well, with how we plan to grow sales, this year.

是的，約翰，如果我可以插話並提供一些背景信息，包括組合數字和 POS 的金額，以及毛利率的長期觀點。正如吉姆所說，這兩大驅動力的結合也是我們今年銷售成長策略的重要組成部分，因此它與我們今年的銷售成長計​​畫非常吻合。

But I think of it as 60%, 40%. We're getting a little feedback there 60%, 40% as far as the mix between those two key drivers, so 60% being kind of a heavy mix with the soils and the mulch, those growing media products, and rodenticide products. And then 40% being the heavy customer promotion activity, but both very positive stories driving traffic both online and in store on the gross margin story to 35, Jim alluded to the Hawthorne, providing us the 1% or 100 bps improvement.

但我認為是 60%、40%。我們得到的回饋是，這兩個關鍵驅動因素的混合比例為 60% 或 40%，所以 60% 是土壤和覆蓋物、生長介質產品和殺鼠劑產品的大量混合。然後 40% 是重型客戶促銷活動，但這兩個非常積極的故事都推動了在線和店內流量的毛利率達到 35，Jim 提到了霍桑，為我們提供了 1% 或 100 個基點的改進。

The rest of the story there is a lot of what you're seeing in the first half of this year, which is really an outstanding gross margin story. I mean, our supply chain team is doing an outstanding job delivering on cost savings initiatives, and Jim, towards the end of last year talked about $150 million of cost savings over a three year period.

故事的其餘部分與今年上半年看到的許多內容相同，這確實是一個出色的毛利率故事。我的意思是，我們的供應鏈團隊在成本節約計畫方面做得非常出色，吉姆在去年年底談到了三年內節省 1.5 億美元的成本。

We're through about half of that for this fiscal year, so $75 million of cost savings this fiscal year. And we have another $75 million to go over the over '26 and '27, and that should provide you well north of 200 basis points of improvement there in our gross margin, and we feel we can outperform that and we're working hard based on as Jim alluded to the whole transformation discussion so the team is looking at the business very intently.

本財年我們已經完成了其中的一半，因此本財年的成本節省為 7,500 萬美元。我們還有 7500 萬美元用於 26 年和 27 年，這應該會使我們的毛利率提高 200 個基點以上，我們認為我們可以超越這一目標，我們正在根據 Jim 提到的整個轉型討論努力工作，因此團隊正在非常專注地關注業務。

And we feel very confident in that part of the story. The only thing I'll wrap up is around pricing. We do, believe it's a long term part of the build along with volume growth as well, and that comes with innovation and our product portfolio differentiation, so we were able to take list pricing, this fiscal year. We've, reinvested it back into promotional activity which is obviously doing what we thought it was going to do which is drive a good strong unit growth. So those are just some of the numbers, to kind of follow up from Jim's comments.

我們對故事的這一部分非常有信心。我唯一要說的是有關定價的事情。我們確實相信，這是一個長期建設的一部分，同時也伴隨著產量的成長，這伴隨著創新和我們的產品組合差異化，因此我們能夠在本財年採取定價。我們將其重新投資到促銷活動中，這顯然達到了我們預期的效果，即推動了強勁的單位成長。這些只是一些數字，用來跟進吉姆的評論。

Thanks. Thanks so much appreciate it.

謝謝。非常感謝。

Thank you.

謝謝。

Jonathan Matuszewski, Jefferies.

喬納森·馬圖謝夫斯基，傑弗里斯。

Great, good morning, and thanks for taking my question. The first question was on, trade down to DIY. Jim, I think you said it's some survey work around 25% of consumer surveyed or are planning to trade down this year. Maybe if you could elaborate on that, clarify if there is any benefit associated with trade down in your current sales guidance, and any kind of framework to think about, any upside for any point or 5 points or whatever of trade down activity away from DIFM? That's my first question. Thank you.

太好了，早安，謝謝您回答我的問題。第一個問題是關於「交易降級為 DIY」。吉姆，我想你說過，一些調查顯示，受訪的消費者中約有 25% 計劃今年降低消費。也許您可以詳細說明一下，澄清一下您目前的銷售指導中是否有與降價相關的任何好處，以及任何需要考慮的框架，遠離 DIFM 的降價活動是否有任何好處？這是我的第一個問題。謝謝。

Alright, I'll let probably Nate take that one, but I'll start with, I don't see it as trade down, I see it as trade up, because a lot of what and I think we're running commercials like this now where we're talking to homeowners that have a huge amount of pride.

好吧，我可能會讓 Nate 來回答這個問題，但首先我要說的是，我不認為這是降級交易，我認為這是升級交易，因為很多時候，我認為我們現在正在播放這樣的廣告，我們正在與那些非常自豪的房主交談。

The whole Martha Stewart, side of wanting to garden and pride in your home and, your garden. For sure lawn people have that as well, and so I think what a lot of our thoughts are and some research behind this is that there's a lot of pride and the people who are very prideful and we want to help people do that. Can get a better result being on a multi-step program that they do themselves versus having somebody show up.

整個瑪莎·史都華 (Martha Stewart) 都想打理花園，並為自己的家和花園感到自豪。當然，草坪工人也有這樣的經歷，所以我認為我們的許多想法和背後的一些研究表明，人們有很多自豪感，人們非常自豪，我們希望幫助人們做到這一點。透過自己執行多步驟程序可以獲得比由別人來執行更好的結果。

I'm not going to say a minimum wage -- but damn near and remember we were in that business the service side so we know it pretty well but I think our view is that consumers can get a better lawn doing it themselves for less money, and I think that's what the sort of data is showing us at least that there are a significant number of people who are moving into do it yourself versus do it for me.

我不會說最低工資——但差不多，記住我們從事服務業，所以我們非常了解，但我認為我們的觀點是，消費者可以用更少的錢自己修剪草坪，獲得更好的草坪，我認為這就是數據向我們展示的，至少有相當多的人選擇自己修剪，而不是請人修剪。

Yeah, just to build on what Jim said, Jonathan, he mentioned in his script 25%, of folks that we surveyed indicate that lawn and gardening is so important that if they have to they'll trade down I guess as you say to DIY. In terms of baking into our numbers, no, I would say that when we look at the historical data there's probably 2020, 20% to 25% of consumers that fluctuate between doing it themselves and do it for me.

是的，基於吉姆所說的，喬納森在他的腳本中提到，我們調查的 25% 的人表示草坪和園藝非常重要，如果必須的話，他們會選擇減少開支，選擇 DIY。就我們的數據而言，不，我想說，當我們查看歷史數據時，到 2020 年，大概有 20% 到 25% 的消費者會在自己做和為我做之間搖擺不定。

So I think given that noise we're not building it into the numbers, but look, there could be a tailwind there for sure and I know we've talked about the pressures on the small and medium sized landscapers in terms of finding you know manpower to do that work. So maybe but as I said when we talked earlier, I don't see anything changing in our numbers. We're pretty confident where we're at and I think that consumers are responding accordingly.

因此，我認為，考慮到這些噪音，我們不會將其計入數字中，但看看，那裡肯定會有一個順風，我知道我們已經討論過中小型園林設計師在尋找人力來完成這項工作方面的壓力。所以也許吧，但正如我之前談話時所說的那樣，我沒有看到我們的數字有任何變化。我們對目前的狀況非常有信心，我認為消費者也會做出相應的反應。

That's helpful. And then just a quick follow up on private label. Jim, I think you mentioned you're seeing little pressure from private label this past quarter. Maybe if you could give us a sense of the pricing GAAP that's trending in the market today, maybe your products versus private label, is it around that kind of historical 30% norm and how you expect maybe that GAAP to fluctuate as the fiscal year continues as store brand pricing changes. Thanks so much.

這很有幫助。然後只是對自有品牌進行快速跟進。吉姆，我想你有提到過，上個季度你沒有感受到來自自有品牌的壓力。也許您可以讓我們了解當今市場上流行的 GAAP 定價，也許您的產品與自有品牌相比，是否圍繞著歷史 30% 的標準，以及您預計隨著財政年度的繼續，隨著商店品牌定價的變化，GAAP 可能會如何波動。非常感謝。

So I'll start then hold on (multiple speakers) come on, dude, don't want to let talk. We're going to let everybody talk. I think it's so competitive out there.

那麼我先開始了，然後等一下（多個發言者）來吧，夥計，不想說話。我們會讓每個人都發言。我認為那裡的競爭非常激烈。

That the price gaps are less than normal because the programs that we put together with the retailers are resulting in a very significant focus on our products and pretty steep pricing action to get consumers in the store and I think that's not only healthy but I think that very much reduces pressure on private label. So I don't know Josh, if you feel any different about that.

價格差距小於正常水平，因為我們與零售商共同製定的計劃使我們更加關注自己的產品，並採取相當高的定價措施來吸引消費者進店，我認為這不僅是健康的，而且還大大減輕了自有品牌的壓力。所以我不知道喬希，你對此有何不同看法。

No, I would agree. I would say everyday price points, you look at that still in the normal range of what we would see that call it 20% to 30% GAAP overall, but the promotional plans have closed that GAAP, especially when you look at fertilizer, grass seed, those categories where we've driven frequency, deeper, sharper discounts on drive items, that's really where we've seen progress against private label.

不，我同意。我想說的是，日常價格點，你看它仍然在我們所看到的正常範圍內，總體上是 20% 到 30% 的 GAAP，但促銷計劃已經接近 GAAP，特別是當你看肥料、草籽這些我們推動頻率的類別時，對驅動項目的更大、更大的折扣，這就是我們真正看到與自有品牌競爭的進展。

Thank you.

謝謝。

Thank you.

謝謝。

Andrew Carter, Stifel.

安德魯卡特（Stifel）。

Hey, thank you very much. Just wanted to ask some potentially dumb question, but I can't answer it. In terms of where do you see risk ever like of a garage load or pantry load, whatever you want to call it, like consumers pushing their purchases to the part of the season? I mean, you've had two really good POS unit numbers, well above what the category should be doing, but just give us any context around the category like the categories doing, just your individual categories what you see when people coming back just that risk that's out there? Thanks.

嘿，非常感謝。只是想問一些可能很愚蠢的問題，但我無法回答。就您認為哪些方面有風險而言，例如車庫負荷或食品儲藏室負荷（無論您怎麼稱呼它），例如消費者將購買行為推至旺季？我的意思是，您有兩個非常好的 POS 單位數字，遠遠高於該類別應該做的水平，但請給我們提供有關該類別的任何背景信息，例如類別的表現，只是您的各個類別，當人們回來時您會看到什麼風險？謝謝。

Well, I'll take this one. Listen, Andrew --

好吧，我要這個。聽著，安德魯--

I think, right? No, I definitely take it. I'm not sure I know the answer either.

我想，對吧？不，我一定會接受。我也不確定我是否知道答案。

So, I'll just give you some stats on what we're seeing in first half, and I'll sort of pick on lawns on fertilizer, our attachment rate is 2x historical obviously driven by a lot of the promotions, but what's really interesting is roughly 60% or 40% of those consumers are new consumers coming into the category or at least ones that haven't participated in the last couple of years. So my view is that it's a non-issue on pantry loading.

因此，我只會向您提供一些我們在上半年看到的統計數據，我會挑選草坪肥料，我們的附著率是歷史的 2 倍，顯然是由大量促銷活動推動的，但真正有趣的是，大約 60% 或 40% 的消費者是進入該類別的新消費者，或者至少是過去幾年沒有參與過的消費者。所以我認為食品儲藏室的裝載量不是問題。

Well certainly there may be some of that. You also see it early season with private label as that stuff tends to go on discount. We're very confident, especially as we start to beat the drum on frequency of feeding, and we are seeing an improvement there. Our frequency is up about 3% in the first half, and remember, 60% of our POS is ahead of us in lawn. So again, I just, I don't see it and I'm not terribly concerned and I'm feeling good about the fact that we're bringing new consumers in and that's not just our data it's also some of our retailer data. So I feel pretty comfortable that that's not going to be an issue for us.

嗯，當然可能有一些。您也會看到早期的自有品牌商品往往會打折。我們非常有信心，特別是當我們開始大力宣傳餵食頻率時，我們看到了進步。我們上半年的頻率上升了約 3%，請記住，60% 的 POS 在草坪上領先我們。所以，我再說一次，我沒有看到這一點，也不是很擔心，而且我對我們正在吸引新消費者這一事實感到很高興，這不僅僅是我們的數據，也是我們的一些零售商的數據。所以我感到很放心，這對我們來說不會成為問題。

The second question is, I think you withdrew Hawthorne revenue guidance for the year and apologize if I missed it. I don't didn't hear if you reiterated the EBITDA. Is it the same EBITDA guidance, I would guess no for the year, but you've reiterated the full year, so I guess where's the incremental strength coming from relative to the old guidance. Thanks.

第二個問題是，我認為您撤回了霍桑今年的收入預期，如果我沒有註意到，我深表歉意。我不知道您是否重申了 EBITDA。這是相同的 EBITDA 指導嗎？我猜今年不會，但您重申了全年指導，所以我想相對於舊指導，增量力量來自哪裡。謝謝。

Sure. So I think in past calls we've talked about trying to achieve a target for Hawthorne, of an EBITDA of $20 million. In my prepared remarks I mentioned first half of the year Hawthorne is around, adjusted EBITDA $4 million so they definitely will fall short of that target. We did not adjust our full year total company, EBITDA guidance of $570 million to $590 million. If I just go down through the P&L and what gives us confidence and continuing to manage through that I would say gross margin wise we're doing some outstanding work there and continue to perform well versus the target of 30%.

當然。所以我認為，在過去的電話會議中，我們曾討論過努力實現霍桑的目標，即 EBITDA 達到 2000 萬美元。在我準備好的發言中，我提到霍桑今年上半年的調整後 EBITDA 約為 400 萬美元，因此他們肯定達不到這個目標。我們沒有調整全年公司總 EBITDA 預測，即 5.7 億美元至 5.9 億美元。如果我看一下損益表，以及是什麼讓我們有信心並繼續管理它，我會說在毛利率方面，我們在那裡做了一些出色的工作，並且繼續表現良好，與 30% 的目標相比。

So we've got great line of sight there. On the SG&A front, our SG&A in our guidance, we've mentioned that we guide to 17%. And that's important to note that it just allows us to flex, along our P&L as we deal with Hawthorne activities. So we do have some variability to our SG&A that allows us, the balance of the year flexibility.

所以我們在那裡有很好的視線。在銷售、一般及行政費用方面，我們在指導中提到，我們指導銷售、一般及行政費用為 17%。值得注意的是，它只是讓我們在處理霍桑活動時能夠靈活調整我們的損益表。因此，我們的銷售、一般及行政費用確實存在一些變化，這使我們能夠實現年度平衡的靈活性。

And then in addition to that, Jim mentioned transformation in his prepared remarks. We did make some people cuts and we also took some variable non-essential spend out as we managed the year and really it's more of a long term view, and we feel like we can get further savings. If you might remember on the last call Jim challenged us to achieve around $30 million of incremental, overhead cuts, and we're well on our way on those activities to deliver that for '26.

除此之外，吉姆在準備好的發言中也提到了轉型。我們確實裁減了一些人員，並且在管理年度時也取消了一些非必要的可變支出，實際上這更像是一種長期的考慮，我們覺得我們可以進一步節省開支。如果你還記得的話，在上次電話會議上，吉姆向我們提出了挑戰，要求我們實現約 3000 萬美元的增量管理費用削減，而我們正在順利開展這些活動，以便在 26 年實現這一目標。

And part of that gives us confidence for the balance of the year. So that's why we didn't adjust our total company adjusted EBITDA for Hawthorne, as I mentioned, we continue to expect them to be profitable over the balance of the next two quarters. The company continues to adjust its business model and do all the right things, as noted, the first two quarters of this fiscal year.

這在某種程度上讓我們對今年的平衡發展充滿信心。所以這就是為什麼我們沒有調整霍桑的整體公司調整後 EBITDA，正如我所提到的，我們繼續預計他們將在未來兩個季度內實現盈利。正如本財年前兩個季度所指出的，該公司繼續調整其商業模式並做所有正確的事情。

Yeah, I just want to throw out, we had a two day board meeting that was Thursday Friday of last week and I've been very complimentary of Mark and his finance team and I think it's not probably fair to give it credit to the finance team alone, but I think the entire operating group, the healthier our business becomes.

是的，我只是想說，我們上週四和週五舉行了為期兩天的董事會會議，我對馬克和他的財務團隊非常讚賞，我認為只把功勞歸於財務團隊可能不公平，但我認為整個營運團隊的功勞越大，我們的業務就越健康。

The more room we can build in for disappointments in any one little piece of the business and I think what was clear is that. There's a pretty I think the budgeting process was pretty conservative. I think the business is performing at least as well is kind of what we need and therefore when they inventoried areas like Mark was just doing of areas where we have protection room built in.

我們為業務中任何一個小環節的失望留出的空間就越大，我認為這是顯而易見的。我認為預算過程相當保守。我認為業務表現至少是我們所需要的，因此當他們像馬克一樣對區域進行盤點時，我們剛剛在區域內建造了保護室。

If anything happens that we aren't anticipating. But there's room and on the opposite side potential upside as well. So I think we're sticking with the guidance and I think it's pretty unlikely we fall out of that and if things go well, which is we're in sort of peak POS period right now. And so everything sort of depends on what sells out and then one last thing which I view is a pretty significant positive and I know that some of the analyst community is pretty tight with retail.

如果發生任何我們沒有預料到的事情。但還有空間，而且另一方面也具有潛在的上升空間。所以我認為我們會堅持指導方針，而且我認為我們不太可能脫離這一指導方針，如果一切進展順利的話，我們現在正處於 POS 高峰期。所以一切都取決於什麼能賣出去，最後還有一件事我認為是一個非常重要的正面因素，我知道一些分析師群體與零售業的關係非常密切。

But based on tariffs, I think retailers are working really hard to manage their inventory dollars in sort of the fall and so we're hearing from multiple retailers and openness to sort of extending the season where you would see back to school and Halloween sort of taking space out of lawn and garden.

但基於關稅，我認為零售商在秋季會非常努力地管理庫存資金，因此我們聽到多家零售商表示願意延長銷售季，屆時你會看到返校季和萬聖節佔用草坪和花園的空間。

And I think that's a lot of Asian sourced product, and so I think there's a reasonable probability that the season gets extended longer which is not in our numbers, and so that I think would be healthy too. So I would say that, whether it was Mark and his team presenting the financials to the board, Nate and the operators talking about their plans, I think there's a lot of confidence that we sort of have this, and that's kind of where we're at.

我認為其中有很多來自亞洲的產品，所以我認為這個季節延長的時間是很有可能的，這不在我們的考慮範圍內，所以我認為這也是健康的。所以我想說，無論是馬克和他的團隊向董事會報告財務狀況，還是內特和運營商談論他們的計劃，我認為我們對此很有信心，這就是我們現在的狀況。

Thanks, I'll pass it on.

謝謝，我會傳達的。

Joe Altobello, Raymond James.

喬·阿爾托貝洛、雷蒙·詹姆斯。

Thanks. Hey guys, good morning. I guess first question maybe -- Mark, by the way, congratulations on removing the interim moniker. Could you quantify the amount of sales that might have shifted from Q2 into Q3?

謝謝。大家好，早安。我想第一個問題可能是——馬克，順便說一句，恭喜你取消了臨時綽號。您能否量化可能從第二季轉移到第三季的銷售額？

Sure, I'll give it a go.

當然，我會嘗試一下。

Do you have any idea what the answer is?

你知道答案是什麼嗎？

He's going to come out. I'll come up with it and these guys to correct me. I think when we've been out on the road, I mean, when we talk to people, the month of March is obviously a big shipment month. April is as well you're looking at daily shipment activity of $30 million to $35 million for the US consumer business, on an invoice that's not a net sales.

他就要出來了。我會想出這個辦法，然後讓這些人來糾正我。我認為，當我們上路時，我的意思是，當我們與人們交談時，三月顯然是一個重要的出貨月份。四月份，美國消費者業務的日出貨量為 3,000 萬至 3,500 萬美元，但發票金額並非淨銷售額。

And so that, some of those days can shift quarter to quarter, based on the slower start, and colder weekends the past few in the month of March or into February and stuff. So I contextualize what may have moved, I would just say that that's how I kind of like see it, I don't know if you guys have a different point of view a couple days. No, I'm just saying a couple days can shift easily from Q2 to Q3.

因此，由於開局較慢，以及三月或二月過去幾個週末的氣溫較低，其中一些日子可能會逐季度變化。所以我把可能發生的變化放在了背景中，我只是想說這就是我喜歡看到的樣子，我不知道你們幾天後是否有不同的觀點。不，我只是說幾天就可以輕鬆地從 Q2 轉移到 Q3。

From you that's true, yeah, and I think the real story is POS.

是的，您說的沒錯，而且我認為真實的故事是 POS。

Yeah. On that front I would say the momentum that we saw coming out of Q2 in first half. We obviously all saw all with the weather in early April that's picked right back up as the weather has proceeded and we're on the same trajectory we were on exiting the house. So mix, just back to the mix thing, that's a good thing I think, the early season mulching soils bringing consumers to retailers, LGOR (Lawns, Gardens, Ortho, Roundup) got a little bit of a slow start with that weather in April, but it's on fire now, so I can't quantify it, but I'm feeling pretty good about Q3.

是的。在這方面，我想說我們在上半年看到了第二季的勢頭。顯然，我們都看到了四月初的天氣，隨著天氣的進展，天氣又恢復了正常，我們又回到了離開家時的軌道上。所以混合，回到混合的事情，我認為這是一件好事，早期的覆蓋土壤將消費者帶到零售商那裡，LGOR（草坪、花園、Ortho、Roundup）在四月份的天氣下起步有點慢，但現在很火爆，所以我無法量化它，但我對第三季度感覺很好。

Joe, this is just my comments on. Everybody wants to exclude, kind of mulch and soils. We spent a lot of time on this discussion at the board meeting and I think Sadie who runs that part of our business reminded us pretty hard that people who are buying mulch and people who are buying soils -- and by the way, the soils business is an improving premium business, meaning more of a shifting to branded products than before that all these people are engaged in gardening.

喬，這只是我的評論。每個人都想排除各種覆蓋物和土壤。我們在董事會上花了很多時間討論這個問題，我認為負責我們這部分業務的 Sadie 非常認真地提醒我們，購買覆蓋物的人和購買土壤的人——順便說一下，土壤業務是一個不斷改進的高端業務，這意味著比以前更多地轉向品牌產品，所有這些人都從事園藝。

And so that, this is not a bad sign that the -- I'm not even want to call it commodity because the mulch business is certainly a high value, a high dollar low margin business, but it is absolutely critical to Lawn and Garden and the fact that it's doing well is a good thing. And Sadie's soil business or Miracle-Gro soils is doing really, really well.

所以，這並不是一個壞兆頭——我什至不想稱之為商品，因為覆蓋物業務無疑是一個高價值、高美元、低利潤的業務，但它對草坪和花園來說絕對至關重要，而且它做得很好是一件好事。Sadie 的土壤生意或說 Miracle-Gro 土壤生意做得非常非常好。

So I do think that there's a tendency in here for everybody to say ex mulch, or ex soils, and I think it's a lame thing. It's just the mulch business is not going anywhere. It's powerful. It brings consumers in, it builds market share of retail. It's clearly competitive and low value from a profit point of view. But from a customer point of view and an intent point of view it's really high. And I end up lecturing my folks here on stop poo-pooing mulch. It's a big important business and the people who do it are all people who are going to engage in gardening activities throughout the season.

所以我確實認為這裡有一種傾向，每個人都說前覆蓋物或前土壤，我認為這是蹩腳的說法。只是覆蓋物業務不會有任何進展。它很強大。它吸引消費者，建立零售市場份額。從利潤角度來看，這顯然具有競爭力，但價值較低。但從客戶的角度和意圖的角度來看，這個比例確實很高。最後，我在這裡教訓我的人們不要再對覆蓋物嗤之以鼻。這是一項重要的大生意，從事這項業務的人都是整個季節都會從事園藝活動的人。

Got it. Helpful just to just to follow up on that. I want to go back to your comments about promotions and the delta between POS units, POS dollars. I've covered you guys for a long time and I think -- correct me if I'm wrong, but I generally view your category as relatively inelastic and driven more by weather really than anything else. So has that changed recently?

知道了。有助於跟進這一點。我想回到您關於促銷以及 POS 單位和 POS 美元之間的差異的評論。我報道你們很久了，我想——如果我錯了請糾正我，但我總體上認為你們的類別相對缺乏彈性，而且實際上更多地受天氣影響。那麼最近情況有改變嗎？

Look, here's what I want to say, which is yes, I think that the relatively -- I don't know, we grew the business what 30%, 35% during COVID. We did not give a lot of that away. We grew nearly 10% last year we grew, I don't know what like the numbers that we reported, the numbers haven't gotten worse, put it that way, since the end of the half they've gotten, marginally better.

聽著，我想說的是，是的，我認為相對而言——我不知道，在 COVID 期間我們的業務增長了 30% 還是 35%。我們並沒有透露太多。去年我們的成長了近 10%，我不知道我們報告的數字是怎樣的，這些數字並沒有變得更糟，可以這麼說，自上半年末以來，它們略有好轉。

I think it's we're doing better. I think what we're doing better is we're driving the category. The new marketing team and Nate and his crew, I think, is what's happening in our business is really, really good. I think the challenging part to be honest, is that by embracing the promotional side of the dollars, which would have been it would have made our task of getting 35 so much easier.

我認為我們做得更好了。我認為我們做得更好的是我們正在推動這一類別的發展。我認為，新的行銷團隊以及 Nate 和他的團隊為我們的業務帶來了非常非常好的影響。老實說，我認為挑戰在於，透過利用美元的促銷優勢，我們獲得 35 個獎項的任務將會變得容易得多。

We're really betting on a model which is cut a lot of expenses out of the business, reinvest a large part of that back in sort of activation and brand support, and give a reasonable improvement, and I mean that in a big way because my family cares about it, to improve the financial return of this business but I think what you're really seeing.

我們真正押注的是一種模式，即從業務中削減大量開支，將其中的很大一部分重新投資於激活和品牌支持，並實現合理的改進，我之所​​以這麼做，是因為我的家人非常關心它，以提高這項業務的財務回報，但我認為你真正看到的是什麼。

Is the company is doing more and more of the right thing and I think we're, I don't want to say just getting started. But I think we're believers, what I've said to people is having been through. The shit of living in the latrine, I think is what I said in the Wall Street Journal.

公司是否正在做越來越多正確的事情，我想我們，我不想說才剛開始。但我認為我們是信徒，我對人們說的話都是經歷過的。生活在廁所裡的糟糕經歷，我想這就是我在《華爾街日報》上所說的話。

We've become a little bit radicalized on driving the business and part of when I say I think our evaluation is completely unfair. I get it. We're in the penalty box. We going to prove ourselves we're going to do that. But I think what you see is a very vibrant consumer business. I think the Wall Street Journal article about Home Depot and their $20 billion secret garden.

我們在推動業務方面變得有點激進，我認為我們的評​​估完全不公平。我得到它。我們在禁區內。我們要證明自己，我們能夠做到這一點。但我認為你看到的是一個非常活躍的消費業務。我認為《華爾街日報》有關家得寶及其價值 200 億美元的秘密花園的文章。

Is the truth it's one of the biggest categories they have were absolutely buy that, and I think that, what you see is an incredible consumer category that is what you said, pretty much immune from this, these are people who own homes, they're not, they're not hobos.

事實是，這是他們最大的類別之一，他們絕對會購買它，而且我認為，你看到的是一個令人難以置信的消費者類別，就像你所說的那樣，幾乎不受此影響，這些人是擁有房屋的人，他們不是，他們不是流浪漢。

And that if we do our job better, they will buy more product, and I think we that's the radicalized part and so I think we're well on our way to it, and I think that this is a very unique consumer franchise that is not being properly valued.

如果我們做得更好，他們就會購買更多的產品，我認為這就是激進的部分，所以我認為我們正在朝著這個方向前進，我認為這是一個非常獨特的消費者特許經營，但還沒有得到適當的重視。

The only other thing, I had Joe is when he talks about radicalizing on advertising as an example, we are on more times than maybe we have been in the past. We've put that incremental investment to work, so I feel like that is as long as you stay with it and continue that investment year over year which goes back to, for example, even the fall campaign. Where we've continued to invest that drives sales, we know it works it's one of our core convictions --

唯一讓我印象深刻的是，當喬以廣告激進化為例談論時，我們比過去更常談論這件事。我們已經將增量投資投入到了工作中，所以我覺得只要你堅持下去，年復一年地繼續投資，這甚至可以追溯到秋季活動。我們持續投資以推動銷售，我們知道這是有效的，這是我們的核心信念之一--

Look, Mark and me and on sort of this end of the corporate building, have looked at the value of various consumer franchises, as a sort of multiple, and I think our view is we sell at a discount and I think part of what's happened is what Mark just said is we have to believe in our sort of business model we cannot be fair weather brand slash marketeers. We've got a -- and we know when we invest there is a return, and I think we also know the other side when we don't, we don't see.

你看，馬克和我，在公司大樓的這一端，已經將各種消費者特許經營權的價值視為一種倍數，我認為我們的觀點是我們以折扣價出售，我認為發生的事情的一部分就是馬克剛才說的，我們必須相信我們的商業模式，我們不能成為公平的品牌和營銷者。我們知道，當我們投資時，就會有回報，而且我認為，我們也知道，當我們不投資時，我們就看不到回報。

So listings become harder, the challenges that, when we're negotiating deals become harder that the brand, the power of our brands matters and it is only by consistent high spend and what we're doing what we call transformation is converting this company where we can spend that kind of money, we refer to.

因此，上市變得更加困難，我們在談判交易時面臨的挑戰比品牌更難，我們品牌的力量至關重要，只有透過持續的高支出，我們正在做的所謂的轉型就是將這家公司轉變為我們可以花這種錢的地方，我們指的是。

I think back in 2008, 2009, I think it was more like 2010, I made this bet that we could increase sales in a really terrible external environment and we could take share and grow sales. We did, we just couldn't afford it. That's why we bailed on it. What's different here is we're reconfiguring the company so we can afford it. That's really what's happening here. That's transformation.

我記得在 2008 年、2009 年，或者更確切地說是 2010 年，我打賭我們可以在非常糟糕的外部環境下提高銷售額，我們可以佔領市場份額並增加銷售額。我們確實這麼做了，但我們負擔不起。這就是我們放棄的原因。這裡的不同之處在於，我們正在重組公司，以便我們可以負擔得起。這就是這裡真實發生的事。這就是轉變。

Yeah, not to drag this on. Joe, but just to get to the point, yes, 100% the post-pandemic world and how consumers see that value is different than the pre-pandemic world and our promo dollars, if I look at what we spent in the first half versus historical, it's up and it's a new business model and it's working.

是的，不要再拖下去了。喬，但只是為了說明一下，是的，100％後疫情時代以及消費者如何看待這種價值與疫情前時代和我們的促銷費用不同，如果我看看我們上半年的支出與歷史相比，它有所上升，這是一種新的商業模式，而且正在發揮作用。

Appreciate the call guys. Thank you.

感謝大家的來電。謝謝。

Eric Bosshard, Cleveland Research Company.

艾瑞克‧博薩德（Eric Bosshard），克里夫蘭研究公司。

Thanks. Good morning. Two follow ups, and then a question. First of all, the promotional spend, just trying to get a sense, are you spending more than you planned more than a year ago? I'm trying to figure out if this is your money or the retailer's money that's being spent on what sounds like heightened promotional spending?

謝謝。早安.兩次後續行動，然後提出一個問題。首先，關於促銷支出，我只是想了解一下，您的支出是否超出了一年前的計劃？我想弄清楚這是你們的錢還是零售商的錢，這些錢聽起來像是用來增加促銷支出的？

Well, for sure high promotional spend I would say on budget.

嗯，我想說，在預算之內，促銷支出一定會很高。

We're on budget, we haven't spent more than we planned on spending, but we are spending

我們的預算是合理的，我們的支出沒有超過計劃，但我們的支出

But it's a lot.

但數量很多。

If you remember that we did take list pricing this year, and we reinvested that into promotional activity for this fiscal year as well so we were planning for that higher spend.

如果您還記得的話，我們今年確實採用了標價，並且我們也將其重新投資到本財年的促銷活動中，因此我們計劃增加支出。

Yeah. But all within the budget of what we had started the year.

是的。但一切都在我們年初的預算之內。

But Eric, it's a lot more money. But within budget and it again this is part of a -- I don't know that we knew what the answer would be. But I think we knew one thing, getting pricing, and sort of recovering our margin because this is core to what we've been up to, at the retail level there was more resistance, so the sort of compromise will spend the money.

但是埃里克，這可是多得多的錢啊。但在預算範圍內，這又是其中的一部分——我不知道我們是否知道答案是什麼。但我認為我們知道一件事，獲得定價，並恢復我們的利潤，因為這是我們一直在做的事情的核心，在零售層面存在更多的阻力，所以這種妥協會花掉錢。

What that did is it probably made our mission a little bit harder here, but I think the assurances from sales and I think from retail partners is we're spending at least that much money and they're very active in bringing you listen. There's probably not an analyst that knows retail better than you. I mean it and I think there's so much effort for building share that they're using these dollars to push it.

這可能使我們的任務變得更加困難，但我認為銷售人員和零售合作夥伴的保證是，我們至少花了那麼多錢，而且他們非常積極地讓您收聽。可能沒有比你更了解零售業的分析師。我是認真的，我認為他們為建立市場份額付出了巨大的努力，所以他們用這些錢來推動它。

And I think our view is it's working, and I think we'll probably look to build this into a model, but when I say in the call it requires a very significant financial resources. To leave that money and I'm calling it activation money with the retailers to significantly increase our brand spend. Makes our job a lot harder and that it means Mark and Nate's job is a lot harder to figure out and again this goes back to this issue what exactly is transformation.

我認為我們的觀點是它是有效的，我認為我們可能會考慮將其建構成一個模型，但我在電話中說它需要非常大量的財務資源。把這筆錢（我稱之為啟動資金）留給零售商，以大幅增加我們的品牌支出。這讓我們的工作變得更加困難，也意味著馬克和內特的工作更難弄清楚，這又回到了這個問題：轉型到底是什麼。

It's completely remodeling this company so we can afford to do these things because our view is as a competitive franchise matter if we can do that year after year that we ultimately we will get paid for the value of this franchise.

這徹底重塑了這家公司，以便我們能夠負擔得起這些事情，因為我們的觀點是，作為一個競爭性的特許經營問題，如果我們能夠年復一年地這樣做，最終我們將獲得與這個特許經營權的價值相符的報酬。

Secondly, Jim, you talked about, the importance of narrowing the price gap relative to private label, and I guess I just want to dig on that question a little bit because, even what you just talked about, you're spending to build a great brand franchise. Why do you need to narrow the gap versus private label? It seems like it suggests that the value of the brand is not as significant. Can you explain that?

其次，吉姆，您談到了縮小與自有品牌價格差距的重要性，我想我只是想深入探討一下這個問題，因為即使您剛才談到，您也在花錢打造一個偉大的品牌特許經營權。為什麼需要縮小與自有品牌之間的差距？這似乎顯示品牌的價值並不那麼重要。你能解釋一下嗎？

Like, I don't, Eric, all due respect, I don't think that's what I said. I think the gap based on the level of promotion that's occurring in retail has reduced. I also said that I think our grass seed business and our lawn fertilizer business has become pretty pricey. We've been doing really good work in our lawns business. So that the words you hear, I think sometimes it's hard to read what we're meaning. But the lawns team is doing a really fabulous job of saying what do we have to do to build a multi-step program, and I don't know John.

就像，我不這麼認為，艾瑞克，恕我直言，我不認為這就是我所說的。我認為零售業促銷水準的差距已經縮小。我還說過，我認為我們的草種業務和草坪肥料業務已經變得相當昂貴。我們的草坪業務一直做得非常出色。所以，我認為有時候我們很難去理解你聽到的那些話到底是什麼意思。但是草坪團隊在說明我們需要做什麼才能建立一個多步驟計劃方面做得非常出色，我不知道約翰。

I had the brand people show up here like they normally would not be in the room. But you know if people have the time and John you can go pretty quick it's where are you headed with lawns?

我讓品牌人員出現在這裡，就像他們通常不會出現在房間裡一樣。但是您知道如果人們有時間並且約翰您可以很快地去的話您要去哪裡修剪草坪呢？

Well, I think you mentioned it earlier, Jim. We're changing a lot. The media and marketing campaign is going to continue to emphasize pride of taking care of your own lawn, that coupled with regular feeding messaging is super important. And when we drive people to retail, we have great programs at retail to make sure that we're incentivizing that behavior.

嗯，我想你之前提到過，吉姆。我們正在發生很大的改變。媒體和行銷活動將繼續強調照顧自己的草坪的自豪感，這與定期施肥資訊相結合非常重要。當我們吸引人們到零售店時，我們在零售店有很好的計劃來確保我們能夠激勵這種行為。

So multiple bags purchasing really gets consumers taking home two bags at a time and putting them down their lawn. That's what they're aiming to get is a great.

因此，購買多個袋子實際上意味著消費者一次帶兩個袋子回家並將它們放在草坪上。這就是他們想要實現的偉大目標。

Okay, but I'm going to talk about the uncomfortable part then, which is that the result of this is going to be lawn fertilizer pricing based on basically the products that we're going to be recommending coming down, okay, and this was the uncomfortable part during the board meeting which is, this is going to require instead of buying one bag that people buy multi-step. So I think this will help vis-a-vis private label, but I think over time call it two or three years.

好的，但是我要談談令人不舒服的部分，那就是這樣做的結果將是基於我們將要推薦的產品的草坪肥料定價，好的，這是董事會會議上令人不舒服的部分，即這將要求人們分多個步驟購買而不是購買一袋。所以我認為這對自有品牌有幫助，但我認為隨著時間的推移，這需要兩三年的時間。

You're going to see us very in a very measured way bringing prices down for long fertilizer, part of what John is doing with the supply chain is in a way that I have never seen before in this company because Marysville is like a fixture. The Marysville plant is a fixture, and John just said I can't afford to do business with you guys and I encouraged him, and I think so did Nate to say if you can't do it.

你會看到我們以非常謹慎的方式降低長效肥料的價格，約翰對供應鏈所採取的方式是我在這家公司從未見過的，因為瑪麗斯維爾就像一個固定裝置。瑪麗斯維爾工廠是個固定裝置，約翰剛才說我不能跟你們做生意，我鼓勵他，我想內特也這麼說，如果你做不到的話。

We'll manufacture someplace besides Marysville, and I don't care what that means. I think the result with the supply chain is going to be very beneficial for John's cost of goods. It's going to involve a little bit of capital to reconfigure that plan, but not crazy. And so I think we're not afraid of this, but what we are going to need is multi-bag purchases as opposed to one bag purchases. But so I don't know if that really answers the question. But I think the areas where we were concerned with grass seed and lawn fertilizer. I think we've got plans on both of those, and I think we're seeing good results so far.

我們將在瑪麗斯維爾以外的某個地方進行生產，我不在乎這意味著什麼。我認為供應鏈的結果將對約翰的商品成本非常有利。重新配置該計劃將需要一點資金，但不會太瘋狂。所以我認為我們並不害怕這一點，但我們需要的是多袋購買，而不是單袋購買。但我不知道這是否真的回答了這個問題。但我認為我們關注的是草籽和草坪肥料。我認為我們對這兩方面都有計劃，而​​且我認為到目前為止我們已經看到了良好的結果。

And Eric, from a gross margin perspective long term, I mean, our business well enough, having that multi bag, the incremental volume from a like a lawns category, that is incremental to the margin story. So even as Jim talks about, price decreases are making it, a little different dynamic there. It is margin accretive to the longer trajectory of the company, in our goal to get to 35.

艾瑞克，從長期毛利率的角度來看，我們的業務做得還不錯，擁有多袋產品，草坪類別的增量銷售對利潤率來說是一個增量。因此，正如吉姆所說的，價格下降正在使情況發生一些變化。它有利於公司長期發展的利潤成長，我們的目標是達到 35 個。

Okay, and then the last question, Jim, you're over the last couple years you clearly become more focused on units in a lot of the communication, the messaging, again, not to quote you, but a common or units more important than dollars.

好的，最後一個問題，吉姆，在過去的幾年裡，你顯然在很多溝通、訊息傳遞中更加關注單位，再說一次，不是引用你的話，而是一個比美元更重要的共同點或單位。

The concern would be, units aligning also with the gross margin goal. How are you managing a greater focus on units and also the clear commitment you have written on your wall of getting a gross margin? How do you manage that?

值得關注的是，單位數是否也與毛利率目標一致。您如何更好地關注單位數量，同時又能兌現您在牆上寫下的獲得毛利率的明確承諾？你是如何做到的？

First of all, Nate's the one hat's responsible for it, but I don't think they conflict.

首先，Nate 是這件事的唯一責任人，但我認為他們之間並不衝突。

No, they don't, and I think, look, Eric, the reason we really started shifting our focus to units was really the lawns issue because of the pricing we had taken on fertilizer, and focusing on US dollars it really masked the unit decline. And from our perspective, units is the sweet spot and as Jim said we've got to manage the supply chain around that, to make sure we're delivering gross margins.

不，他們沒有，而且我認為，埃里克，你看，我們真正開始將注意力轉移到單位上的原因實際上是草坪問題，因為我們對化肥的定價是按照美元計算的，這確實掩蓋了單位數量的下降。從我們的角度來看，單位是最佳點，正如吉姆所說，我們必須圍繞這一點來管理供應鏈，以確保我們能夠實現毛利率。

So I think they're totally simpatico in terms of looking at units, it's a better metric for my GMs to run their business by and gross margin is like a number two metric and I think what we did in lawns or what we're doing, we're not quite there yet we're going to do across the board and take cost out and drive efficiency. So I'm not terribly worried about it. It's just becomes sort of an irrelevant indicator for us, and it's like the prior.

所以我認為他們在看待單位方面完全一致，這對我的總經理來說是一個更好的衡量標準來經營他們的業務，毛利率就像第二個衡量標準，我認為我們在草坪上所做的或我們正在做的事情，我們還沒有完全達到那個水平，我們將全面採取行動，降低成本，提高效率。所以我對此並不太擔心。它只是成為一個對我們來說無關緊要的指標，就像之前一樣。

I think its we're in sweet spot right now in regard to retailers looking to bring consumers in, and that's kind of working and driving a little bit of this unit volume. I think if you look at last year. And in this year I think there's a lot of sort of share combat occurring at the retail level and that's on our side.

我認為，就零售商吸引消費者而言，我們現在正處於最佳時機，這在某種程度上起到了作用，並在一定程度上推動了銷量的成長。我想如果你看看去年。我認為今年零售層面出現了很多份額爭奪戰，這對我們有利。

I don't know if that when that goes away if we we'll start to see more units hooking up with, but at this point promo I think it's fair to say the promotional level is so high out there that it is definitely driving units to our benefit, how long that lasts, I don't know, but again if you look and say plus 30% during COVID didn't give hardly any of that back.

我不知道當這種情況消失時，我們是否會開始看到更多的單位加入進來，但就目前的促銷而言，我認為可以公平地說，促銷水平如此之高，這肯定會推動單位的增加，從而給我們帶來好處，這種情況會持續多久，我不知道，但如果你再看一下，說在 COVID 期間加上 30% 幾乎沒有任何回報。

And then picking up call I think we say 9%, but 10% last year and double digits this year it certainly feels good.

然後接電話時我想我們說的是 9%，但去年是 10%，今年是兩位數，這當然感覺很好。

And Eric, let me just add with units. So if I look at my asset utilization across our base it's not ideal volume is good volume helps gross margin. It deals with unabsorbed overhead so it's absolutely one of the biggest levers we have and that's why units are important.

艾瑞克，讓我用單位來加一下。因此，如果我查看整個基地的資產利用率，那麼理想的數量並不是好的，良好的數量有助於提高毛利率。它處理未吸收的間接費用，因此它絕對是我們最大的槓桿之一，這就是為什麼單位很重要的原因。

And from a finance perspective, Eric, just the way I reconcile it, I mean our soils business is an outstanding, margin profile that lines up well, to our longer term trajectory and then, as Nate alluded to getting that unit volume growth, the reason we're able to deliver a lot of the supply chain savings longer term, we're utilizing our assets more.

從財務角度來看，埃里克，我是這樣認為的，我們的土壤業務非常出色，利潤率狀況與我們的長期發展軌跡相符，然後，正如內特提到的，實現單位產量增長，我們之所以能夠在長期內實現大量供應鏈節省，是因為我們更多地利用了我們的資產。

We're doing things differently to get those better cost savings so that all kind of goes hand in hand, with each other and the only thing I'll close on mulch is, it is a product that drives foot traffic and volume across all of our customer base and that helps us deliver in our selling of all of our products, many higher margin products. So it's very much an important part of the overall portfolio. So I think they can work hand in hand to the overall story.

我們採用不同的做法來更好地節約成本，使所有方面齊頭並進，相互促進，關於覆蓋物，我唯一要說的是，它是一種可以推動所有客戶群客流量和銷量的產品，有助於我們銷售所有產品，包括許多利潤率更高的產品。因此它是整體投資組合中非常重要的一部分。所以我認為他們可以攜手完成整個故事。

Thank you.

謝謝。

William Reuter, Bank of America.

威廉·路透，美國銀行。

Hi guys, good morning. Thank you for taking our question. This is Rob Briggs on for Bill. So I appreciate all of the color on private label. I guess just one last one on that, how much, would you say you're taking in terms of share and then, regarding shelf space, are you taking any shelf space from the private label?

大家好，早安。感謝您回答我們的問題。我是羅布·布里格斯，代替比爾發言。所以我很欣賞自有品牌的所有顏色。我想就此問題再問最後一個問題，您認為您佔據了多少份額，然後，關於貨架空間，您是否從自有品牌那裡佔據了貨架空間？

Look, it sort of depends. I think if you look at like the organic business, I think our percent of the promotion right now is higher and therefore, I think I think you're seeing that., but I don't know you're looking at me like weird -- come on.

瞧，這得看情況。我認為，如果你看一下有機業務，我認為我們現在的促銷百分比更高，因此，我認為你看到了這一點。但我不知道你是否用奇怪的眼神看著我——拜託。

I would just say, share of shelf, if we were to break that down, I would say it's this is. Share of shelf absolutely up and that's driven by the promotions and the bulk out that you need for that.

我只想說，如果我們要分解貨架份額，我會說這就是。貨架份額絕對上升，這是由促銷和所需的大量銷售推動的。

But so I think that's the one that matters. It's not that on shelf doesn't matter. I think off shelf is such a big part of what happens this time of year.

但我認為這才是最重要的。這並不是說上架不重要。我認為現成的商品是每年這個時候發生的事情的重要組成部分。

Private label still plays an important role for our retail partners, and heck, we supply a fair amount of that. So I think I like narrative here like this is a war against private label that's really not the case. This is a war to drive foot traffic to retail and retailers leveraging our brands to do so, and private label still plays a key role for our retail partners and we're still key partners on that side of the business. So I think it's more of a war on foot traffic and leveraging.

自有品牌對我們的零售合作夥伴來說仍然發揮著重要作用，而且我們也提供了相當數量的自有品牌。所以我認為我喜歡這裡的敘述，就像這是一場針對自有品牌的戰爭，但事實並非如此。這是一場推動零售客流量的戰爭，零售商利用我們的品牌來實現這一目標，自有品牌仍然對我們的零售合作夥伴發揮關鍵作用，而我們仍然是該業務方面的關鍵合作夥伴。所以我認為這更像是一場針對客流量和槓桿的戰爭。

We just back it up and maybe I'm going to sound a little defensive, but we tend to hear this issue of are you guys all worried about private label. I don't think we're seeing a big shift and I don't think I know we're not seeing a big shift to private label. No, and you can see it and you break it down by category, right? You look at the las category as units have declined within the category. It's just consumers leaving it. They aren't trading down to private label.

我們只是支持它，也許我聽起來有點辯護，但我們傾向於聽到這個問題，你們是否都擔心自有品牌。我認為我們沒有看到大的轉變，而且我認為我們沒有看到向自有品牌的大轉變。不，您可以看到它並按類別對其進行分類，對嗎？您可以查看 las 類別，因為該類別內的單位數量已經下降。這只是消費者離開它而已。他們不會轉向自有品牌銷售。

It's more they want the experience, they want the brand, so as we've reinvested back into that and the promotional strategies that we have, we believe we are growing the category for our retail partners as well as growing our and share within that. So you look at gardening and what we're doing with the Miracle-Gro brand there, that's really driving share to our retail partners and share within the box to Miracle-Gro overall.

他們更想要體驗，他們想要品牌，因此，隨著我們對此進行重新投資以及我們現有的促銷策略，我們相信我們正在為零售合作夥伴擴大產品類別，同時也在擴大我們的市場份額。因此，您將看看園藝以及我們在那裡對 Miracle-Gro 品牌所做的一切，這確實推動了我們零售合作夥伴的份額以及 Miracle-Gro 整體的盒內份額。

So I think it plays different roles and different categories for each of our retailers, and you know we really remain key partners with our retailers there to drive that foot traffic in different ways by category.

因此，我認為它對於我們每個零售商來說都扮演著不同的角色和不同的類別，而且您知道，我們確實仍然是那裡的零售商的關鍵合作夥伴，以不同方式按類別推動客流量。

Great. That, that's super helpful color. I appreciate that. And the last one from me, regarding that 3.5 times leverage target by the end of '27, is that where you want to keep leveraged long term and then, would you consider, increasing leverage for M&A or share repurchases?

偉大的。那，那是非常有用的顏色。我很感激。我最後一個問題，關於到 27 年底實現 3.5 倍槓桿率的目標，您是否希望長期保持這個槓桿率，然後，您是否會考慮增加併購或股票回購的槓桿率？

I don't know, let's start with -- I think our view if Mark and I were alone right now. We probably operated like 3.5 to 3.7. I would say somewhere in there, and I think we felt like we get really good pricing on our debt in at that level. I think where we've been, to be fair. The journey through the cesspool that we've been on like since after COVID, probably makes us somewhat more conservative, so I think probably I would say 3.5 max.

我不知道，讓我們先從——我想如果馬克和我現在單獨在一起的話我們的看法。我們的營運水準大概在3.5到3.7之間。我想大概在這個水平上，而且我覺得在這個水平上我們的債務定價非常好。我認為，公平地說，我們已經去過那裡了。自從 COVID 之後，我們經歷了像污水池一樣的旅程，這可能會讓我們變得更加保守，所以我想我可能會說最多 3.5 個。

Maybe 3.25. I don't know. I'm sort of looking at Mark. I don't know where he is, but I, we have had informally this this conversation that wherever we have been historically it's probably a lower number that would make the street my family happier with. In regard to M&A, I don't want to sound like I've gotten old and I think I criticize Chris and the team at Hawthorne back in the day of what was it?

可能是3.25吧。我不知道。我好像在看馬克。我不知道他在哪裡，但是我們曾經非正式地討論過這個問題，無論我們身在何處，從歷史上看，較低的數字可能會讓我的家人對這條街更滿意。關於併購，我不想聽起來像我已經老了，我認為我批評了克里斯和霍桑的團隊，那是什麼？

I don't want to sound gun shy. I think we believe we have a lot of value with what we're doing. There are probably some. Close in adjacency deals that if they were priced attractively we could get interested in. But I think the bias right now is to drive our business without M&A and I think that that's again, I don't want to sound like I'm just repeating everybody who would criticize us.

我不想讓別人覺得我膽怯。我認為我們相信我們所做的事情具有很大的價值。可能有一些。如果鄰近交易的價格具有吸引力，我們可能會對其感興趣。但我認為現在的傾向是在不進行併購的情況下推動我們的業務，我認為這是再次，我不想聽起來像是在重複那些批評我們的人的話。

But as the CEO of the company, having looked at whether it's Smith and Hawken, maybe our European businesses, Hawthorne. I think that probably like a lot of other businesses, the M&A activity was expensive, and I'm not sure. If we had taken all that money and giving it back to the shareholders that we wouldn't have a bunch of super happy shareholders and a much higher stock price. So I don't want to sound like I'm getting old and I'm sort of taking that line.

但作為公司的首席執行官，我們考慮過是史密斯和霍肯，還是我們的歐洲業務，霍桑。我認為可能與許多其他企業一樣，併購活動成本高昂，但我不確定。如果我們把所有的錢都還給股東，我們就不會擁有一群超級高興的股東和更高的股價。所以我不想讓別人覺得我變老了，我就是這麼想的。

But I do think that what you all should expect from me as the leader of the company is to take a for considering where we've been to take a pretty conservative point of view which is whether it's leverage or sort of M&A.

但我確實認為，身為公司領導者，大家應該對我有所期待，想想我們一直以來所處的位置，採取一種相當保守的觀點，無論是槓桿還是某種併購。

if you look at the board in front of me here, we do not have a requirement for excessive growth. I think what we're saying is looking for 2% unit volume, about 1% pricing per year total about 3%. That's what's built into my sort of expectation for Nate and the crew. I think if we start -- I think we're just going to have to look at where we get to and whether we think that another point or two, but I think the business is doing really well and I think trying to get aggressed.

如果你看一下我面前的董事會，你會發現我們並沒有過度成長的要求。我認為我們所說的是尋求 2% 的單位數量，每年約 1% 的定價，總計約 3%。這就是我對 Nate 和團隊的期望。我認為如果我們開始——我認為我們只需要看看我們能達到什麼程度，以及我們是否認為還有一兩點，但我認為業務做得很好，我認為我們正在努力積極進取。

I think complete our recovery. I think that's the big thing is just let's finish the job and let's not immediately and it's me I think mostly hypnotizing myself into thinking we need M&A to get this done. I think we have a very valuable franchise. And I think let's try not to screw it up.

我認為我們已經完全康復了。我認為最重要的是讓我們完成這項工作，但不要立即行動，我認為主要是我自己在催眠自己，認為我們需要併購來完成這項工作。我認為我們擁有非常寶貴的特許經營權。我認為我們應該盡量不要把事情搞砸。

Yeah, I would just add this is Nate, Rob, if I look at our three to five year midterm plan, it's really based on organic growth. When we look at household penetration, we have a lot of opportunity to grow the category, we know e-commerce is growing at double digits. So we're working both with retailers and with our own, D2C plays there. So I'm really satisfied as I look at our road map that three to five years it doesn't, it would be opportunistic.

是的，我只想補充一點，這是 Nate，Rob，如果我看一下我們的三到五年的中期計劃，它實際上是基於有機增長的。當我們觀察家庭滲透率時，我們有很多機會來擴大這個類別，我們知道電子商務正在以兩位數的速度成長。因此，我們既與零售商合作，也與自己的 D2C 公司合作。因此，當我看到我們的路線圖時，我感到非常滿意，因為三到五年後它不會實現，這將是一個機會。

I would put it that way, small tuck-ins. Beyond five years, sure, maybe it's maybe it's part of our road map there, but that's a long ways away and you know our commitment is to get into a really comfortable leverage range and not swing for the fences and just deliver steady growth.

我會這樣說，小塞子。當然，五年後，也許這是我們路線圖的一部分，但那還有很長的路要走，你知道我們的承諾是進入一個真正舒適的槓桿範圍，而不是孤注一擲，只是實現穩定的增長。

Well, and I had one other thing which I know any members of my family who are on the call. There's an expectation that we get our share count down, that we've used share count to sort of fund stuff and when we needed to and I think we'd like to get our share account reduced and that's going to require shareholder friendly actions and a focus of our cash flow on not only earnings. But anything that we have extra once we get a leverage where we want it to reduce share count.

嗯，我還有一件事，我認識打電話的家人。人們期望我們減少股票數量，我們已經使用股票數量來為某些東西提供資金，當我們需要時，我認為我們希望減少我們的股票帳戶，這將需要採取對股東友好的行動，並將我們的現金流重點放在收益上。但是，一旦我們獲得槓桿，我們就希望它能減少股票數量。

Yeah, and I concur. I mean 3 times to 3.5 times is a is a real nice sweet spot for us on a leverage, it's where we've traditionally issued debt and gotten favorable rates, and it allows us to navigate, any one year and investments we want to do. And then to Jim's last point there on shareholder friendly actions in the future, it allows you, given the free cash flow we deliver based on those earnings, we should be able to buy back, shares annually at a consistent level, similar to what we used to do pre-COVID, above and beyond our quarterly dividend.

是的，我同意。我的意思是，3 倍到 3.5 倍對於我們的槓桿率來說是一個非常好的最佳點，這是我們傳統上發行債務並獲得優惠利率的點，它使我們能夠在任何一年進行我們想要的投資。然後，關於吉姆關於未來股東友好行動的最後一點，考慮到我們根據這些收益提供的自由現金流，我們應該能夠每年以穩定的水平回購股票，類似於我們在 COVID 之前的做法，並且超出我們的季度股息。

And I want to just throw one last thing out because it credit goes to everybody in this room and folks who work for us. Getting leverage now I don't know, is 4.47?

最後我只想說一句，因為這榮譽屬於在座的每一個人以及為我們工作的人。現在獲得槓桿我不知道，是 4.47 嗎？

4.41 this quarter.

本季4.41。

That. I think for the journey we've been on we never saw us getting to a point where we were north of 4.5. Obviously we screwed that up but for getting down below 4.5, which I would say while it's still in the modest leverage it is back within relatively normal for us and a huge amount of progress. I think the whole this team deserves credit for, like, I told this to the board, getting down below 4.5 times was a ton of work and everybody has done really fabulous work and it's been a lot of, a lot of blood, sweat, and tears.

那。我想，在我們走過的這段旅程中，我們從未想過能達到4.5以上的水準。顯然，我們搞砸了，但跌到4.5以下，我想說，雖然槓桿率仍然處於適度水平，但對我們來說已經恢復到相對正常的水平，而且取得了巨大的進步。我認為整個團隊都值得稱讚，就像我告訴董事會的那樣，將比率降至 4.5 倍以下需要做大量的工作，每個人都做出了非常出色的工作，付出了很多很多的心血和汗水。

Great thank you so much.

太好了非常感謝。

Thank you. That does conclude today's conference call. Thank you for participating. You may now disconnect.

謝謝。今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。