This is what we saw in apparel, and we’re going to see this again in logistics. And so we’re underway in discussion already with other logistics providers around the world to understand how best we can enable and support them in their supply chain efficiency aims as well. Some of those will come to bear, either in pilot trial as we go through 2024 and then onwards from 2025 as well. I think the second thing you’re going to see and specifically logistics is that because you have this peak typically in the second half of the year. The first half and largely the first quarter tends to be lower just from a volume perspective for logistics overall. And that’s what we’re anticipating as well in our overall first quarter. We will see some continued apparel growth slightly.
And then we’ll see other segments that will also contribute in terms of some of the new programs we’ve launched as well for the first quarter. The first half of the year will certainly be up relative to the first half of last year simply because of the annualization of some of those large programs, Jeff.
Greg Lovins: Yes, Jeff, on your second question, I think Deon indicated in the prepared remarks, intelligent labels revenue for the year in 2023 was around $850 million. That does include some revenue that’s in the materials segment. So if you just look at the solutions segment, it’s a bit lower than that because some of that is sold through our converted channel through materials. Now as we talked about as well, last year, we said we had a roughly $800 million business. There is some currency translation there, of course, that impacts that number. But overall, we grew, as we said, kind of low double digits for the year in 2023 and that number is around $850 million across the enterprise.
Operator: Our next question comes from Josh Spector with UBS Securities. Please proceed.
Josh Spector: I just wanted to ask a couple quickly on retail and really your confidence in the second half and where your volumes are today. So my multiyear stacks are getting kind of messed up, I guess, as we get further and further from 2019. I guess my data would say you’re down about low single digit in the fourth quarter versus that level. I imagine that’s wrong. So where would you say you are versus 2019? And then when you talk about a normalization, I guess what’s the magnitude of the improvement you see in the second half as possible has worked into your guidance assumptions and what’s your visibility to that today? Thanks.
Deon Stander: So Josh, let me just start at the high level. We’re anticipating that we’ll see apparel normalization in the second half of the year, largely because we’re seeing full uncertainty at retail and brand level, and they’re factoring that into their sourcing near-term requirements as well. And compounded by, I think, some more of the geopolitical escalation that we’ve seen more recently. I think at the retail confidence level, we continue to see retail volumes be down both in Europe and North America at an absolute retail volume level in late 2023 and they’re roughly forecast to be flat or similar in 2024. Final point I’d make is if you look at I think on Slide 6, we highlighted that we’ve had more than four quarters of continued significant import declines relative to normalized patterns in 2019.
And at some point, that does turn and we’re starting to see that now in North America for part of Q4, and I don’t doubt that we’ll also see that when the information comes through from Europe as well. That trend is part of our confidence around why we buy around mid-2024, we anticipate volumes for apparel normalizing at that point.
Greg Lovins: Yes, Josh. I think you can see on that slide, apparel imports in North America were down from 10% to low teens as you look at the different quarters across 23. Europe is a little worse, down in the low 20s. So look on a net basis, it’s somewhere in the mid-plus teens from that perspective in 2023. We expect to still see that kind of a trend in the first half and start to improve them in the back half, as Deon talked about.
Operator: Our next question comes from Matt Roberts with Raymond James. Please proceed.
Matt Roberts: I might try to dig just a little bit more. If apparel volumes are expected to normalize in the second half, does that imply you could hit the $10 run rate in EPS as soon as 3Q? Or is that still uncertain and in regard to the 20% growth rate in intelligent labels, can you quantify how many points of that is dependent on the apparel rebound?
Deon Stander: So Matt, I think we were clear the last time that we have confidence in the $10 run rate being achieved at some point in 2024, and that still remains the confidence, in fact, it’s included in our guidance. I think the only variable that we continue to see is related to the uncertainty and the impact on timing. And so at this point where we will see a likely $10 run rate in the second half of the year. As it relates to your 20% IL growth that basically is going to account for we think about sort of 2 points of the company growth as we look for 2024. And it’s based on making sure that we continue to accelerate our existing programs, roll out the new programs that we have and apparel volume rebounding as well.
