Niko Lahanas: Well, also live animals, I would add too. You know, we’ve seen a little bit of a drop off in penetration, particularly in dog. Cat seems to be doing pretty well and aquatics and live animal – or small animal, excuse me, are holding up pretty well. But that’s going to be another driver. And we have a small live animal business as well. And that’s been down because of, you know, you’re just not seeing the adoption rate from the COVID high. So, that’s going to drive, you know, the durables and then also the consumables downstream. The other thing, you know, I would say is, what we have to be mindful of too is the consumer trading down. Now, on the Garden side, like, you know, if we [technical difficulty] sorry – we put it on mute there for a sec.
In wild bird, you know, we have good, better, best, and so we can cover off the consumer if they decide to trade down. And we have to see how that plays out in Pet as well, particularly in our treats business, you know, in terms of the consumer feeling a little bit stressed and wanting to trade down from say natural chews to all the way down to biscuits, and that’s something we don’t even make, are biscuits. But so far it’s held up pretty well. But we do have to be a little bit cautious there.
Jim Chartier: Great. Thank you.
Niko Lahanas: Yes.
Operator: Our next question comes from the line of Bob Labick with CJS Securities. Please proceed with your question. And Bob, your line is live. Anyway, it seems as if Bob’s line is having some technical difficulties. We’ll go ahead and proceed to the next question. Our next question comes from the line of Andrea Teixeira with JPMorgan. Please proceed with your question.
Andrea Teixeira: Thank you, operator, and good afternoon, everyone. A question on the top-line, the flat to modest part, I think underlying you mentioned, are you assuming better POS? You just discussed obviously strong POS for the Pet business and more modest on the Garden. So, I was just trying to parse out what are your expectations in terms of, like, real POS data from a volume perspective. So, I’m assuming, in your transcript – or not your transcript, your release, you talk about modest pricing into 2024. So, I wanted to see what are your assumptions in terms of the shipments in 2024. And then also if I add on the mid-single-digits TDP growth you mentioned, is that additional that you’re coming on spring – the spring, your visibility for the shelving factors into spring?
And then your outlook for, so likely up operating margin, can you update us on how much you expect from your program, the savings program, if there is any update on those savings? And finally, sorry for all these questions, but a clarification on the gain that you had of $6 million in the quarter. You adjusted out all the expenses from the program, but I think the gain is added back to the EBIT. So, just to see if the adjusted GAAP number – adjusted non-GAAP number includes the gain, but excludes the expenses. Thank you.
Niko Lahanas: Okay. I’m going to take a crack at it. As far as POS and into ’24, I think, you know, we go into every year assuming, you know, again a fairly normal weather on the Garden side. On the Pet side, I think, you know, given we feel great about where inventories are, I think in both segments, we feel like, you know, POS should be pretty stable. So, we feel like there’s good equilibrium there in terms of our ships and then our sales going forward to the consumer.
J.D. Walker: Niko, I think there was also a piece of that that was tied to TDP, when we would see the lift from that.
Niko Lahanas: Yes.
J.D. Walker: And that would be in the Spring. So, the retailer sector shelves typically in the January timeframe for the coming season. So, that’s when we’ll start to see the impact from that.
Niko Lahanas: Yes. Yes. You know…
Andrea Teixeira: And that’s included in your guide? I’m sorry.
Niko Lahanas: Yes. Yes, absolutely.
John Hanson: Yes. And we’ve seen some, you know, on the Pet side, we’ve seen some TDP growth as well, you know. And, you know, the good news for Pet, you know, even with the softness in pet acquisition and pet ownership and we talked a little bit about durables, you know, we feel really good about our share position. You know, we’ve taken market share in consumables, in durables, brick-and-mortar, and e-comm and we feel very good about that and feel very good about continuing that in fiscal ’24.
Andrea Teixeira: That’s very helpful. And then on the operating margin, and the gain in the quarter, you can help us?
Niko Lahanas: Yes. So, the number we gave you, so the non-GAAP of I think total year was like $16 million. Now that was net of the gain. So, we netted all that out and we non-GAAP’ed it. So, if you look at Garden, I think their GAAP number in the quarter was actually higher because of the gain.
J.D. Walker: It’s correct. We – so, just like we took out the expenses – sorry.
Niko Lahanas: Turning to the non-GAAP, we deducted the gain…
J.D. Walker: Yes.
Niko Lahanas: From our non-GAAP results.
Andrea Teixeira: Okay. Perfect.
Niko Lahanas: Does that help?
