Andrea Teixeira: And then just – oh, that’s super helpful. Thank you for clarifying. And then the operating margin outlook, right, that you’re expecting, on the savings program which obviously you did make a lot of effort on a bunch of facilities that you closed and there are also warehouses, how we should be expecting embedded in your $2.50 and better outlook, what is the – what is it we are expecting and embedding there in terms of savings?
Niko Lahanas: Yes. As I mentioned in the prepared remarks, we’re not going to guide on the total savings number. It’s in the guide. We also feel, you know, that there will be a lot of promotional activity. We need to see how the consumer and the retailers react in the year. You know, if you look at the last few years too, we took savings every year. However, a lot of those savings were overshadowed by runaway inflation. So, that’s why we’re a little reluctant to guide on an absolute number because we’re not, you know, we may not be able to see it, given the competitive environment in the marketplace in the coming year. That’s why we’re opting to be a little bit more accurate and give specific data points on projects every quarter and actions that we’re taking every quarter.
Andrea Teixeira: Okay. That’s fair. I’ll pass it on.
Operator: Our next question comes from the line of William Reuter with Bank of America. Please proceed with your question.
William Reuter: Good afternoon. The first is, you’ve made a bunch of comments kind of with regard to your expectations of promotions and it wasn’t clear to me whether these comments were across both Lawn and Garden, as well as Pet. I think it was clear that they were part of the Lawn and Garden commentary, but if you could talk a little more about that?
Niko Lahanas: Yes. I think it’s across the entire business. You know, if you look at what’s going on right now, you know, the macroenvironment is, you know, it’s flashing a little bit red right now and you’ve got higher interest rates. You’ve got, you know, CPG companies as well as retailers really working their working cap down, because of the higher cost of capital. We think that, you know, it’s going to be a bit of a dog fight in ’24 and in trying to take share here and there, and everyone is going to be doing kind of the margin grab. So, we think it’s going to be a lot more promotional, in particular in a deflationary environment. So, we think it’s going to be across the board. It’s going to be pretty tough here.
William Reuter: Got it. And then I want to make sure I got the previous point correct. But I think you said that inventory levels across both segments you believe to be in good position. So, PO – sell-in and sell-through should be pretty well aligned. Is that correct?
Niko Lahanas: Yes. They’ve been – you know, the spread’s been narrowing throughout the year. So we feel pretty good about that sort of state of equilibrium right now. That said, our inventory levels, you know, if you ask me, I’d like to see us drive them down a little more. You know, I think we still have some work to do there, and in particular, the higher cost inventory. But we’re going to keep at it. I think we made great progress this last year decreasing by $100 million and I think our cash flow from operations really reflect that.
William Reuter: Got it. And then lastly, you brought up M&A towards the end of the prepared remarks. I feel like there has been a disconnect in valuations of public companies and a lot of private seller expectations over the last handful of years particularly in pet. Do you believe that this disconnect still exists? Do you think that sellers are becoming more rational? Are you more optimistic about the ability to find suitable targets at good valuations?
Niko Lahanas: We are. I mean, we’re very value-driven. So, we’re value buyers of growth businesses. And you’re right, you know, the last few years, the Pet businesses were, you know, very, very high multiples. And that’s why you didn’t see us doing a lot of pet acquisitions. This is our first one in a while. We feel like we’ve got a great business, fits in really well into our Dog and Cat platform. We’re seeing a lot more activity, I would say in the last few weeks. So, we’re seeing a lot more deal flow. I do believe the valuations are more realistic right now than they were in the last few years. So, I’m quite optimistic about the M&A pipeline and our ability to identify and get deals done.
William Reuter: Great. That’s it from me. Thank you.
Niko Lahanas: Thanks.
Operator: Our next question comes from the line of Hale Holden with Barclays. Please proceed with your questions.
Hale Holden: Hi. I just have two questions. The pet treats business that you guys just announced the acquisition of, does that meaningfully change the mix of hard goods and consumables in the Pet segment?
Niko Lahanas: No, I mean it’s a bit of a bolt-on. It’ll slide right into our Dog and Cat platform. So, it’s not going to meaningfully change, you know, the mix between consumable and durable. But what I would point out, and I think if there’s anything I want folks to take away from the call is really the kind of the real-time evolution of our portfolio. So, if you think about what we did a quarter ago, we sold the Garden distribution business. And then we turned around and we buy a pet consumable business that has much better consumer tailwinds, it’s, you know, faster growth, higher margin consumable and really not seasonal. So, you can see kind of what’s going on there real-time in terms of our portfolio. And I think if there is anything to take away from the call, it would be that.
