Noel Wallace: Thanks. We talked about it, I think, on the second and third call — on third quarter call that the strength of our Latin America business and ultimately, our ability to lead in pricing and then the consistent history we have of seeing volume return to the categories. And so if I talk at the category level first, what’s great is we’ve seen all three of the categories in which we compete, inflect positively from a category standpoint. And you’ve obviously seen us growing quite considerably on the volume side, the last three quarters, which is generating good volume share growth for our business. So we’re very pleased with the overall performance there. And based on where we see the categories inflecting right now, we’re pretty confident that we’re going to continue to see balanced growth as we move forward.
We’ll have to take some currency pricing for sure through the year. But as we’ve indicated before, we would expect the volume to come back in these markets, and that’s exactly what we’re seeing. If you drill down to some of our biggest markets, particularly Brazil and Mexico, really strong quarter for both those markets with double-digit volume growth for Brazil and for — and strong double-digit growth for Mexico as well. So again, a clear indication that the strategy of putting in strong innovation across all price points, getting the advertising, which we accelerated in the fourth quarter, likewise in Latin America, is helping to recover the categories and drive good volume market share in that business.
Operator: The next question comes from Nik Modi with RBC Capital Markets. Please go ahead.
Nik Modi: Yeah. Thank you, good morning, everyone. Just wanted to follow up maybe on the raw material packaging inflation. Just some more perspective. You cited specialty products, I just wanted to get some context around that and what exactly some of those elements are.
Noel Wallace: Sure. Let me throw that one to Stan and he can give you a little bit more context there.
Stan Sutula: Sure. Unlike the prior two years, we don’t expect a material impact here. So we see modest inflation in 2024 and there are some areas like every year that go up and down. But there are some new ones this year, things like fish oil has increased significantly. But overall, we expect modest inflation. And so while commodities overall are off of their highs, they’re still elevated versus pre-COVID levels. And we expect that as we go through this, there might be a little bit of benefit moving in our favor, but not dramatically. And the only thing I’d say after that is raw materials are one component. So we deal with conversion costs, we deal with transport and logistics costs, and we drive productivity across all these areas through our Funding the Growth program, and that’s why we’re confident on margin expansion for 2024.
Nik Modi: Great. And Stan, if I could just follow up on Filippo’s question. I think he was asking on proteins as it relates to Hill’s. So you cited ag costs, but maybe just comment on protein? What you are seeing…
Stan Sutula: Yeah. Pleasingly, at least at the current point in time, we’re not seeing an impact to Hill’s in total on an increased basis year-on-year. So we look in total around Hill’s as ag has kind of stabilized here a bit as well as proteins, we don’t see a big headwind heading into 2024 based on total for commodities for Hill’s. And that’s important, because as we drive productivity with modest levels of flow-through on price and the innovation, that will allow us to continue to expand margin on the Hill’s portfolio.
Operator: The next question comes from Chris Carey with Wells Fargo. Please go ahead.
Chris Carey: Hey, good morning. So I wanted to ask about productivity and maybe go down to the regional level. I think this was the best productivity in our model anyways, going back roughly 20 years. And so is there anything abnormal about this quarter, any pull forward of productivity? Or are we talking about maybe just productivity muscle continues to build here? And that this is something that we can think about being at a slightly higher run rate go forward? And then just connected to that, this was the best North America margin we’ve seen in some time. Was there any outsized productivity benefit in the quarter? Or are you just starting to see some easing costs and better efficiency relative to the stabilization we’re seeing in the business? Thanks.
Noel Wallace: Yeah. Thanks, Chris, and good morning. Yeah, a little bit of all of that, quite frankly. Obviously, with the incredible inflation that we’ve seen over the last 1.5 years across the bulk of our commodity basket, we’ve had to obviously accelerate the funding the growth and the higher cost obviously have allowed us to generate higher funding the growth. As I mentioned earlier, a lot more efficiency in the plants and our ability to utilize our manufacturing facilities to drive more of the funding the growth projects has likewise allowed us to step up a little bit of that funding the growth in 2023 that we historically had not had the time to do. So a bit of it will be symptomatic of the year and the opportunity. But I think the discipline that we’ve ingrained and the culture that we have ingrained at Colgate around funding the growth in parallel, likewise with the global productivity initiative that we put in place, has allowed us to generate obviously strong contraction in our costs overall.
I wouldn’t say use it as a benchmark for going forward. There will be a lot of moving parts to that, but we feel like structurally, we’re in a better place on funding the growth. Structurally, we’ve managed to execute the GPI in line and slightly towards the high end of the guidance range that we provided earlier on that initiative. So we feel like we’re in a good place. Pricing will moderate, so it’s important that we continue to generate the strong funding the growth and through the P&L in order to generate the margin growth that Stan talked about.
Operator: The next question comes from Olivia Tong with Raymond James. Please go ahead.
Olivia Tong: Great. Thank you, good morning. First, I wanted to ask you a little bit about the top line, obviously, coming off a very impressive 7% top line growth in Q4. The guide for the fiscal year at sort of 3% to 5%. Can you just provide some perspective thinking about first half versus second half, perhaps the cadence of volume growth as the pricing contribution sort of begins to lap? And then similarly on EPS, obviously, a very strong ’23 and Q4, talking about the mid- to high single digits. That, of course — that range implies potential for growth deceleration in 2024. So just talk about what has to happen to get to the high and what you incorporate in terms of the low end and perhaps an incremental conservatism built into the guide? Thank you.
