So — and that obviously could impact our margins as well. So I just wanted to make sure that that is considered. Currencies is another element that can impact the top line and the bottom line. And I think that that is something to be considered. And last big thing I think that Dennis mentioned this in his script is, this business model has the capability to deliver very strong free cash flow. We are anticipating even with those conservative assumptions that we share with you, we’re anticipating that the company will be able to deliver about 150 million in free cash flow this year. We took this — just the model very seriously. We looked at CapEx, we try to conserve capital, we have a high expectation that we will be able to turn inventories faster just eliminating the excess that we created just by being strategic to make sure that we have product to service both our stores and our wholesale business.
But we are expecting that all that is going to be kind of like eliminated from the business more. And as a result, we can generate $150 million with conservative assumptions.
Corey Tarlowe: That’s great. Thanks so much for all that help and best of luck.
Carlos Alberini: Thanks, Cory.
Operator: Thank you. One moment for our next question please. And it comes from the line of Dana Telsey with Telsey Advisory Group. Please proceed.
Dana Telsey: Good afternoon everyone. Hi, Carlos. As you think about the different channels of distribution, Americas wholesale has always been a little bit more the challenging one. How do you think of that opportunity going forward? And what do you want it to be as a percent of the business in the long term? As your own DTC grows, you just mentioned expanding the store network. Where do you think it should be? How do you think of full price and outlook? And how do you think of by the channels of Guess and Marciano? And just lastly, you mentioned on the gross margin, some IMU benefits. How is that being planned for 2023? Thank you.
Carlos Alberini: Thank you, Dana. Good afternoon. How are you? So let me start with your question on wholesale. We love the wholesale business. So let me start there. If you look at the strength of our wholesale business, it has been just very remarkable for this company for many decades and this year and our current business is no exception to that. We are super happy with how wholesale has been performing both in the last few years in North America and in Europe for sure until very — until now. So what we see is — and let me just start by defining what is included in the Americas wholesale business, which is a segment for us. It comprises four markets, it’s U.S., Canada, Mexico and Brazil. And the momentum of each of these markets is relatively different and there are significant causes for each.
So the one market that is under most pressure is the U.S. And we think that this is somewhat driven by how retailers that buy our product had approached the issues with supply chain and now with what’s happening with the consumer. And as a result, we see that there is a contraction of buying and that contraction is, we think, primarily motivated by trying to keep inventories in check and not create any excess inventory. So as a result, we think that we have to play this game in a different way and be a lot more careful with how we buy. We had an experience when COVID started that we saw order cancellations left and right and we decided strategically at the time that we were going to keep those orders alive and that was a fortunate thing because then we found that our retail partners came back to us and say, well, we need product now because the consumer is back, COVID was somewhat under control.
