Julien Mininberg: Hi, Peter. Julien here. Thanks for the question. Given there’s two parts to it, let’s split up the answer. So Brian will definitely be able to address the range on Q2, and then we’ll talk the demand part just afterwards.
Brian Grass: Yeah, Peter. The wider range is really centered around investment spending and the timing of that investment spending and there’s a lot of moving parts as you called out when you were asking the question about consumer demand. So we have a lot of initiatives going and a lot of positive momentum going in the right direction on things like the traveler and those sorts of things. The timing of when that gets into the retailer and when we really want to drive demand can fluctuate between the second quarter, third quarter and so on. And so there is a range of outcomes for the second quarter that is largely based on the timing of our investment spend when it will follow exactly. And in a matter of weeks, could make a shift between Q1 and Q2, and that’s really what we’re dealing with here because that is such a new item, and it’s actually hitting retail towards the end of the second quarter and it will hit some retail before other retail.
And so hopefully, you can imagine that there’s a period of time that could overlap just a matter of several weeks, which could make a difference to the quarters. And that’s why there’s kind of a wide range of outcomes. We can’t perfectly predict when the timing will be exactly above that. And so there’s a little bit of a range there for the second quarter.
Julien Mininberg: Great. And on the demand subjects, I think the simplest thing we can say is that everyone on the call, I think, in the market broadly is aware of the choppiness in predictions pressure that’s on the consumer at a macro level, so the famous inflation and higher interest rates, the higher for longer speech that the Fed is reiterated month after month. And in the case of these categories to your specific question, we’re in a broad set of categories. So some of them are just feeling the pain of that discretionary reduction as buying pattern shift. Others like Outdoor, for example, are seeing the benefits of the megatrend of Outdoors. Prestige Beauty is generally doing better and then the world of COVID flu, it’s — we’re off season right now.
It’s hard to tell and these things go up and down. In terms of what it means for us, I think the simplest thing I can say is, we just reiterated our sales guidance today and all of that was considered when we put that number forth.
Peter Grom: Great. Thanks so much. I’ll pass it on.
Julien Mininberg: Sure. Thank you, Peter.
Operator: Our next question comes from the line of Susan Anderson with Canaccord Genuity. Please proceed with your question.
Susan Anderson: Hi. Thanks for taking my question and very nice job on the quarter. I was curious on the inventory levels, it’s nice to see them down so much. I guess, are you guys still working towards your goal to be under $400 million by the end of the year? And then just curious on the SKU rationalization and kind of where you’re — like how much of that is completed at this point and how much of it is left for the rest of the year? Thanks.
Brian Grass: Yeah. I think we’re still on track with our goal. The implied in our cash flow range of $250 million to $270 million. Obviously, to be at the 270, we’d have to be at the $400 million or maybe slightly below. If we could end up maybe a little bit higher than that, which would put us in the $250 million cash flow range for the year. So I think we’re comfortably within that range. We — like I said, we could end up at 410, 415 by the end of the year. If we do that, it would be a good reason for it. It will be because we’re leaning into opportunities and we want to have the inventory to be prepared to shift to those opportunities. And then, if we don’t have incremental opportunities like, that then we’d be likely closer to the $400 million. So I think we would toggle within that range by the end of the year, and we’re definitely on track to do that.
