Mark Astrachan: All right. That’s good. Two questions for you. One sort of related to the recent line of questioning. So, inventories were up again sequentially. How do we think about the improvement there? And does that kind of lead into flow-through of improvement in gross margin through 2023? And maybe more bigger picture, how do you think about the relative affordability of Monster and energy drinks broadly in the US after the price increase? It seems like you think that other beverage categories. Pricing has been steady riser over the last decade plus, so the gap has sort of narrowed. You took a little bit of pricing, but not nearly as much on a cumulative basis. Is there opportunity here to become more price rationale from an energy category standpoint as you kind of move forward?
Hilton Schlosberg: Well, let’s talk about the first question, Mark, about inventories. As you know, when we went out of 2021, our inventories were just too low. We were unable to service our customers without major upheavals and without major costs. So, we — there was no question that the inventories had to move and move significantly up because bearing in mind where our sales are. But as we are, we believe that we have sufficient inventories, which is important for us to be able to service our customers. Are we working on getting those inventories down? Yes. And these inventories will optimize themselves in due course. So, I wouldn’t be concerned. Our products have a two-year shelf life, and it’s important that we maintain sufficient inventories to service our customers.
And then on that second question you asked about pricing, if you know and look, for example, at a Mountain Dew at Walmart, a 20-ounce Mountain Dew Walmart, their price is $2.18. And Monster is $2.28, so we — I think as you look at the energy category and you kind of balance the pricing of 20-ounce sodas and energy drinks. Remember that we now — and just twisting over to convenience, we sell more — energy drink sell more at convenience than carbonated soft drinks. So, there is a balance. And I think we have struck a very good balance. With regard to going forward, we have a price increase planned for 24-ounce, which we believe has got opportunity, and we’re taking price in 24-ounce up beginning of April. So that will happen. And we’ll continue to monitor the opportunities for price increases in the US, as we see margins and as we see the carbonated soft drink category, and it’s a whole bundle of issues that lead us to move in the direction of whether to take price.
Operator: The next question comes from Filippo Falorni of Citi. Please go ahead.
Filippo Falorni: Hey. Good afternoon, guys.
Rodney Sacks: Hi.
Filippo Falorni: Can you talk about your expectations for your innovation pipeline in 2023, particularly on a relative basis over the last couple of years, given it seems like you have a pretty substantial pipeline this year, both in alcoholic beverage and your core energy drinks? Thank you.
Rodney Sacks: The fact is that I think that we’ve actually got a really broad base of innovation, I think that it has sort of improved over the last few years, and I think we’re sort of getting it right. I think that will be positive for the brand. We also are being able to secure a little more shelf space across the different channels, which is helping us with innovation, because in some cases, we didn’t get shelf spaces in some of the years past, and it was sort of difficult to actually get the innovation to achieve the benefits that we had hoped for. We think that this year, we will be able to achieve those benefits. We have rationalized some of the SKUs. And we think that we’ll be able to get a good selection of our innovation on shelf, particularly the new energy Zero Sugar and also the new Reign subline, which will going to go up against other competitors in the 12-ounce category.
