Marlo Cormier: Thank you. So our leverage range of the 1.5x to 2x, we do believe that’s appropriate for our business going forward. So, we will continue to work towards that. This quarter, we were pleased to be able to further optimize our balance sheet with the recent refinancing. We did take $80 million of principal out of that secured note as we refinance into a new secured note. Just given the timing of our cash flow, we are generally much heavier in the back half and certainly in Q4 in terms of our free cash flow generation. So, we did use our ABL to help complete that refinancing. We have got about $60 million outstanding on that ABL. So, we will continue to balance debt pay-down and share repurchase. But we do look to get out of that ABL as we progress through the coming quarters and as we get into our heavier cash generation quarters. But we will take a balanced approach as you heard us comment, we are guiding to about a $10 million share repurchase for Q3.
Unidentified Analyst: Great. Thanks. And then just a follow-up, can you speak to the extent to which the weakness on higher ticket items continues to weigh on sales and when we might start to comp out of that?
Denise Paulonis: Yes. The way that I would think about it is we guided Q3 sales down one to plus one. So, in general, progress in returning to the total business headed towards a positive comp. So, as I mentioned earlier, our focus as we saw the uptake in promotion through Q2 take hold was really to think about our planning for Q3 and Q4. Those actions and changes are underway now as we are engaging with our customer and providing them with offers. So, progressively see comps improving as we go into Q3 and getting us back into kind of flat performance, which is what we expect for the full year.
Unidentified Analyst: Thank you so much.
Operator: Thank you. And our final question will come from Simeon Gutman from Morgan Stanley. Please go ahead.
Simeon Gutman: Hi. Good morning everyone. I wanted to ask Denise about the industry. There seems to have been this like synchronous slowing little bit in beauty and then a lot from – it looks like middle and lower income, and I missed some of the prepared remarks, but curious on the industry, if it’s – we have reached some kind of peak in innovation and consumption or it’s just the macro and the wallet pressure is waning. Is there anything with innovation that’s not there? And why do you think that we might be seeing this pullback now?
Denise Paulonis: Yes. Simeon, happy to share at least some perspectives that I see through the data that I can examine in our business. What we talked about a little bit in the prepared remarks was a bit of the bifurcation of the customer, which is interesting that on the pro side, which serves more middle to more of an upper income customer demographic is that client sitting in the chair. We have actually seen pretty healthy stylist demand, which nice business there. And underneath that, the innovation cycle on the hair care, care color side for the pro is pretty robust. And particularly what we are picking up in distribution on some core performing brands has been solid. And so as we look to the second half of the year, we see that continuing and at least at this point, while we are monitoring it quite closely, our stylist feel pretty good about their book of business and where they are headed.
I think the bifurcation comes and what we can see through our Sally data is that our lower income customer in Sally because we do serve all income levels, but we mix a little bit more lower income. That lower income customer has been the customer where the frugality is coming through more that when they are buying, they are looking for the deals, they are looking for ways to stretch those dollars a little bit more or be a little bit more frugal. I don’t think that the challenge is really an innovation cycle towards the lower end. As we mentioned, we also have our Happy Beauty pilot, which serves, I would call it right now primarily a middle income customer and you weren’t necessarily seeing that same pull back or challenge with transactions and ticket there that we were – that we are seeing more on the Sally side.
So, I don’t think the innovation cycle is really the cause. I think it’s more of the customer pocket book and that lower-income customer just feeling that much more pressure.
Simeon Gutman: And I know you mentioned a little bit about the back half of your year. I don’t want to get into quarter-to-date, but curious if the trends have continued or what we were seeing in the last, like, I don’t know, four weeks to six weeks could have been a bit of a blip, I don’t know, pent-up demand, consumer spending on other things because the weather got better, and maybe now the wallet can return to normal because we have seen some head takes [ph] before, whether it’s the industry and/or in the consumer. Curious if you are seeing any pivots again, not to get too granular into quarter-to-date, but of a different perspective.
Denise Paulonis: Yes. If I look out over the longer term, we have seen a very dynamic customer on both sides of the business, right, different choices being made at different times. And I think as you mentioned, these cycles that seem to happen around pockets of spending and then maybe pockets of a bit more frugality. What I would more say is we certainly – we guided to the minus one to plus one, which is a bit of a sequential improvement from where we were this past quarter in terms of our sales performance. That reflects our quarter-to-date results and what we are seeing happen with the business. And I would say, in general, seeing continued solid performance on that BSG side and with a little bit of the softness continuing on the Sally side is what’s underneath those numbers.
We expect that for us, a factor as we are going through the year as well is now on the BSG side since we lapped one of the challenges with one of our hair care brands in the second quarter. But that’s just an underlying good guy to deliver us back into the territory of the flat sales, flat comp that we guided to for the full year. So, everything about the trend of the start of this quarter is reflected in our guidance. And feel like following the new news of a little bit softer AUR that came through, we set another inflection point here with the customer that we are managing through.
Simeon Gutman: Thanks. Good luck.
Operator: I am sorry. That’s the final question.
Denise Paulonis: Great. Well, thank you all. We appreciate all of our shareholders and appreciate all of you tuning in to hear more about our quarter today. And as always, thank you to all of our associates around the world for serving our customers. And we look forward to connecting with everyone again next quarter.
Operator: Thank you. And ladies and gentlemen, that does conclude our conference for today. Thank you for your participation and for using AT&T teleconference. You may now disconnect.
