Jim Salera: That’s all very helpful color. Thanks Wendy. I’ll pass on.
Wendy Davidson: Thanks.
Operator: Thank you. Our next question comes from the line of Michael Lavery with Piper Sandler. Please proceed with your question.
Michael Lavery: Thank you. Good morning.
Wendy Davidson: Good morning.
Michael Lavery: Just would love to understand some of the brand spending and investments step-ups, a little bit better. When you talk about it being more second-half skewed, should we also think about is spilling into fiscal ‘25. I know that’s a way out and we just finished ‘23, but is that — which should we think of it as you’re just kind of getting started, mid ‘24, or maybe a little bit of a flip side of the same coin, you’re at around a 6% EBIT margin now, do you have a target in mind of like kind of when and how you recover, maybe we’ll hear some of this more at Investor Day, but maybe just a sense of how the spending and profitability balance is, how you’re thinking about that and what you expect in terms of the timing of the spend ramp up?
Wendy Davidson: Yes, I’ll start and I’ll pass over to Chris to give a bit more color. But I think the — two things, one, Investor Day. We’ll provide a lot of clarity and what we’re seeing around the multi-year and the expectations within each one of those years. Year one, as we said, is really a reset, it is a reset of our foundation. And I would characterize it as the front half we will lean heavily into driving the fuel to invest in the business and driving productivity, and then being very prudent in where we lean into the investments in the back half. The investments you’ll see, some of that will be organizationally to support our channel expansion, and a slight increase in marketing investment year-on-year, but the bulk of that will fall in back half of the year.
So, you’ll see consistency in the pressure we had from quarter three, quarter four, for some of our key brands, continue into the front half of this year, but incremental, you won’t really see until the back half of the year.
Chris Bellairs: Yes, Michael, the only thing I would add is, definitely questions as Wendy said, that we’ll go into much more detail at Investor Day. But we, in the past have talked about the pacing of our investments and the pacing our investments will be determined by two things. The attractiveness of the investment and the amount of fuel that we were able to be generating over what period of time. So, yes, you get into the back half of the year as Wendy said, more generation of that productivity of that fuel that pays for the investments, and then better visibility into fiscal ‘25, to come in a few weeks.
Michael Lavery: Okay, that’s helpful. And just a follow-up to clarify on the club promo for I think it was Alba, would we hear this correctly that you that was pulled into 4Q and has already done, that’s not something that we should expect into — it’s not shifting into 2Q, correct, it’s out of 1Q and in the review mirror, is that correct?
Chris Bellairs: Correct.
Michael Lavery: Okay, great, thanks so much.
Wendy Davidson: You bet.
Operator: Thank you. [Operator Instructions] Our next question comes from the line of Matt Smith with Stifel. Please proceed with your question.
Matt Smith: Hi, good morning.
Wendy Davidson: Good morning.
Matt Smith: Wanted to dig in a little bit on productivity savings. I believe, previously the company was targeting over $100 million of savings between fiscal ’24 and fiscal ’25. Can you give a little more detail as to the level you now expect to realize in fiscal ’24? And then how much of the productivity savings that you expect for the year, do you expect to be used alongside pricing, to offset lingering inflation, versus fund investments in the business in the second half?
Wendy Davidson: Yes, this is an area that I’ve been really pleased joining the company have to see how robust the team’s productivity processes have been. And I think we’ve provided the detail that in fiscal ’23 we actually over delivered to expectations in productivity, and that combined with pricing allowed us to cover for inflation. For fiscal ’24, you’ll see that continuing. So we actually have a ramp up of productivity in fiscal ’24, the traditional things that the team has in the regular pipeline, but there are some incremental to that, that will lay out in more specificity, when we go into Investor Day. We’ve got some pricing as well. And the combination of both of those gives us the ability to invest back in the business without a significant step back, but I’ll let Chris provide a little bit more color.
Chris Bellairs: And continue to accrue gross margin, as I said earlier to Ken’s questions. So if you think about kind of the combination of pricing, productivity, offset by inflation, we think the net of those three things is positive and you’ll see that in gross margin improvement.
Matt Smith: Okay, thank you for that. And then, just in general, the overall level of investment behind the business that you achieve in the second-half of the year. Can you talk about, how you view that level, relative to where you need to take the business overall in terms of spending. When you — I think last quarter you provided some commentary about needing to spend more behind some of the core brands to unlock growth potential. Do you get most of the way there in the second-half of the year or do you expect investment spending to continue to outpace sales growth even beyond fiscal ’24?
Chris Bellairs: I wouldn’t say that we. So we certainly don’t get to the levels, that we would want to be able to support the brands, in the out years. And you’ll see some of that laid out. When we talk on Investor Day. But we also realize that there is a lot of cost in the business that we can drive out, that can help to fund that. And so, it’s going to be a combination of those two things. And I think I’ve said this in the last couple of quarters, we definitely want to make sure that we are prudent in how we do that. So, I don’t have a desire to take a giant step back, to be able to fund that overnight. I think there is an opportunity for us to drive efficiency and effectiveness of the spend we have today. In trade, how are we driving the efficiency of our trade spend, that’s giving us the right reach and getting the right activity with the consumer.
