Good day, and thank you for standing by. Welcome to the HanesBrands fourth quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your host today, TC Robillard, Vice President of Investor Relations. Please go ahead. Good day, everyone, and welcome to the HanesBrands' quarterly investor conference call and webcast. We're pleased to be here today to provide an update on our progress after the fourth quarter of 2023. Hopefully, everyone has had a chance to review the news release we issued earlier today. The news release, updated FAQ document, and the replay of this call can be found in the investor section of our hanes.com website. On the call today, we may make forward-looking statements either in our prepared remarks or in the associated question-and-answer session. These statements are based on current expectations or beliefs and are subject to certain risks and uncertainties that may cause actual results to differ materially. These risks include those related to current macroeconomic conditions, consumer demand dynamics, our ability to successfully execute our strategic initiatives, including our Full Potential Plan, the Champion Performance Plan, and our evaluation of strategic alternatives for our Global Champion business, our ability to deleverage on the anticipated timeframe and the inflationary environment. These risks also include those detailed in our various filings with the SEC, which may be found on our website as well as in our news releases. The company does not undertake to update or revise any forward-looking statements which speak only to the time at which they are made. Unless otherwise noted, today's references to our consolidated financial results and guidance exclude all restructuring and other action-related charges and speak to continuing operations. Additional information, including a reconciliation of these and other non-GAAP performance measures to GAAP, can be found in today's news release. With me on the call today are Steve Bratspies, our Chief Executive Officer, and Scott Lewis, our Chief Financial Officer. For today's call, Steve and Scott will provide some brief remarks, and then we'll open it up to your questions. I'll now turn the call over to Steve. Thank you, T.C. Good morning, everyone, and welcome to our call. 2023 was a year marked by various challenges and hurdles, but also progress in a number of areas. We experienced a sales environment that was even more challenging than our cautious view, particularly within the U.S. activewear market and in Australia. This drove sales, operating profit, and EPS results that did not meet our expectations for the quarter and the year. While we are not at all satisfied with our results, we've seen several positive indicators that demonstrate progress in our strategy and give us confidence that our margins and our leverage have reached an inflection point. Despite the top-line headwinds, we continued to strengthen the foundation of our business in 2023. The actions we've taken to simplify our business, reduce inventory, cut costs, and reignite Innerwear are working, and we're beginning to see the initial benefits of these actions in our results. We returned gross margin to pre-inflation levels as expected. We exited the year with gross margin of 38%, a 400 basis point improvement over prior year. We reduced inventory by more than $600 million, unlocking working capital as planned. We returned operating cash flow to its historical $400 million-$600 million range. For the year, we generated $562 million of operating cash flow, exceeding our plan. We paid down more than $500 million of debt, which was $100 million ahead of our debt reduction target for the year. We eliminated more than $45 million of fixed costs spread across cost of goods and SG&A. We gained market share across our U.S. innerwear business, leveraging data analytics to drive better on-shelf product availability and successfully delivering our largest innovation launch in decades. Looking into 2024, we expect the challenging sales environment to continue, particularly in Q1, which Scott will discuss in a moment. That said, we're confident we can build on our progress this year. With visibility to input costs on our balance sheet and cost savings actions in our supply chain, we expect continued year-over-year improvement in gross margin. We expect another year of strong cash flow, driven by expected recovery and profit margins and the additional opportunities we see for working capital improvement. We plan to pay down another $300 million of debt this year, as we remain committed to using all of our free cash flow to reduce debt. The expected combination of debt paydown and EBITDA growth, we expect to further reduce our leverage in 2024. We expect continued market share gains in innerwear as we roll out another record year of innovation, including plans to increase our brand strength and marketing investments. Now, let me provide an update on Champion before finishing with some thoughts on our Reignite Innerwear strategy. We continue to aggressively implement our Champion Performance Enhancement Plan to strengthen the brand and position Champion for long-term profitable growth. We went into the execution of our Champion strategy with a full understanding that these long-term strategic actions would create real top-line headwinds in the short term, which we're seeing play out. Not surprisingly, these headwinds have been compounded by challenges within the activewear apparel category over the past year. The combination of these two factors drove a 23% year-over-year decrease in global Champion sales in the quarter. Despite the top line pressure, we're progressing on a number of our actions to strengthen the brand. We're cleaning up our inventory in the channel. We're implementing a disciplined product and channel segmentation strategy with a focus on our fall/winter 2024 offering. We're building brand heat within our pinnacle product and account offerings, and we're gaining traction with our global Champion: What Moves You marketing campaign, with plans for increased marketing investment this year. We're confident we're taking the right steps to drive the long-term success of Champion. However, as we've previously stated, it'll take time for our strategic actions to translate to the P&L. With respect to our review of strategic alternatives for the global Champion business, which I know is top of mind, the process is progressing as expected. We continue to evaluate the right path forward as we've seen strong interest from a broad and diverse group of global parties. While there's nothing specific to add at this time, we remain committed to updating you as appropriate when there's news to share. Next, I'd like to pivot the discussion to our Reignite Innerwear strategy, which continues to gain traction and build momentum. Recall, when we laid out our strategy a few years ago, our innerwear business in the U.S. had been consistently declining and losing market share. With our Reignite Innerwear strategy, we said we'd shift this business to growth and market share gains over time, and we'd do this by delivering innovation that consumers wanted, by increasing brand marketing investments, by bringing younger consumers into our brands, and by making our products available where, when, and how consumers wanted to shop. We've made significant progress on executing this strategy. We've globalized our design process. As a result, we're now launching cross-category, cross-geography products, and we have a robust innovation pipeline that provides visibility to new product offerings through 2025. We've improved our speed to market across a large portion of our products, with the lead time from design to on-shelf availability shortened by 30%. We've become more efficient with our inventory. We've significantly reduced SKUs to focus on higher velocity, higher margin SKUs, as well as make room for innovation products. We've leveraged our advantage global supply chain to further improve our cost structure, and we've built our global talent. We're seeing this translate to our innerwear results. Our U.S. innerwear sales have grown at an approximate 2% compound annual growth rate over the past four years. Certainly, the market has seen significant swings over this time, which we continue to experience. But over time, we believe this is a stable category with stable consumption patterns. We are gaining market share, which is the best indicator of future growth during challenging market environments. In the fourth quarter, we gained additional market share with both men and women in the U.S., with the strongest share gains coming from younger consumers. In fact, in the back half of the year, each one of our innerwear categories gained share with younger consumers. We returned to historical segment margins while supporting higher levels of marketing investments. We're successfully delivering innovation. 2023 was our most successful innovation year in decades. Hanes Originals was the largest innovation launch in our history, spanning multiple product categories and five countries. We also built on our absorbency platforms in both Australia and the U.S., and we launched M by Maidenform in the fourth quarter, which we'll support with a media campaign this year. And looking at 2024, we have a robust pipeline of new product launches, including Hanes SuperSoft, Bonds Anti- Chafe, and Bali Breathe. We believe these innovation launches, along with our planned increased investment in brand marketing, position us well to continue to grow share, especially with younger consumers. As I close, I'd like to take a moment and thank the entire HanesBrands team. Your agility, teamwork, and passion are the reason we continue to make progress on our transformation journey despite the headwinds we faced. 2023 had its challenges, especially with respect to the sales environment. However, it also had many successes. We're making progress on our Champion Performance Enhancement Plan. The actions we've taken to simplify our business, reduce inventory, cut costs, and Reignite Innerwear are working. We reached a key milestone with a positive inflection of our margins and our leverage. And though we expect another challenging sales environment in 2024, we have solid visibility to be able to deliver continued margin improvement, strong cash generation, further debt reduction, and continued market share gains in innerwear. And with that, I'll turn the call over to Scott. Thanks, Steve. Let me echo your thanks to the global HanesBrands team. 2023 certainly presented sales challenges, but through a continued focus on executing our initiatives to simplify the business, reduce costs, deliver innovation, and leverage our supply chain capabilities, we were able to exit the year with momentum across several key performance metrics. For today's call, I'll touch on the highlights from the quarter, our improved financial position, and then I'll provide some thoughts on our outlook. For additional details on the quarter's results and our guidance, I'll point you to our news release and FAQ document. At a high level, the fourth quarter was mixed relative to our expectations. Sales were below our outlook as the consumer environment proved more challenging than we expected, particularly in the U.S. activewear market and in Australia. This, in turn, drove lower than expected operating profit and EPS. That said, we continued to reduce SG&A, with expense dollars decreasing as expected. We delivered results that were ahead of our expectations for gross margin, inventory reduction, and operating cash flow, and we paid down more debt than planned. Looking at the details of the quarter, net sales were $1.3 billion. This represents a decrease of 12% versus prior year, with 130 basis points coming from the U.S. Hosiery divestiture and 40 basis points from FX headwinds. On an organic, constant currency basis, net sales decreased 10% in the quarter. Touching briefly on sales by segment. Our U.S. Innerwear business was essentially in line with our outlook. For the quarter, sales decreased 1% versus last year, which compared against a 5% decrease for the overall market. We gained market share in the quarter, driven by retail space gains, improved on-shelf availability, as well as successful consumer-led innovation and new product launches. In our international business, constant currency sales decreased 7% as macroeconomic pressures continued to weigh on consumer demand in Australia and Europe. These headwinds more than offset growth in our Innerwear business in the Americas and our Champion business in China. And in our U.S. Activewear business, sales decreased 24% as compared to last year. The decrease was driven by the continued combination of challenges within the activewear apparel category and the expected top line headwinds from the strategic actions were taken to strengthen the Champion brand and position it for long-term profitable growth. Turning to margins. Adjusted gross margin of 38.2% was strong and above our expectation. This represents an increase of 395 basis points over prior year. The year-over-year improvement was driven primarily by the benefits from our inventory and cost savings initiative, as well as lower input costs from commodities and ocean freight. These two factors more than offset the impact from wage inflation. With respect to adjusted SG&A, expenses decreased $38 million as compared to last year, in line with our outlook. The lower expense was driven by a combination of cost savings initiatives, disciplined expense management, and lower variable expense, which more than offset increased brand marketing investments. As a percent of sales, SG&A expense increased 100 basis points over prior year. The deleverage, despite lower SG&A dollars, was driven primarily by the impact from lower sales, increased brand investments. This resulted in an adjusted operating margin of 8.5% for the quarter, an increase of 295 basis points over last year. Looking at the remainder of the P&L, interest and other expenses were $77 million. Adjusted tax expense was $22 million, which excludes a one-time discrete tax benefit of $81 million. Adjusted earnings per share for the quarter was $0.03. Turning to the balance sheet and cash flow, we continued to strengthen our balance sheet and increase our financial flexibility as we reduced inventory, paid down debt, and increased liquidity. We saw further improvement in our inventory position as we continued to implement and build our capabilities around inventory management. We ended the year with inventory of $1.37 billion, which represents an improvement of 31%, or $612 million as compared to last year. This was more than $100 million ahead of our $1.5 billion target, as we are progressing faster than expected on our inventory initiatives. We generated $562 million of operating cash flow for the year, which was ahead of our $500 million goal, and we successfully unlocked tied-up working capital. We paid down more than $500 million of debt for the full year, $100 million ahead of our debt reduction target, driven by the higher-than-expected operating cash flow. Our leverage was 5.2 times on a net debt to adjusted EBITDA basis. It was below our fourth quarter covenant of 6.75 times and our peak of 5.6 times in the second quarter of 2023. We remain committed to using all of our free cash flow to pay down debt. We expect to further reduce our leverage in 2024, driven by a combination of EBITDA growth and continued debt reduction. And all of this has led to our liquidity position increasing to more than $1.3 billion at the end of the fourth quarter. And now turning to guidance. All of my comments will refer to adjusted results from continuing operations and will be based on the midpoint of our guidance ranges. At a high level, we expect the sales environment in our categories to remain challenging in 2024, particularly the first quarter. We expect positive progressions on top-line trends through the year, driven by two factors. First, in our global Champion business, as we previously discussed, our fall/winter 2024 line is the first global offering from the new team that's based on a global segmentation approach. Therefore, with the actions we're taking ahead of that launch, particularly on cleaning up our inventory in the channel, we believe we're moving through the trough of Champion sales in Q1 and the first half this year. Second, in our global Innerwear business, based on our forecasting analytics and consumer consumption trends, we expect the category headwinds to be most challenging in the first quarter before moderating through the rest of the year. We expect to outperform the category as we're well positioned to gain market share behind our innovation launches and increased brand marketing investments. While we expect a challenging sales environment, we believe we're well positioned to deliver strong operating profit growth for the year. This outlook is based on input cost visibility we have on the balance sheet and our cost savings initiatives, as well as the conservatism we've layered into our profit outlook. We expect year-over-year improvement in both gross and operating margins in each quarter of 2024. With lower interest expense due to lower outstanding debt balances, we expect earnings per share to grow even faster than operating profit for the year. With respect to our first quarter outlook, we expect net sales on a reported basis to decrease approximately 16% as compared to last year. Adjusting for the impact from the U.S. Hosiery divestiture and FX headwinds, organic constant currency sales are expected to decrease approximately 14%. That said, we expect first quarter operating profit to increase approximately 10% over prior year, and operating margin to expand approximately 145 basis points to 6%. And with the timing of last year's refinancing, interest expense is expected to be up year-over-year, resulting in an EPS loss of $0.07, which is essentially in line with last year. Turning to our full year outlook, we expect net sales on a reported basis to decrease 4% as compared to last year. Adjusting for the impact of the U.S. Hosiery divestiture and FX headwinds, organic constant currency sales are expected to decrease approximately 2%. We expect full year operating profit to increase approximately 26% over prior year, and operating margin to expand approximately 225 basis points to 9.4%. For EPS, the midpoint of our guidance range is $0.45, which implies a 650% growth over prior year. Lastly, with our expected profit recovery and additional working capital opportunities, we expect to generate approximately $400 million in cash flow from operations for the year. So in closing, while 2023 was challenging from a sales perspective, we made significant progress across a number of key performance metrics, including reaching a positive inflection in our margins and our leverage. As we look to 2024, we expect the sales challenges to continue, particularly in the first quarter. However, with our view to input costs and cost savings initiatives, we have visibility to deliver on strong operating profit and EPS growth outlooks. Furthermore, we believe we're well positioned to continue to expand margin, to deliver another strong year of operating cash flow, and to continue to delever our balance sheet. With that, I'll turn the call over to T.C. Thanks, Scott. That concludes our prepared remarks. We'll now begin taking your questions, and we'll continue as time allows. I'll turn the call back over to the operator to begin the question-and-answer session. Operator? As a reminder, to ask a question, please press star one, one on your telephone and wait for your name to be announced. To withdraw your question, please press star one, one again. Please stand by while we compile the Q&A roster. Our first question will come from the line of Jay Sole with UBS. Great. Thank you so much. My first question is just on Champion. Can you just talk about the margins at Champion? You talk about fiscal 2023, and then maybe talk about the plan to improve the margins. And based on the 2024 guidance, what's your expectations for margins for Champion in fiscal 2024? And then, Scott, if we can just talk about the guidance for fiscal 2024, what are you expecting specifically for Innerwear? I mean, you mentioned the comments about expecting to outperform the category. If you could just give us a little bit more color there, that'd be super helpful. Thank you. Good morning, Jay. Thanks for your question. So I'll speak to margins on a couple levels. One, you were talking about Champion, but I also want to speak to kind of margin overall as we think about 2024 and kind of what to expect there. So for 2023, and this applies not just to Champion in the activewear business, but also total company, you know, our margins were pressured by the higher inflationary costs that we saw in 2023, right? And so now as we go into 2024, that is largely behind us now, and we can kind of move forward with momentum with an enhanced margin recovery going forward. So some of the same elements, again, we saw in Champion, you're going to see total year, the input costs. We also Champion had a little more of a sales volume pressure in 2023 than the rest of the business. As you look at 2024 and the margin outlook, I think a couple of things that you need to keep in mind to kind of make sure you understand the cadence from 2023 to 2024. So, and we talked about this at the very beginning of 2023, that you know, we expected margin recovery into the upper 30% range in the and by the time you get to the fourth quarter. And we achieved that, actually overachieved that in the fourth quarter at 38.2%. And so as you look at that, and now we're back to pre-inflationary levels from a margin standpoint. As you move to 2024, our profit outlook is at 38.5% gross margin. We had that in the first quarter, and we're holding that steady throughout 2024. We have a high degree of confidence in that margin profile because we have really good cost visibility from an input cost as well as the cost savings that we've already put in place. So that's really important to understand as you think about margins going into 2024. Another fine point I want to make sure you hear on the profit outlook is, as we were looking at kind of the overall view of 2024, and Steve's gonna speak to the sales side, is clearly there's a lot of still a lot of dynamics and a lot of pressures from a top line standpoint. The consumer environment is still challenged. Keeping that in mind and knowing that, as we looked at our profit outlook, what we wanted to make sure is we made sure we layered in some incremental conservatism in our profit outlook to make sure we can hedge and de-risk from the standpoint of managing that potential volatility on the top line. That we've already considered some, but anything unanticipated beyond what we've already baked in, we wanna make sure we've hedged our profit for that. Now, a good example of that, as you look at and we talked about this before, we have really good visibility to profit two, you know, two, three quarters out from a cost of sales standpoint. We know it's on the balance sheet. We can see that roll out. As we were, again, putting together a profit outlook, we wanted to make sure that, you know, we didn't bake all of that, that upside in, right? We have, again, the lower input costs, we have the cost savings. We wanna make sure we protect on the downside in case, again, there's unanticipated volatility, not factored in our sales outlook. So Steve, anything on the sales you wanna add to that? Yeah. Thanks, Scott, and good morning, Jay. I think when you think about the sales plan for the year, the guide for the year, you know, obviously, we start with our current environment and understand where we are. And sales have been challenging, there's no doubt about it, and the consumer environment has been difficult for us as we go forward. But we're starting to see, you know, improvement in that space, and we're pretty confident in the numbers that we can deliver for the year. When you look at Champion specifically, we think the business is gonna trough in the first quarter and first half of this year. And, you know, we're taking actions to make sure that, you know, we clean up the channel ahead of our fall/winter 2024 line, that's gonna be launching. You know, this is gonna be a progressive growth throughout the year. Obviously, retailers are being a little cautious, but the categories will be clean. Our collegiate business is gonna be on a more normal cadence. You know, the fall/winter line that we're gonna be introducing in Champion has gotten really strong response from the pinnacle accounts, which of course is really important to set the tone for the brand. We're gonna be ready for, you know, a replenishment chase model in the back half of the year, and we're gonna be spending behind the brand and really support this. So we think that brand can grow in the back half of the year and start to pivot to a much more positive space. And the same thing for Global Innerwear. I'm really pleased with where we're headed in the Global Innerwear business and the share gains that we're seeing in this business. We've got pretty good forecasting analytics to understand where the category is gonna be over time, and, you know, we're gonna continue to take share. The category, you know, was down 5% in Q4, and, we took a lot of share, and we're expecting, you know, those trends to continue in the early part of the year, but then to improve. So, you know, with our innovation that's coming, with our media that's coming, we're gonna be leaning in, and, you know, we think the, the back half is gonna be better than, than the front half, for sure. And, you know, that leads to all the, the margin opportunities that Scott talked about. You know, we're really confident in the profit outlook for the year. There's some, you know, conservatism built in. As Scott said, we have a lot of known savings that haven't included at this point, so we can adapt to a volatile top-line environment if it occurs. Yeah, and if I could just add one more thing. You, Jay, you were asking about innerwear margins. So one thing I think is important to keep in mind, too, as you look at, and I mentioned about this earlier, about just the margin pressure we saw in 2023. Innerwear, over the last five quarters, has had significant margin expansion. It was 8.3% in Q4 2022, and we finished the year in Q4 at 21.1%. So again, that really demonstrates, again, where we are, and we're back again in that pre-inflationary margin levels. Got it. Thank you so much. Thank you. Our next question will come from the line of Paul Lejuez with Citi. Hey, thanks, guys. Curious if you could talk about the permanent retail space gains that you mentioned on the innerwear side. At what retailers are you seeing those gains? And, you know, are there any places where you've seen permanent space losses that would offset those gains? Maybe if you can frame just what percent of net increase you're seeing on permanent space gains. And then curious on your cash from operations guidance, what should we expect on the inventory line, as we move throughout the year and to end the year? How much of a benefit or drag will that be on your cash cash flow guidance? And then last, just curious, what is the size of the Australia business? Thanks. Sure. Let me start with the space gains. I've been really pleased with the space gains that we've been getting in key accounts for us. A lot of it, not all of it, is driven by innovation. So the product that we're bringing to market last year with Hanes Originals, with, you know, men's, women's, kids, across the board, and by Maidenform, that's now launching, and as we lean into the new innovation that's coming this year with SuperSoft and Anti-Chafe, are all taking incremental space. So that's the good news, as we sell in, we're all gaining space. The other thing that's going on, and you know, I don't wanna, I don't wanna talk about specific customers, but if you go out and you look, you'll see us taking permanent space away from other national brands, and that's our base business, and that's because the business is performing better and turning faster for the retailers. So they're making those choices, and there, there's some obvious ones going out there. The other thing that I think is really important, and I got this question the other, you know, the other day as we were having a discussion, I think it's important, is private label is not playing the role that it had been in the past, and actually, private label is losing share in the innerwear market right now. So that's opportunity for us to continue to go out and gain that permanent space as well. So it's, it's broad, it's cross categories, it's cross, it's cross channels, and we're pleased 'cause it's gonna drive our business going forward. Okay, good morning, Paul. Thanks for your question. So for cash flow, very proud of the team and what we delivered on cash flow in 2023. Really solid execution across the business, did a great job of managing working capital. We knew there was a lot of opportunity and really delivered on that in 2023. So for 2023, we had $562 million of cash flow, right? So that returns us back to that historical range cash flow. And in fact, you know, we were guiding to $500 million of cash flow for the year. We saw upside in that, and that was driven by working capital, especially inventory. We ended the year inventory $130 million below what we were targeting. So again, great job with execution there by the team, which accelerated cash flow and accelerated debt paydown. So as you move to 2024, you know, keeping that in mind, we again, we had a little acceleration of cash into 2023. As we look for 2024, we are guiding to $400 million of cash flow for the year, again, within that historical range that we've seen in the past. As far as the mix, I would say again, there's still opportunity with working capital. As you look at the overall mix of cash flow generation, I'd say about 2/3 of that's gonna come from profit and a third of that is gonna come from working capital. And the working capital is gonna come across all working capital. Inventory, I think there's still opportunity there. There's AR and AP opportunities, and we've got a good track record of managing working capital. Our team is very focused, especially like for cash conversion cycle. As I look at that, I can really see opportunities beyond what we've already achieved in our working capital as we get into 2024. I think your final question was about Australia and how big that is. We don't release the exact number, but low teens percent of total HBI is the right number for you to anchor on, and the majority of that business is an innerwear business. Got it. Our next question will come from the line of Paul Kearney with Barclays. Great. Thanks for taking my question. Can you go over where are inventory levels by brand for Hanes versus Champion? You mentioned cleaning out the channels inventories for Champion, so where do you see channel inventories, particularly there? And then it goes back to the first question, but with the Q1 guidance for organic sales down 14 and full year down two, what gives you all the confidence that the business can reaccelerate through the year? And what are the main drivers that are behind that improvement? Thanks. Sure. So, from an inventory perspective, we don't break it out by business, but, you know, closing the year at 1.37 puts us in a really good position. I think we're balanced across our portfolio. Our inventory reduction actions and process improvement through management capabilities, life cycle planning, SKU discipline, that applies pretty consistently across the business. So the actions we're taking are consistent, and we use the same methodology and same mindset, if you will, and philosophy of how we manage inventory across the business. So we feel like we're in good shape across the total business. In terms of sales, maybe I'll go a little deeper then on some of the things that I talked about earlier. You know, we have a pretty good understanding, particularly in innerwear, of predictive capability, where the market is right now and understanding where it's going. And, you know, that's based on forecasting, analytics, and predictive algorithms that are tied to historical correlations of the business, along with macroeconomic metrics. So we think we're in pretty good shape to understanding where the category is going, and we think it will improve throughout the year. But, you know, for innerwear, if we look at where we are today, there's some shipment timing things. There's some inventory actions things, the innovation timing. You know, our—all the innovation that we're bringing, which is gonna be our biggest year yet, you know, 2023 was a historical year. We're gonna have another one this year on top of that with the launches across Hanes, across Bali, across Bonds, which, I'm very encouraged about. And we're gonna lean into that with some media spending, at higher levels than we have in the past. So I think you're gonna see a ramp in the innerwear business as we go forward, and I'm comfortable with that. And at Champion, it's the same thing. You know, I think this business is gonna drop out in the first half, and, you know, we're taking a lot of actions to prepare ourselves for the fall/winter business that's coming, so that we're clean and that we have enough room to sell that in, and it's flowing in well. You know, retailers are a bit cautious, but we think the cleaning up that we're doing is working well. And then you're gonna see some, you know, the college business is gonna rebound for us. It's been choppy the last couple of years. I mean, last year, you know, the heat that we had in the back half of the year affects that business. We think it's gonna be a more normal year. The Pinnacle accounts are excited about our business that's coming in, that's gonna land in the back half. We are focusing more on a replenishment model than a made-to-order model, this year. That's gonna allow us to leverage our supply chain strengths and capture demand in real time. So we have a, you know, process around never out SKUs that's more disciplined than it's been in the past on Champion. It's gonna help drive that business. We're gonna be spending more behind the brand. The marketing campaign that we've been driving is working. It's working globally, and we're gonna lean into that. You know, there's hot spots around the world that are continuing to grow, like our China growth has continued to accelerate with our partner there. We think the business is gonna move forward throughout the year. We've got a lot of activity coming. We're ready as a company. W e have the cost structure in place. Scott, as you mentioned earlier, the profit's gonna come with that in the back half. We feel like we've got sales kind of nailed down, and we've got the programming to drive the business for the year. Thank you. Best of luck. Our next question will come from the line of Ike Boruchow with Wells Fargo. Hey, good morning, everyone. A couple questions from me, more follow-ups to some of the answers you guys gave. Steve, just to make sure I heard right, I think you said for the year, you're expecting the gross margin to be about 38.5%. Was that, did I hear that right? That's correct, Ike. Okay. And then I was just kind of curious, is there seasonality to it? The business has changed a lot, but it is usually 1 Q, a little bit higher than that, and the rest of the year, kind of more similar Q2 to Q4. Is there any seasonality we should kind of keep in mind? Yeah, we do have seasonality with the business, but as I look at 2024, I would just kind of hold more of a steady, gross margin rate, is what I would anticipate, and I would guide you to throughout the year. You know, the cash flow is seasonal. I mean, typically, in the first half, it's more of a break-even cash flow. The cash flow is more generated in the back half. But I think from a gross margin standpoint, I would say that, again, more of a steady. Again, like I mentioned earlier to the earlier question, again, we have great visibility to the cost, right? And so from the input costs that are lower, the cost savings that are, you know, also on the balance sheet, we can see this roll out over the course of the quarters. Again, and that's not all on the guide. We've not baked all that in. We took incremental conservative assumptions, from a profit standpoint to make sure we can, again, de-risk and hedge from a, from a sales outlook, there, so. Got it. And then just a last quick one. Is there any chance you guys would give a specific guide for both Champion and Innerwear for Q1 and for the fiscal year? And if not, I guess what I'm just trying to understand, because it sounds like there's confidence growing on Innerwear and Champion traction, but you're also, you know, the year-over-year decline you're guiding to in Q1 is worse than the decline you had in Q4, which missed your plan. So I'm just trying to, I'm trying to kind of square that up a little bit, if you can. If there's any way to kind of, you know, give us a little bit more info, that'd be great. Yes, sir. We don't guide by segments, but let me give you some directional kind of thoughts about the first quarter for segments. Top line, and Steve, feel free to chime in in that detail. So on U.S. Innerwear, we expect the U.S. Innerwear business to be down mid-single digit year-over-year. That's in line with where the category is for the first quarter. On the international side, the international business, it'll be down low double digits on a reported basis and down around 10% constant currency. Again, some of the challenges that we talked about earlier, that Steve referenced with Australia, and then just cautious view from a European retailer standpoint. On U.S. Activewear, there's a couple things to keep in mind. We're expecting that to be down roughly 30%, in the first quarter. Kind of same headwinds that we've been talking about. It's important to note there, though, about 2/3 of that decline is the kind of lapping some timing issues from last year. If you remember last year, in the first quarter, we implemented SAP, so there was some timing, acceleration of shipments, ahead of that SAP implementation. We also benefited from timing from the collegiate business standpoint. There's some unseasonably strong sales in Q1 of last year that we are lapping. And then the last piece of that is just with our kids' business, we moved that to a licensee model, and so you have some changes year-over-year for that. So again, that's 2/3 of the, of the fluctuation from year to year, so. Got it. Thanks so much. Our next question will come from the line of Hale Holden with Barclays. Your line is now open. Hey, good morning. I was wondering if you could just give us some context on why you think the Innerwear category has been down so much over the course of the year and projected down in the first quarter? Just feels like a lot for what has historically been a replenishment category, understanding that you're gaining share within the category. Yeah, thanks for the question. You know, I think when you go back and you look at last year, the category was down about 3%, and then it decelerated a little bit in Q4 to about 5%, and we're expecting a little bit of that continuation into Q4. When you go back and you look at historically, this category has been roughly a 1% unit growth business. You know, we would expect that the category is gonna bounce back to that. You know, you go back and look over the last 4 years, with all the volatility that we've had through, you know, supply chain and everything that's gone on, it's been certainly a volatile couple of years. The category's actually grown roughly that 1%. I know it doesn't feel like that, but you've had, you know, a huge spike in 2021, and it's been down, and our growth during that time has been about 2%. So when you look at this in macro, the category's actually been behaving at historical levels, and we've been outpacing that category. And, you know, from the beginning, we've been saying our goal is we're gonna grow 2x the category rate, and if you look at it over four years, that's what we've done. Again, it doesn't feel like that quarter- to- quarter, and it's very, very choppy, but we expect that the category is gonna return to historical levels. It's gonna be a good, stable category, and we're continuing to take share in, and, you know, we're better prepared to do that in the past. You know, there was a time when we were losing share. There was a time when we weren't growing, but we pivoted that, and the reignite of our Innerwear business is working now, and the innovation we're coming this year is gonna be a big impact on that. Great. Thank you very much. Thank you. Our next question will come from the line of Carla Casella with J.P. Morgan. Hi, thank you for all the color you've been giving on the global Champion growth over the years. Have you, or can you give us a sense for how big that is as a global brand? I remember years ago, a couple years ago, it was about $2 billion. I'm assuming from the, the declines it's lower, but any ballpark figures for the global Champion size? Thanks, Carla. The Global Champion number, you know, historically, that number you were using is roughly right. You know, obviously, we've talked about the strategic process that we're going on through right now, so I wanna be sensitive to the numbers that we share. But, you know, that $2 billion number, the business has declined a little bit the last couple years, so it's a little smaller than that, by, you know, maybe $200million-$300 million is roughly the number to use. Okay. And then, you talk about new launches and Champion troughing out in the first half with kind of growth in the back half. Is there any risk that you've lost shelf space that you won't be able to get back? Or I guess, how much of the declines that you've seen in that brand are lost space versus just less new product and lower turns? Sure. When you think about that business, you know, it's seasonal. So you have your spring, summer, you know, business, you have your fall, winter, so there's a lot of resets that happen every single year. The key is to show up with innovative product that's very consumer relevant and very brand relevant. And I feel like coming into fall/ winter, we have a good job of that, and our customers are very receptive to what we have. So I feel good about our space and where we're gonna play and how we're gonna compete in the market. When you look historically at what's driven down the business, part of it's the category. You know, the category has certainly struggled the last couple years, and we are certainly no exception to that. That said, we have declined faster than the category, and that's why we're going through the big changes that we've gone through as a business. Really refocusing on creating, you know, heat behind the brand, which we lost. Making sure that we have a very clear product and channel segmentation strategy as we go to market. Building behind the Champion What Moves You campaign. You know, we're operating as a more global company than we have in the past, so that we're working on global platforms for product, which makes us much, much more efficient, faster to market. So we, we've put in a lot of strategic initiatives to address our performance in the market. You know, we're, they're starting to come together, and that's why we're starting to see the business is gonna improve in the back half of this year as that strategy is realized. That concludes today's question and answer session. I'd like to turn the call back to T.C. Robillard for closing remarks. We'd like to thank everyone for attending our call today, and we look forward to speaking with you soon. Have a great day. This concludes today's conference call. Thank you for participating. You may now disconnect.