Good afternoon. Welcome to the first quarter of fiscal 2023 conference call for Leslie's, Inc.. At this time, all participants are in a listen-only mode. Following the prepared remarks, management will conduct a question-and-answer session. If you should require any operator assistance during the conference call, please press star zero on your telephone keypad. As a reminder, this conference call is being recorded and will be available for replay later today on the company's website. I will now turn the call over to Caitlin Churchill, Investor Relations. Thank you. You may begin. Thank you and good afternoon. I would like to remind everyone that comments made today may include forward-looking statements, which are subject to significant risks and uncertainties that could cause the company's actual results to differ materially from management's current expectations. These statements speak as of today and will not be updated in the future if circumstances change. Please review the cautionary statements and risk factors contained in the company's earnings press release and recent filings with the SEC. During the call today, management will refer to certain non-GAAP financial measures. A reconciliation between the GAAP and non-GAAP financial measures can be found in the company's earnings press release, which was furnished to the SEC today and posted to the investor relations section of Leslie's website at ir.lesliespool.com. On the call today from Leslie's is Michael Egeck, Chief Executive Officer, and Steve Weddell, Chief Financial Officer. With that, I will turn the call over to Mike. Thanks, Caitlin, and good afternoon, everyone. Thank you for joining us. Please note that we have posted a short earnings deck to Leslie's IR site, and that we will be referring to certain pages in that deck during our call. I'd like to start by reminding everyone that the first quarter is our smallest quarter of the year, representing only about 12% of total year sales. However, it is an important quarter as we take the actions, incur the expenses, and make the appropriate investments to set ourselves up for the all-important second half of our fiscal year, which is pool season across the country. With that in mind, I'm pleased that we delivered overall Q1 performance that was in line with our expectations despite some very challenging weather in the quarter. Sales for the quarter grew 6% to a record $195 million. Average order value grew 7%, and transactions were down 1%. Average revenue per customer grew 6%, and our customer file was flat. Residential hot tub grew 35% in the quarter, and pro pool grew 11%. Residential pool sales decreased 3% in the quarter. Comp sales decreased 4% for the quarter, which contributed to a two-year stack comp of +17%. Comp sales for the quarter were negatively impacted by wet and cold weather, particularly in Texas, California, and the Southwest. Sales in Florida benefited from the cleanup associated with Hurricane Ian. In total, our weather service provider calculated that weather was a 5% headwind to comp sales for the quarter. This is the first quarter since the positive impact of the Texas freeze in the second quarter of 2021 that weather has had a significant impact on our overall comp sales. Gross profit for the quarter was $65 million, and gross margin rate was down 290 basis points. Please refer to page 6 of our supplemental deck to review our Q1 margin rate bridge. As you can see, the primary drivers of the change in margin rate are: Number 1, business mix, driven by acquisitions that disproportionately impacted margins in the quarter. Two, incremental product costs in excess of retail price increases. Three, incremental DC expense associated with the execution of our strategy to peak store and DC inventory earlier in preparation for pool season. Four, deleverage of occupancy costs driven by a decrease in comp sales. These factors are all reflected in our full year guidance. We expect these same factors to impact our Q2 margin rate. To complete our summary of Q1 financial performance, Adjusted EBITDA for the quarter was -$12 million. Adjusted diluted earnings per share were -$0.14. Given the seasonality of our business, the loss in the quarter was anticipated and does not change our expectations for the full year. Accordingly, we are reaffirming the full-year outlook we provided at our Investor Day in November. As we noted in November, we expected tougher first half comps this year. Our first quarter results were in line with our internal expectations. However, the makeup of those results did have some differences from our full-year outlook. As you can see illustrated in the table on page 9 of the deck, total comp sales of - 4% was less than our full-year guide of - 2.5%. Comp sales for non-discretionary products ex Trichlor were down 3% in the quarter and had a total comp sales contribution of - 2.5% versus our full-year guide of + 1.3%. Trichlor comp sales grew 8% in the quarter and had a total comp contribution of + 1% versus our full-year guide of - 1.1%. We saw no price deflation versus the prior year's quarter or the fourth quarter of fiscal 2022. Discretionary product comp sales were down 11% in the quarter and had a total comp contribution of -2.5% versus a planned comp contribution of -2.7% for the year. Non-comp sales in the quarter were +9.6% versus our full year guide of +5%. In summary, nondiscretionary sales ex Trichlor were not as strong as we expected due to adverse weather. Discretionary sales overall performed in line with our expectations, although hot tub sales were somewhat better than we expected. Trichlor outperformed as retail prices remained stable, and non-comp sales outperformed, driven by acquisitions and new stores. As we look to the second quarter, weather is projected to be less of a headwind, but we do expect our hot tub business to decelerate such that we continue to anticipate first half comps to be as we described at our investor day. Moving to the industry backdrop, the pool and hot tub industry experienced reduced consumer demand in the quarter. As you can see on page 10 of the deck, our specialty pool retail competitors, based on third-party aggregated credit card data, experienced a decline in sales of 7.2% in the quarter. This softening demand has two primary components. First, as we discussed concerning our own results, weather was a significant negative factor year-over-year for most markets. Second, consumers were less confident based on the challenging macroeconomic backdrop. For our business, we saw this decreased confidence manifested in consumer behavior changes, including purchases of smaller sizes of our two key sanitizers, Trichlor and Cal-Hypo, and reduced units per transaction. UPT for the quarter was down 2%. Against this backdrop of reduced demand, the competitive advantages derived from our integrated system of physical and digital assets, and our associates' strong execution of our diversified growth initiatives drove continued market share gains. Turning now to the performance of our strategic growth initiatives. First, despite the macroeconomic and weather challenges in the quarter, our consumer file was flat versus the prior year's quarter and improved 200 basis points from our fiscal Q4 2022. Next, we continue to deepen our relationship with our consumers. Average revenue per consumer grew 6% in the quarter, and the number of loyalty members increased 15% over the prior year's quarter. With regard to our Pro initiative, we ended the quarter with 2,850 Pro contracts in place, and we are currently operating 80 Pro locations. Our plan to convert 15 Pro locations and build three new Pro locations in 2023 remains on track, and all 18 locations are scheduled to be operating by the start of the pool season. Pro consumer group sales grew 11% in the quarter, with comp sales down 4%. Our Pro comps were affected by the same factors we discussed for our overall business, as well as some product availability challenges with one equipment vendor. M&A was the standout contributor to the quarter, accounting for more than $15 million in non-comp sales. Year to date, we have closed on two acquisitions that added six locations, and we have another five acquisitions under LOI that would add 13 locations. We expect to close the acquisitions under LOI prior to the start of pool season. The current macroeconomic conditions in the pool and hot tub industry have created additional attractive acquisition opportunities, and we plan to continue accelerating this initiative. Regarding our residential white space initiative, in the quarter we added five locations through acquisitions, opened one new store, and closed two stores for a net increase of four locations. We currently operate more than 990 locations, and we're on track to operate over 1,000 locations by the start of the pool season. For AccuBlue Home, we have finished consumer testing of the version 2.0 device and remain on track to launch this initiative for pool season 2023. With regard to corporate governance, we have published the proxy for our annual shareholding meeting scheduled for March 16, 2023. In the proxy, we announced that Ms. Jodeen Kozlak will not be seeking re-election to our board, and that Mr. Marc Magliacano of L Catterton will be resigning from our board effective with the completion of our annual meeting. We thank Jodi and Marc for their service and many contributions to Leslie's. In conjunction with these changes, we also announced that our board will be revised from 10 to 8 members. Now I will turn it over to Steve to share more detail on our Q1 financial results. Thank you, Mike. Good afternoon, everyone. As Mike mentioned, our first quarter results were in line with our expectations, and we reported record sales for the quarter. We're grateful for our team as they continue to execute against our initiatives and prepare for pool season in 2023. For the first quarter, we reported record sales of $195 million, an increase of 6% or $10 million when compared to the first quarter of fiscal 2022. Our comparable sales decreased 4% or $7 million. This decrease is on top of our comparable sales growth of 21% in the first quarter of fiscal 2022 and calendar adjusted comparable sales growth of 26% in the first quarter of fiscal 2021. Our comparable sales growth on a two-year stack basis was 17%, and on a three-year stack basis was 42%. Our non-comparable sales totaled $17 million in the first quarter of fiscal 2023, which was driven by seven completed acquisitions that added 32 locations, as well as eight net new store openings since the end of fiscal 2021. Our comparable sales decreased by 4% for residential pool, 4% for pro pool, and 2% for residential hot tub. On a two-year stack basis, we generated comparable sales growth of 14% for residential pool, 36% for pro pool, and 4% for residential hot tub. Unfavorable weather had a 5% impact on sales growth during the first quarter, with the Texas market experiencing the largest impact. Gross profit decreased 3% or $2 million when compared to the first quarter of fiscal 2022. Gross margin rate, which decreased in line with expectations, was down 290 basis points to 33.5% from 36.4% in the prior year. On page 6 of our supplemental deck, I'll review our Q1 gross margin rate bridge in more detail. During the quarter, gross margins were impacted by the following. First, business mix lowered gross margins by 130 basis points, primarily related to M&A completed during the last 12 months. Second, lower product margins had a 40 basis point impact as a result of higher input costs. During the quarter, promotional activity was flat to slightly down and did not have a material impact on our gross margins. Third, occupancy costs deleveraged by 85 basis points due to rent increases and negative comparable sales growth. Finally, incremental distribution expenses lowered gross margin by 35 basis points. Distribution expenses were elevated as we ex-executed on our plans to receive in and distribute more product to our store network earlier than last year in preparation for the coming pool season. I'll turn to SG&A. SG&A increased 16% or $12 million when compared to the first quarter of fiscal 2022. We estimate inflation during the quarter increased SG&A by approximately $5 million, primarily related to payroll and digital marketing spend. The current year quarter also has an additional $4 million of non-comparable SG&A associated with acquired businesses. Adjusted EBITDA was - $12 million for the first quarter of fiscal 2023, which was slightly ahead of internal expectations. Adjusted net loss was $25 million in the first quarter of fiscal 2023, compared to a loss of $11 million in the first quarter of fiscal 2022. Interest expense increased to $13 million during the quarter from $7 million in the first quarter of fiscal 2022, and our effective tax rate remained consistent at 25%. Adjusted diluted earnings per share was - $0.14 in the first quarter of fiscal 2023, compared to - $0.06 in the prior year. Basic and diluted weighted average shares outstanding were 184 million in the first quarter of fiscal 2023, compared to 189 million shares in the first quarter of fiscal 2022. Moving to the balance sheet. We finished the first quarter of fiscal 2023 with cash of $3 million. We had $91 million outstanding on our revolver, compared to cash of $53 million and no borrowings on our revolver at the end of the first quarter of fiscal 2022. The reduction in net cash was primarily due to investments in inventory and higher M&A activity during the past 12 months. At the end of the first quarter of fiscal 2023, we had $99 million available on our revolver. We ended the first quarter of fiscal 2023 with $430 million of inventory, an increase of $185 million or 76% compared to $245 million at the end of the first quarter of fiscal 2022. The increase in inventory is primarily related to equipment, chemicals, and M&A activity. Both the equipment and chemical product categories are non-discretionary in nature and are not subject to technology or fashion risk. As previously stated, our first priority is to put the company in a position to meet consumer demand for the season. In furtherance of that objective, we continue to view our current elevated inventory position as appropriate and sensible given the uncertainty of supply. We also have the ability to use our balance sheet as a competitive advantage and invest in higher inventory levels in both our stores and our distribution centers. When we believe we have sufficient inventory to meet consumer demand through season, and after we see supply chains across the industry become more predictable, then we will strategically manage inventory levels down. On debt, at the end of the first quarter of fiscal 2023, we had $796 million outstanding on our secured term loan facility compared to $804 million at the end of the first quarter of fiscal 2022. The applicable rate on our term loan during the first quarter was LIBOR + 250 basis points, and our effective interest rate was 6.1% compared to an effective interest rate of 3% during the first quarter of fiscal 2022. Before I wrap up our first quarter performance, I'd like to share an update on our supply chain readiness. In November, we discussed specific actions we were taking to improve our supply chain across three key areas. First, expand capacity by implementing the two-shift, seven-day-a-week model during pool season for our distribution centers and by adding additional 3PLs to our network. Second, stock more inventory across our network. Third, diversify our supply base. I'm pleased to report that we have made significant progress against all three of these areas, and our team is focused on meeting consumer demand across our entire network during the upcoming pool season. Now let me turn to our outlook for fiscal 2023. Our performance in the first quarter of fiscal 2023 was in line with expectations, and today we are reaffirming the outlook we issued at the end of November. As we discussed a couple months ago, we're expecting a more uncertain macroeconomic environment in fiscal 2023, up to and including a recession that will pressure industry sales, margins, and earnings growth. Approximately 80% of our sales are non-discretionary products and services, which will mitigate but not eliminate a recessionary impact on our business. For fiscal 2023, we continue to expect sales of $1.56 billion-$1.64 billion, gross profit of $667 million-$708 million, Adjusted EBITDA of $280 million-$310 million, net income of $131 million-$146 million, adjusted net income of $145 million-$160 million, and diluted adjusted earnings per share of $0.78-$0.86, and diluted share count of 185 million shares-187 million shares. Finally, on our outlook, I want to remind everyone of the natural seasonality within our business. Our primary selling season occurs during our fiscal third and fourth quarters, which span April through September. We invest in our business throughout the year, including in operating expenses, working capital, and capital expenditures related to our growth initiatives. While these investments drive performance during our primary selling season, they reduce our earnings and cash flow during the first half of our fiscal year. Consistent with our commentary in November, in fiscal 2023, we expect negative comparable sales growth and significant gross margin declines in the first half of the fiscal year, given the strength of the comparable periods in fiscal 2022 and fixed cost deleverage. We also expect to generate all of our Adjusted EBITDA and earnings in the second half of the fiscal year. In summary, during the first quarter of fiscal 2023, we generated record sales and performed in line with our expectations. We're grateful for the contributions of our entire team as they continue to execute against our initiatives and prepare for the 2023 pool season. We will continue our relentless focus on enhancing our customers' experience and executing our initiatives to drive growth and market share gains. With that, I will hand it back over to Mike. Thank you. Thanks, Steve. The pool and spa industry has proven over time to be one of the most durable and advantaged consumer products categories. It does have some sensitivity to macroeconomic conditions. In addition, during periods that are not prime pool season, consumers can take some shortcuts in maintenance with less danger of lost swimming days, safety concerns, and equipment damage from poor water care and maintenance. In the first quarter, we did see some indications of reduced confidence and demand from pool and spa owners, especially for discretionary products. This reduced confidence, combined with some very unfavorable weather, made for a challenging industry backdrop. Against that backdrop, we feel good about meeting our internal profit expectations and growing our top line 6%. These results are a testament to our teams performing at a high level and to the ability of our diversified strategic initiatives to drive growth in adverse macro conditions. Importantly, we feel very good about the progress we made against our plans to de-risk our supply chain and ensure that we are in position to win big during the 2023 pool season. With that, I will hand it back to the operator for Q&A. Thank you. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For a participant choosing speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question is from Simeon Gutman with Morgan Stanley. Please proceed. Hey, good afternoon, everyone. Hope you're good. I think you've talked about this in the past. I wanted to ask what recession could look like for you, and I think there's a lot of puts and takes, and who knows how the consumer will spend on travel, and maybe it comes back into this category. If there is a history lesson, and just to clarify, -5 to flat, is that bracketing a potential recession or that is a non-recession scenario? Yeah. Thanks for the question, Simeon. The full year guidance does include challenging macro conditions up to including a recession. That does bracket it, to answer your question. You're right, there's a lot of puts and takes in there, right? A recession could slow down spend on travel and could keep more people at home. It could also look for people to, you know, just try to skip some steps in pool maintenance, but they can only do that for a period of time, as you know. Yeah, we're comfortable that our full year guidance sufficiently brackets economic conditions up to and including a recession. Okay. A quick follow-up. I don't know if it's deflation or disinflation or price tracking relative to expectations and then demand for durables? You mentioned you're starting to see some pockets or not durables, but I guess units per se. How are units tracking versus how you thought and how is price tracking versus how you thought? Yeah, I start with price. Inflation was a little higher than we anticipated in the quarter, came down across all of our product categories. Definitely heading in the direction we anticipate. Doesn't change our outlook for 5% for the full year. In terms of durables or if you would, big ticket items, we have seen some weakness in equipment. At the same time, our equipment repair and parts businesses have picked up. There's a little bit of a signal that some people are looking to repair versus replace or upgrade right now. I think we got to keep in mind that this is a, you know, a very small quarter for us, and we internally try very specifically not to take the trends we see in Q1 and apply them to the balance of the year. Such a small quarter that, you know, a little bit of changes in consumer behavior or in this case, you know, really challenging weather have an outsized impact on the quarter that just don't impact the full year. Okay. Thanks, Mike. Good luck. Yep. Thank you. Our next question is from Steven Forbes with Guggenheim Partners. Please proceed. Hey, this is Rene Marin on for Steven Forbes. I wanted to touch on the pro side of the business. Can you discuss any incremental learnings from this customer? Additionally, can you discuss any notable trends with pricing in this segment? Thank you. Rene, that was specific to the pro consumer. Is that correct? Yep. Yep. You know, our pro business is run through our residential stores, predominantly. In the pro business, you know, we saw a similar impact as we did in residential, due to the weather. You know, comps were down 4%. We looked very closely to see if we saw any signs of an increase in DIY behavior among our consumers and maybe some reduction in their use of pros. We did not see anything of that nature in the data that we got. I think, you know, for us, focused on smaller pros and servicing them through our own retail stores, the pro conversation is very similar to the residential conversation. We did see some of the pros buying some smaller quantities of sanitizers. you know, I think there's a feeling in the pro market that chemical prices could come down, and I think they're trying to wait it out, frankly, a little bit. We have not seen any indication of any deflation in chemicals at this point. Got it. Thank you. Yep. Our next question is from Ryan Merkel with William Blair. Please proceed. Hey, guys. Thanks for taking the question. Can we start with inventory? Mike, the inventory kind of pops off the page and up a bit sequentially. How much is safety stock and when do you see inventory normalizing? Yeah, that's a great question, Ryan. Thank you for that. As we think about our inventory growth, I mean, there's two key reasons that inventory is up. One is sales growth over the last year, last few years. And then importantly, the strategic decision that we made to intentionally pull forward 2023 receipts in advance of season. We believe that pull forward is appropriate. When you look at the last two years, the industry has had a number of supply chain challenges, and we've had far too many out of stocks on key products, and we're unable to serve consumers. The pull forward allows us to load our stores with more product and facilitate the replenishment cycle during the early part of our season. It's also one of the reasons that ESP, some of the distribution costs, be a little bit higher in the last quarter as well. But again, the inventory that we're procuring today is for this season. It's inventory that is being brought in earlier in preparation for season. It's not stocking up for kind of longer-term needs. Okay. You know, very much on purpose, and I know some M&A is in there too. Yep, exactly. Yeah. Very purposeful. The only thing I would add, Ryan, you know, with our omni-channel capabilities, the ability to load up the stores kind of maximum capacity early and then to keep it there year-round allows us to take advantage of, ship from store. My second question, I wanted to dig in on the discretionary sales. I think you mentioned down 11%. Can you just unpack some of the weaker categories? And I know you mentioned equipment, but what else is in there? Yeah, we consider most all equipment non-discretionary, right? Heaters is probably the one we've talked about in the past, that you don't have to have a heater to keep a pool maintained. We did see heater sales down very much in line with what we saw in Q4 as well. In terms of other discretionary categories, you know, as you might imagine, we've seen the above ground pool business be very weak. Prices have come down considerably. There's a lot of excess inventory in the market. We're not playing a price game on that, we've seen our sales come down as well. Recreation products in general, floats and noodles and things like that have, you know, are down considerably as we anticipated. Above ground pools is as we anticipated as well. We saw that, you know, start to occur very, actually in the fourth quarter and then also, very early in Q1. Got it. Yep. Those categories make sense. Thanks. Yep. Thank you. Our next question is from David Bellinger with MKM Partners. Please proceed. Hey, guys. Thanks for taking the question. First one on gross margins. Those seem to be back at Q1 of 2020 levels, and even those sales are almost 40% lower back then. How should we think about the mix impact going forward? Is, is that the largest headwind we should keep in mind as we, as we update our models here? Is, is that discretionary piece also playing into that as well? Yeah. Do you want me to take that, Mike? Yeah, go ahead, Steve. Remember back, our guide in November was flat to - 35 basis points for the year. We do anticipate a reduction in gross margins for the year. We talked about the first half being lower or down significantly, I should say, with some improvement in the back half. The core question that you're getting at is, will the current quarter impacts persist? If not, why might they change as we work through the year? Let me kind of walk through each of the individual line items. Business mix, Number 1, related to M&A that we completed primarily in the back half of last year. As we work through this full year, it'll be much less impactful on $1.6 billion of sales versus the first quarter sales of $195 million. When you think about product costs, you know, we're in the off-season, so our expectation is that by the time that pool season starts, industry retail pricing will have caught up with industry cost increases. Maybe have seen somewhat of a slow adoption of some of those higher costs in the current environment, but absolutely expect that to occur. And then DC expenses in the first quarter, you know, those expenses will moderate as we get in to the full year as well. We talked a lot about the challenges we had in our New Jersey DC and vendor delivery cadence last year. Since we brought forward some of the inventory receipts and movement of that inventory around our network, we've also pulled forward some of those expenses as well. Again, as we look to the second half and better comps, we're gonna see occupancy normalize as well. No, no change to overall outlook that we provided back in November. Again, the 290 basis point decline this quarter in line with our expectations and see a path to what we previously provided. Got it. That's very helpful. This is my follow-up here on Mike, some of your ending comments in the prepared remarks, just on the indications of reduced confidence in the category. Are you hearing that from your Pro customers as well, some of the larger Pros particularly? I'm just curious if we were to see a wider slowdown across pool, would you see that more pronounced from the Pro or the DIY customer at first? Maybe just give your some thoughts there. Yeah, the Look, I think the way to think about demand is to keep in mind it's a very small quarter, right? For the whole industry. I know we've said that a lot, but again, trying to extrapolate trends from this first quarter, which is A, small, and B, had a really outsized weather impact. I just think that's tricky. Internally, we're trying not to do that. You know, in terms of DIY versus Pro, as I said in the earlier question, very similar behavior that we saw in both channels. We looked really hard for any indication that there might be some switch from Pro to DIY, and we did not see that. We expect the Pro business to play out for the year as anticipated when we put out our guide, and we expect the residential business to do the same. Got it. Thank you. Our next question is from Garik Shmois with Loop Capital Markets. Please proceed. Hi. Thank you. Just wondering if you could speak on the impact of Trichlor. Obviously, it's held in here, and you've said in the past you plan to hold on to it as much as you possibly can. Just given the big delta between, you know, how resilient pricing has been so far versus what's in your guidance, I was wondering if you could maybe provide some perspective on, you know, if you would anticipate pricing to come down, when might that be? Or if there's any signs of weakness that you're seeing at this point at all. Garik, thanks for the question. The, you know, the pricing for pool season really gets set Memorial Day weekend. You know, we've talked about that a little bit before at some conferences as well as calls. That's when I would say the industry settles in on price for the balance of the pool season. Up until that point, you know, we try not to make any assumptions. We talked about at our Investor Day that there's a case for price deflation in Trichlor. We have not seen any evidence of that. We know that Trichlor costing is up. I think that is now set in the industry, and it would be unusual for the industry to discount off of that. But there's a lot of chatter about that potential outcome. We're not discounting it, which is why we have it in our guide as a possibility. To date, we haven't seen any inclination of price deflation in Pro or residential. Just to reiterate, there's plenty of inventory in the channel. I would say everybody is fully inventoried in Trichlor. Got it. No, that's helpful. Follow-up question is just, you know, you spoke to the weather impacts on the quarter. You know, it sounds like most of that was on the non-discretionary side. I'm just wondering if there might possibly be any pent-up demand from any purchases that might've been pushed out due to the weather. Should we assume that those sales were effectively lost with the poor weather in the quarter? I think it'll be interesting to see. I think chemicals, right, that sales opportunity has probably passed. I think it remains to be seen on equipment because, you know, with the weather being as challenging as it was, it impacted store traffic, site traffic. You know, pools were not on people's mind. I think there's an opportunity to recover that. Again, super small quarter, outsized weather impact. We're being very careful not to draw any trends for the full year from it. We didn't see anything despite those two factors that would tell us we need to. Got it. Thanks. Yeah. I'd add to it, Garik, that, you know, I think the lost sanitization days in the calendar fourth quarter are de minimis, right? I think Mike's right. It's, it's more along the lines of traffic and could that have deferred some purchases around sanitizers? Sure. lost sanitization days just not meaningful. Okay, great. Thanks for that. That's the look. Our next question is from Peter Keith with Piper Sandler. Please proceed. Hey, good afternoon, everyone. I wanna follow up a little bit on the prior question around the Trichlor. Like you'd noted, there's a lot of Trichlor inventory in the industry. We'll see what happens with pricing. I guess in the event there is some price cuts as we get close to Memorial Day, how would that impact your product margins? Are you guys already kind of bought up on a lot of the Trichlor inventory and sort of stuck with your cost? How should we think about that flow through if a deflation comes to be? Yeah. Our costs are set for Trichlor. I would say the industry costs are set. If we see price deflation from this point, retail price deflation, that would be an impact on margins. It's also the reason we don't think we're gonna see it in the industry. I don't believe there's a need for any price deflation. In our mind, inventory, demand, supply, both domestic and import, has all kind of settled in at a specific price and a specific volume, and we consider the category healthy at the moment. Okay. Maybe just on that same topic, there seem to be some concern or some speculation that you and others in the industry are sitting on elevated chemical or Trichlor margins versus historic margins. Where are you on it relative to, like, a 2019 level? Are you in line or above on Trichlor? What does that margin profile look like? Yeah. Peter, I'm sorry. I'm gonna have to pull the competitive information on that one. We, you know, we have grown margins throughout the quarters, though, as David brought up earlier on a question, we're closer to 2019 currently overall. We expect to end the year in a better position than we were in 2019. Margins up, are up overall for the business. I would say our Trichlor margins are higher, but to go into specifics, I'm gonna have to decline that one. Okay. Fair enough. I appreciate that. Thanks for the insights. Yep. Our next question is from Andrew Carter with Stifel. Please proceed. Thank you very much. Good evening. What I wanted to ask is, you mentioned the smaller pack sizes are something you're seeing as a potential sign of consumer weaknesses. I guess, how do you compare those, that percentage of the volume versus, say, before the big Trichlor disruption, where if there was a 35 lbs bucket of tabs and people thought they couldn't get anything, they'd grab it? Second thing I'd ask is, wouldn't the smaller pack size be accretive to you from a product margin standpoint? Finally, if, you know, depending on how you extrapolate that, is it an easy switch if you're over-inventoried at the store of big pack sizes to make that correction given pack sizes, or are you stuck with it? Anything you can help out with there. Thanks. Yeah. Thanks, Andrew, for the question. The smaller sizes are a little more profitable for us. We do, particularly now that we do the bulk of our own tableting, have the ability to switch between bucket sizes during the season. The advantage we have this season is we're just fully inventoried across all sizes. But the behavior we're seeing in going to smaller sizes, and this is, I'm gonna say this is anecdotal from our stores, but we have a lot of stores, and it's a fairly common explanation when we ask our general managers what's going on, is that people seem to be coming in with a monthly budget, if you would, for their pool. They seem to be. You can't manage sanitizers down because your pool size doesn't change. What you can do is spread sanitizer purchases out by buying smaller buckets at a time. We think that's what we're seeing right now. But again, it's small quarter weather. Trying not to draw any trends from it. Appreciate that. Second question I would ask you, this kind of goes back to where you've kind of consistently shown that you've outperformed the industry. I know you said costs are set for you on Trichlor, costs are set for the industry. How do you think of the risk of, you know, your competitors sitting on too much inventory and that really being the leg down in deflation? What's your visibility into that to be able to react quickly and be preemptive or whatever on that? Thanks. Yeah. I don't, you know, I can only speculate about the level of competitors' inventory. What we do know is that industry is fully inventoried. In that case, there is an opportunity for some irrational behavior. We have, like I've said, we haven't seen that. I don't think we expect to see it. However, we as we said at our investor day when we laid out our full year guidance, we're more than prepared to compete if we need to. What we're not gonna do is lose market share in sanitizers. You know, we believe that we have a cost structure where we are more than able to do that. Thanks. I'll pass it on. Thanks, Andrew. Our next question is from Jonathan Matuszewski with Jefferies. Please proceed. Great. Good afternoon, thanks for taking my question. My first question was just to follow up on inventory. Curious if you could just break out, Steve, maybe just the increase in units versus price. Not sure if you could get as granular as the Trichlor units versus price, but that would be helpful. Then just a second piece of that first question is how you're thinking about the rate of inventory growth in fiscal 2Q. Right? I think overall inventory balances were up around 74% this quarter. Just thinking, you know, how should we expect that rate of growth in fiscal 2Q? That's my first question. Thanks. Yeah. Both good questions. We certainly expect inventory to be up again in Q2. We typically will peak in our inventory the last couple weeks of March, first couple weeks of April, and then we start getting into kind of replenishment cycle as season starts to kick off. Would expect inventory to be up again in Q2, less so than in Q1, but still a dollar increase. When you think about inflation, I guess if I expand out and I talked through, you know, a 4th factor, it's equipment, it's chemicals, it's M&A, and it's inflationary. Inflation was, you know, a top four contributor to the increase year-over-year. Definitely have a larger increase from a unit perspective than from a cost perspective, certainly have seen those costs flow through to the inventory balances as well. We feel good about the inventory that we have in our facilities and in our stores. You know, again, when you think about that composition or product that we're bringing in early, it's high turn product, top SKUs that we know we need for pool season. Where last year we talked a lot about kind of getting behind the curve and the replenishment cycle, we have more inventory available to distribute out to whether e-commerce customers or to our retail locations to serve those consumers as season really gets kicked off. Again, consistent with prior years, I can't tell you the day or the week that season will really kick off, but it will be typically in the month of May. Feel good with the position, we have in inventory today. That's super helpful. Then just a follow-up question on Trichlor. You know, Mike, I think you mentioned you weren't seeing any evidence of, you know, price deflation. I think we've seen some online retailers maybe, you know, cutting price in January. Not sure if that's just a seasonal kind of promotion that they typically do, but any commentary on that would be helpful. Thanks. Yeah. There's a little bit of import. I'm gonna actually call it questionable import chlorine running through Amazon at the moment. It's quite small, and it's literally small buckets. There was something similar last year for a short period of time, and then it disappeared. I think we're probably in a similar situation. There's always some competition around the edges, but in terms of, you know, our retail price competitors and our scale, digital competitors, I think the Trichlor pricing is acting pretty rationally. That's great. Thanks for clearing that up. As a reminder to star one on your telephone keypad if you would like to ask a question. Our next question is from Peter Benedict with Baird. Please proceed. Hey, Mike, Steve. Just a couple questions. First, just on the sector supply chain, Just help us, what's still not operating efficiently? I know you're bringing a lot of inventory in. I'm just curious, what areas of the business are you still kind of concerned about or maybe aren't operating fluidly at this point? That's my first question. You know, Peter is. You'll remember in Q3 and Q4 last year, we had some challenges with specialty chemicals in particular. We said we would address that in two ways. We'd buy more earlier, which we've done, and we'd also diversify our vendors there, which we've done as well. If I was to point to one area, that would be probably predominant. In terms of equipment, the equipment vendors, you know, have done a nice job getting themselves back on schedule. Fairly recent, we have taken in a lot of equipment inventory purposely so that, you know, we won't be looking necessarily to reorder in season. We're purposely trying to buy it upfront, which I think we've successfully done with all except maybe one vendor. In Trichlor, that's, you know, that's really us, and we control most of that supply chain now, particularly with our investment in Stellar for tableting. We feel good about where we are with Trichlor, but we've also bulked up the inventory there as well, with the idea that we're gonna pre-position a much higher percentage of it into the stores themselves. The only other area that's been a little bit challenging, but is coming along nicely now is Cal-Hypo, kind of the second-largest sanitizer in the industry that was in rather short supply in Q4, and is, you know, just really now in December and January, coming online and in the volumes we'd like. All right. That's very helpful. Thanks, Mike. Just on the loyalty file, I think you said it was up 15%. I think that's an improvement in the rate of growth relative to how it was running kind of last year. Maybe talk about what's driving that and the maybe the complexion of who you're bringing into the loyalty file. Thank you. Yeah, we're just, we're really pleased with how loyalty file is performing. You know, it's now up to about 75% of our total sales. Membership continues to grow, and the members are continuing to get more productive for us. Probably what's most encouraging for us is, you know, as we look at the different cohorts in our file, we have a, I'm gonna say a limited number of loyalty members who are in our top cohort, despite in total accounting for 75% of sales. The way we look at that is a really significant opportunity to continue to treat people up through those cohorts. A lot of the loyalty growth is coming from reactivations, right? Customers who have not, were in a loyalty program maybe much earlier, several years ago, and have come back in as we've upped the marketing of it. Also we're signing up, at a nice rate, new loyalty members from our existing base, that's predominantly in stores, and then also digitally. Those are predominantly brand new customers to Leslie's. Good. We feel really, really good about the loyalty file, not just for this quarter, but long term as we continue to build its productivity. Terrific. Thanks. Good luck, guys. Thank you. We have reached the end of our question-and-answer session. I would like to turn the conference back over to Mike for closing comments. Thank you, operator, and thank you all for joining us this afternoon. For those of you with pools, I would suggest you start thinking about pool season because as I believe we've made clear, at our call today, we certainly are. Certainly are preparing for it and looking forward to it. Thank you. Thank you. This will conclude today's conference. You may disconnect your lines at this time, and thank you for your participation.