Q1 2024 Gildan Activewear Inc Earnings Call

Operator: Ladies and gentlemen, thank you for standing by, and welcome to the Q1 2024 Gildan Activewear Earnings Conference Call. After the presentation, there will be a question and answer session, and if you would like to ask a question during this time, simply press star 1 on your telephone keypad. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Jesse Hayem, Vice President, Head of Investor Relations. Please go ahead.

Ladies and gentlemen, thank you for standing by and welcome to the Q1 'twenty 'twenty four Gilden Activewear earnings Conference call.

After the presentation, there will be a question and answer session and if you would like to ask a question. During this time simply press star one on your telephone keypad.

Please be advised that today's conference is being recorded.

I would now like to hand, the conference over to Jesse Hamm, Vice President head of Investor Relations. Please go ahead.

Jessy Hayem: Thank you. Good afternoon, everyone. Earlier, we issued a press release announcing our results for the first quarter of 2024, along with our interim shareholder report containing management's discussion and analysis, as well as consolidated financial statements. These documents are expected to be filed with the Canadian Securities and Regulatory Authority and the U.S. Securities Commission today, and they'll also be available on our corporate website. Joining me on the call today are Vince Tyra, President and CEO of Gildan, Rod Harries, Executive Vice President and Chief Financial and Administrative Officer, and Chuck Ward, President, Sales, Marketing, and Distribution.

Jesse Hamm: Thank you.

Jesse Hamm: Good afternoon, everyone.

Jesse Hamm: We issued a press release announcing our results for the first quarter of 'twenty 'twenty four along with our interim shareholder report containing management's discussion and analysis as well as consolidated financial statements. These documents are expected to be filed with the Canadian securities and regulatory authorities and the U S Securities Commission today.

Jesse Hamm: And they'll also be available on our corporate website.

Jesse Hamm: Joining me on the call today are a bench tirade, president and CEO of scale down Rod Harries, <unk> Executive Vice President and Chief financial and administrative officer, and Chuck Ward, President sales marketing and distribution.

Jessy Hayem: This afternoon, we'll take you through the results for the quarter and then a question and answer session will follow. Before we begin, please take note that certain statements included in this conference call may constitute forward-looking statements that involve unknown and known risks, uncertainties, and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. We refer you to the company's filings with the U.S. Securities and Exchange Commission and Canadian Securities Regulatory Authority.

Speaker Change: This afternoon, we will take you through the results for the quarter and then a question and answer session will follow.

Speaker Change: Before we begin please take note that certain statements included in this conference call May constitute forward looking statements, which involve unknown unknown risks uncertainties and other factors, which could cause actual results to differ materially from future results expressed or implied by such forward looking statements we were.

Speaker Change: For you to the company's filings with the U S Securities and Exchange Commission and Canadian Securities regulatory authorities.

Jessy Hayem: During this call, we will also discuss certain non-GAAP financial measures. Reconciliations to the most directly comparable IFRS measures are provided in today's earnings release as well as in our MD&A. Now, I'll turn it over to Vince. Thanks.

Speaker Change: During this call we will also discuss certain non-GAAP financial measures.

Speaker Change: Conciliations to the most directly comparable I F. R. S measures are provided in Tonight todays earnings release as well as our M. D N a.

Speaker Change: Now I'll turn it over to Vince.

Vincent J. Tyra: Thanks, Jesse, and good afternoon, everyone. This quarter, I saw firsthand the hard work and dedication of our teams as we delivered on our goals and demonstrated resilience as a company. Our first quarter performance was in line with our expectations, with several bright spots, including continued market momentum and ring spun and fleece products. We saw good momentum in activewear overall, which was offset by some softness in hosiery and underwear, but this was expected and, to a certain extent, would lead to broader market weakness.

Vince: Thanks, Jessie and good afternoon, everyone.

Vince: This quarter I saw firsthand the hard work and dedication of our teams as we delivered on our goals and demonstrated resilience as a company.

Vince: Our first quarter performance was in line with our expectations with several bright spots, including continued market momentum in ring spun and fleece products we.

Vince: We saw good momentum in activewear, overall, which was offset by some softness in hosiery and underwear, but this was expected and to a certain extent do or broader market weakness.

Vincent J. Tyra: So I'm pleased with our competitive position and the team's execution, which drove significant year-over-year improvement in our key financial metric. We met our top-line expectations, maintained solid margins, and a healthy balance sheet, all testaments to our strong business model. Some of you joined us on April 15th when I shared key elements of my vision for the future, which will enable us to embark on a new chapter of sustainable growth, driving strong free cash flow generation and shareholder return.

Vince: So I'm pleased with our competitive positioning and the team's execution, which drove significant year over year improvement in our key financial metrics.

Vince: We met our topline expectations maintained solid margins and a healthy balance sheet, all a testament to our strong business model.

Speaker Change: Some of you joined US on April 15th when I started when I shared key elements of my vision for the future, which will enable us to embark on a new chapter of sustainable growth driving strong free cash flow generation and shareholder returns.

Vincent J. Tyra: So before diving into the details of our first quarter results, allow me to summarize these elements on which we are now laser focused. One, we will continue to focus on our supply chain excellence and on driving successful execution of our investments in Bangladesh while remaining true to our back-to-basics principles and our commitment to innovation and ESG. Two, we have a renewed focus on our brands and on enhancing our commercial capabilities to deliver the best offering to our customers across the board.

Speaker Change: So before diving into the details of our first quarter results allow me to summarize these elements on which we are now laser focused one we will continue to focus on our supply chain excellence and on driving successful execution of our investments in Bangladesh, while remaining true to our back to basics principles and our commitment to innovation.

Speaker Change: <unk> and ESG.

Speaker Change: Two we have a renewed focus on our brands and our enhanced and element in enhancing our commercial capabilities to deliver the best offering to our customers across the board.

Vincent J. Tyra: Three, we are increasing our emphasis on serving our retail partners and becoming the supplier of choice. Four, we will apply a focused, local approach from product to pricing to supply chain to regain and gain share in targeted international markets. And lastly, we will make people and their development a priority, ensuring that the next generation of leaders has space and support to grow to their full potential. So, bottom line, our key focus priorities are clear. We are off to a good start to the year. I look forward to taking your questions a little later during the Q&A session. And with that, I will turn it over to Rod.

Speaker Change: Three we are increasing our emphasis on serving our retail partners and becoming the supplier of choice for we will apply a focused be local approach from product to pricing to supply chain to regain and gained share in targeted international markets and lastly, we will make people and their development of priority.

Speaker Change: Ensuring that the next generation of leaders.

Speaker Change: <unk> and support to grow to their full potential.

Speaker Change: So bottom line, our key focus which are clear we're off to a good start to the year I look forward to taking your questions. A little later during the Q&A session and with that I will turn it over to Rod.

Rhodri J. Harries: Thank you Vince.

Rhodri J. Harries: And thank you all for joining us today to discuss our first quarter results. The quarter unfolded largely as we anticipated, with sales of $696 million, down 1%, in line with guidance provided on April 15. Activewear sales were up 1% versus last year, offset by a 10% decline in the hosiery and underwear category, which was expected and which I'll address later. However, total shipments, all categories combined, were stable compared to the previous year, slightly exceeding our initial expectations.

Rhodri J. Harries: And thank you all for joining us today to discuss our first quarter results.

Rhodri J. Harries: The quarter unfolded, largely as we anticipated with sales of $696 million down 1% in line with guidance provided on April 15th.

Rhodri J. Harries: Activewear sales were up 1% versus last year offset by a 10% decline in the hosiery and underwear category, which was expected and which I'll address later.

Rhodri J. Harries: Total shipments all categories combined were stable compared to the previous year slightly exceeding our initial expectations.

Rhodri J. Harries: The year-over-year decline in consolidated net sales can largely be attributed to both lower net selling prices as we drove market share gains in certain areas and an unfavorable mix due to the ongoing impact of trade-down within certain capital markets. Importantly, though, we delivered an operating margin within our target range and in line with our guidance as we lapped peak cotton costs and reaped the benefits of lower manufacturing costs. And this drove a strong double-digit increase in adjusted earnings growth for the quarter. So, all in all, we were pleased with our performance.

Rhodri J. Harries: The year over year decline in consolidated net pulse can largely be attributed to both lower net selling prices as we drove market share gains in certain areas.

Rhodri J. Harries: Unfavorable mix due to the ongoing impact of trade down within certain cap.

Rhodri J. Harries: Importantly, though we delivered an operating margin within our target range and in line with our guidance as we lapped peak cotton costs and reap the benefits of lower manufacturing costs.

Rhodri J. Harries: And this drove a strong double digit increase in adjusted earnings growth for the quarter.

Speaker Change: So all in all we were pleased with our performance and as Vince mentioned, we are off to a good start to the year, allowing us to reaffirm our outlook and guidance for 2024.

Rhodri J. Harries: And as Vince mentioned, we were off to a good start to the year, allowing us to reaffirm our outlook and guidance for 2024. So now, let's turn to the specifics of the quarter. Activewear sales of $592 million were up 1%, driven by higher shipments, reflecting positive POS trends both in North America and international markets and continued strength in key product categories, namely fleece and ring-spun t-shirts, where we believe we are gaining share.

Rhodri J. Harries: We also benefited from seasonal replenishment at distributors, which came in slightly below last year's level, as expected. Our national accounts, who service retail markets, also showed strong momentum, as we continue to gain share in this channel as well. Partly offsetting the activewear volume growth, we're lowering net selling prices as we opportunistically implement price actions in select channels where we are seeing direct flow through to share. This said, from an overall pricing perspective for the full year, it is important to note that we continue to expect relatively good price stability as we move through 2024.

Speaker Change: So now, let's turn to the specifics of the quarter.

Speaker Change: Active active sales of $592 million were up 1% driven by higher shipments, reflecting positive Pos trends, both in North America and international markets and continued strength in key product categories, namely fleece and ring spun T shirts, where we believe we are gaining share.

Speaker Change: We also benefited from seasonal replenishment at distributors, which came in slightly below last year's level as expected.

Speaker Change: Our national accounts, whose service retail markets also showed strong momentum as we continue to gain share in this channel as well.

Speaker Change: Partly offsetting the activewear volume growth were lower net selling prices as we opportunistically implemented price actions in select channels, where we are seeing direct flow through to share.

Speaker Change: This said from an overall pricing perspective for the full year is an important important to note that we can you expect relatively good price stability as we move through 2024.

Rhodri J. Harries: Volume growth was also offset by unfavorable product mix relative to the prior year due to the ongoing impact of trade down within certain categories, as noted earlier. Finally, international sales were up 1%, reflecting a potential stabilization in POS trends with noticeable signs of recovery in some of our regions. Turning to the hosiery and underwear category,

Speaker Change: Volume growth was also offset by unfavorable product mix relative to the prior year due to the ongoing impact of trade down within certain categories as noted early earlier.

Speaker Change: Finally international sales were up 1%, reflecting a potential stabilization in P. O S trends with noticeable noticeable signs of recovery in some of our regions.

Speaker Change: Turning to the hosiery and underwear category sales were down 10% versus the prior year, reflecting unfavorable mix within this category the phase out of the under armour business with the expiry of the license on March 31st as previously communicated and broader industry weakness in the underwear category.

Rhodri J. Harries: Sales were down 10% versus the prior year, reflecting an unfavorable mix within this category, the phase out of the Under Armour business with the expiry of the license on March 31st, as previously communicated, and broader industry weakness in the underwear category. Moving on to margins for the quarter, both gross and adjusted gross margins saw significant improvement, up 360 and 410 basis points year over year, respectively. Our adjusted gross margin reached 30.3%, which was primarily driven by lower raw material and manufacturing input costs, slightly offset by the impact of lower net selling prices and unfavorable mix, as noted earlier.

Speaker Change: Moving on to margins for the quarter, both gross and adjusted gross margin saw a significant improvement up 360, and 410 basis points year over year, respectively.

Speaker Change: Our adjusted gross margin reached 33%, which was primarily driven by lower raw material and manufacturing input costs slightly offset by the impact of lower net selling prices and unfavorable mix as noted earlier.

Rhodri J. Harries: With respect to SG&A, expenses were $105 million, or 15.1% of sales, including charges pertaining to advisory fees on shareholder matters, costs related to assessing external interest in acquiring the company, adjustments to CEO separation costs, as well as special retention awards, all totaling $20 million. Excluding these charges, adjusted SG&A expenses as a percentage of sales were up 70 basis points to 12.3%, mainly reflecting various non-recurring expenses and, to a lesser extent, sales deleverage.

Speaker Change: With respect to SG&A expenses were 105 million or 15, 1% of sales, including charges pertaining to advisory fees on shareholder matters costs related to assessing external interest in acquiring the company adjustments to CEO separation costs as well as special retention Awards.

Speaker Change: All totaling $20 million.

Speaker Change: Excluding these charges adjusted SG&A expenses as a percentage of sales were up 70 basis points to 12, 3%, mainly reflecting various nonrecurring expenses and to a lesser extent sales to deleverage.

Rhodri J. Harries: Even though it was a smaller quarter, 12.3% is definitely higher than we like, and looking ahead, we expect SG&A as a percentage of sales to return closer to 10% for the remainder of the year. Putting these elements together, we generated an operating margin of 15.1%, down from 18.2% in the comparable period in 2023, which included a $25 million gain from the sale and leaseback of one of our U.S. distribution facilities. On an adjusted basis, our operating margin was 18%, up 340 basis points over last year, at the low end of our target range of 18 to 20% and in line with the guidance we communicated.

Speaker Change: Even though it was a smaller quarter 12, 3% is definitely higher than we like and looking ahead, we expect SG&A as a percentage of sales to return closer to 10% for the remainder of the year.

Speaker Change: Putting these elements together, we generated an operating margin of 15, 1% down from 18, 2% in the comparable period in 2023, which included a 25 million gain from the sale and leaseback of one of our U S distribution facilities.

Speaker Change: On an adjusted basis, our operating margin was 18% up 340 basis points over last year at the low end of our target range of 18% to 20% and in line with the guidance we communicated.

Rhodri J. Harries: Further, after reflecting net financial expenses of $23 million and factoring in the positive benefit of a lower outstanding share base, we reported GAAP diluted EPS of $0.47, down 13%. However, adjusting for the previously detailed charges, earnings per share was $0.59, up a strong 31% year over year. Turning to cash flow and balance sheet items, cash flow used in operating activities totaled $27 million, and we consumed $71 million of free cash flow in the quarter, which was a significant improvement over the $202 million of free cash flow consumed in 2023. This was driven by lower working capital investments and lower capital expenditure, which last year reflected the investments made in our new large-scale manufacturing complex in Bangladesh.

Speaker Change: Further after reflecting net financial expenses of $23 million and factoring in the positive benefit of a lower outstanding share base, we reported GAAP diluted EPS of <unk> 47 cents down 13%. However.

Speaker Change: However, adjusting for the previously detailed charges earnings per share was <unk> 59 sets up a strong 31% year over year.

Speaker Change: Turning to cash flow and balance sheet items cash flow used in operating activities totaled 27 million and we consumed 71 million of free cash flow in the quarter, which was a significant improvement over the 202 million free cash flow consumed in 2023.

Speaker Change: This was driven by lower working capital investments and lower Capex, which last year reflected the investments made in our new large scale manufacturing complex in Bangladesh.

Rhodri J. Harries: On this note, we are pleased to share that the ramp-up of our Bangladesh facility is progressing as planned, and we continue to expect that we will reach 75% exit capacity at the end of 2024, enabling us to further reduce costs, diversify our supply base, and provide us with another valuable key foothold from which to serve our global market. Finally, capital return to shareholders from share repurchases was $57 million during the quarter, and we ended with net debt of $1.1 billion and a net debt leverage ratio of 1.6 times, well within our targeted level.

Speaker Change: On this note we are pleased to share that the ramp up of our Bangladesh Bangladesh facility is progressing as planned and we continue to expect that we will reach 75% exit capacity at the end of 2024, enabling us to reduce further reduce costs diverse or diversify our slip supply base and providing us with another valuable key foothold from which to.

Speaker Change: Serve our global markets.

Speaker Change: Finally capital returned to shareholders from share repurchases was 57 million during the quarter and we ended with net debt of $1 1 billion and a net debt leverage ratio of one six times well within our targeted levels.

Rhodri J. Harries: Turning to our outlook, we continue to feel cautiously optimistic about the industry landscape for the remainder of 2024. We are mindful of the general concerns over a softening and more value-focused consumer and potentially moderating consumer spending.

Speaker Change: Turning to our outlook, we continue to feel cautiously optimistic about the industry landscape for the remainder of 2024.

Speaker Change: We are mindful of the general concerns over a softening and more value focused consumer and potentially moderating consumer spending.

Vincent J. Tyra: Nonetheless, we believe our industry continues to benefit from some recovery and the ongoing shift of wallet share towards experiences, events, and travel. As such, we believe we remain well positioned to meet the 2024 targets that we laid out in February and that we really recently reconfirmed at our investor update on April 15. So recapping for 2024, we expect the following revenue growth for the full year to be flat to up low single digits, with the notable call out that excluding the impact of the Under Armour Licence Agreement expiry, 2024 four-year revenue growth would be in the low to mid-single-digit range.

Speaker Change: Nonetheless, we believe our industry continues to benefit from some recovery and the ongoing shift of wallet share towards experiences events and travel.

Speaker Change: As such we believe we remain well positioned to meet the 'twenty 'twenty four targets that we laid out in February and then we work we're really recently reconfirmed at our Investor update on April 15th.

Vincent J. Tyra: We also expect adjusted operating margin to be slightly above the high end of our 18 to 20 percent target range for 2024. This assumes that certain refundable tax credits will be introduced in one of the jurisdictions in which we operate, which will reduce our SG&A in 2024. We expect CAPEX to come in at approximately 5% of sales. We expect adjusted diluted EPS in the range of 292 to 307, up between 13.5% and 19.5% year-over-year.

Speaker Change: So recapping for 'twenty 'twenty four we expect the following.

Speaker Change: Revenue growth for the full year to be flat to up low single digits.

Speaker Change: With the notable call out that excluding the impact of the under armour license agreement expiry of 2020 for full year revenue growth would be in the low to mid single digit range.

Speaker Change: We also expect adjusted operating margin to be slightly above the high end of our 18% to 20% target range for 2020 for.

Speaker Change: This assumes that certain refundable tax credits will be introduced in one of the jurisdictions in which we operate which will reduce our SG&A in 2024.

Speaker Change: We expect capex to come in at approximately 5% of sales.

Speaker Change: We expect adjusted diluted EPS in the range of $2 92 to 307 up between 13, 5% and 19, 5% year over year.

Vincent J. Tyra: And we expect free cash flow to be above 2023 levels driven by increased profitability, lower working capital investments, and lower capital expenditures than in 2023. Given our expected strong free cash flow and our recently revised target debt leverage ratio of 1.5 to 2 times, tightened from previously 1 to 2 times, the company currently plans, absent any further corporate developments, to resume share repurchases following the annual general meeting of shareholders on May 28, 2024.

Speaker Change: And we expect free cash flow to be above 2023 levels, driven by increased profitability lower working capital investments and lower capital expenditures than in 2023.

Speaker Change: Given our expected strong free cash flow and our recently revised target debt leverage ratio of one five to two times tightened from previously one to two times. The company currently plans absent any further corporate developments to resume share repurchases. Following the annual general meeting of shareholders on May 28 2000.

Speaker Change: <unk> 24.

Vincent J. Tyra: Furthermore, the assumptions underpinning our outlook are essentially the same as we had previously communicated. In this regard, we continue to assume that the Global Minimum Tax, or GMT, legislation in Canada and Barbados will be enacted during 2024, retroactive to January 1st, 2024, and have incorporated its impact on our effective tax rate. Finally, we have also provided guidance for our second quarter, with net sales expected to be flat to up low single digits year over year.

Speaker Change: Furthermore, the assumptions underpinning our outlook are essentially the same as we had previously communicated.

Speaker Change: In this regard we continue to assume that the global minimum tax or GMT legislation in Canada in Barbados will be enacted during 2020 for retroactive to January one 2024 of incorporated its impact on our effective tax rate.

Speaker Change: Finally, we have also provided guidance for our second quarter with net sales expected to be flat to up low single digits year over year.

Vincent J. Tyra: An adjusted operating margin is expected to come in above the high end of our 18 to 20 percent target range for 2024, including the cumulative positive benefit of expected refundable tax credits mentioned earlier. Correspondingly, we have also assumed that the GMT will be enacted in the second quarter of 2024, although we recognize that this could occur later in the year. So that's all I wanted to cover from a financial perspective, and with that, I will turn it back over to Vince.

Speaker Change: And adjusted operating margin expect is expected to come in above the high end of our 18% to 20% target range for 2024, including the cumulative positive benefit of expected refundable tax credits mentioned earlier.

Speaker Change: Correspondingly we have also assumed that the G. M T will be enacted in the second quarter of 2024, although we recognize that this could occur later in the year.

Speaker Change: So that's all I wanted to cover from a financial perspective, and with that I will turn it back over to Vince.

Vincent J. Tyra: Thanks, Rod. And to wrap up, let me reiterate that our team remains focused on executing our enhanced GST strategy and leveraging our solid foundation as we work towards executing on the five priorities I have identified and achieving the near and medium-term targets as outlined during the investor update on April 15th. Our foundation is solid, and this, together with our strong balance sheet, is an enviable position to be in, and I'm excited about our ability to drive shareholder value into the future. Now, I'll turn it over to Jess.

Vince: Thanks, Rod and to wrap up let me reiterate that our team remains focused on executing our enhanced GST strategy and leveraging our solid foundation as we work towards executing on the five priorities I've identified and achieving the near and medium term targets as outlined during the investor update on April 15th are.

Vince: Our foundation is solid and this together with our strong balance sheet is an enviable position to be in and I am excited about our ability to drive shareholder value into the future and now I will turn it over to Jesse.

Jessy Hayem: Thank you, Vince. This concludes our prepared remarks, and now we'll begin taking your questions. Before moving to the Q&A session, I'd like to remind you to limit your questions to two and we'll circle back for a second round if time permits. Operator, you may begin the Q&A session.

Jesse Hamm: Thank you Vince This concludes our prepared remarks and now we'll begin taking your questions before moving to the Q&A session I'd like to remind you to limit your questions to two and we'll circle back for a second round. If time permits operator, you may begin the Q&A session.

Operator: Thank you. As a reminder, if you would like to ask a question, please press star 1 on your telephone keypad. If you would like to withdraw your question, simply press star 1 again. Your first question comes from the line of Paul Lejuez with Citigroup. Your line is open.

Jesse Hamm: Thank you as a reminder, if you would like to ask a question. Please press star one on your telephone keypad. If you would like to withdraw your question simply press Star one again.

Jesse Hamm: Your first question comes from the line of Paul <unk> with Citigroup. Your line is open.

Paul Lawrence Lejuez: Hey, thanks. Thanks, guys. Hopefully, you can hear me.

Jesse Hamm: Bob.

Paul: Thanks, guys hopefully you can hear me.

Paul Lawrence Lejuez: Curious what the non-recurring expenses were that you didn't adjust out of SG&A and what the amount was, and if there was anything that we should think about in terms of SG&A dollar growth as we think about the next several quarters. I think you said closer to 10%, but obviously that'll be dependent on sales. So, I'm curious how you're thinking about SG&A dollar growth. And then second, I'm curious about the product cost tailwind that helped you in the first quarter.

Paul: Curious what the nonrecurring expenses that you didn't adjust out of SG&A and what the amount was and if there was anything.

Paul: So we should think about in terms of SG&A dollar growth.

Paul: As we think about the next the next several quarters I think you said closer to 10%, but obviously that will be dependent on sales. So curious how you're thinking about SG&A dollar growth.

Paul: And then second curious about the product cost.

Paul: <unk> that helped you in the first quarter.

Paul Lawrence Lejuez: How are you thinking about those tailwinds as we move throughout the year? And then you did, I think, invest in some price to drive market share in 1Q. How should we be thinking about your actions to do the same in future quarters? Thanks.

Paul: How are you thinking about those tailwind as we move throughout the year and then you did I think invest in some price to drive market share in <unk>.

Paul: How should we be thinking about your actions to do the same in future quarters. Thanks.

Rhodri J. Harries: Okay, Paul, I'll take that. And there are a few things to cover there. So on SG&A, if you look at where we came in on SG&A for the quarter, the one thing you do have to remember is that we were expecting it to be, as a percent of sales, a little bit lower due to the enactment of GMT. That would have had about an 80 basis point impact. That didn't occur, but that should occur as we go forward.

Speaker Change: Okay, Paul ill take that and there's a few things to cover there. So on SG&A. If you look at effectively where we came in on the SG&A for the quarter.

Paul: The one thing you do have to remember is that we were expecting that it would be as a percent of sales a little bit lower due.

Paul: Due to the enactment of the of G. M. T that would've had about an 80 basis point impact that they didn't occur but that should occur is that as we go forward right now we're expecting that that will occur in the second quarter and there'll be a catch up for the first quarter and the second quarter. So instead of effectively an 80 basis point reduction.

Rhodri J. Harries: Right now, we're expecting that that will occur in the second quarter, and there will be a catch-up for the first quarter and the second quarter. So instead of effectively an 80 basis point reduction that you would normally see, we probably will see something like a 160 basis point reduction in the catch-up. But if you look at SG&A overall, we do think we have it dialed in well. There was a little bit of noise in the first quarter on some non-recurring costs that are, to a certain extent, somewhat related to the current situation that we're in. We were able to effectively adjust out the majority of those impacts, but we had a little bit of noise. But, you know, I wouldn't get too distracted by that.

Paul: That you would have normally seen we'd probably see something like a 160 basis point reduction in the catch up but if you look at our SG&A. Overall, we do think we have a dialed in well there was a little bit of noise in the first quarter on some near a nonrecurring cost that to a certain extent.

Paul: Somewhat related to the that the current situation that we're in we were able to effectively adjust out the majority of those impacts, but we had a little bit of noise, but I you know I wouldn't get too distracted by that I think overall, we've got a SG&A well in hand, and as we as we move through the year as we said we effect.

Rhodri J. Harries: I think overall, we've got SG&A well in hand. And as we move through the year, as we said, we effectively would see SG&A or delivering on our target of 10 percent or better, especially with the enactment of GMT. And again, when that GMT gets enacted, and we do see the jobs credits credits coming through the quarter where that occurs, we do expect to see a fairly significant retroactive or cumulative catch up.

Paul: Sivley would see SG&A.

Paul: They're delivering on our target of 10% or better, especially.

Paul: Especially with the enactment of a of G. M T and when again when that G. M. T gets enacted and we do see the jobs credits credits coming through the quarter, where that occurs we do see a fairly significant.

Paul: Retroact or or accumulative catch up so it might be a little bit I would say variable as we go through the year as you go from quarter to quarter drew.

Rhodri J. Harries: So it might be a little bit, I would say, variable as we go through the year as you go from quarter to quarter driven by that. But overall, I would say 10 percent or better of sales is really what we're driving towards for the full year. If you look at product cost tailwinds as we move through the year, we have said that effectively we would benefit from a couple of things this year, which we were tracking really in the back half of last year, and that's flowing through as we move through 2024.

Paul: Driven by that but overall I would say the the attempts to plan or better of sales is really what we're driving towards for the full year.

Paul: If you look at product cost tailwind as we as we move through the year. We have said that effectively we would benefit from a couple of things. This year, which we had we were tracking really in the back half of last year and that's flowing through.

Paul: As we move through 'twenty four we do have lower fiber costs and are effectively are unfolding.

Rhodri J. Harries: We do have lower fiber costs that are effectively unfolding, and that is, I would say, pretty significant. We saw that occurring to a certain extent at the end of Q3 and then Q4, and now we see that as we move through the first quarter and the remainder of the year. That, combined with, I would say, very good manufacturing performance because we're very focused on the optimization of our system, and we are ramping up Bangladesh, really gives us, I would say, a strong tailwind as we move forward.

Paul: Unfolding and that is I would say pretty significant again, we saw that occurring in.

Paul: It is to a certain extent in at the end of Q3, and then Q4 and now we see that as we as we move through the first quarter and the remainder of the year and that also combined with I would say very good manufacturing performance because we're very focused on the optimization of our system and we are ramping up Bangladesh.

Paul: It really gives us I would say strong tailwind as we move forward and so that gross margin.

Paul: Which I called out at a 33% which is basically in line with where we are where we saw it in Q4 is now at that level, which I would say we feel we can continue to move forward at and gives us a I would say strong support.

Rhodri J. Harries: That gross margin, which I called out at 30.3%, which is basically in line with where we saw it in Q4, is now at that level which I would say we feel we can continue to move forward at and gives us, I would say, strong support to our overall operating margin performance. From a pricing perspective, I did call out that we did see some negative prices in the quarter, and as we move through the year, we expect to see a bit of negative prices.

Paul: Two our overall.

Paul: Operating margin performance.

Paul: From a pricing perspective, I did call out that we did see some negative price.

Paul: In the quarter and as we move through the year, we expect to see a bit of negative price, but I think if you look at that it's I would say very targeted the price actions that we're taking we're focusing on really areas, where we can take share. We're also seeing a little bit of.

Rhodri J. Harries: But I think if you look at that, it's, I would say, very targeted, the price actions that we're taking. We're really focusing on areas where we can take share. We're also seeing a little bit of targeted work in the international markets. But again, what we see is, effectively, I would say, a moderate impact because, if you think about price overall, we have big price gaps versus our competitors. We are lower than our competitors.

Paul: A targeted work in the international markets, but again, what we see is effectively I would say moderate impact because if you think about price overall, we have big price gaps versus our competitors, we are lower than our competitors and then in an environment, where you have inflation. If you look at our you know ultimately whats going on with the <unk>.

Rhodri J. Harries: And then in an environment where you have inflation, if you look at ultimately what's going on with various input costs, there's not really, I would say, downward price pressure for us. So for us, it's very targeted activities on the price side where we're driving share, and we'll see the impact of that as we move the year long term.

Paul: With various input costs. There is not really I would say a downward price pressure for us so for us it's very targeted activities on the price side, where we're driving share and we will see the impact of that as we move through the year long term.

Paul Lawrence Lejuez: Got it. Thank you. Good luck.

Speaker Change: Got it. Thank you good luck.

Speaker Change: Thank you.

George Doumet: Your next question comes from the line of George Doumet with Scotiabank. Your line is open.

Paul: Your next question comes from the line of George <unk> with Scotiabank. Your line is open.

George Doumet: Yeah, hi guys, good afternoon. The Closery to Underwear segment came a little bit below expectations. Can you maybe give a little bit of color on there, maybe perhaps the impact of the Uncapable Mix, the expectations for some retail wins, just trying to get a sense of maybe how the revenue outlook looks for that segment for the year?

George: Yeah, Hi, guys good afternoon.

George: <unk> segment came in a little bit below our expectations can you maybe give a little bit of color on there or maybe perhaps.

George: We don't favorable mix the expectations for some retail wins, just trying to get a sense of maybe how the revenue outlook looks like for that segment for the year. Thanks.

Chuck J. Ward: Hi George, this is Chuck. Rod mentioned we did see a little bit lower performance within the underwear category, but it was really mostly in the underwear segment, where underwear we're not seeing the historical replenishment at this point that you would typically see, and the retailers are remaining cautious around that. But we do expect that to return as we go through the year. And so, from a hosiery perspective, I would say we had a good performance in hosiery for the quarter.

George: Hi, George it's Jack I'll take that.

Jack: As we saw.

Jack: Rod mentioned, we did see a little bit lower performance within the innerwear category, but it was really mostly in the underwear segment were unaware we're not seeing the historical replenishment at this point that you would typically see.

Jack: But we and our retailers are remaining cautious around that.

Jack: But we do expect that to return as we go through the year.

Jack: And so and then from a hosiery perspective, I would say we had a good performance in hosiery for the quarter, we are seeing solid traction with some of our <unk> partners and hosiery.

Chuck J. Ward: We are seeing solid traction with some of our GLB partners in hosiery, and so despite, you know, the expiry of the U.A. License working good momentum from a hosiery perspective. So from a mixed perspective, again, I think. There was lower underwear, kind of in line with the Sox, but then the overall mix that Rod mentioned in his comments, I would say was more in the activewear area that he was mentioning from mixture, got it, and

Paul: And so despite.

Paul: The expiry of the UAE.

Paul: License, we're seeing good momentum from our hosiery perspective.

Paul: So from a mix perspective, again I think.

Paul: There was lower underwear.

Paul: Kind of in line with the Sox, but then know Raul mixed that Rod mentioned in his comments I would say we're more in the activewear area that he was mentioned from a mix perspective.

George Doumet: Got it. And my final question, and I know it calls for a more meaningful deterioration from current conditions, but I guess for events, if we do see a deterioration, just wondering how you would position Gildan, perhaps any differently than today, over the coming quarters in New York?

Speaker Change: Got it and my final question and I know your outlook calls for nor meaningful deterioration from current conditions.

Speaker Change: So again, if we do see we do see a deterioration just wondering how you are positioning yoga.

Paul: Absent any differently than today over the coming quarters and years.

Vincent J. Tyra: Yeah, I guess you're thinking about, you know, deterioration in pricing. And, you know, right now, I feel like we're in really good shape, as Rod talked about, from the fiber cost. And even competitively, I feel like we're at a place where we need to be. I mean, Chuck and I spend time with our team just talking about where we are competitively priced. We've watched some competitive action in pricing that we've not followed in a couple instances, and feel comfortable we continue to move forward. So we don't have any anticipation of it. There's nothing in our plan for it, but, you know, we'll watch the market and react accordingly.

Paul: Yeah, I guess, you're thinking about deterioration in pricing and I know you know right now I feel like we're in a really good shape.

Paul: As rod talked about from the fiber cost and even competitively I feel like we're at a place where we need to be I mean, Chuck and I spend time with our teams is talking about where we are competitively price we've watched some competitive action and pricing that we have not followed in a couple of instances and feel comfortable we continued to to move forward. So.

Paul: We don't have any anticipation of it there's there's nothing in our plan for it but.

Paul: We'll watch it as a the market and react accordingly.

Speaker Change: Okay, great. Thanks, Good luck.

Paul: Okay.

George Doumet: Okay, great. Thanks. Good luck. Your next question comes from the line of Jay Sole with UBS. Your line is open.

Paul: Your next question comes from the line of Jay sole with UBS. Your line is open.

Jay Daniel Sole: Great. Thank you so much.

Jay Daniel Sole: Great. Thank you so much right I thought I heard you say per second quarter sales you're forecasting flat.

Jay Daniel Sole: Flat to up low single digits as opposed to get some more color on that how youre thinking about activewear, how youre thinking about the hosiery and underwear segment that'd be super helpful. Thank you.

Rhodri J. Harries: Okay, Jay, thanks for the questions. Yeah, so if you look at the second quarter, we are guiding flat to low single digits. And I think if you think about how we're progressing, as we move forward, we do see strength in the activewear side. So if you look at the activewear side, and you think about on the volume side, or you think about sort of POS and activewear in the first quarter, it was, I would say, high, low, single digit. And then, as you move into the second quarter, we see more mid single digits.

Speaker Change: Okay, Jay Thanks for the questions. Yeah. So if you look at the second quarter, we our guide.

Speaker Change: Guiding flat to up low single digits and I think if you think about how we're progressing as we move forward, we do see strength in the activewear side. So if you look on the on the Activewear side and you think about.

Speaker Change: On the on the volume side or do you think about sort of P. O S and activewear in the first quarter. It was I would say high low single digit and then as you move into the second quarter, we see more like mid single digits. So we're seeing positive Pos in north.

Rhodri J. Harries: So we're seeing positive POS in North America, we're seeing positive POS in international markets, and the activewear story is unfolding well. You know, we are very well positioned from a product perspective. If you look at that, we talk often about how we're driving share and ring spun, how we're driving in fleece.

Speaker Change: America, we're seeing positive P O S in international in the Activewear story is unfolding well.

Speaker Change: We are very well positioned from a product perspective, if you look at that we love we talk often about how we're driving share in ring spun how we're driving and fleece.

Speaker Change: But we also have a new product innovation flowing through in basics, we have new product styles coming through.

Speaker Change: <unk> 3000 is a good example of that where we are effectively that's a new product in the national account side on the on the international side and so active wears is we're really showing a very good strength on the activewear side is that as we move as we progressed through the year and so that's where the strength is I would say, we do expect to continue to.

Rhodri J. Harries: But we also have new product innovation flowing through, and basics; we have new product styles coming through. 3000 is a good example of that, where we are effectively that's a new product on the national account side on the international side. And so, you know, activewear. We're really showing very good strength on the activewear side as we move as we progress through the year. And so that's where the strength is. I would say we do expect to continue to see softness in the underwear and hosiery category.

Speaker Change: See softness in the underwear and hosiery category as we go into the second quarter. We do have the phase out of under armour, which we've talked about we do have broader market weakness on the on the underwear side.

Rhodri J. Harries: As we go into the second quarter, we do have the phase out of Under Armour, which we've talked about; we do have broader market weakness on the underwear side. If you look at the market in total, effectively, you're seeing POS down probably mid single digit, maybe high single digit. And you know, that market has been a tough market. What's interesting is, sooner or later, people are going to replenish, and it's going to turn into a tailwind.

Speaker Change: If you look at the market in total.

Speaker Change: Effectively you're seeing.

Speaker Change: S down probably mid single digit maybe high single digit.

Speaker Change: And that market has been a tough market.

Speaker Change: What's interesting is sooner or later people were going to replenish and it that's going to turn into a tailwind, but we do see continued I would say weakness in the broader market in the second quarter.

Speaker Change: As we move forward and so that I would say as a effectively that softness.

Rhodri J. Harries: But we do see continued, I would say weakness in the broader market in the second quarter, as we move forward. And so that I would say is effectively that softness in the underwear and hosiery, despite really, we're doing well on products and everything that we can control is offsetting strength on the activewear side. Pricing, we will still be doing a bit of, I would say, targeted pricing to drive share, and then the unfavorable mix will be coming through with the trade down. Again, this is effectively, you know, if we see people buying more crews than hoods, and people buying more t-shirts than long sleeves.

Speaker Change: In the underwear and hosiery, despite really we're doing well on products and everything that we can control is off offsetting strength in the activewear side pricing, we will still be doing a bit of I would say targeted pricing.

Speaker Change: Two to drive share and then the unfavorable mix will be coming through with the trade down again. This is effectively if we see people buying.

Speaker Change: More crews than hoods.

Rhodri J. Harries: I mean, this has been happening. It was a theme that started last year, and we continue to see it in the marketplace. That will ultimately reverse as well. So I would say that on the core fundamentals, we're doing very well. And I think what is pleasing as we move into the second quarter is that we do now see flat to low single-digit growth. And obviously, we'll continue to be driving that as we move through the year.

Speaker Change: People buying more T shirts than long sleeves. I mean this is this has been occurring was a theme that I started last year in it that we continue to see it in the marketplace that ultimately will reverse as well so I would say on the core fundamentals were doing variable and.

Speaker Change: I think what is pleasing as we move into the second quarter, we do see now the flat to low single digit and obviously will continue to be driving that as we as we move through the year.

Speaker Change: Understood. Thank you so much.

Brian Morrison: Your next question comes from the line of Brian Morrison with TD Cowan. Your line is open.

Speaker Change: Your next question comes from the line of Brian Morrison with TD Cowen Your line is open.

Brian Morrison: Thank you very much Rod first question can you just clarify did you say that Pos was up high single digits for Activewear in Q1, and do you know what the industry was.

Brian Morrison: Thank you very much. Rod, first question, can you just clarify? Did you say that POS was up high single digits for activewear in Q1 and do you know what the industry was?

Rhodri J. Harries: No, I didn't say that. But effectively, what I said, Brian, was for us, it was high-low single digit, right? So effectively, if you look at where the POS was, and if you look at, you know, across the board, what was, what was really good was that we saw very, you know, positive POS pretty well across the board on the activewear side. So we saw it in all categories and international, actually; it was mid-single digit, a little bit higher actually. But, you know, on that, for the total category, it was high-low single digits. And then as we go into the second quarter, what we're seeing is more like mid-single digits. So it's progressing well.

Rhodri J. Harries: No I didn't say that effectively what I said, Brian was for US It was a high low single digit right. So effectively if you look at our you know where the POS was and if you look at.

Rhodri J. Harries: They had all across the what was what was really good is that we saw very positive.

Brian Morrison: Pretty well across the board on the Activewear side. So we saw it in all categories and international actually it was mid single digit a little bit higher actually.

Brian Morrison: For the total category with high low single digit and then as we go into the second quarter. What we're seeing is more like mid single digits. So it's progressing well.

Rhodri J. Harries: and relative to the industry, do you think that was where?

Brian Morrison: And relative to the industry do you think that was there.

Rhodri J. Harries: Well, we think the industry in some cases is really struggling actually. If you look effectively on the print wear side, I would say down probably negative mid single-digit, maybe even high single-digit. I mean, you know, we are grabbing share and we're doing well, and it is a tough environment out there. So I would say it's been, and is a more broadly, a negative environment and do well against that backdrop.

Speaker Change: Well, we think the industry in some cases is really struggling actually if you. If you look at our effectively on the on.

Speaker Change: The print wear side I would say down probably a negative.

Speaker Change: Mid single digit maybe even high single digit I mean, yeah, we are grabbing share and we were doing well and.

Brian Morrison: It is a tough environment out there so I would say it's been a it isn't but more broadly it's a negative environment.

Brian Morrison: <unk>.

Brian Morrison: <unk> that backdrop.

Brian Morrison: Okay, sorry, and Rod, I want to follow up. In terms of EPS for the quarter, had the GMT been implemented, I estimate you would have been about 55 cents. Is that correct? And the second part of that question is, for Q2, you expect to be at the high end of the margin range or above the margin range. Does that include the 160 basis points of improvement in SG&A?

Speaker Change: Okay, sorry, and Rod I wanted to follow up in terms of EPS for the quarter had the gene at GMT been implemented I estimate you would've been in the 55 is that correct and the second part of that question is.

Speaker Change: For Q2, you expect to be at the high end of the margin range or above that range does that include the 160 basis points of improvement of SG&A.

Rhodri J. Harries: Yeah, okay, so if you look at the first quarter, your first question, I would say if GMT had been enacted, it would have been about a 5 cent impact, right? So we would have been about 5 cents lower. So if you think about the beat, effectively, 5 cents of that was GMT, and I would say the remainder of the beat was just on our manufacturing side, our underlying cost performance.

Rhodri J. Harries: Yeah. Okay. So if you look at the first quarter of your first question I would say if the.

Rhodri J. Harries: If GMT had been enacted it would've been about a five cent impact right. So we would have been about five cents lower so if you think about the beat effectively five cents of that was GMT.

Rhodri J. Harries: And the I would say the remainder of the beat was just on the on our manufacturing side are our underlying cost performance. So I would say, we're pretty pretty pleased with the way that turned out.

Rhodri J. Harries: So I would say we're pretty pleased with the way that turned out. But then, obviously, as we go forward, there'll be catch-up on that. You have to think about that as you think about the second quarter. And then, effectively, if you think about where we're going to be from an operating margin standpoint for the second quarter, we have guided that we'll be above our range, the 18 to 20 percent. And I would say I think we can do well versus the high end of the range. But again, that assumes that GMT is implemented and we do get the refundable tax credits.

Rhodri J. Harries: But then obviously as we go forward there'll be catch up on that after they have to think about that in.

Rhodri J. Harries: The second quarter.

Rhodri J. Harries: And then effectively if you think about.

Rhodri J. Harries: The where we're going to be from an operating margin.

Rhodri J. Harries: Standpoint for the second quarter, we have guided that we will be above our range. The a 18% to 20% and you know I would say I think we can do well versus the high end of the range and again that assumes that our GMT is implemented and we do get the risk.

Rhodri J. Harries: A refundable tax credits.

Vincent J. Tyra: Okay, and then last question. It's more high-level, Vincent. I want to hear your view, not so much on why there needed to be wholesale changes at the board level recently but what, if any, changes we should expect, either operationally or governance-wise, as a result of these changes.

Speaker Change: Okay, and then last question, it's more high level and I want to hear your view not so much on why there needed to be wholesale changes at the board level recently.

Vincent J. Tyra: What if any changes we should expect either operationally or governance wise as a result of these changes.

Vincent J. Tyra: Yeah, I don't think you're going to see anything material there. You know, obviously, the special committee meets on that. It's outside our privy in terms of involvement and decision making there. You know, I certainly had an opportunity to interview some of the candidates along the way, but no decision from my end in terms of who joined our board. Obviously, we just completed our board meetings and had a nice transition between the, I'll say, outgoing and the incoming board members.

Speaker Change: Yeah, I don't I don't think you're going to see anything material there.

Vincent J. Tyra: Obviously, the special Committee meets all that it's outside our Privy in terms of our involvement in and and decision, making there you know it certainly had an opportunity to interview some of the candidates along the way, but no decision for my end in terms of.

Vincent J. Tyra: Who who joined our board obviously, we just completed our board meetings that had a nice transition between the.

Speaker Change: I'll say, the outgoing and the upcoming board members.

Vincent J. Tyra: And, you know, but we don't expect anything materially to change in terms of, you know, what's happening, governance, and things like that. You know, we respect and rely on the professionalism and the experience of who's joined us now. We're excited to meet them and start working with them.

Vincent J. Tyra:

Vincent J. Tyra: But we don't expect anything materially to change in terms of you know.

Speaker Change: What's happened and governance and things like that we respect to rely on the professionalism of the experience of Who's joined US now we're excited to meet them in and get working with them.

Brian Morrison: Okay, very good color. Thanks a lot, Vincent.

Speaker Change: Okay very good color. Thanks, a lot.

Christopher Li: Your next question comes from the line of Chris Lee with Desjardins. Your line is open. Oh, hi, good afternoon, everyone.

Brian Morrison: Your next question comes from the line of Chris Lee with <unk>. Your line is open.

Christopher Li: Oh, hi, good afternoon, everyone. My first question is, I was wondering if you could talk about just the inventory level for your customers, both at the wholesale distributor level and at the retail level. Thank you.

Christopher Li: Oh, Hey, good afternoon, everyone. My first question is I was wondering you begin to talk about just the inventory level for your customers pulled at the wholesale distributor level and at the retail level. Thank you.

Chuck J. Ward: Hi Chris, this is Chuck.

Christopher Li: Hi, Chris This is Chuck.

I think from an inventory perspective, where.

Chuck: We're imbalance overall, if you think about.

Chuck J. Ward: Yeah, I think from an inventory perspective, we're, you know, we're in balance overall, you know, if you think about From a distributor channel perspective, I would say, as Rod mentioned, we had our seasonal restocking, not as much as last year, but again, a good restocking. I would say weeks on hand are in good shape, and again, the inventory is in balance. I think from a retail perspective, we've continued to see retailers bring down inventory since post-pandemic times and as they adjust.

Chuck: From a distributor channel perspective, I would say as Rod mentioned.

Chuck J. Ward: We had our seasonal restocking.

Chuck J. Ward: Not as not as much as we as last year.

Chuck J. Ward: But again, a good restocking I would say weeks on hand or are in good shape and again, the inventories and balanced I think from a retail perspective.

Chuck J. Ward: We've continued to see retailers bring down inventory since post pandemic times and as they adjusted their as I mentioned earlier you know they are cautious.

Chuck J. Ward: And they're monitoring inventory closely and staying more.

Chuck J. Ward: Just in time, but we think inventories are are in a good place overall.

Chuck J. Ward: Maybe I'll just add to that that the one area where.

Speaker Change: Maybe I'll just add to that the one area, where we are running just maybe a little light is in international in a in Europe and the one thing that we see there very definitely as with the ramp up of Bangladesh, what we're going to fix that very soon so I would say theres a little bit of opportunity in the international side as we bring.

Chuck J. Ward: <unk> in and again, we see that is effectively driving driving Pos in sales as we go forward.

Christopher Li: Okay, that's helpful. And maybe one for you, Rob, just for the quarter, activewear sales were up about 1%. I was wondering if you could sort of break out for us, you know, how much of that was long-term growth versus a net selling price decline, just so we get a sense of, like, what was the composition of that 1% activewear sales?

Speaker Change: Okay. That's helpful and maybe one for you Ralph <unk>.

Christopher Li: <unk>.

Rob: Activewear sales were up about 1% I was wondering if you can sort of break out for us how much of that was volume growth versus net.

Christopher Li: Net selling price decline just don't get a sense of like what was the composition of that 1%.

Rob: Activewear sales growth.

Rhodri J. Harries: Yeah, I mean, look, if you look at effectively the 1%, I would say that, as I said, the volume was – we saw a good volume uplift in the quarter from an activewear perspective, right? So if you think about the – I talked about the mid-single-digit POS – sorry, not mid-single – the low-single-digit POS on the higher side, but And so he was a good driver in the quarter.

Rob: Yes, I mean look if you'll get effectively the 1% I would say that.

Rhodri J. Harries: As I said the volume was a we had we saw a good.

Rhodri J. Harries: Volume lift in the quarter from an activewear perspective, right. So if you think about the I talked about the mid single digit P. O S. Oh, sorry, not mid single and the low single digit Pos on the on the higher side that really that just flows through the volume.

Rhodri J. Harries: For the most part and so that was a good driver in the quarter and then we'd hit we saw some offset on the on the price side and we saw some upside offset on the on the mix side, but look volume is is going well within activewear and as I said to set us up well for second quarter and the remainder of the year.

Rhodri J. Harries: And then we saw some offset on the price side, and we saw some offset on the mix side. But look, volume is going well within activewear. And as I said, it sets us up well for the second quarter and the remainder of the year. We are taking share, and we're doing well.

Rhodri J. Harries: We are we're taking share and we're doing well.

Speaker Change: Okay. Thanks very much.

Martin Landry: Your next question comes from the line of Martin Landry with Stiefel. Your line is open.

Rhodri J. Harries: Your next question comes from the line of Martin Landry with Stifel. Your line is open.

Martin Landry: Hi, good evening.

Martin Landry: Good evening. I would like to touch on the trade-down patterns that you've talked about. I think, if I recall correctly, we started to see a trade-down in Q2 last year. I was wondering when you expect that to happen again, and how is the trend going? Is the trend worsening? Is the trend easing? Just a bit of color as to what the end consumer is, and how they're behaving

Martin Landry: I would like to touch on.

Martin Landry: The trade down patterns debt.

Martin Landry: That you've talked about I mean.

Martin Landry: I think if I recall correctly, we started to see trade down in Q2 last year.

Martin Landry: I was wondering when do you expect to cycle that.

Martin Landry: And.

Martin Landry: How is the trend going as the trends worsening as the Chinese in just a bit of color as to.

Martin Landry: And consumer is.

Martin Landry: They're creating.

Chuck J. Ward: OK, Martin, you know, you're right. We did start last year seeing some of the trade down. Some of that may have been economic, but also some of it may have been from a fashion perspective. We've seen a trade down in the fleece, as we talk about it from hoods to crews. We used to be a larger percent hoods, but it kind of shifted down some last year to where we were larger crews.

Speaker Change: Okay Martin.

Martin Landry: Youre right, we did start last year seeing some of the trade down.

Chuck J. Ward: Some of that May have been economic but also some of it may have been.

Chuck J. Ward: From a fashion perspective, we've seen a trade down really into fleeces, we talk about it from hoods to cruise.

Chuck J. Ward: We used to be a larger percent hoods.

Chuck J. Ward: Shifted down some last year to where we were larger crews now it's kind of eased up to where it's closer to 50 50 of the cruising hoods. So we're starting to see that that E. Some.

Chuck J. Ward: Now it's kind of eased up to where it's closer to 50-50 of the crews and hoods. So we're starting to see that ease some. And then, as Rod mentioned, the long sleeves. We've seen a shift some from long sleeves as well. But again, that could be somewhat economical, but I think it's also some shift in fashion. But overall, we are seeing an ease.

Chuck J. Ward: And then as Rod mentioned, the long sleeves, we've seen a shift some long sleeves as well.

Chuck J. Ward: But again that.

Chuck J. Ward: That could be somewhat economical, but I think it's also some shift in fashion, but overall, we are seeing in east okay.

Martin Landry: And, you know, we're seeing in the apparel space, and consumers are responding to promotions a lot. Like, can you talk a little bit about, you know, what you're seeing in terms of promotional activity right now?

Chuck J. Ward: And.

Chuck J. Ward: We're seeing in the apparel space.

Martin Landry: And consumers are responding to promotions a lot like can you talk a little bit about <unk>.

Martin Landry: No.

Martin Landry: <unk>.

Martin Landry: Your what youre seeing in terms of promotional activity right now.

Chuck J. Ward: Well, as Vince mentioned earlier, I think we've seen some competitors do some promotional things, specifically, you know, in our activewear channels that we haven't followed suit on and haven't moved a whole lot there.

Rod: Well as Vince mentioned earlier, I mean, I think we've seen some competitors do some promotional things specifically.

Chuck J. Ward: Specifically.

Speaker Change: Our activewear channels that we haven't followed suit and haven't moved a whole lot there.

Chuck J. Ward: We continue to gain share in the market. You know, you are seeing some at the retail level. We are, you know, looking at things with our retailers. But again, I think, as Rod also mentioned earlier, we have a pricing gap with a lot of our competitors such that when they do, you know, have promotional activity, we're not seeing a big impact come our way, and we're not having to match because we already have such a pricing gap.

Speaker Change: Vince said it didn't move we continue to gain share in the market.

Martin Landry: Okay, that's helpful. Thank you.

Chuck J. Ward: You are seeing some at a at a retail level, we are looking at things with our retailers.

Martin Landry: But again I think as Ron also mentioned earlier, we have a pricing gap on a lot of our competitors such that when they do have promotional activity, we're not seeing a big impact come our way and we're not having to match because we already have such pricing gaps.

Martin Landry: Okay.

Martin Landry: Okay. That's helpful. Thank you.

Stephen MacLeod: Your next question comes from the line of Stephen MacLeod with BMO Capital Markets. Your line is open.

Martin Landry: Your next question comes from the line of Stephen Macleod with BMO capital markets. Your line is open.

Stephen MacLeod: Thank you. Good evening.

Stephen MacLeod: Thank you good evening.

Chuck J. Ward: Just wondering if you can provide a little bit of color around what you saw in terms of POS between fleece and fashion basics in the quarter.

Stephen MacLeod: Just wondering if you can provide a little bit of color around what you saw in terms of Pos between fleece and fashion basics in the quarter.

Chuck J. Ward: Yeah, both were good. We saw high single-digit growth on the fleece side and, again, continue to see great volume from that perspective. We're seeing double-digit growth on the ringspun side. As Rod mentioned, we are continuing to take share across all categories, but I would say even more so in those categories.

Stephen MacLeod: Yeah. Both were good we saw high single digit on the fleet side and again continue to see great volume from that perspective, we're seeing double digit growth on the ring spun as Rod mentioned, we are continuing to take share across all categories, but I would say even more so those category.

Chuck J. Ward: <unk>.

Chuck J. Ward: Okay.

Stephen MacLeod: Okay, that's great. That's helpful. Thanks, Chuck.

Speaker Change: Okay. That's great that's helpful. Thanks Chuck.

Stephen MacLeod: And then just on the international business, you talked a little bit about.

Speaker Change: In your prepared remarks, just seeing some.

Speaker Change: Some incremental inflections in Pos and I'm just wondering if you can give a little bit of color around sort of where where you are seeing.

Stephen MacLeod: And then just on international business, you talked a little bit about, in your prepared remarks, just seeing some incremental inflections in POS. And I'm just wondering if you can give a little bit of color around sort of where you're seeing POS stabilization, maybe by market, and what you think some of the drivers might be. Is it just comparing up against tougher comparatives? Or is there, are you seeing some sort of demand beginning to really take hold?

Stephen MacLeod: The stabilization, but maybe by market and what you think some of the drivers might be is it just comping up against tough tougher comparatives or are you seeing sort of demand beginning to really take hold.

Chuck J. Ward: You know, to comment, there has been, it's been a little bit of a, I would say, diverse reaction throughout some of the international markets. We're seeing, you know, Asia is actually up. So we're starting to see, you know, for a long time, we were seeing decline there. Now we're seeing improvement there. You know, Europe's stable, but

Stephen MacLeod: Yes.

Stephen MacLeod: The comment there has been it's been a little bit of.

Chuck J. Ward: I would say diverse reaction throughout some of the international markets we're seeing.

Chuck J. Ward: Asia is actually up so we're starting to see for a long time, we were seeing decline there we're seeing improvement there.

Chuck J. Ward: Europe's stable, but.

Chuck J. Ward: We're still seeing some of what we saw in previous quarters, which I mentioned was kind of lower in the UK versus better in continental Europe. We're still seeing those same trends. It hasn't really changed a whole lot. But then we've seen strength in Latin America, some of that driven by things like the election in Mexico that's happening now that obviously drives volume. So we're seeing good volume in that market.

Chuck J. Ward: We're still seeing some of what we saw like previous quarters, which I mentioned was was kind of lower in the U K versus better in Continental Europe, We're still seeing those same trends that hasn't really changed a whole lot, but then we've seen strength in Latin America.

Chuck J. Ward: Some of that driven by things like.

Chuck J. Ward: Election in Mexico, that's happening now.

Chuck J. Ward: That obviously drives volume so we're seeing good volume in that market.

Stephen MacLeod: Okay, that's great, Collar. Thank you.

Speaker Change: Okay. That's that's great color. Thank you.

Luke Hannan: Your next question comes from the line of Luke Hannan with Canaccord Genuity. Your line is open.

Stephen MacLeod: Your next question comes from the line of Luke Hannan with Canaccord Genuity. Your line is open.

Luke Hannan: Thanks, good afternoon. Rod, I think you mentioned that we were talking earlier about innovation, and I think that this specific style that you brought up was the Gildan 3000, and something that was being well received by customers. Can you remind us just where you are as of today when it comes to introducing new innovation, new products to both your retail and your imprintable customers as well? Are we in the early stages here? Is that accelerated throughout the year? Maybe just the cadence of that.

Luke Hannan: Thanks, Good afternoon, Ron I think you had mentioned we were talking earlier about innovation and I think that the specific style that you brought up was the <unk> 3000, and something that is being well received by customers can you remind us just where you are as of today when it comes to introducing new.

Luke Hannan: Innovation, new products to both your retail and your.

Luke Hannan: Youre incredible customers as well as a REIT in the early stages here should that accelerated throughout the year, maybe just the cadence of that.

Chuck J. Ward: Yeah, Luke, I think, you know, overall, on the 3000 perspective, we are in the early days there, we've launched that from an international perspective, and we've had a great reception for it. And I think it's going to really help us grow internationally. We've done that in some of our national account business that services large retailers, as well, and we've seen a great reception for that.

Rod: Yeah look I think overall to the 3000 perspective, we are in early days there. We've lost at launch that from an international perspective had a great reception to it and I think it's going to really help us grow internationally.

Chuck J. Ward: We've done that in some of our national account business that services large retailers as well we've seen a great reception to that but I think more importantly on the innovation side, we've talked about it quite a bit last year and earlier this year around the real innovation is on some of our core product, where we have taken our core basic product we've upgraded.

Chuck J. Ward: But I think more importantly, on the innovation side, you know, we talked about it quite a bit last year and earlier this year. The real innovation is on some of our core products, where we have taken our core basic product, we've upgraded it, given it a better feel, better printability, and really, we still have it at the same price. And they're starting to see that in the market. And really, you're going to see it in the market largely in the summer.

Chuck J. Ward: That.

Chuck J. Ward: Gift, giving it a better feel better print ability.

Chuck J. Ward: And really we're still have it at the same price and they're starting to see that in the market and really you're going to see it in the market largely in the summer, but people are already starting to to get the product and we're getting great.

Chuck J. Ward: But people are already starting to get the product, and we're getting great comments about it, about the improved hand, and improved printability, both on that basic core product as well as our core fleece. And so those innovations are going to continue to drive the growth that we've talked about in our five-year plan.

Chuck J. Ward: Comments about it about the improved has improved credibility.

Chuck J. Ward: Both on that basic core product as well as our core fleece and so those innovations are going to continue to drive the growth that we've talked about it in our five year plan.

Luke Hannan: Okay, thanks. And then, for my follow-up here, we talked about the acceleration of POS so far into Q2. I'm just curious if you can share what sort of end markets are driving that as of today. I know the corporate promotional channel, for instance, has been somewhat of a laggard compared to some of the other end markets. I'm just curious if you can share what you're seeing on that front.

Speaker Change: Okay. Thanks, and then for my follow up here, you talked about the acceleration of Pos so far into Q2 I'm. Just curious if you can share what sort of end markets are driving that as of today I know the corporate promotional channel for instances been somewhat of a laggard compared to some of your other end markets I'm just curious.

Speaker Change: You can.

Speaker Change: Sure what youre seeing on that front.

Chuck J. Ward: Yeah, I think as we left the first quarter and went into the second quarter, we just continued to see, you know, sequential improvement. Really, go back to January. We've seen it throughout each month. We're seeing sequential improvement. And I think as you think about it, you're thinking about, I think we mentioned in our opening comments about travel and leisure and events, and we're continuing to see those things drive demand, and we're seeing good demand driven by those things.

Speaker Change: Yes, I think whereas we left left first quarter one in the second quarter. We just continued to see sequential improvement really go back to January we've seen it throughout throughout each month, we're seeing sequential improvement and I think as you as you think about it youre thinking about I think we mentioned in our opening comments around travel and leisure and <unk>.

Chuck J. Ward: Vince.

Chuck J. Ward: And we're continuing to see those things drive demand and we're seeing good demand driven from those things to your point some of the corporate spending we continue to think we'll be a future tailwind.

Chuck J. Ward: But to your point, some of the corporate spending, we continue to think will be a future tailwind because it has not come back completely, but we are seeing improvements there. So we're seeing it across, you know, various channels, and then also with our new activewear program that we had at retail that we launched in the first quarter. It's really performed well, and so obviously that's been driving good POS for us as well.

Chuck J. Ward: It has not come back completely but we are seeing improvements there. So we're seeing it across.

Chuck J. Ward: Various channels and then also with our new Activewear program that we had at retail.

Chuck J. Ward: That we launched in the first quarter has really performed well.

Chuck J. Ward: And so obviously, that's been driving good Pos versus well.

Luke Hannan: Okay, thank you very much.

Speaker Change: Okay. Thank you very much.

Mark Robert Petrie: Your next question comes from the line of Mark Petrie with CIBC. Your line is open.

Luke Hannan: Your next question comes from the line of Mark Petrie with CIBC. Your line is open.

Mark Robert Petrie: Yeah, thanks. Good afternoon.

Mark Robert Petrie: Yes, thanks, good afternoon.

Mark Robert Petrie: Just touched on it Chuck but I wanted to ask about the retail programs.

Chuck J. Ward: You just touched on it, Chuck, but I wanted to ask about the retail programs, the wins that are in place now, and how they're performing. I think you said they were performing well. I assume that means on plan. And then I think you have a new program coming in around now as well. Is that on track? Is that in place? And then... Are there other program wins that are embedded in your guidance, or would those be incremental to what you have?

Chuck J. Ward: The wins that are in place now how they are performing I think you said.

Chuck J. Ward: <unk>, well I guess I assume that means on plan.

Chuck J. Ward: And then I think you had a new program coming in around now as well is that on track is that in place.

Chuck J. Ward: And then.

Chuck J. Ward: Are there other program wins that are embedded in your <unk>.

Chuck J. Ward: Guidance or would those be incremental to what you have out there.

Chuck J. Ward: Yeah.

Mark Robert Petrie: Sure, Mark. I think, first of all, you know, you asked about the program that was recently launched. That was the Activewear program I just mentioned. It is performing well, I would say, maybe even above some expectations. So it's performed quite well, and we're happy with it. I think other programs, we do have other wins that we do have baked in to our forecast that we have landed, and we're excited about those. We have some that are kind of rolling out Q2, some rolling Q3, and some rolling Q4.

Chuck: Sure Mark I think first of all you asked about the program that recently launched was the active wear program I just mentioned it is performing well I would say maybe even above some expectations. So it's it's performed quite well.

Mark Robert Petrie: And we're happy with it I think other programs, we do have other wins that.

Mark Robert Petrie: That we do have baked in the.

Mark Robert Petrie: In our forecast that we have landed and we're excited about those we have some that are kind of rolling in Q2, some rolled in Q3 and some roll in Q4. So we have opportunities that are that are rolled out throughout the year.

Mark Robert Petrie: So we have opportunities that are rolled out throughout the year, you know, and it Again, activewear is doing well. I would say in the underwear category, we have seen that that's not performing quite as we would hope. But again, we think there's a tailwind. We think there will be a replenishment of people's underwear coming soon. And we have some good opportunities within there where we're doing some things with pack sizes, doing things with space, where I would say, well, we should get improvement in turns. And so, you know, I think we are excited about the various retail programs that we have, both coming and already long.

Mark Robert Petrie: And it's again act wheres doing doing well I would say only the underwear category. We have seen that that's not performing quite to where we would we would hope but again, we think there's a tailwind we think there will be replenishment of people.

Mark Robert Petrie: Underwear coming soon and.

Mark Robert Petrie: And we have some good opportunities within there where we are.

Mark Robert Petrie: Doing some things with pack sizes doing things with space, where I would say, we should get improvement in turns.

Mark Robert Petrie: So I think we are excited about the various retail programs that we have.

Mark Robert Petrie: Both coming in already launched.

Rhodri J. Harries: And I would say, Mark, anything above that, any incremental programs will be upside to basically what we have, right? So I think our forecast is we try to make sure that it's deliverable, and it reflects what we're seeing. In some respects, I would say we have been cautious because of the broader environment, what we said earlier about the consumer and how they're reacting in the marketplace. So we have good programs on the activewear side, on the underwear side, on the hosiery side, they're all rolling out, and they're reflective.

Mark Robert Petrie: And I would say mark any new anything above that any incremental programs will be upside to basically what we have in the REIT. So I think our forecast is we've tried to make sure that it's deliverable. It reflects what we're seeing and in some respects I would say we have been cautious because of the broader environment, where we said.

Rhodri J. Harries: We are about the consumer and how they are reacting in the marketplace. So.

Rhodri J. Harries: We have good programs on the on the activewear side on the underwear side on the <unk>.

Rhodri J. Harries: And then if we do see some upside in the back half, which obviously we're progressing through the year now, so that probably would impact more in 2025 than it would in 24. But in any event, if they are new programs that will provide support and boost the upside, I would say.

Rhodri J. Harries: Rosary side, they're all rolling out they're reflected and then if we do see some upside in the back half, which obviously, we're progressing through the year now so that probably would impact more 2025 than it was 24.

Rhodri J. Harries: But in any event if they are new programs that will provide support to the upside I would say.

Mark Robert Petrie: And on Bangladesh, how should we think about sort of the ramp-up from here? I mean, if you're at 75% exit rate or 75% capacity at the end of the year, where are you today? How should we frame the revenue contribution of that? And then how will that ramp-up affect your Central America capacity? And when would those shifts occur?

Speaker Change: Yeah, Okay. Thanks.

Mark Robert Petrie: And Oh on Bangladesh, how should we think about sort of the ramp up from here I mean, if youre at 75% exit rate or 75% capacity at exit of the year.

Mark Robert Petrie: Or are you today.

Mark Robert Petrie: Should we frame the revenue contribution of that and then how will that ramp up effect your central America capacity and when would those shifts.

Mark Robert Petrie: Be made.

Mark Robert Petrie: Okay.

Rhodri J. Harries: So, Mark, if you look at where we are, you know, we, as we were very clear, right, we're at the end of the year at 25, we're going to be at 75 at the end of the year. And I would say the ramp-up is going very well. It's progressing, actually, in some respects, a little bit better than we anticipated. And you know, we are very excited about what we see coming out of Bangladesh.

Speaker Change: So mark if you look at where we are we are we as we were very clear right. We ended the year 25, we're going to be at 75 at the AR at the end of the year and I would say the ramp up is going very well, it's a it's progressing actually in some respects a little bit better than than we anticipated and we are very excited about what we we.

Rhodri J. Harries: See coming out of our out of Bangladesh, and so and we have good flexibility actually has to eat off the <unk> the broader environment gets a little bit stronger we need.

Rhodri J. Harries: And so, we have good flexibility, actually, as the, you know, if the broader environment gets a little bit stronger, we need to go a little faster. We definitely have the capability to do that in the as we move through 24. And then, what we expect is the progressive ramp-up of the remainder in 25. So, it's going very well. And we are, you know, very pleased with the product, with the cost, and everything that's happening in Bangladesh. And the second part of your question again, please.

Rhodri J. Harries: To go a little faster, we definitely have the capability to do that.

Rhodri J. Harries: In the as we move through 'twenty four and then what we expect is a progressive ramp up of the remainder in 25 cell, it's going going very well.

Rhodri J. Harries: And we are very pleased with the product with the cost everything that's occurring in the in Bangladesh and the second part of your question again please.

Mark Robert Petrie: The second part related to how the Central American capacity... will be adjusted as Bangladesh ramps up and the timing. Yeah, I would say that.

Rhodri J. Harries: Second part related to how the central American capacity will be adjusted as Bangladesh ramps up and the timing of that.

Rhodri J. Harries: Yeah, I would say that our Central American capacity is pretty well dialed in now, right? Effectively, that capacity is obviously close to the North American market. We've got it focusing on certain products. Fleece is a good example of that. On the GLB side, there is also a good example of that. It's on the hosiery side.

Speaker Change: Yes, I would say that our central our central American capacity is pretty well dialed in right effectively that capacity.

Rhodri J. Harries: Is obviously close to the North American market.

Rhodri J. Harries: We've got it tough focusing on certain products.

Rhodri J. Harries: <unk> is a good example of that.

Rhodri J. Harries: On the on the <unk> side is also a good example of that.

Rhodri J. Harries: On the <unk> side, So, let's say Central America is focused on a number of different products and we've got it where we want it to be and so as we go forward. What we're really expecting is growth to come out of Bangladesh.

Rhodri J. Harries: So, let's say Central America is focused on a number of different products, and we've got it where we want it to be. And so, as we go forward, what we're really expecting is growth to come out of Bangladesh and to continue to run with the current capacity we have in Central America. And then we'll see. I mean, we might get the opportunity to tweak that up as well at some point as well. But right now, I would say that it's pretty stable, and we're bringing up Bangladesh, and we've got very, very good flexibility with that ongoing ramp-up and supporting future growth.

Rhodri J. Harries: And to continue to run with the you know the current capacity we have in Central America, and then we'll see I mean, we might get the opportunity to tweak that up as well at some point as well, but right now I would say that's pretty stable and we're bringing on Bangladesh.

Rhodri J. Harries: And we've got very very good.

Rhodri J. Harries: Flexibility with that.

Rhodri J. Harries: The ongoing ramp up in supporting future growth.

Speaker Change: Okay. Thanks for that.

Vishal Shreedhar: Your next question comes from the line of Vishal Shreedhar with the National Bank. Your line is open.

Rhodri J. Harries: Your next question comes from the line of Vishal Street with National Bank. Your line is open.

Vishal Shreedhar: Hi, thanks for taking my questions. Just a few clarifications. Has Gildan taken all the price that it needs to take, or do you anticipate taking more through the year?

Vishal Shreedhar: Hi, Thanks for taking my questions just a.

Vishal Shreedhar: A few clarifications.

Vishal Shreedhar: Has gilden taken all the price that it has that it needs to take or do you anticipate taking more through the year.

Chuck J. Ward: No, we do not anticipate taking additional price. I think we're comfortable with price. We think overall pricing will remain stable. And again, we will just, you know, do some strategic pricing where we need to, where we think we can gain share, as Rod mentioned, maybe in international markets, certain categories, certain markets. But again, I think we think price will remain fairly stable.

Vishal Shreedhar: Now we do not anticipate taking additional price I think we are comfortable with price. We think overall pricing will remain stable and again, we will just do some strategic pricing, where we need to where we think we can.

Chuck J. Ward: Gained share as.

Chuck J. Ward: You know Rod mentioned, maybe an international market certain certain categories certain markets.

Chuck J. Ward: But again I think we think price will remain fairly stable.

Vishal Shreedhar: Okay. And the gains that you've noted in international, the inflection, is that due to allocating more capacity to the international markets, or is that due to the international markets themselves recovering, or a bit of both?

Chuck J. Ward: Okay.

Chuck J. Ward: The gains that you've noted in international the inflection is that due to allocating more capacity to the international markets or is that due to the interim national markets.

Vishal Shreedhar: Themselves recovering or a bit of both.

Speaker Change: I would say there is some of both but I think really as we go forward as.

Rod: One youre going to continue to see improvement in the international markets, but on top of that we think there's definitely opportunities to as.

Chuck J. Ward: I would say there's some of both, but I think really as we go forward, one, you're going to continue to see improvement in the international markets, but on top of that, we think there's definitely opportunity to, as Vince said in his opening remarks, regain share and gain additional share in international markets as Bangladesh comes up because that gives us the ability where maybe we had shorted those markets in the past, we have the ability to make sure we have the right inventory available because, again, availability is a key purchase criteria, obviously, for us, and so we want to make sure that product's available in market, and with Bangladesh coming up and ramping up, we'll be able to do that, and as Rod said, if it grows, if the markets grow or we gain share quicker, we can ramp up Bangladesh quicker to fulfill that.

Chuck J. Ward: As Vince said in his opening remarks, ringgit regained share and gain additional share in international markets as Bangladesh comes up because that gives us the ability where maybe we had shorted those markets in the past we have the ability to make sure. We have the right inventory available because again availability as a key purchase criteria, obviously for us and so we want to make sure that <unk>.

Chuck J. Ward: <unk> available in market and will Bangladesh coming up and ramping up we will be able to do that and as Rod said if it grows as the markets grow where we gained share quicker, we can wrap up Bangladesh quicker to fulfill that.

Vishal Shreedhar: Okay, so the 25% of Bangladesh that you're currently ramping up to by the end of 2023, that's being placed internationally right now?

Chuck J. Ward: Okay. So the 25% of Bangladesh that you that you currently ramped up to by the end of 2023, that's being placed internationally currently.

Chuck J. Ward: Well that's that's feeding both it's I want to be clear it helps feed international but it also comes back you know to the North American market as well so you know we are underwear is largely made in in Bangladesh so it feeds that market back to the US it feeds our growth you know I talked about earlier you know our fashion growth is is up double digits it feeds it helps feed that growth that's the reason as Rod said Central America you know we have stable with things like comfort colors GLB hosiery and as we continue to grow we'll use Bangladesh to continue to grow not only to provide international markets but also come back to North

Vishal Shreedhar: Well that's that speeding both.

Chuck J. Ward: To be clear it helps feed international but it also comes back.

Vishal Shreedhar: Okay, thank you.

Vishal Shreedhar: To the North American market as well. So we are <unk> largely made in Bangladesh. So it feeds that market back to the U S. If feeds our growth.

Vishal Shreedhar: Talking about earlier.

Vishal Shreedhar: Our fashion growth is up double digits. It feeds it helps feed that growth. That's the reason that as Rod said Central America, we are stable with things like comfort colors <unk> hosiery.

Vishal Shreedhar: And as we continue to grow we'll use Bangladesh between new to grow not only to provide international markets, but also come back to North America.

Speaker Change: Okay. Thank you.

Jessy Hayem: There are no further questions at this time. I'll turn the call over to Jesse Hayem for closing remarks.

Vishal Shreedhar: There are no further questions at this time I'll turn the call to Jesse Hamm for closing remarks.

Jessy Hayem: Thank you. And again, we'd like to thank everyone for joining us and attending our call today. And we look forward to speaking with you soon. Have a great evening.

Jessy Hayem: Thank you and again, we'd like to thank everyone for joining us and attending our call today and we look forward to speaking with you soon have a great evening.

Operator: This concludes today's conference call. Thank you for joining us. You may now disconnect.

Speaker Change: This concludes today's conference call. Thank you for joining you may now disconnect.

Operator: [music].

Operator: Okay.

Operator: Yes.

Operator: [music].

Operator: Okay.

Jessy Hayem: Thank you.

Operator: [music].