Q1 2025 Gildan Activewear Inc Earnings Call

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Operator 2: Ladies and gentlemen, thank you for standing by, and welcome to Gildan Activewear Inc.'s 2025 Q1 earnings conference call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Jessy Hayem, Senior Vice President, Head of Investor Relations and Global Communications. Please go ahead.

Speaker Change: Ladies and gentlemen, thank you for standing by and welcome to Gilden Activewear to 2025 Q1 earnings Conference call. Please be advised that today's conference is being recorded I would now like to hand, the conference over to Jesse Hamm Senior Vice President head of Investor Relations and Global Communications.

Speaker Change: Please go ahead.

Jessy Hayem: Thank you, Sarah. Good afternoon, everyone, and thank you for joining us. Earlier today, we issued a press release announcing our results for Q1 and maintaining our guidance for 2025. We also issued our interim shareholder report containing management's discussion and analysis and consolidated financial statements. These documents are expected to be filed with the Canadian Securities Administrators and the U.S. Securities and Exchange Commission today, and they're available on our corporate website. As a reminder, please note that we'll be holding our AGM tomorrow morning at 10:00 AM Eastern Time, with more information available on the events page of our corporate website. Now, joining me on the call today are Glenn Chamandy, President and CEO of Gildan, Luca Barile, Executive Vice President, Chief Financial Officer, and Chuck Ward, Executive Vice President, Chief Operating Officer.

Speaker Change: Thank you Sarah.

Speaker Change: Good afternoon, everyone and thank you for joining US earlier today, we issued a press release announcing our results for the first quarter and maintaining our guidance for 2025. We also issued our interim shareholder report containing management's discussion and analysis and consolidated financial statements.

Speaker Change: These documents are expected to be filed with the Canadian Securities unregulated authorities and the U S Securities Commission today, and they're available on our corporate website. As a reminder, please note that we will be holding our AGM tomorrow morning at 10 am Eastern time with more information available on the events page of our corporate website.

Speaker Change: Now joining me on the call today are Glenn <unk>, President and C. E O of Gil Dan Luca, but really executive Vice President Chief Financial Officer, and Chuck Ward Executive Vice President Chief operating Officer.

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 which 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 Authorities. 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 our MD&A. Now I'll turn it over to Glenn.

Speaker Change: This afternoon, we'll 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.

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

Speaker Change: During this call. We will also discuss certain non-GAAP financial measures reconciliations to the most directly comparable <unk> measures are provided in today's earnings release as well as our M. DNA.

Glenn: And now I'll turn it over to Glenn.

Glenn Chamandy: Thank you, Jessy, and good afternoon, everybody. As we highlighted in our press release, you can see that the Gildan Sustainable Growth Strategy, or GSG, continues to drive profitable growth, and we are very pleased with our progress and performance. We delivered Q1 sales of $712 million, which were up 2.3% versus last year, driven primarily by strong activewear sales growth of 9%. Our Q1 growth rate would have been mid-single digits when you exclude the phase-out of our Under Armour business. Our adjusted earnings per share of $0.59, essentially flat year over year, which includes a negative impact of the enactment of global minimum tax and the positive impact of job credits. Despite the rapidly evolving environment, we remain highly committed to continue executing in our GSG strategy across its 3 pillars, capacity, innovation, and ESG.

Glenn: Thank you Jesse and good afternoon everybody.

Glenn: As we highlighted in our press release.

Glenn: Can see that the Gil Dan sustainable growth strategy or G. S. G continues to drive profitable growth and we are very pleased with our progress and performance.

Glenn: We delivered first quarter sales of $712 million, which were up 2.3% versus last year.

Glenn: Given primarily by strong activewear sales growth of 9%.

Glenn: Our first quarter growth rate would have been mid single digits. When you exclude the phase out of our under armour business.

Glenn: Our adjusted earnings per share of 59 cents essentially flat year over year.

Glenn: Which includes a negative impact of an ethnic ment of global minimum tax and the positive impact of job credits.

Despite the time.

Glenn: The rapidly evolving environment, we remain highly committed to continue executing in our G. S. T shroudie across its three pillars capacity innovation and ESG.

Glenn Chamandy: We continue to be on a path to deliver on our 3-year objectives for 2025 to 2027 period, which include net sales growth of mid-single digit range and adjusted EPS growth in the mid-teen range. Now looking at the current year, with the recent tariff announcement and despite the challenging macroeconomic environment, we are maintaining our guidance for 2025, supported by many drivers which should allow us to deliver on our objectives for the full year. As we mentioned in the past, about 3-quarters of our expected sales growth for 2025 is coming from new programs. We remain very excited about our innovation pipeline, such as our soft cotton technology, our Plasma Print, our Color Blast, just to name a few, which is increasing our competitive advantage and allowing us to continue to drive market share gains.

Glenn: We continue to be on a path to deliver on our three year objectives for 2025 to 2027 period, which include net sales growth of mid single digit range.

Glenn: And adjusted EPS growth in the mid teen range.

Glenn: Now looking at the current year.

Glenn: With the recent tariff announcements and despite the challenging macroeconomic environment.

Glenn: We are maintaining our guidance for 2025.

Glenn: Supported by many drivers, which should allow us to deliver on our objectives for the full year.

Glenn: As we mentioned in the past.

Glenn: Three quarters of our expected sales growth for 2025 is coming from new programs.

Glenn: And we remain very excited about our innovation pipeline such as our soft cotton technology, our plasma print are colored blast just to name a few.

Glenn: Which is increasing our competitive advantage and allowing us to continue to drive market share gains.

Glenn Chamandy: Luca will go over our 2025 guidance in more detail, but I'd like to address the current operating environment and the recent tariff announcement. Although the situation remains fluid with respect to tariffs, the 10% reciprocal tariff now in effect on goods imported to the US from most countries, I'd like to leave you with three points to keep in mind. First, remember, we are a global, vertically integrated, low-cost manufacturer, which we believe is our competitive advantage as it provides a great deal of flexibility and agility. Second, we have a significant US cotton and yarn content in our products, which should allow for significant tariff savings since a 10% reciprocal baseline tariff does not apply to the value of US content imported products, which puts us in a very strong competitive advantage. Finally, we have other levers which we can use in this environment, such as price.

Glenn: Luca will go over our 2025 guidance in more detail.

Luca: But I'd like to address the current operating environment and the recent tariff announcements.

Luca: Although the situation remains fluid with respect to terrorists the 10% reciprocal tariff now wouldn't affect on goods imported into the U S. For most countries I'd like to leave you with three points to keep in mind.

Luca: First remember we are a global vertically integrated low cost manufacturer.

Luca: Which we believe is our competitive advantage as it provides a great deal of flexibility and agility.

Luca: Second we have a significant U S cotton and yarn content in our products.

Luca: Which should allow for significant tariff savings since a 10% of our cyclical baseline tariff does not apply to the value of U S content imported products.

Luca: Which puts us in a very strong competitive advantage.

Luca: Finally, we had other levers, which we can use in this environment such as price.

Glenn Chamandy: In conclusion, we will continue to monitor the situation closely. We are cautiously optimistic as we look ahead. Though we are well positioned to maneuver through a period of uncertainty, thanks to our strong industry positioning, our agility to operate in dynamic environments. However, while we continue to focus on the things that we can control, I'd like to emphasize that regardless of the environment, we will continue to leverage our GSG strategy with a focus on executing long-term shareholder value. I look forward to answering your questions after our formal remarks, and now I'd like to turn it over to Luca for a financial review.

Luca: So in conclusion, we will continue to monitor to monitor the situation closely.

Luca: We are cautiously optimistic as we look ahead.

Luca: So we are well positioned to maneuver through a period of uncertainty thanks to our strong industry positioning our agility to operate in dynamic environments. However.

Luca: However, while we continue to focus on the things that we can control I'd like to emphasize that regardless of the environment. We will continue to leverage our <unk> strategy with a focus on executing long term shareholder value.

Luca: I look forward to answering your questions. After our formal remarks, and now I'd like to turn it over to Luca for financial review.

Luca Barile: Thank you, Glenn, and good afternoon, everyone. Thank you for joining us today to discuss our Q1 results. Let me start by saying that I'm very pleased to be here today and to have the opportunity to take you through our company's Q1 performance. Before we begin, I'd like to take a brief moment and thank Glenn, Rod, and the rest of the management team for their continued support as I step into this role. Let me begin by covering the specifics of the Q1, and then I will comment on our outlook and guidance for 2025. Let's begin with the Q1's results. We reported Q1 sales of $712 million, up 2.3% year-over-year. If we exclude the impact of the phaseout of Under Armour, net sales for the Q1 are up mid-single digits.

Luca: Thank you Glenn and good afternoon, everyone.

Luca: Thank you for joining us today to discuss our first quarter results.

Luca: Let me start by saying that I'm very pleased to be here today and to have the opportunity to take you through our company's first quarter performance.

Speaker Change: Before we begin I'd like to take a brief moment and thank Glen Ron and the rest of the management team for their continued support as I step into this role.

Speaker Change: Let me begin by covering the specifics of the quarter and then I will comment on our outlook and guidance for 2025.

Speaker Change: So let's begin with the quarter's results.

Speaker Change: We reported first quarter sales of $712 million up 2.3% year over year.

Speaker Change: If we exclude the impact of the phase out of under armour.

Speaker Change: Net sales for the quarter.

Speaker Change: Our up mid single digits.

Luca Barile: This was driven by a strong performance in activewear, up $55 million or 9.3%, driven by higher sales volumes, which reflected a favorable product mix in North America with a higher proportion of fleece and ring spun products. Although the quarter started slower than expected, we observed an improving trend as we moved through the second half of February and into March. We continued to experience a strong market response to our recently introduced products which feature key innovations, including our soft cotton technology. We also saw continued momentum with national account customers, driven by our competitive positioning and the ongoing benefits from recent changes in the industry landscape. Looking at international markets, sales decreased by 2% year over year following two strong quarters of growth.

Speaker Change: This was driven by a strong performance in activewear up 55 million or nine 3%.

Speaker Change: Driven by higher sales volumes, which reflected a favorable product mix in North America with a higher proportion of fleece and ring spun products.

Speaker Change: Although the quarter started slower than expected, we observed an improving trend as we move through the second half of February and into March.

Speaker Change: We continued to experience strong market response to our recently introduced products, which feature key innovations.

Speaker Change: Including our soft cotton technology.

Speaker Change: We also saw continued momentum with national account customers driven by our competitive positioning and the ongoing benefits from recent changes in the industry landscape.

Speaker Change: Looking at international markets sales decreased by 2% year over year, following two strong quarters of growth.

Luca Barile: Europe, our largest market, performed well in the quarter but was offset by softness in Asia, which persisted due to the macroeconomic backdrop and a tougher year-over-year comp in Latin America. Turning to hosiery and underwear, this category was down 38% versus the prior year, mainly due to the phaseout of our Under Armour business, along with unfavorable mix within this category. We also continued to see broader market softness in hosiery and underwear in the category in Q1. We are encouraged to see some pickup in momentum for underwear in the current quarter. Turning our focus to margins for the quarter. Our gross margin was 31.2%, a 90 basis point improvement over the prior year, primarily due to lower raw material costs. SG&A expenses decreased by $18 million to $87 million versus $105 million last year, which included significant proxy contest and leadership charges.

Speaker Change: Europe, our largest market performed well in the quarter.

Speaker Change: Was offset by softness in Asia, which persisted due to the macroeconomic backdrop and a tougher year over year comp in Latin America.

Speaker Change: Turning to Holzer and underwear. This category was down 38% versus the prior year, mainly due to the phase out of our under armour business, along with unfavorable mix within this category.

Speaker Change: We also continued to see broader market softness in hosiery and underwear in the category in Q1, though we are encouraged to see some pickup in momentum for underwear in the current quarter.

Speaker Change: Turning our focus to margins for the quarter.

Speaker Change: Our gross margin was 31.2% a 90 basis point improvement over the prior year, primarily due to lower raw material costs.

Speaker Change: SG&A expenses decreased by $18 million to $87 million versus $105 million last year, which included significant proxy contest and leadership charges.

Luca Barile: Excluding these charges, adjusted SG&A for the quarter was $86 million or 12.1% of sales, and essentially flat year over year. The positive benefit of the jobs credit introduced by Barbados in Q2 2024 was largely offset by higher variable compensation and higher distribution expenses. We bring all these elements together, and after adjusting for restructuring and acquisition related items in both years, we generated adjusted operating income of $135 million, or 19% of net sales, up 100 basis points year over year, well ahead of guidance provided, driven primarily by higher gross margins. Moving on to taxes. The company's adjusted effective income tax rate for the quarter was 15% compared to 3.6% last year, reflecting the enactment of global minimum tax in Canada and Barbados in Q2 2024, as previously communicated.

Speaker Change: Excluding these charges adjusted SG&A for the quarter was $86 million or 12, 1% of sales and essentially flat year over year.

Speaker Change: As the positive benefit of the jobs credit introduced by Barbados in the second quarter of 2024 was largely offset by higher variable compensation and higher distribution expenses.

Speaker Change: As we bring all these elements together.

Speaker Change: And after adjusting for restructuring and acquisition related items in both years, we generated adjusted operating income of 135 million or 19% of net sales up 100 basis points year over year, well ahead of guidance provided driven primarily by higher gross.

Speaker Change: <unk>.

Speaker Change: Moving on to taxes, the Companys adjust adjusted effective income tax rate for the quarter was 15% compared to three 6% last year, reflecting the enactment of global minimum tax in Canada, and Barbados in the second quarter of 'twenty 'twenty four as previously communicated.

Speaker Change: <unk>.

Luca Barile: After reflecting higher net financial and income tax expenses and our lower outstanding share base, we reported GAAP diluted EPS of $0.56 in Q1, up 19% versus the prior year. Whereas adjusted diluted EPS of $0.59 came in flat year-over-year after adjusting for the negative impact of proxy costs in 2024. Now turning to cash flow and balance sheet items. Cash flows used in operating activities totaled $142 million, compared to $27 million in Q1 2024, primarily due to an increase in non-cash working capital, largely in line with the company's expectations. After accounting for CapEx of $23 million, the company consumed approximately $166 million in free cash flow. We also returned $62 million to shareholders by repurchasing 1.2 million shares in the quarter.

Speaker Change: After reflecting higher net financial and income tax expenses and our lower outstanding share base, we reported GAAP diluted EPS of <unk> 56 cents in the first quarter up 19% versus the prior year.

Speaker Change: Whereas adjusted diluted EPS of <unk> 59 cents came in flat year over year after adjusting for the negative impact of proxy costs in 2024.

Speaker Change: Now turning to cash flow and balance sheet items.

Speaker Change: Cash flows used in operating activities totaled 140 $42 million compared to $27 million in the first quarter of 2024.

Speaker Change: Primarily due to an increase in noncash working capital.

Speaker Change: Largely in line with the company's expectations.

Speaker Change: After accounting for Capex of 23 million the company consumed approximately $166 million in free cash flow.

Speaker Change: We also returned 62 million to shareholders by repurchasing one 2 million shares in the quarter.

Luca Barile: Finally, we ended the quarter with net debt of about $1.8 billion and a leverage ratio of 2.2 times net debt to adjusted EBITDA, well within our targeted range of 1.5 to 2.5 times. Overall, and concluding on the results, we're very pleased with the quarter and we remain confident in our ability to deliver this continued financial performance despite a dynamic macroeconomic environment. Now turning to our strategy and outlook. As Glenn highlighted earlier, we are pleased with our execution and the progress made on the three pillars of our GSG strategy. First, our new manufacturing complex in Bangladesh continues to ramp up and is well on track. Moreover, on the innovation front, we continue to tap into the largest innovation pipeline in the company's history, with more product launches to come in 2025, as detailed by Glenn.

Speaker Change: Finally, we ended the quarter with net debt of about $1 8 billion and a leverage ratio of 2.2 times net debt to adjusted EBITDA.

Speaker Change: Well within our targeted range of one and a half to two and a half times.

Speaker Change: So overall and concluding on the results, we're very pleased with the quarter and we remain confident in our ability to deliver this continued financial performance despite a dynamic macroeconomic environment.

Speaker Change: Now turning to our strategy and outlook.

Speaker Change: As Glenn highlighted earlier, we are pleased with our execution and the progress made on the three pillars of our GST strategy first.

Speaker Change: First our new manufacturing complex in Bangladesh continues to ramp up and is well on track.

Speaker Change: Moreover, on the innovation front, we continue to tap into the largest innovation pipeline in the company's history with more product launches to come in 2020 five as detailed by Glenn.

Luca Barile: Lastly, with regards to ESG, we remain fully on track with our next generation objectives. In this regard, we are pleased to have been included in S&P's 2025 Sustainability Yearbook for the 13th consecutive year. Gildan was also included in CDP's leadership band for its 2024 climate change disclosures for the fifth time, highlighting our strong commitment to sustainable practices. With regards to our outlook, we continue to feel cautiously optimistic. As Glenn detailed, we are committed to executing on our GSG strategy.

Speaker Change: And lastly, with regards to ESG, we remain fully on track with our next generation objectives.

Speaker Change: In this regard we are pleased to have been included in S. N. PS 20, twenty-five sustainability yearbook for the 13th consecutive year.

Speaker Change: Moreover, Gilden was also included in Cdp's leadership band for its 2020 for climate change disclosures for the fifth time.

Speaker Change: Highlighting our strong commitment to sustainable practices.

Speaker Change: With regards to our outlook, we continue to feel cautiously optimistic.

Speaker Change: As Glenn detailed we are committed to executing on our G. S T strategy.

Luca Barile: Despite an evolving and challenging macroeconomic backdrop, we believe that our low cost, vertically integrated business model, along with our industry positioning and our demonstrated agility in operating in dynamic environments, underscore our confidence in reconfirming our guidance metrics for 2025, which include: revenue growth for the full year to be up mid-single digits, full year adjusted operating margin to increase approximately 50 basis points, CapEx to come in at approximately 5% of sales, adjusted diluted EPS to be in the range of $3.38 to $3.58, up between approximately 13% and 19% year over year. Free cash flow is expected to come in above $450 million. Further, the outlook that I just laid out is underpinned by some key assumptions, including the following.

Speaker Change: And despite an evolving and challenging macroeconomic backdrop.

We believe that our low cost vertically integrated business model.

Speaker Change: Along with our industry positioning and our demonstrated agility and operating in dynamic environments underscore.

Speaker Change: Underscore our confidence and Reconfirming our guidance metrics for 2025.

Speaker Change: Which include.

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

Speaker Change: Full year adjusted operating margin to increase approximately 50 basis points.

Speaker Change: Capex to come in at approximately 5% of sales.

Speaker Change: Adjusted diluted EPS to be in the range of $3.38 to $3.58 up between approximately 13% and 19% year over year.

Speaker Change: And free cash flow is expected to come in above $450 million.

Speaker Change: Further the outlook that I just laid out is underpinned by some key assumptions, including the following.

Luca Barile: Firstly, based on the information available at this time, we have considered the impact of tariff measures in place on our operations as well as on industry demand, in conjunction with mitigation initiatives that are available to us and our ability to leverage our flexible business model as a low-cost, vertically integrated manufacturer. We also continue to expect growth in key product categories driven by recently introduced innovation, a favorable impact from new program launches, and continued market share gains. We expect ongoing benefits from the jobs credit program that took effect in Barbados in 2024, and we anticipate that our effective tax rate for 2025 will remain at a similar level to what we saw for the full year in 2024.

Speaker Change: Firstly based on the information available at this time, we have considered the impact of tariff measures in place on our operations as well as an industry demand in conjunction with mitigation initiatives that are available to us.

Speaker Change: And our ability to leverage our flexible business model as a low cost vertically integrated manufacturer.

Speaker Change: We also continue to expect growth in key product categories, driven by recently introduced innovation favour.

Speaker Change: The favorable impact from new program launches.

Speaker Change: And continued market share gains.

Speaker Change: We expect ongoing benefits from the jobs credit program that took effect in Barbados and 2024 and.

Speaker Change: And we anticipate that our effective tax rate for 2025, we will remain at a similar level to what we saw for the full year in 2024.

Luca Barile: Lastly, we expect to continue repurchasing shares under our NCIB program, given the strength of our balance sheet, our expected strong free cash flow, and our leverage framework target of 1.5 to 2.5x net debt to adjusted EBITDA. Finally, we have also provided guidance for our Q2, with net sales expected to be up mid-single digits year over year and adjusted operating margin expected to be in a similar range as the Q2 of 2024, which included the significant positive benefit from the jobs credit introduced in May 2024 by Barbados and which was retroactive to 1 January 2024. We also expect our adjusted effective income tax rate in the Q2 of 2025 to be at a similar level to the full year 2024 adjusted effective income tax rate.

Speaker Change: Lastly, we expect to continue repurchasing shares under our N CIB program, given the strength of our balance sheet, our expected strong free cash flow and our leverage framework target of one and a half to two and a half times net debt to adjusted EBITDA.

Speaker Change: Finally, we have also provided guidance for our second quarter.

Speaker Change: With net sales expected to be up mid single digits year over year, and adjusted operating margin expected to be in a similar range as the second quarter of 2024, which included the significant positive benefit from the jobs credit introduced in May 2024 by Barbados and which were.

Speaker Change: Retroactive to January 1st 2024.

Speaker Change: We also expect our adjusted effective income tax rate in the second quarter of 2025 to be at a similar level to the full year 2024, adjusted effective income tax rate.

Luca Barile: In summary, while we are mindful of the uncertain economic environment, our solid foundation, our resilient, low-cost, vertically integrated business model, and our operational and financial discipline provide us agility, confidence, and the foundation to navigate through this environment. Thank you. Now I'll turn it over to Jessy.

Speaker Change: In summary, while we are mindful of the uncertain economic environment.

Speaker Change: Our solid foundation.

Speaker Change: Our resilient low cost vertically integrated business model.

Speaker Change: And our operational and financial discipline provide us agility.

Speaker Change: Conference and the foundation to navigate through this environment.

Jesse Hamm: Thank you and now I'll turn it over to Jesse.

Jessy Hayem: Thank you, Luca. This concludes our prepared remarks, and now we will begin taking your questions. Before moving to the Q&A session, as usual, I would like to remind you to limit your questions to two, and we will circle back for a second round if time permits. Sarah, you may begin the Q&A session.

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

Jesse Hamm: You may begin the Q&A session.

Operator 2: Thank you. 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. Please ensure you are not on speakerphone and that your phone is not on mute when called upon. Thank you. Your first question comes from Paul Lejuez with Citigroup. Your line is open.

Jesse Hamm: Thank you if you would like to ask a question. Please press star one on your telephone keypad. If he would like to withdraw your question simply press Star. One again. Please ensure you are not on speaker phone and that your phone is not on mute when called upon thank you.

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

Paul Lejuez: Hey, thanks, guys. 2 questions. 1, can you talk about POS trends in each of your major channels and whether you are seeing any signs of destocking amongst your major customers? Second, can you talk about what specific tariff pressure you bake into guidance from a cost perspective and what sort of mitigation you build in on the pricing side? Thanks.

Speaker Change: Hey, Thanks, guys. Two questions. One can you talk about Pos trends in each of your major channels.

Speaker Change: Seeing any signs of Destocking amongst major customers and then second can you talk about what specific tariff pressure you baked into guidance from a cost perspective, and what sort of mitigation you build it on the pricing side. Thanks.

Luca Barile: Okay, well, Chuck will start off with the POS.

Speaker Change: Okay, well chuckles startup of the peers.

Chuck Ward: Yeah. Hi, Paul. As Glenn mentioned in his comments, we had a very strong quarter, from an activewear perspective, and we're really happy with where we landed there. We continued to gain share in a market that was down low to mid-single digits, but we gained share capitalizing on the same drivers that we have talked about the last few quarters, our innovation in tees and fleeces with our soft cotton technology. Our Comfort Colors and American Apparel were both up double digits again as well. Luca mentioned, obviously, we had a strong momentum in national accounts. 1, we had wraparound effect of business that we picked up from Delta and the closure last year, but also we started to ship some of the new programs that we've been talking about.

Paul: Yeah, Hi, Paul.

Speaker Change: As Glenn mentioned in his comments when we had a very strong quarter.

Speaker Change: On the activewear perspective that will really happy with where we landed there and we continue to gain share in a market that was down low to mid single digits that we gained share capitalizing all the same drivers that we talked about the last few quarters, our innovation guarantees and pleased with our soft cotton technology, our comfort colors and American apparel.

Speaker Change: Both of them double digit again as well and then Luca mentioned and obviously, we had a strong momentum in national accounts.

Speaker Change: One we had wraparound effect of business from that we picked up from Delta and closure last year, but also we started to shift some of the new programs that we've been talking about so again, we performed better than the market and where we're happy with where side than what we saw.

Chuck Ward: Again, we performed better than the market, and we're happy with the activewear side and what we saw. He did mention also on the innerwear, we did see we were down in innerwear, but largely driven by under.

Speaker Change: We did mention also later, where we did see.

Speaker Change: We were down in innerwear, but largely driven by filing.

Glenn Chamandy: As far as the inventory in the channel, it's in good bounds, and we haven't seen any sign of de-stocking. Luca?

Speaker Change: And as far as the inventory in the channel. It's a mitten good bounds and we haven't seen any sign of Destocking and Luca.

Luca Barile: With respect to the guidance and the assumptions with respect to tariffs, I think it's important to understand that when we maintained our guidance, our guidance is based on elements that we can control. What we've done is we've taken the impact of the current measures that are in place, and we've factored in how that impacts our operations. We factored in what that means in terms of demand, and we factored in those mitigating factors that you alluded to. In terms of our guidance for the full year, revenue is up mid-single digits. If you peel back the onion and you take a look at the market assumption, we're a bit conservative there. We're saying, Look, the market is going to be flat to down low single digit, based on the uncertainty that's in the market and the impacts of tariffs more broadly.

Speaker Change: Now with respect to the guidance and the assumptions with respect to tariffs I think it's important to understand that when we gave we maintained our guidance. Our guidance is based on elements that we can control. What we've done is we've taken the impact of the current measures that are in place and we've factored in how that impacts.

Speaker Change: Our operations, we factored in what that means in terms of demand and we factored in those mitigating factors that you would look to that you alluded to so again.

Speaker Change: In terms of our guidance for the full year revenue was up mid single digits and if you Peel back the onion and you take a look at the market assumption, we're a bit conservative there and we're saying look the market is going to be flat to down low single digit based on the uncertainty that's in the market and the impacts of tariffs more broadly.

Luca Barile: With respect to tariffs, I think the headline that you have to remember is that with respect to Gildan, tariffs impact before any mitigation strategies is well below the 10% of the headline number that you see in the overall environment. The reason for that is because we benefit from the amount of US content that is in our product. We know that US inputs make up a meaningful percentage of our cost of sales, and we've baked that into our guidance assumptions. In terms of the mitigation factors, we've taken a little bit of price. That assumption is in there. We also take a look at, let's not forget, we're the low-cost manufacturer, and we have flexibility within our supply chain. There's elements that we've already put in place within our supply chain using that flexibility to mitigate some of those factors.

Speaker Change: With respect to tariffs I think the headline that you have to remember is that with respect to Gil Dan.

Speaker Change: Tariffs impact before any mitigation strategies is well below the 10%, but the headline number that you see in the AR in the overall environment and the reason for that is because we benefit from the amount of U S caught the content that is in our product. So we know that U S inputs make up a meaningful percentage of our cost of sales.

Speaker Change: And so we've baked that into our guidance assumptions and in terms of the mitigation factors, we've taken a little bit of price and that assumption is in there and we also take a look at let's not forget we're the low cost manufacturer and we have flexibility within our supply chain. So there's elements that we've already put in place within our supply chain using that flexibility to mitigate some of those.

Luca Barile: In summary, we're very comfortable. We're confident in the guidance that we've maintained. We've given you a little bit of the assumptions behind the curtain, and it takes into account the measures that are in place today.

Speaker Change: [noise] factor. So in summary, we're very comfortable we're confident in the guidance that we've maintained with giving you a little bit of the assumptions behind the curtain and it takes into account the measures that are in place today.

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

Speaker Change: Yes. Thank you good luck.

Operator 2: The next question comes from Brian Morrison with TD Cowen. Your line is open.

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

Brian Morrison: Thanks very much. Evening, Glenn, and welcome, Luca. First question. In the MD&A, you note benefits from national accounts due to changes in the industry landscape. I just want to make sure I understand this. It sounds like competitor weakness, new product success, and I assume vertical integration widening your cost advantage. Can you confirm that? The question is this leading to nearshoring, and if so, are you seeing further incomings, including GLB?

Brian Morrison: Thanks, very much evening, Glenn and welcome Luka.

Speaker Change: First question. The MD&A, you know benefits from national accounts due to changes in the industry landscape I just want make sure I understand this it sounds like competitive weakness new product success and I assume vertical integration widening your cost advantage can you confirm that and then the question is is this leading to near shoring and if so are you seeing further income means including G. L. B.

Glenn Chamandy: Well, the change in the competitive landscape on a year-over-year basis is really some of the competitors have left the channel, Delta, who closed down last year, other competitors have vacated the channel, a combination of, as well as potentially nearshoring and other activities coming back to this hemisphere. I think that things are changing now rapidly, particularly with the tariffs. The one thing maybe from a nearshoring perspective, when you look at the, I think, imports into the United States, maybe to put things in perspective, China represents around over 20% of the products being sold into the United States today. Obviously, with their tariff levels, that's prohibitive for them to supply products into the market. If you take the ASEAN type countries, which is Vietnam, Indonesia, Cambodia, Thailand, Philippines, Myanmar.

Speaker Change: Well the change in the competitive landscape on a year over year basis is really the the.

Speaker Change: Some of the competitors that are left to channel.

Speaker Change: You know Delta who closed down last year.

Speaker Change: Other competitors have vacated the channel and a combination of as well as potentially nearshoring and other activities coming back too.

Speaker Change: To this hemisphere I think that you know things are changing now rapidly, particularly with the you know with the tariffs.

Speaker Change: The one thing maybe you know from.

Speaker Change: From a near shoring perspective, when you look at the I think imports into United States, maybe to put things in perspective.

Speaker Change: China represents around over 20% of the products being sold into the United States today.

And obviously you know with their tariff levels that's.

Speaker Change: That's prohibitive for for them to supply products into the market.

Speaker Change: And then if you take tea AZN of type countries, which is Vietnam, Indonesia, Cambodia, Thailand, Philippines Miramar. Those are also countries, which still have to negotiate their tariff levels that were bubble that had high tariff levels.

Glenn Chamandy: Those are also countries which still have to negotiate their tariff levels that had high tariff levels in the first go-around. They represent another 31%. I would say that when you look at the overall structure, particularly in retail, because you have a lot more Asian type product in the retail, servicing retail markets than you would in the wholesale. I think we're going to see a lot of people thinking about their supply chain, and that could be a positive impact for us on people looking to nearshore. Maybe just to add one last thing on that is that the CAFTA region only represents around 9% of total apparel to the United States. I think we think that there's a lot of opportunity with the way the landscape is changing and our competitive positioning, particularly on how we're positioned globally today.

Speaker Change: The first go around they represent another 31% so I would say that when you look at the.

Speaker Change: The overall structure, particularly in retail because you have a lot more Asian type product in the retail servicing retail markets and he was in the wholesale I think we're going to see a you know a lot of.

Speaker Change: People thinking about their supply chain and that could be a positive impact for us on people looking to niche nearshore.

Speaker Change: And maybe just a little add one last thing on that is that you know the CAFTA region only represents around 9% of total apparel in the United States. So there's I think we think that there's a lot of opportunity with this with the with the way the landscape is changing and our competitive positioning particularly.

Speaker Change: How we're positioned.

Speaker Change: Globally today.

Brian Morrison: That's great, Glenn. My second question is, I noticed you left out Bangladesh from your comment there. From a strategy perspective, Bangladesh is being built as a ring-spun hub for the US. The tariff is 10% now, I understand you source cotton and yarn from the US, and you're agile. How do you adjust to meet growth if Bangladesh tariffs are reinstated at that higher rate? Is there capacity in Honduras? How should we think about this?

Speaker Change: That's a that's great. My second question is I noticed you left out Bangladesh in your comment there from a strategy perspective, Bangladesh is being built is a ring spun hub for the U S. The tariff was 10% now and I understand you source cotton in Europe, and the U S and your agile, but how do you adjust to meet growth, if Bangladesh tariffs or reinstate.

Speaker Change: At that higher rate is there capacity in Honduras, how should we think about this.

Glenn Chamandy: Well, first of all, we got a lot of flexibility in our supply chain, number one, which is the first thing you have to understand is how we can maneuver things. I would say to you is, look, firstly, from Bangladesh, 50% of it was a $500 million, and the thing's running full, I mean, today, just to put things in perspective. Of the $500 million we're running out of the plant today, 50% of that is servicing international markets in Canada, which we still provide product into these countries. The other 50% is producing ring-spun products, which are coming back to the US. Now, to put things in perspective, what we said is that the cost, once that factory is fully ramped up, will have a 25% reduction in cost relative to our Central American cost.

Speaker Change: Well first of all we've got a lot of flexibility in our supply chain number one which was the first thing you have to understand is how we can maneuver things so.

Speaker Change: But I would say to you is look firstly from Bangladesh, 50% of the you know it was a 500 million dollar and we're running at focusing on the things running full I mean today, just put things in perspective, and a love of the 500 million, we're running out of the plant today, 50% of that servicing international markets in Canada, which we still provide pre.

Speaker Change: <unk> into these countries. The other 50% is producing ring spun products, which are coming back to the U S. Now to put things in perspective, what we said is that the cost once the factory is fully ramped up will have a 25% reduction in costs relative to our central American cost. So if you look at the 10% minus the input of <unk>.

Glenn Chamandy: If you look at the 10% minus the input of US component, that's still not moving the needle and still very viable for us to produce goods in Bangladesh, and particularly in the ring spun category. In the same breath, I would say to you is that we have the capabilities of maneuvering within our supply chain if tariffs do come back at a higher rate. Bangladesh, to answer your question before, it represents around 9% of the apparel going back into the US, just for that perspective. At the same time, one thing I would tell you is that we're actually in the process now. Our capacity today is running around 90%, so we do have available capacity. Most of our capacity that's available is in Central America because of the way we've optimized our capacity, and we ramped up Bangladesh to 100% of its utilization.

Speaker Change: U S component.

Speaker Change: That's still not moving the needle and still very viable for us to produce goods in Bangladesh.

Speaker Change: And particularly in the run spring spring category in.

Speaker Change: In the same breath I would say to you is that we have the capabilities of maneuvering within our supply chain, if tariffs do come back at a higher rate.

Speaker Change: Bangladesh to answer your question before he represents around 9% of the apparel going back into the U S. Just for for that perspective and at the same time, one thing I would tell you is that we're actually in the process now of looking we're running our capacity today is running around 90%. So we do have available capacity most of our capacity.

Speaker Change: That's available is in Central America, because of the way, we've optimized our capacity and we ramped up Bangladesh to 100% of its high utilization, but within our footprint in Central America. We're also looking to actually increase the capacity as well.

Glenn Chamandy: Within our footprint in Central America, we're also looking to actually increase the capacity as well. We think that there's going to be a lot of opportunity as we go forward, particularly with the way the tariffs are evolving. The fact is that we think we're going to be at a cost advantage relative to other geographical areas. All things put in place with our supply chain, I think we've got a very effective opportunity here to take advantage of the situation.

Speaker Change: Because we think that theres going to be a lot of opportunity as we go forward, particularly with the way the tariffs are going to evolving and the fact is is that we are I think we're going to be at a cost advantage relative to other geographical areas. So all things put in place with our supplier.

Shane: Shane I think we've got a very effective.

Speaker Change: Opportunity here to.

Shane: Take advantage of the situation.

Brian Morrison: Thank you very much.

Shane: Thank you very much.

Operator 2: The next question comes from Chris Li with Desjardins. Your line is open.

Speaker Change: The next question comes from Chris Li with days or a day. Your line is open.

Chris Li: Oh, hi. Good afternoon, everyone. My first question is, I just want to confirm just your answer to an earlier question about what's embedded in your guidance. Does it now incorporate a more conservative outlook in terms of industry demand? I think it was mentioned it's now flat to down low single digit. I think it was flat last quarter. Have you tweaked your outlook to reflect sort of down low single digit for industry demand?

Speaker Change: Oh, Hi, good afternoon, everyone. My first question is I just wanted to confirm just your answer to an earlier question about what's embedded in your guidance does it incorporate more conservative outlook in terms of industry demand I think it was mentioned is now flat to down low single digits.

Speaker Change: Last quarter. So have you had any kind of tweak your at your.

Speaker Change: Our outlook to reflect the low sent down low single digits with industry demand.

Luca Barile: Yes. Thank you for your question, Chris. Yeah, absolutely. Look, when you take a look at the guidance for the full year, revenue up mid single digit. Okay? The first element is the market. We did add that element of conservatism, and the market is now, the assumption is that it'll be flat to down low single digit. You have to go one step further and we have to say, Okay, we're in a great position to take share. We have the assumption that we're going to continue to take share on our core business. Let's remember that around 75% of our growth going forward is based on new programs. Those new programs, there's meaningful t-shirt and fleece programs in the national account business, as well as the Champion license, right, in our print wear channel.

Speaker Change: Yes. Thank you for your question, Chris Yeah, absolutely. So look when you take a look at the guidance for the full year revenue up mid single digits. Okay. So the first element is the market. So we did add that element of conservatism and the market is now the assumption is that it will be flat to down low single digit. But then you have to go one step further and we have to say okay.

Speaker Change: We're in a great position to take share and we have the assumption that we're going to continue to take share on our core business and then let's remember that around 75% of our growth going forward is based on new programs.

Speaker Change: And those new programs there is meaningful in a T shirt and fleece programs in our national account.

Speaker Change: Business as well as the champion license right in our print where channel. So those are the elements you have to keep in mind and definitely what we did factor in some of that conservatism when it comes to the markets the market assumption.

Luca Barile: Those are the elements you have to keep in mind. Definitely what we did factor in is some of that conservatism when it comes to the market assumption.

Chris Li: Got it. Okay. My follow-up question is that in terms of that 75% coming from new programs, how much visibility do you have? How secure are they? Are they dependent on market conditions, i.e., if the economy does take a sort of downturn, are those programs at risk? If they are, will you be compensated somehow by the customers? How much protection do you have on those new programs?

Speaker Change: Got it Okay and my follow up question is that in terms of that 75% coming from new programs.

Speaker Change: How much.

Speaker Change: Visibility do you have how secure are they are they dependent on market conditions I E.

Speaker Change: Canada take a sort of a downturn.

Speaker Change: Those programs at risk and you say or would you be compensated somehow by by by the customers like it how much protection do you have on those.

Glenn Chamandy: Well, look, Chris, we're going to launch these programs. We look at what the opportunity is and the POS or the point of sale of these programs once they get launched. Let's say you take a program, you put it in retail. These are all replenishment, no fashion risk type of programs. If the market is slightly down, yeah, maybe we can lose a couple percentage points on the overall program in our anticipation, which we factored into our forecast. Overall, I would say to you that they're pretty secure because we're taking space. The space is quantified into sales per square foot, that sales per square foot should yield the three-quarters of our sales guide that we laid out. Does that answer your question?

Speaker Change: And those costs were.

Speaker Change: So yeah, we were gonna launches programs, we look at what the.

Speaker Change: The opportunity is in the P O S or the point of sale of these programs once they get launched so lets say you take a program you put in retail. These are all replenishment no fashion risk type programs. So.

Speaker Change: If the market was slightly down yeah, maybe we can lose a couple of percentage points on the overall program and the anticipation, which we factored into.

Speaker Change: Our forecast.

Speaker Change: But overall I would say to you that they're pretty secure because you know, we're taking space to spaces quantified into.

Speaker Change: Sales per square foot and that's per.

Speaker Change: Sales per square foot should yield the.

Three quarters of our sales guidance, we laid out.

Speaker Change:

Chris Li: Okay. Yep. Perfect. Thanks, and best of luck.

Speaker Change: To answer your question, Okay, perfect, Thanks, and best of luck.

Operator 2: The next question comes from Luke Hannan with Canaccord Genuity. Your line is open.

Speaker Change: The next question comes from Luke Hannan with Canaccord Genuity. Your line is open.

Luke Hannan: Yeah, thanks. Good evening, everyone. Glenn, you talked about some of the innovation that's going to continue within 2025. Just curious if we can get a little bit more granularity on it. Specifically, if it's going to be concentrated, if at all, across any of your main channels being basic, ring spun, or fleece. Secondly, what about the cadence of that as well? Is it going to be filling white spaces in the portfolio? Is it going to be more about revamping some of the existing SKUs that you sell? Thanks.

Luke Hannan: Yeah. Thanks, Good evening, good evening, everyone. Glenn you talked about some of the innovation that's going to continue within 2025 I'm. Just curious if we can get a little bit more granularity on it specifically if it's going to be concentrated if at all across any of your main channels being basic spring spun or fleece, and then secondly, what about the.

Speaker Change: Cadence of that as well.

Speaker Change: Is it going be filling white space within the portfolio, there's going to be more about revamping some of the existing skus that you sell.

Glenn Chamandy: I'll start off by saying that, look, what we did in 2024, after two years of a lot of work, is we really revamped almost all of our product lines. Our basics, our fleece. Basically, we touched almost every product line, with our soft cotton technology, our fleece basically with the MBS yarn, et cetera. We also changed the way the fabric is constructed. It's softer, it pills less. There's all kinds of different things that we've done through the innovation of our yarn spinning, et cetera. We also have a pipeline of other product categories and, Chuck, maybe you want to just.

Speaker Change: I'll start off by saying that look at you know what we did in 'twenty 'twenty.

Speaker Change: For after two years of a lot of work as we really revamped almost all of our product lines, our basics, our fleece I mean, basically we touched almost every product line with our soft cotton technology.

Speaker Change: But our fleece basically with the M. D S yarn et cetera. So we also changed the way that the fabric is constructed it's softer at pills less so there's all kinds of different things that we've done through the innovation of our yarn spinning etcetera etcetera, but we also have a pipeline of other.

Speaker Change: Product categories, and you know Chuck maybe you want to just.

Chuck Ward: Yeah, sure. Look, as Glenn said, we've touched a lot of product, if not all the product, over the last 2 years. As he was talking, we also have something called Plasma Print technology that's coming online, that'll come on later this year or early next year. That really improves the printability from a direct-to-garment printing perspective. We did showcase it at the Impressions Expo in Long Beach earlier this year. The reception to it has been outstanding. We're going to continue to innovate across all of our product lines. We have some additional programs coming out in innerwear as well. We're moving into different fabrications, that sort of thing, where we're picking up space. We're really taking the innovation throughout our product and picking up new programs across all categories.

Chuck: Yeah, sure look and as Glenn said, we've touched a lot of product if not all of the product.

Chuck: Over the last few years, but as he was talking we also have something called plasma print technology. That's that's coming online that'll come on later this year early next year.

Chuck: It really improves the print ability from a direct to garment printing perspective, we did show a showcase at the ISS show in long Beach earlier, this year and the reception to it has been outstanding and so we're going to continue to innovate across all of our product lines.

Chuck: We have some additional programs in.

Chuck: Coming out in innerwear, as well, where we're moving at a different fabrications that sort of thing where we're picking up space.

Chuck: So we're really taking the innovation throughout our product and picking up new programs across all categories and we also have innovation and you know quite a few new products that we're offering in our comfort colors brand as well so.

Glenn Chamandy: We also have innovation in quite a few new products that we're offering in our Comfort Colors brand as well. We just got a whole pipeline of innovation that's going to continue to roll out through 2025 and into 2026.

Chuck: We're constantly we just got a whole pipeline of innovation, that's going to continue to rollout through 2025 and enter 2026.

Luke Hannan: That's great. Thanks. As a follow-up to the tariff conversation, you mentioned that even the product that you're creating in Bangladesh, that does use US cotton. I believe you do most of your yarn spinning within the US, but in Bangladesh, you do use third-party spinners. You can correct me if I'm wrong. If that is the case, do you envision setting up more yarn spinning facilities of your own to support your operations in Bangladesh?

Speaker Change: That's great. Thanks, and then as a follow up to the tariff conversation you mentioned that.

Speaker Change: The product that youre, creating in Bangladesh that does use U S. Cotton I believe you do most of your yarn spinning within the U S. But in Bangladesh you to use third party spinners you can correct me, if I'm wrong, but it's.

Speaker Change: That is the case do you envision setting up more yarn spinning facilities of your own.

Speaker Change: To support your operations in Bangladesh.

Glenn Chamandy: Well, we have a vested interest in all of our yarn spinning facilities in Bangladesh. We use US cotton, so we ship the cotton, we purchase the cotton, we ship it to Bangladesh, and it gets spun into yarn and produced. Cotton is a large component of our total cost structure, particularly on basic T-shirts, so it's important part of our ESG strategies and let alone our whole manufacturing process. In the States, obviously we have a little bit more US content in the US because of the yarn spinning in this hemisphere. We're well-positioned, I think from a tariff perspective. You can do the math, cotton and spinning is a large component of our cost structure.

Speaker Change: Well, we have we have a vested interest in all of our yarn spinning facilities in Bangladesh.

Speaker Change: What we use U S. Cotton, so we shipped a cotton we purchase a cartoon we ship it to Bangladesh and you know it gets spun into yarn and produce so we.

Speaker Change: We do have.

Speaker Change: Cotton is a large component of our total cost structure, particularly on your basic T shirts. So you know it. It sits it's important part of our of our ESG strategies and let alone our whole manufacturing process. So.

Speaker Change: In the states you know, obviously, we have a little bit more U S content in the U S because of the yarn spinning in.

Speaker Change: In this hemisphere, but we're well positioned.

Speaker Change: I think from.

Speaker Change: From a tariff perspective.

Speaker Change: You can do the math and you know this.

Speaker Change: The cotton and spending as a large proponent of our of our cost structure.

Luke Hannan: Okay. Thank you very much.

Speaker Change: Okay. Thank you very much.

Operator 2: The next question comes from Stephen MacLeod with BMO Capital Markets. Your line is open.

Speaker Change: The next question comes from Stephen Macleod with BMO capital markets. Your line is open.

Stephen MacLeod: Thank you. Good evening, everyone. Lots of great color so far, so thank you. I just had two follow-up questions. One is, I'm just wondering if you can provide any color on what you've seen on a Q2 to date basis with respect to the North American distributor channel in terms of sales trends. Secondly, Glenn, you talked a little bit about the opportunities to increase capacity in Central America, which I think is particularly interesting. I'm just curious if you can provide just even a little bit of color around, would that be potentially something expansion within your current Rio Nance facility or is there something new that you're potentially contemplating?

Speaker Change: Thank you good evening everyone.

Stephen Macleod: Lots of great color. So far so thank you, but I just had two follow up questions.

Stephen Macleod: One is I'm just wondering if you can provide any color on what you've seen on the.

Stephen Macleod: Quarter second quarter to date basis with respect to.

Stephen Macleod: The North American distributor channel in terms of sales trends and then secondly, you know.

Stephen Macleod: Glenn you talked a little bit about the opportunities to increase capacity in Central America.

Stephen Macleod: Which I think is particularly interesting. So im just curious if you could if you can provide just even a little bit of color around how would that be potentially something extension was in your current where an.

Stephen Macleod: 19 facility or is there something something new that you're potentially contemplating.

Glenn Chamandy: Well, I always tell you, look at, like everything else, we have a lot of flexibility in our system. We're continuing to look like everything else. When we build our plants, we build them and we are capable of expanding them quickly. We always give ourselves a little bit of room to maneuver. Our objective is that we don't want to spend a lot of capital to expand, and we need to expand quickly. Most likely working with existing structure basically is the best way for us to do it. It's going to maximize our cost and efficiency, keep us within our CapEx range, and allow us to maximize output. I would say that we're very optimistic that we can increase our capacity in this hemisphere. It's part of what we think is a big opportunity.

Stephen Macleod: Well I would tell you look at like like everything else, we have a lot of flexibility in our system.

Stephen Macleod: And we're continuing to look look like it's like everything else wouldn't you know we built our plants, we rebuilt them in and we are capable of expanding them quickly.

Stephen Macleod: We always give ourselves a little bit of.

Stephen Macleod: The room to maneuver. So what our objective is is that you know we don't want to spend a lot of capital to expand and we need to expand quickly. So you know.

Stephen Macleod: Most likely working with existing structure basically is the best way for us to do it.

Stephen Macleod: It's going to maximize our cost and efficiency keeps us within our capex range and allow us to maximize output. So you know.

Stephen Macleod: I would say that we're very optimistic that we can increase our capacity in this hemisphere.

Stephen Macleod: And it's.

Stephen Macleod: It's part of what we think is.

Stephen Macleod: A big opportunity now one of the things I would say to you is that you know the.

Glenn Chamandy: Now, one of the things I would say to you is that as I mentioned earlier, in terms of the imports from Asia, we're already seeing customers coming and looking for filling shelves really at the end of the day. There's definitely going to be, we think, potentially a shortage of product because it's prohibited to bring product in from China. We think we need to take advantage of it. We're cautiously optimistic. We can put and align our capacity without really sticking our neck out, but giving us all the flexibility that as we go forward, if things materialize and we have opportunity, we can take advantage of it. I would say to you on another front is that we have a lot of, I would say, momentum as we already move into 2026 in terms of building new business.

Stephen Macleod: As I mentioned earlier in terms of the.

Stephen Macleod: The imports from Asia.

Stephen Macleod: Where are we seeing.

Stephen Macleod: Customers coming in looking for you know Phil.

Stephen Macleod: Filling filling shelves really agenda today I mean, there's a there's definitely going to be we think potentially a shortage of product because it's prohibited to bring product in from China. So we were in a we think we need to take advantage of it.

Stephen Macleod: And we're cautiously optimistic so we know we can put it.

Stephen Macleod: And the liner capacity without really sticking your neck out, but giving us all the flexibility that as we go forward if things materialize and we have opportunity with.

Stephen Macleod: Can take advantage of it.

Stephen Macleod: And I would say to you on another front is that we have a lot of I would say momentum as we already move into 2020 six in terms of building new.

Stephen Macleod: New business.

Glenn Chamandy: I think that that's also Because it takes time to do these things, but we're starting to see retailers allocate or work with our team. We're pretty excited about that too. Our pipeline is strong for 2026, and I think that we even have a chance to do some fill in for this year. That's really why we're excited and really focusing on expanding our capacity.

Stephen Macleod: And I think that that's also because it takes time to do these things, but we're starting to see retailers.

Stephen Macleod: Oh allocate or work with our team.

And we know we're pretty excited about that too. So our pipeline is strong for 2026, and I think that we even have a chance to do some.

Stephen Macleod: Some fill in for for this year and that's really why we're excited and really focusing on expanding our capacity.

Chuck Ward: On the quarter to date of Q2 POS front and business front, we've kind of seen the trend as we talked about last few quarters where a quarter would start out a little slower and then accelerate. We're actually seeing in January, we saw it start off a little slower, impacts of weather, fires, and different things happening. It improved sequentially in February. It improved again in March. Well, the good news is it's going ahead and improving again in April. We're continuing to see consistent improvement through April, so we feel good about how this quarter has started out.

And on the on the quarter to date of Q2 P. O S front end business. Brendan you know, we've kind of seen the trend as we talked about last few quarters, where.

Quarter would start out a little slower and then accelerate but we're actually seeing so in January we saw it start off a little slower impacts of weather fires different things happening it improves sequentially in February it improved again in March well. The good news is it's gone ahead and improving again in April so we're continuing to see consistent improvement.

Stephen Macleod: Through April so we feel good about how the quarter has started out.

Luca Barile: I would say just to end off on Q2 is that we've put the guidance right, that our revenue is up mid-single digits, and we feel comfortable with the outlook that we've laid out. We remain cautiously optimistic. For Q2, you should see some of the same trends as we finish Q1, where there's market share gains across the channels and key product categories, and we start to see some of the impact of the new program. Q2, revenue up mid-single digit. We're quite pleased. It's still very early in the quarter, but we're quite pleased with what we see.

Speaker Change: Yeah, and I would say just to end up on that on the second quarter is that we've put the guidance right that our revenue was up mid single digits and we feel comfortable with the outlook that we've laid out we remain cautiously optimistic but for the second quarter you should see some of the same trends as we finished the first quarter right, where there's market share gains across the channels and.

Speaker Change: Product categories, and we start to see some of the impact of the new program. So our second quarter revenue up mid single digit and we're quite pleased it's very it's still very early in the quarter, but we're quite pleased with what we see.

Stephen MacLeod: Yeah. Okay. That's great, guys. Thanks so much for the color.

Speaker Change: Yeah, Okay. That's great guys. Thanks, a lot for the color.

Operator 2: The next question comes from Paul Kearney with Barclays. Your line is open.

Speaker Change: The next question comes from Paul Attorney with Barclays. Your line is open.

Paul Kearney: Hey, good evening. Thanks for taking my questions. Can you talk about what you're seeing in terms of pricing in the market? Have prices in your key categories already started to rise for tariff costs? My second question is, given your relative advantage, how do you balance accelerating the potential market share gains versus taking some benefit on margin? Thank you.

Paul Attorney: Hey, good evening, thanks for taking my questions.

Paul Attorney: Can you talk about what youre seeing in terms of pricing in the market prices in your key categories already started to rise for tariff costs and my second question is given your relative advantage, how do you balance accelerating the potential market share gains versus taking some benefit on margin. Thank you.

Chuck Ward: Thank you, Paul. On the pricing front, we've seen pricing remain fairly stable through Q1 and into early Q2, so not a lot of price changes at that point. We have taken selective minimal price offs so far to offset inflation and some of the tariffs. Some of that will begin taking effect later in Q2. Again, we're not seeing that, as both Glenn and Luca have mentioned, with our ability, with our vertically integrated supply chain, our flexibility, we think that'll continue to be selective minimal price offsetting that tariff and not large price changes as you may have to see from other regions or other suppliers.

Paul Attorney: Thank you Paul on the on the pricing front I mean, we've seen pricing remain fairly stable through Q1 and into early Q2. So.

Paul Attorney: You know not a lot of price changes at that point, we have taken selective minimal price offs, so far to offset inflation and some of the tariffs some of that'll begin taking effect later in Q2.

Paul Attorney: But again, we're not seeing that.

Speaker Change: Both Glenn and Luka mentioned with our ability with our vertically integrated supply chain flexibility.

Speaker Change: We think that'll continue to be selective minimal price offsetting that tariff and not a large price changes as you may have to see from other regions or other suppliers.

Luca Barile: I guess, just to round out the question from the margin perspective. For the full year, we're guiding to an improvement in the operating margin by 50 basis points versus 2024. If you boil it down to the levers that we need in order to achieve the expected operating margins which underpin our guidance, the first is fully leveraging our greenfield project in Bangladesh. That flow through in cost of sales. The second is improving the utilization of the Central American capacity, produce more fleece, high growth products. The third is benefiting from the yarn modernization investments and other strategic initiatives that optimize our supply chain. Finally, successfully navigate the tariff situation with the levers that are available to us, which is, we went over, but the flexibility in our operations, as well as a little bit of price.

Speaker Change: And I guess just to round out the question from the margin perspective for the for the full year, we're guiding to an improvement in the operating margin by 50 basis points versus 2024, and if you boil it down to the levers that we need in order to achieve the expected operating margins, which underpin our guidance. The first is fully.

Speaker Change: <unk> are Greenfield project in Bangladesh, right and that flow through in cost of sales.

Speaker Change: The second is improving the utilization of the central American capacity produce more fleece high growth products right.

Speaker Change: And the third is benefiting from the yard modernization investments and other strategic initiatives that optimize our supply chain and finally, no successfully navigate the tariffs situation with the levers that are available to us which is we went over but the flexibility in our in our operations as well as a little bit of price.

Paul Kearney: Okay. Thank you very much.

Speaker Change: Okay. Thank you very much.

Operator 2: The next question comes from Vishal Shreedhar with National Bank. Your line is open.

Speaker Change: The next question comes from the South Street here with National Bank. Your line is open.

Vishal Shreedhar: Hi. Thanks for taking my questions. With respect to the industry trends in Q1, when you talked about the declines, was that in sales or units?

Speaker Change: Hi, Thanks for taking my questions with respect to the industry trend in Q1, when you talked about the declines was that in sales or units.

Chuck Ward: We're speaking mainly in units, from a unit perspective, but I think sales perspective tracks the same.

Speaker Change: We're speaking mainly in units from.

Speaker Change: From a unit perspective, but as I think sales perspective tracks the same.

Vishal Shreedhar: I see. With respect to Gildan, what were your units year over year in Q1?

Speaker Change: And with respect to gilden when you.

Speaker Change: What was your units.

Speaker Change: Your units year over year.

Glenn Chamandy: Our price is neutral, and our activewear sales were up 9%, basically driven by our innovation. Basically, our soft cotton technology, our fleece, our Comfort Colors, our AA. Basically, I think we had a good quarter. We're taking share. We have a little bit of revenue from our new programs. Basically, all in all, there was no real price moving in the quarter.

Speaker Change: In Q1 prices neutral our prices neutral in our activewear sales were up 9% basically driven by.

Speaker Change: You know the more innovation.

Speaker Change: Basically our soft style technology, our fleece, our comfort colors are a a basically.

Speaker Change: We had a I think we had a good quarter, we're taking share.

Speaker Change: We have a little bit of revenue from our new programs.

Speaker Change: But basically all in all the you know there was no real price moving in in the quarter.

Vishal Shreedhar: Right. Given that mix was favorable, presumably units was something less than 9, but still positive?

Speaker Change: Right, but given that mix was favorable.

Speaker Change: Presumably units was something less than nine that stuff still positive mix with mix was lately. The same I don't think mix was.

Glenn Chamandy: No. Mix was slightly the same. I don't think mix was.

Luca Barile: Well, I think, again, if we take a look, you have to start with the market assumption. How the market performed. The market was down low to mid-single digit in Q1. For the reasons that Glenn went over, we were taking share, and we saw strength in our national accounts business. The categories that are touched by innovation, like Glenn mentioned, Comfort Colors, American Apparel, those were up double digits. Those really underpin the 9% growth in activewear. We're quite pleased with that performance. That's good performance in our quarter. The Q1 is usually the lowest quarter, and we have to remember that. Now, on the underwear and hosiery side, that's where we did have lower sales, 38%, but that's because of the phasing out of the Under Armour business.

Speaker Change: Well I think again, if we take a look you have to start with the market assumption right or what the how the market performed the market was was down low to mid single digit in the first quarter and for the reasons that that Glenn went over we were taking share and we saw strength in our U S. A in our national accounts business. The categories that are touched by innovation like <unk>.

Speaker Change: Len mentioned comfort colors American apparel, those were up double digits. So that those really underpin the 9% growth in activewear and we're I mean, we're quite pleased with that performance. That's good performance and in our quarter than in the first quarter is usually the lowest quarter and we have to remember that now in the underwear and hosiery side, that's where we did have a lower.

Speaker Change: Our lower sales, 38%, but that's because of the phasing out of the under our under armour business.

Vishal Shreedhar: Okay. When do you anniversary the introduction of the soft cotton technology?

Speaker Change: Okay, and when do you anniversary the introduction of the soft cotton technology.

Glenn Chamandy: The soft cotton technology? Well, it's hard to say, though, because you know why? It takes a long time for it to constantly get out to the marketplace. If you look at last year, we started being flat in sales, then Q2, we were 5, slightly up 1, and then as we moved through the quarters, it got a little bit better. It's hard to say, to be perfectly honest with you, but I would say to you that it's resonating with end users. It's a product of choice. I would say particularly when you look in a market where inflation is a factor, people look to trade down, and our soft cotton technology is a great trade-down product.

Speaker Change: The South Korean technology, well, it's hard to say, though because you know why because it's.

Speaker Change: It's it's it takes a long time for it to constantly get out to the marketplace. So like if you look at last year, we were.

Speaker Change: We started being flat in sales than we were a slight Q2, we were flattish slightly up one and then as we move through the quarters It got a little bit better.

Speaker Change: So it's hard to say to be perfectly honest with you, but I would say to you that it's resonating with end users.

Speaker Change: It's a product of choice and I would say, particularly when you look in a market where inflation is a factor.

Speaker Change: People look to trade down in our soft cotton technology is a great trade on product.

Glenn Chamandy: Maybe one other point that we haven't crossed today is that, but people don't realize is that the wholesale cost on our cost, what our customers are selling to end users, our basic bread and butter T-shirt, is selling for $2.30. There's two important points here. One, is that even if there's a slight price increase on $2.30, it's not going to even move the needle because by the time our products get sold to end users and end up at either a souvenir store or somewhere else, they're selling for between $20 and $25. That couple of cents a shirt is never going to move the needle. Secondly, because of our price point is so favorable, we think that we have a good chance in trade down, et cetera. I think we're well-positioned overall to continue our momentum and continue taking share.

Speaker Change: And you know.

Speaker Change: Maybe one other point that we haven't cross a day is that you know, but people don't realize that.

Speaker Change: The wholesale the wholesale costs on our cost what our customers are selling to end users. Our basic you know.

Speaker Change: Bread and butter T shirt is selling for $2.30. So there's two important points here one.

Speaker Change: Is that even if theres a slight price increase on.

Speaker Change: $2.30, it's not going to even move the needle because by the time our products get sold to end users and ended up at either souvenir store or somewhere else I mean, they're selling for between 20 and $25. So that that deal a couple of cents a share. It is never going to move the needle and secondly, because the price because of our price point is so.

Speaker Change: Oh, so favorable.

Speaker Change: Think that we have a good chance and trade down et cetera, et cetera. So I think we're well positioned overall to continue our momentum.

Speaker Change: And continue taking share and we're better positioned than anybody else in the market, which is I think is an important part because not everybody can offset the tariff cost like we do because of the R V.

Glenn Chamandy: We're better positioned than anybody else in the market, which I think is an important part, because not everybody can offset the tariff costs like we do because of our vertical integration, our low-cost manufacturing, our flexibility, our agility, and everything else that we have working for Gildan. We're pretty excited about the opportunity.

Speaker Change: Vertically integration, our low cost manufacturing, our flexibility or agility and everything else, we have working for <unk> and we're pretty excited about the opportunity.

Vishal Shreedhar: Thank you.

Speaker Change: Thank you.

Speaker Change: Yeah.

Operator 2: The next question comes from Martin Landry with Stifel. Your line is open.

Speaker Change: The next question comes from Martin Landry with Stifel. Your line is open.

Martin Landry: Hi, good evening, everyone. My question is on your Q2 guidance for operating margins. You're guiding for operating margins to be stable year over year. Last year it was your highest quarter, I think at 22.7%. Last year you had the Barbados tax credit for 6 months. That was a significant help. This year you're going to have the highest operating margin you've had in a long time. The question is how sustainable is that margin level? Where could margins go next in the long term? Is there upside to your 2025 level, or are you maxed out?

Martin Landry: Hi, Good evening, everyone. My question is on your Q2 guidance for margins or operating margins, you're guiding for operating margins to be stable year over year last year. It was your highest quarter I think at 22, 7%. So.

Martin Landry: This would be in last year, you had the Barbados strike a tax credit for six months.

Martin Landry: That was a significant.

Help so so this year you're going to have the <unk>.

Martin Landry: Highest gross operating margin you've had in long time.

Martin Landry: The question is how sustainable is that margin level and you know.

Martin Landry: Where could margins go next and in the long term.

Martin Landry: Is there upside to your 2025 level or are you maxed out.

Luca Barile: Well, thank you for your question, Martin. I think when you take a look at the operating margin and you take a look at the evolution of the business, right? Like you said, last year, the operating margin was 22.7%. We've guided to a similar operating margin for the Q2 of this year. You're correct that last year included the positive benefit of the jobs credits. It was introduced in May by Barbados. It was retroactive to the Q1. In our disclosures, you see that there was $17 million of that benefit. Now, that we have to take into account. Nonetheless, it is like you say, it's a strong operating margin, and we're comfortable with the guidance that we've given for the Q2, given the trends that you see exiting Q1, right?

Martin Landry: Well. Thank you for your question Marty I think when you take a look at the operating margin and you take a look at the evolution of the of the business right in that like you said last year. The the Mark the operating margin was 22, 7%, we guided to a similar operating margin for the second quarter of this year Youre correct that that included last year.

Martin Landry: Included the positive benefit of the jobs credits. It was introduced in may by by Barbados. It was retroactive to the first quarter and in our disclosures you couldn't you you see that that there was there was a $17 million of that benefit now so that we have to take into account, but nonetheless. It is like you say, it's a very it's a strong operating margin.

Martin Landry: And we're comfortable with the with the guidance that we've given for the second quarter.

Martin Landry: Given the trends that you see exiting Q1 right. When you take a look at where the growth comes from coming from categories, such as comfort colors right to American apparel.

Luca Barile: When you take a look at where the growth comes from, coming from categories such as Comfort Colors, right? American Apparel, fleece. These are categories that really do benefit the margin. With respect to the future view, we've given the guidance for the full year, right? 50 basis points versus 2024. Again, if you peel back the onion there, when you look at the assumptions, we are cautiously optimistic, but at the same time, we're comfortable with the guidance that we gave. Similar to last year in Q2, and 50 basis point expansion for the full year. That's the way I would think about it.

Martin Landry: It fleece and so these are categories that they really do benefit the margin and then with respect to the future view, we've given the guidance for the full year right 50 basis points versus 2024.

Martin Landry: And then again, if you Peel back the onion there when you look at the assumptions we are cautiously optimistic but at the same time, we're comfortable with the guidance that we gave so similar to last year in Q2, and 50 basis points expansion for the full year, that's the way I would think about it.

Martin Landry: Okay. That's helpful. Glenn, just coming back to the dynamic at play here. It seems like your competitive advantage is improving. It seems like you could increase your capacity utilization. I would assume that gives you a bit more flexibility to pick and choose which program you want to play in, and maybe potentially improve your margin. Is that a fair assessment?

Speaker Change: Okay, that's helpful and.

Speaker Change: Hey, Glenn just coming back to the dynamic at play here. It seems like your competitive advantage is improving.

Speaker Change: It seems like you're you could increase your capacity utilization.

Speaker Change: I would assume that gives you a bit more flexibility to pick and choose.

Speaker Change: You know, which programming and you want to play in and maybe potentially improve your margin is that a fair a fair assessment.

Glenn Chamandy: Well, I would say to you is that obviously that's our goal is always to return and focus on shareholder value. I would say yes, that would be the answer. Look, there's strategic opportunities for us right now. We're going to continue to focus on the long term for the business and making sure that we work with our customers for the long term. I think that's really going to be the most important decision that will drive our decision making.

Speaker Change: Well I would say to you is that obviously, that's that's that's our goal was always who returned.

Speaker Change: Focus on shareholder value. So I would say, yes that would be the answer but if you look at note there's strategic opportunities for US right now we're going to continue to focus on the long term for the bed business and making sure that we work with our customers for.

Speaker Change: For the long term.

Speaker Change: And I think that's that's really going to be the most important.

Speaker Change: Decisions that will drive our decision making.

Martin Landry: Okay. Thank you, and best of luck.

Speaker Change: Okay. Thank you and best of luck.

Operator 2: The next question comes from Mark Petrie with CIBC. Your line is open.

Speaker Change: The next question comes from Mark Petrie with CIBC. Your line is open.

Mark Petrie: Yeah. Good afternoon. Thanks for the question. Just a couple follow-ups. I guess first, with regards to price, have you observed any price activity or price increases from your competitors?

Mark Petrie: Yeah. Good afternoon. Thanks.

Speaker Change: Thanks. Thanks for the question just a couple of follow ups I guess first with regards to price have you observed any price activity or price increases from your competitors.

Chuck Ward: We have seen selective pricing out by some competitors as well. I think we're going to continue to see that dynamic play out through the rest of this quarter. I think it was early days. It took some people time to assess their supply chain. I think we could do so quickly due to our vertically integrated manufacturing, our ability to control what we do, and so we've moved accordingly. I think we'll continue to see that happen over the coming weeks and months.

Speaker Change: We've seen we have seen selective pricing out by some competitors as well. So I think we're going to continue to see that dynamic play out through the rest of this quarter. I think it was early days take took some people time to assess our supply chain I think we could do so quickly due to our vertically integrated manufacturer.

Speaker Change: During our ability to control what we do and so we've moved accordingly, but I think we will continue to see that happen over the coming weeks and months.

Mark Petrie: Would you characterize your moves as being roughly in line with the competitive set or lagging or leading?

Speaker Change: And would you characterize your moves as being roughly in line with the competitive set or lagging or leading.

Glenn Chamandy: Well, it's early days still. I would say to you that, look, we have, I think, an advantage because of our US content, both our cotton and our yarn, versus some of the competitors in the market. We'll see what happens. They might just sacrifice their margin. We'll see. I think we're being cautious on how we maneuver in the market on price, and we're going to leverage our infrastructure and our low-cost manufacturing.

Speaker Change: Well, it's early days still so I would say to you that look at I mean, we have I think is an advantage.

Speaker Change: Because of our U S content or both are caught in our yarn versus some of the competitors in the market. So we will see what happens I mean or though they may just sacrificed margin, we'll see but I think we've.

Speaker Change: We're being cautious on how we renew version in the market on price and we're going to leverage.

Speaker Change: Our infrastructure and our low cost manufacturing.

Mark Petrie: Yeah. Understood. Okay, thanks. Then, just on the cash flow, working capital, is that just sort of typical seasonality, or is there something else there and we should just sort of expect it to continue to normalize throughout the balance of the year? Then also related to that, I suppose, bit of a slower pace on buybacks for you in Q1 versus obviously being more aggressive on the releveraging in 2024. How should we think about the pace of buybacks through the balance of the year, assuming the 5% to 6% sort of general target is still the right number?

Speaker Change: Yeah understood. Okay. Thanks, and then just on the on the cash flow.

Speaker Change: Working capital is that just sort of typical seasonality or is there something else there and we should sort of expect it to continue to normalize through the balance of the year and then also related to that I suppose.

Speaker Change: Bit of a slower pace on buybacks for you in Q1 versus.

Speaker Change: You know, obviously being more aggressive on the re leveraging in in 2024, but how should we think about the pace of buybacks through the balance of the year I'm, assuming the 5% to 6% sort of general target is still the still the right number.

Luca Barile: Yeah, Mark, thank you for your question. For the first part, in terms of the working capital, look, the working capital is under control, right? Heading into season, it's normal that working capital as a percentage of sales will be higher. In terms of our projections and really our target, is that would moderate back to something around, let's say, 37% of sales towards the end of the year. The components of that will, in terms of the receivables and the inventory, will both moderate. We feel very comfortable there. We're also well-positioned. When you look at working capital at this juncture, working capital is a good thing because don't forget, number one purchasing criteria for our customers is availability. That comes with a working capital cost up front and then you monetize. By the end of the year, normalize back to 37%.

Speaker Change: Yes, Mark. Thank you for your question. So for the first part in terms of the working capital look the working capital is under control right. So like heading into season, it's normal that you get working capital as a percentage of sales will be higher but in terms of our projections and where really our target because that would moderate back to something around let's say 37.

Speaker Change: Percent of sales towards the end of the year and the components of that will in terms of the receivables and the inventory will both moderate so we feel very comfortable there.

Speaker Change: We're also well positioned when you look at working capital at this juncture working capital is a good thing because don't forget number one purchasing criteria for our customers as availability. So that comes to the working capital cost upfront and then you monetize so by the end of the year normalized back to 37% and in terms of the return of capital to share to shareholders.

Luca Barile: In terms of the return of capital to shareholders, that's of utmost importance for us. We've laid that out in our capital allocation strategy. Q1, $62 million, 1.2 million shares. The way to think about our NCIB program is that we will continue to buy back shares in a sustained cadence, 5% to 6% over the course of the year is the way to think about that. Really important to us is that as we provide capital back to shareholders and as we meet our objectives, we have to maintain a healthy balance sheet. Our leverage framework of 1.5 to 2.5 times is what we're comfortable with. You'll see that also be monitored in conjunction with the way we buy back stock. I think that should answer both of your questions.

Speaker Change: That's of utmost importance for us we've laid that out in our capital allocation strategy, our first quarter $62 million 1.2 million shares and the way to think about our NCI B program is that we will continue to buy back shares on in a sustained cadence and 5% to 6% over the course of the year is the way to think about that and read.

Speaker Change: Important to us is that as we provide capital back to shareholders and as we meet our objectives, we have to maintain a healthy balance sheet and our leverage framework of one and a half to two and a half times because what we're comfortable with.

Speaker Change: And so you'll see that also be monitored in conjunction with the way we buy back stock. So I think those that should answer both questions.

Mark Petrie: Yeah. It does. Thank you. Maybe actually just one quick one. I think I'm hearing you say that the account wins for 2025 were maybe slightly in place for Q1, but obviously getting much more material throughout the year. Is that right?

Speaker Change: Yeah, Yeah. It does thank you and maybe just one quick one I think I'm hearing you say that the account wins for 2025 were.

Speaker Change: Maybe slightly impact a slightly in place for Q1, but obviously getting much more material throughout the year is that right.

Chuck Ward: Yes, that's right. We feel most of those will continue through H2 and you'll see it accelerate there. Also, as Glenn mentioned, we also have line of sight of new programs into 2026 that we think will also give us the same level of sustained growth as we look through and support our mid-single-digit growth going into 2026.

Speaker Change: Yes, that's right I mean, we feel most of those will continue through the back half and you'll see you'll see it accelerate there and also as Glenn mentioned.

Speaker Change: We also have line of sight of new programs into 2026 that'll probably that we think will also give us the same level of sustained growth as we look through and support our mid single digit growth going into 2026.

Mark Petrie: Yeah. Understood. Okay. Thanks for all the comments. All the best.

Yeah understood. Okay. Thanks for all the comments all the best.

Chuck Ward: Thank you.

Speaker Change: Thank you.

Luca Barile: Thank you.

Operator 2: This concludes the question and answer session. I'll turn the call to Jessy Hayem for closing remarks.

Speaker Change: This concludes the question and answer session I'll turn the call.

Jesse Hamm: Okay, Jesse Hamm for closing remarks.

Jessy Hayem: Thanks, Sarah. Once 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.

Jesse Hamm: Thanks, Sarah once 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 2: This concludes today's conference call. Thank you for joining. You may now disconnect.

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

Jesse Hamm: Okay.

Jesse Hamm: Yes.

Jesse Hamm: Okay.

Jesse Hamm: [music].

[Analyst]: We meet down at our spot. We had a patio with a view of a parking lot. It was 2 for 1 and 4 for 2. Had Christmas lights in the middle of June. All hung up like I was on you. I say, Hey, hey baby, do you wanna come over? You say, No way, then you're moving closer. Next thing I know, you were in my T-shirt. Right there, your hair, messed up like a Guns N' Roses video. Oh, oh. I still got it up in my head. You were moving around in the TV light. I ain't ever seen anything like. Your dress on my floor. The way you wore my T-shirt. Yeah. You look good in my T-shirt, girl. Oh, yeah.

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