Dan Sullivan: Susan, thank you for the question. Yes, the Grooming portfolio internationally had a very, very strong quarter in large part led by Bulldog, which grew about 18% year-over-year. The brand has now reached number 2 in the U.K. ahead of NIVEA in the category, which is a significant accomplishment. And the team has worked very hard here. I would attribute it to three things: continued distribution gains, which we had profiled in for the year. Interesting innovation, we’ve introduced the new advanced line for Bulldog, which is a more premium priced skin set of products for the brand, which has been very well received initially. And then innovation this year in the category, we’re seeing it mostly in anti-perspirant deodorant expansion a bit into hair care. So the brand continues to really perform well in its home base and deliver some really excited growth.
Susan Anderson: Okay. Great. That’s really helpful. And then also I wanted to ask just on transportation costs and the issues going on in the Red Sea. If you’re those or what your expectations are for transportation for this year? And then also, just if you have any exposure to the issues there?
Dan Sullivan: Yes. So the exposure is fairly limited. It would essentially be shave product that moves between Europe and China. And what we’ve seen to date is very little disruption and very little complexity. We have built a bit of inventory. We have seen lead times expand a bit as we’ve had to go around the Cape as opposed to through the Red Sea. So far, it has been de minimis in terms of implications in both cost and complexity. Obviously, the teams have taken the right steps to plan for it, and we don’t anticipate that there will be significant implications for the business this year. But obviously, like everyone else, we’re monitoring the situation.
Susan Anderson: Okay. Great. Thanks so much. Good luck to the rest of the year. Thank you.
Rod Little: Thanks, Susan. Operator, next question, please.
Operator: The next question is Peter Grom with UBS. Please go ahead.
Peter Grom: Thanks, Operator, and good morning, everyone. I hope you’re doing well. So maybe one quick housekeeping question and then another one on gross margin. First, just kind of the pull forward you mentioned in Japan. Is there any way to kind of quantify that? I’m not sure if you mentioned that previously or not, but if you didn’t, it would be helpful if you could share that. And then specifically on gross margin, several times throughout this call, you mentioned a good chunk of this was timing related. But I would be curious whether the productivity performance this quarter gives you greater confidence that there could be further savings to unlock as we look ahead. Thanks.
Rod Little: Yes. Peter, good morning, just the first part on Japan, I’ll take it and then flip it to Dan for the broader gross margin perspective. Look, we had a solid quarter in Japan driven by really three things. One was cycling a period — in the year ago period, so October, November, December a year ago. So back to that had relatively low shipments because of the way we had traditionally phased the business where we would have heavy promotion wholesale pushes in that August, September window. We’re near the end of the year was just a historical practice that, frankly, I don’t like and I don’t think the team like, so we got out of that. And so think of it as we had an easy base to comp in the quarter 1, where we put up good growth.
That was, I would call it, in the range of $5 million to $10 million of an easy comp. But the bulk of the delivery then the other two things are market growth. That market has returned to growth. It had a delayed recovery coming out of the pandemic. And we now have the market in high single-digit growth territory, at least that’s where it was in the quarter just finished. And we have incremental pricing and revenue management coming on top of that, where we’ve taken a couple around pricing in Japan in a market that hadn’t seen much pricing activity over the last few years. So just catching up for inflation that is in the P&L is now benefiting us. We had the cost — think of it, we had the cost in the P&L, but not the pricing help. We’re now seeing that flow.
And so I think we’re optimistic on Japan for the future but not nearly at the rate of what you are seeing that we’re now cycling like-for-like comps on how we’re distributing and managing the business there.
Dan Sullivan: Yes. On the margin piece, Peter, what I would say is, look, we’re certainly encouraged by the results. And I think what we’ve demonstrated within our supply chain organization is we go pretty hard after productivity savings, and we’ve got in excess of 100 different initiatives ongoing at any point in time. And I think that the team will continue to lean in and accelerate where they can. So could there be upside there? I think there could be — would likely — more likely be on the cost side. I think on the revenue side, we’ve got a pretty good line of sight for what we phased in, all of our incremental pricing, which is mostly in international has been sold in now. So there’s no execution risk there, but I wouldn’t anticipate upside.
So I guess, short answer to your question, I think could be. We’re certainly not ready to call it yet, especially with some of the challenges we see in the macro environment. But if it were to come, it would be in productivity, more likely than in revenue.
Peter Grom: Thank you.
Rod Little: Thank you, Peter. Operator, next question, please.
Operator: At this time, there are no further questions. This concludes our question-and-answer session. I would like to turn the conference over to Rod Little, CEO, for any closing remarks.
Rod Little: Yes. Thank you, everyone. I appreciate the time today and the continued interest in the company, and we’ll talk to you in three months with an update on Q2.
Operator: The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.
