Peter Grom: Thanks so much. I’ll pass it on.
Jeremy Smeltser: Thanks, Peter.
Operator: Thank you. And one moment as we move on to our next question. And our next question is going to come from the line of Ian Zaffino with Oppenheimer. Your line is open. Please go ahead.
Ian Zaffino: Hi, [Indiscernible]. Thank you very much.
David Maura: Hi, Ian.
Ian Zaffino: How are you guys?
David Maura: Ian, I’m good. How are you doing? Happy Friday.
Ian Zaffino: Yes. You too, you too. I wanted to ask you on HPC. How are you thinking about a potential separation of that business. I know you had talked about in the past, obviously, [indiscernible] have kind of changed a little bit there. What do you need to maybe get a separation back on track. And then just as far as I guess, fundamentals, but any M&A in that area as well? Because I know you talked a little bit about M&A, but you didn’t mention HPC, so I wanted to kind of see how you’re squaring that? Thanks.
David Maura: Yes. Look, we continue to want to stand that up and build a separate appliance business. But right now, we’re trying to get it back to health. And I think we’re making some improvements there. We’re just out a 600 basis point expansion in the profitability of it in the back half versus the first-half. And we got a lot of work to do there. We just relaunched Remington globally. We’ve got some new talent in that business that I’m optimistic about. And I think the — while I think competition remains fierce, I think there’s going to be some rationalization too, we’ve seen a bankruptcy in the space. I think that retailers are going to want what we’re preparing to give them, which is fewer, bigger, better innovations.
We typically have brands that have good value price points as I think people are going to watch their spending on durable goods, they’ll be tighter with that spending, they’ll probably look for value price point product. And so I think if we can put a couple of quarters of better operating momentum together, and I think that improves our odds of accomplishing our goals. I’ve not been shy about expressing my view that I do like the idea of a combination. It’s synergistic and bring scale and allows us to get additional upside to shareholders. We’ve certainly been down that road in the past, however, unsuccessfully. And we’ll just have to see how that plays out. But I think as current owners of the business, it behooves us to get that thing in a better financial state and get some real earnings growth and operating momentum under it and then the options available to us should improve.
Ian Zaffino: Okay. And then I don’t mean to put you on the spot here. But when you think about earnings potential of that business, I think you threw out something along the lines of like $120 million or something along those lines. Is that how you still feel about that business? Has anything changed there? Just kind of given the environment, what you’ve seen recently?
David Maura: Yes, look, let me hit a head on. Look, you all put me on the spot at all. Look, our Pet business is run rating over $200 million in EBITDA now, right? You saw a $53 print in the quarter. Home & Garden had a very good quarter. We just reported. But we haven’t seen a great Home & Garden selling season going on to two years. So we don’t want to get over our skis on that. Let’s see how March and April plays out. One of the earlier questions there. We had a big retailer, dedicate a lot of space to electronic battery-operated landscape equipment. I’m not sure that went awesome, but maybe we get some space back there. So let’s just see how that goes, but I think we can rebuild the earnings power of Home & Garden. Your specific question around appliances look, we got a $1.2 billion business.
And this business used to be able to do high single digit, low double-digit EBITDA margins. It’s just I believe you’re seeing so much distortion in that industry because you had this giant demand caused by COVID. And because the retailer couldn’t get enough product from us or anybody else, they bought from anybody. And so I think you had a lot of fly by night guys get involved in the business. Hawking product from China at little to no margins with tons of recalls and it’s really damaged the economics of the space. But as that rationalizes and people go bankrupt and consolidation happens and retailers understand, hey, guys like us are in it to win it. We’re here to stick around and be here for the long term. we gained back margin structure.
And I think if we can, through better talent and global marketing operations, like we just demonstrated with Remington on launch in New York, we can start to rebuild that margin structure. Clearly, a 10% margin on $1.2 billion of revenue, it’s — that’s the number you just quoted. So I don’t think we’re going to get there in ’24. But I think we can lay the foundation for it in ’24 and maybe set up to it in ’25, ’26, yes.
Ian Zaffino: All right, great. Thank you very much.
Jeremy Smeltser: Thanks, Ian.
Operator: Thank you. And one moment as we move on to our next question. Our next question comes from the line of Olivia Tong with Raymond James. Your line is open, please go ahead.
Olivia Tong: Great, thank you. First question is just in terms of marketing spend and whether you could talk about sort of short- and long-term goals. Obviously, the capacity has been more nowadays. If you intend to be above the category to gain some lost ground a little quicker? Or is sort of more in line and build? Just want to understand your thought process on reinvesting back in the business first and foremost? Thank you.
