Financial Data and Key Metrics Changes - In 2024, global revenue increased by 5%, with Wrangler's revenue growing by 9% and Lee's revenue declining by 5% [24][26][20] - Adjusted gross margin expanded by 160 basis points to 44.7%, driven by lower input costs and mix [30] - Adjusted earnings per share (EPS) was $1.38, representing a 2% increase compared to the prior year [31] Business Line Data and Key Metrics Changes - Wrangler's global revenue grew 9% in the fourth quarter, with notable growth in outdoor (29%) and female segments (19%) [17][25] - Lee's direct-to-consumer (DTC) revenue grew double digits, while wholesale revenue declined significantly [20][27] - Non-denim categories accounted for approximately one-third of global revenue, with outdoor business growing at a mid-teens rate [9] Market Data and Key Metrics Changes - The U.S. market saw a 9% growth in Wrangler revenue, while Lee's U.S. revenue decreased by 6% [24][26] - In Asia, revenue performance was better than expected, while Europe performed as anticipated [24][29] - Point of Sale (POS) trends showed a decline in February after a strong start to the year, reflecting consumer conservatism [42][101] Company Strategy and Development Direction - The company is focused on Project Genius, aiming for $100 million in savings, with benefits expected to flow through in 2025 [11][34] - Plans to explore shop-in-shop concepts in key retailers to enhance consumer experience [9] - The addition of Helly Hansen is expected to drive growth and enhance the brand portfolio [46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current uncertain environment, emphasizing operational strength and brand investments [6][23] - The company anticipates a transition year for Lee in 2025, focusing on repositioning for growth [20][21] - Management noted that consumer sentiment is currently cautious due to various macroeconomic factors [101] Other Important Information - The company returned $198 million to shareholders through dividends and share repurchases in 2024 [33] - Inventory decreased by 22% to $390 million, achieving an annual turnover target of approximately 3.5 times [32] - The company expects cash from operations to exceed $300 million in 2025 [47] Q&A Session Summary Question: Details on Lee's performance and DTC vs. wholesale dynamics - Management explained that DTC growth reflects successful new product introductions, while wholesale performance lags due to pipeline filling [50][53] Question: Gross margin expectations and seasonal dynamics - Management clarified that gross margin is expected to increase by 30 basis points in Q1, with a moderation in Q2 due to seasonal dynamics and product cost inflation [51][52] Question: Insights on consumer segmentation for Lee - Management indicated a shift towards targeting a more fashion-conscious consumer, moving away from overly aspirational segments [91][92] Question: Impact of potential tariffs on operations - Management discussed that tariffs would begin to impact the P&L in late Q2, with mitigating actions expected to show results in late 2025 and early 2026 [94][95]