Good day, ladies and gentlemen, and welcome to the Q2 2012 Gildan Activewear Earnings Conference Call. My name is Valerie, and I will be your operator for today. [Operator Instructions] As a reminder, this call is being recorded for replay purposes. I would now like to turn the call over to your host for today, Ms. Sophie Argiriou, Director of Investment Communications. Please proceed.

Thank you, Valerie. Good morning, everyone, and thank you for joining us. Earlier this morning, we issued a press release announcing our earnings results for the second quarter of fiscal 2012. Concurrently, we issued a press release to announce the acquisition of Anvil Holdings. We also issued our interim shareholder report containing management's discussion and analysis and consolidated financial statements. These documents are available on our website at www.gildan.com and will be filed with the Canadian Securities Regulatory Authority and the U.S. Securities Commission. On the call with me today, I'm joined by Glenn Chamandy, our President and Chief Executive Officer; and Laurence Sellyn, our Executive Vice President and Chief Financial and Administrative Officer. Laurence will first be providing an overview of our second quarter financial results and our business outlook, after which Glenn and Laurence will be taking your questions. Before we begin, I will remind everyone that certain statements included in this conference call may constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve unknown and known risks, uncertainties and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. We refer you to the company’s filings with the U.S. Securities and Exchange Commission and Canadian Securities Regulatory Authority that may affect the company’s future results. I would now like to turn the call over to Laurence Sellyn.

Thank you, Sophie. Good morning. This morning we announced our results for the second fiscal quarter, which were slightly ahead of our previous guidance, and reconfirmed our sales and EPS guidance for the full year. Also, we announced the acquisition of Anvil, which further solidifies our leadership position in the printwear market; creates potential new growth opportunities to build in relationships with consumer brands supplied by Anvil; and provides attractive returns and capital and EPS accretion. We also announced plans to proceed with the modernization and refurbishment of Rio Nance I, which will begin in the third quarter of fiscal 2012 and be completed by the end of fiscal 2013. Adjusted EPS of $0.23 for the quarter were down from $0.53 per share in the second quarter last year, as the results continue to be significantly impacted by the consumption of inventories previously manufactured with high-cost cotton. The average cost of cotton in cost of goods sold in the second quarter was approximately $1.60 per pound compared with approximately $0.85 per pound a year ago, which negatively impacted year-over-year EPS by close to $0.70 per share and impacted gross margins by close to 2,000 basis points. Selling prices in Printwear were reduced in the first fiscal quarter to align with current cotton futures and were close to the same level in the second quarter last year. The higher cost of cotton resulted in significantly reduced margins and operating income for the Printwear division, which has historically been highly profitable and a significant cash flow generator for Gildan. The reduction in printwear industry selling prices in the first fiscal quarter has helped to stimulate a recovery in industry demand in the second quarter. CREST data for the second quarter showed 4.9% growth in demand in the distributor channel compared to the…

Thank you, Laurence. This concludes our formal remarks. We are now ready to start the Q&A session. [Operator Instructions] Thank you. Valerie?

[Operator Instructions] And our first question comes from Martin Landry of GMP Securities.

Can you talk about the impact of your acquisition of Anvil Holdings to the dynamics of the U.S. screenprint market? This -- I mean, combined with the HanesBrands exiting the market, can we expect more disciplined pricing going forward?

Well, we can't -- they're not the only competitor in the market, so we can't anticipate what will happen in pricing in the market. But I think if you look at where we are today, I think pricing over the last 6 months has been relatively stable. We project that slightly reduced prices in the back half of the year but pretty consistent with our forecast. So we're pretty comfortable with our pricing assumptions. And at the end of the day -- look, I'll give you maybe a little bit of background on the Anvil acquisition and the strategy behind it. This, we think, is a great brand for the company, which will allow us not only to achieve 70% market share, but we believe that there's opportunity to expand our market share to at least a 75% range with the dual-brand strategy. And as we continue to drive our initiatives as we go forward, the advantages of having Anvil as a brand in Gildan's portfolio will allow us to cover more products within the market, and there will be 0 duplication for the products at -- under the Anvil brand relative to what Gildan sells today. So it's going to allow us, we think, to generate significant market share without having price pressures, for example, relative to your point.

I'll just add, Martin, that what drives the economics of this acquisition is all the synergies that I went through in the formal remarks, and I won't go through them all again. Acquisition is highly synergistic, but we didn't include pricing as one of the synergies.

Okay. And can you help me reconcile your full year EPS guidance of $1.30? I believe you've raised your volume outlook for the U.S. screenprint industry to 5% growth for the second half from flat growth previously. You've also increased your market share assumption to 70% following the Anvil acquisition. Why don't we see an upside or a positive impact on your full year guidance?

I'll go through the puts and takes in our guidance with you, Martin. So on the positive side, as you say, we've increased our assumption for market growth. We've assumed 5% growth in the second half of the year in overall demand in the distributor channel compared with flat in our previous guidance, and that contributes about $0.05 of incremental EPS. The accretion from Anvil in the balance of the year is in the order of $0.03, plus we had a beat in Q2, which was, let's say, $0.02. So when you add these 3 together, you have positive impacts totaling $0.10: $0.05 for the higher market growth assumption; $0.03 for Anvil; and $0.02 for the first quarter -- second quarter beat. Going the other way is that we have capped, for the purposes of our projections, our combined market share at 70%, although as Glenn says, we're aggressively pursuing more share as we speak. So what that means is that we are now assuming for Gildan a 63% share compared with the assumption in our previous guidance of 65%, not that we won't pursue the 65%. But we thought it was prudent to cap the combined share at 70%, and therefore our Gildan share is 63%. So that has a negative impact going the other way of $0.03 per share. We have lower sales in our national accounts, and we've also assumed slightly lower distributor inventory rebuild in the third quarter. So the combined effect of these things is another negative $0.02 per share. We have a miniscule increase in our cost of cotton in the balance of the year due to the timing of flow-through of inventories. But every $0.01 change in the cost of cotton is $0.03 of EPS. So we have less than a $0.01 change, but it impacts EPS negatively by $0.02. And then we have also, as we mentioned, the refurbishment of Rio Nance I, which is resulting in a onetime write-off of obsolete equipment totaling $0.03. So add up $0.03 negative for our market share being 63% versus 65%; $0.02 for lower growth in other screenprint markets; $0.02 for cotton; and $0.03 for Rio Nance, you offset $0.10 of positives. In addition to that, we have slightly lower screenprint selling prices, which is in the fleece category, but that's offset by more favorable product mix.

And our next question comes from Tal Woolley of RBC Capital.

I'm wondering if you could talk a bit about the retail performance in the quarter, if you can offer a little bit more color. I mean, you cited some destocking and weaker market conditions. If you could just give us a little more feedback about what exactly happened.

Well, retail market conditions are weaker. But the key focus of our retail division -- of our Branded Apparel division just now is improving our profitability through all the building blocks we've previously outlined with the market, including benefiting from the consolidation of our manufacturing in Honduras and the ramp-up of our new facilities, more favorable product mix, the accretive impact of Gold Toe and the Gold Toe integration. So in spite of the high cost of cotton, we were very pleased with the profitability of our retail division. And we're on track to achieve our objectives -- or achieving our objectives for margins and returning capital for this division, as we benefit from lower-cost cotton in the second half of the year.

And maybe just to add to that is, as we continue to focus on our branding strategy, we've been very successful. We've been able to increase our Gildan-branded sales by over 100% this year over last year, and it represents almost above 15% of our overall retail volume today. So we're very encouraged by the penetration of our brand in retail, and we're also spending a lot of time reinvigorating the Gold Toe brand and driving it as well in retail. So our branding strategy in both Gold Toe and Gildan is performing very well, and we're very excited about the opportunities as we go forward.

Okay. You had mentioned earlier this year, I think, that -- I want to say it was approximately $40 million to $50 million in programs at retail that you weren't necessarily as interested in pursuing going forward due to profitability reasons. Is that -- like when you're talking about the destocking, is that sort of what you're talking about, that you're still unwinding those programs? Or that you're seeing more destocking related to market conditions?

Well, there's been a little bit destocking due to market conditions. But what you're referring to is basically -- look, we've divested ourselves of unprofitable programs. And what we've done is we replaced those programs with branded products, either through the Gildan -- any of the Gildan brands, as well as we're continuing to drive our Gold Toe initiatives. So we basically -- our -- in our guidance, we have a projected sales. We're losing some unprofitable business, but we're regaining business as we go forward that sort of meets our criteria from a branding perspective and margin perspective.

Okay. Just lastly on Anvil. If you could talk about what sort of the production strategy is there right now and the sourcing team, any sourcing teams, things like that, that are there and sort of how you see that evolving under your initiative.

Yes, sure. Look, there's lots of opportunity for us, and the integration of Anvil will happen very quickly. By the end of this fiscal year, all the wholesale volume they have, which is sold to our -- obviously, to our U.S. distributors will be fully integrated into our SRL division, and that's including manufacturing, distribution, sales. Everything will be produced and serviced out of our existing infrastructure. So we'll capitalize significantly on synergies as we go forward into 2013 on that piece of the business, as well as we're going to continue to, right away, let them lever all of our cost of raw material, dyes and chemicals, transportation, et cetera, and also provide them the expertise that they could use to continue lowering their overall cost structure. They also have a significant amount of work being performed by contractors, which are high cost. All these synergies we'll be able to help them with immediately, and we think this would be a very easy integration in terms of our facilities. And the thing about Anvil which is, I think, unique, which is -- and the reason why we looked at the company was twofold, is that the brand stands for a little bit different than Gildan. And that's the reason why we believe that our -- historically, in our own internal minds, we thought we can generate our own volume close to 70%. We think with Anvil, we can definitely grow that market share closer to 75%, because they're -- we're going to be selling products that are unique to Gildan and -- like, for example, the Organic, Recycled, the Sustainable-type products, as well as the whole brand is more youthful in terms of some of the styling in the line that they have versus what Gildan has. And they also offer distributors tear-away-type products that they can sell to large screenprinters that they can't service today through [ph] the Gildan brand. So we think that the combination of the 2, aligning our distributors with more competitive pricing under Anvil, will allow them to grow their overall market and allow us to grow our market share with our existing wholesalers. So we're very excited about the opportunity.

Are there -- so there's no production there. No production assets there at all, or is it like...

They have some small production assets.

And our next question comes from Kenric Tyghe of Raymond James.

I just wanted to follow up on the cotton guidance for the third quarter. Specifically, given that volumes were ahead of your initial expectations and your initial expectations had assumed that you would cycle high cotton cost inventory during the third quarter, certainly I would have thought, given the volume performance, that you would have now cycled the high cotton cost inventory very early in the third quarter if not already having cycled it, and yet we are still calling out cotton sort of pressures through the third quarter and even the back half. I wonder if you would just walk us through that please, Laurence.

Sure. What you're focusing on, Kenric, is the higher market growth and stronger market recovery in the distributor channel, but that was offset by the lower-than-forecast growth in the national accounts. Plus, our international sales were up approximately 25%, but we forecasted slightly higher growth than that even -- but that was impacted by the situation in Europe. So notwithstanding the stronger growth in the distributor channel, sales were the same or marginally lower than what we had forecast. So that's why you're not seeing faster consumption of cotton.

And the cost of cotton, as it flows through our cost of our goods sold is as we forecasted, as we turned our inventories, as we go forward.

Fair enough then. Just -- and if I could then, you commented on Anvil being well positioned with the likes of Nike, adidas and Reebok. Obviously, on the Gold Toe Moretz, we had Under Armour and New Balance, et cetera. Can you just perhaps build out some of your thinking there? I mean, how does well positioned translate or flow through with a Gildan branded product, the licenses you've acquired for a number of other non-national retailers sort of brands? Just trying to sort of see and connect a few of the dots here, if you would.

Sure. Well, look, just like the licenses that we do own today or have today with Under Armour and New Balance, our objective is to try and exploit and try and expand our opportunity with these companies into other product categories we are licensing is one thing we're working on. And all these other companies you just mentioned like Nike, adidas, PUMA, which are branded companies, are all looking for partners to help them through their licensing to drive their brand strategy, as well as potentially supporting them through manufacturing. So -- and that's primarily what Anvil did. So we think that through those relationships, there could be opportunities for us on both those fronts. There's a big movement also, from a client's point of view and sustainability point of view, to produce -- branding companies are looking to produce and align themselves with companies that have environmentally and sustainable practices, which Anvil has positioned themselves as a company. But we are the leader in terms of sustainability in our industry, so that will also allow us to build relationships with these types of companies. So it opens up a door. It's another area of opportunity for us, and we're pretty excited about the future outlook.

And just finally, if I could, on the Anvil acquisition. You specifically called out that you're not assuming any of Anvil's outstanding debt. I may have missed it, but you -- could you put a number to what their outstanding debt is and how you're structuring the acquisition?

Well, I think the only thing that's relevant is that we're financing the acquisition out of utilization of our bank facility. And notwithstanding the use of the facility to finance acquisition, we're projecting to generate -- that our bank -- our use of the bank facility will come down dramatically in the second half of the year, due to our very strong internally generated free cash flow in the second half of the year.

So no, it's -- okay. Just on Anvil itself, see -- is there -- what -- I can't find any reference to what their indebtedness is that you're not assuming or the debt that Anvil was carrying when you acquired the 100% of the common shares.

Well, I think the point is that we're paying $88 million for the company, debt-free. They're going to pay off their existing debt. So that's their information, how their capitalization is divided between equity and debt. We're paying $88 million and acquiring the company without any debt. And maybe the other thing I would add is that one of the synergies I mentioned is that we believe that we will reduce their working capital as we go forward, which would have an effect of slightly reducing the effective cost of the acquisition as we go forward.

And our next question comes from Eric Tracy of Janney Capital Markets.

I guess a follow-up on the Anvil. I guess, Laurence or Glenn, it seems like you're going to be set up by the end of this year in terms of being fully integrated. Why shouldn't we expect some levels of sort of synergies and therefore accretion to come through in '13? Is that just a level of conservatism? Is there something else going on there?

What Glenn said is the sales side of the distributor business will be integrated into our screenprint or Printwear sales division in Barbados, but the manufacturing integration will take place during 2013.

Okay. And then, I guess, back to sort of the core kind of business within screenprint. A lot of favorable things now, picking up share with Anvil. I know Hanes is exiting a portion of their screenprint business, which I think translates to, call it, an incremental $200 million, $250 million opportunity for you all. Looks like there's kind of incremental growth opportunities relative to what seems like are some still sort of pricing issues. It seems like the national accounts are relatively flat year-over-year, little bit of downtick on the share that you're expecting. Can you kind of just walk through those various puts and takes within the core?

I don't think we quite -- we're not sure we've got thrust of the question, Eric. What period of time are you talking about?

Well, again, as we look forward -- I mean, let's just focus on then from a pricing perspective, it clearly seems like there are some irrational -- other vendors being relatively irrational out there, at least continuing to press. Is that what's sort of driving the industry demand side? When do we sort of reach equilibrium there? And sort of how do you drive share, just at the core? And then secondarily, again, it seems like there are some incremental volume opportunities out there for you to take as well.

Maybe to start, in terms of pricing, irrational is -- I would say, is not necessarily the word where we are today. It may have been irrational when high-cost cotton was flowing through at $1.50 (sic) [$1.60] a pound. But if you look at the pricing that we're selling at today relative to the future price of cotton, we're very comfortable with the pricing in the marketplace today. And I think that's proven to be very successful from all fronts, in terms of generating demand and as well as generating market share. And as well as, if you look at some of the recent announcements of some of our competitors, who are not part of what CREST is -- let's say, for example, they, as well, are having significant issues in terms of their earnings and earnings power. So where we are in pricing today in our low-cost manufacturing, we feel very comfortable that we're going to continue to drive market share. And based on what we see happening in April, we're very excited about our momentum in the marketplace. The opportunity, I think, that -- what we're trying to do now, in the combination of Gildan and/bringing Anvil as part of the Gildan cost structure, is to allow our customers, which is our wholesale distributors, to capture more share of the broader market, because not all the sales in the market are captured out of CREST. It's a representation of where the market's heading. The CREST is probably only really 60% of the broader market. Because a lot of other manufacturers, like Delta and ANG [ph] for example, don't -- are not part of CREST in terms of their sales. So with Anvil, we're going to give our distributors a tool -- pricing and product line, really, to reach a piece of the market that we really never served before as Gildan. So -- and that's where we see the big opportunity, not just for us but also for our customers. And we believe that, that will drive additional share for us and as well as our customers as we go forward.

I just want to make -- the one point that Glenn made is that as we benefit from low-cost cotton at the end of the year and cotton comes in line with industry pricing, that's going to translate into attractive economics for the Printwear business, which will be back to its historical levels of profitability.

Okay. Just real quick, lastly. Are you able to maybe say -- maybe not absolute, where you're locked in, but how far you're sort of locked in on cotton into '13? I would imagine you're relatively...

Well, we'd rather not say right now, to be perfectly honest with you. We're covered for the balance of this year.

And our next question comes from Andrew Burns of D.A. Davidson. Andrew Burns - D.A. Davidson & Co., Research Division: Just to follow-up on the pricing. I just wanted to clarify. In the guidance, it talks about, for the Printwear business, slightly lower pricing than the second quarter, and you talked about being comfortable with the current pricing. Could you just help me reconcile these 2 comments? And then it seems a bit counterintuitive if there would be any further pricing degradation with your acquisition of Anvil and HanesBrands downsizing.

The pricing in the back half of the year is more mix-related as we promote some of our fall products, like fleece and so forth. So it just -- it's a larger discount relative to -- but that's historically consistent on a year-over-year basis. Andrew Burns - D.A. Davidson & Co., Research Division: Okay. And you've provided a very detailed EPS bridge between the old guidance and the new guidance. Would there be any way to do that for the top line as well, volumes or market share acquisition?

So we're -- the impact of incremental sales from Anvil, less the effect of capping Gildan share at 63% compared with 65%, the net of these 2 things is adding about $65 million to our sales. The stronger market recovery in the distributor channel is adding about $25 million. And the lower sales in the national accounts, which was primarily in Q2, is offsetting a stronger market recovery. So you're left with $65 million, $70 million of incremental sales, which is essentially the impact of Anvil, less the fact that we capped our organic share.

And our next question comes from Mark Petrie of CIBC World Markets.

Just want to clarify a couple of small things on Anvil. What percentage of their revenues right now overlap with current Gildan product?

About 60-40 between Printwear and what would go into Branded Apparel.

You mean what's wholesale -- what's their wholesale side of the business, is that your question?

Well, I just mean in terms of -- you don't compete on the Organic and Recycled and all that kind of stuff and you say that it's kind of bringing a bit of a different angle to your assortment. What percentage of their sales are in SKUs that you would actually sort of directly compete with already?

They have 2 core T-shirts that are relatively similar to Gildan's, but those shirts are sold with what they call a tear-away label, to allow printers to relabel those shirts. So they're actually uniquely different, to be honest with you, even than the ones that we have. The only issue they have right now is they're not price-competitive on those shirts. So the answer is that there's really nothing that is going to be, on a go-forward basis, similar to what will be sold in Gildan on a unit-by-unit basis. I mean, they're similar in -- a couple of styles are similar. But by and large, most of the products are completely different than what Gildan's offering today.

Okay, that helps.

I'd also add that about 60% of their sales are in the Printwear side of the business and about 40% is the non-retailer brands, so would be part of Branded Apparel. And that's the side of their business that has been growing.

Okay. And then on that wholesale, how much of that is north -- or U.S., and how much of it is Europe and Asia?

The bulk of it is U.S.

Okay. So is -- and is the stuff that you're going to be supplying into Europe and Asia, is that -- are you going to move that into Bangladesh?

Well, whatever we supply in Asia is obviously produced in Bangladesh. And what we supply out of our -- for Europe, we supply both Bangladeshi product as well as our Honduran product. We have flexibility to go on either supply chain, so depending on the product and what quality of the product is made on specific factories.

Okay. Is -- so Bangladesh is still at sort of 3.5 million dozens capacity?

Yes, it is. And it's -- we have a major expansion project in Bangladesh. And as we go through to next year, the capacity there will be closer to the 5 million level.

Okay. And sorry, just -- sorry, one other. Just to clarify, how much of the actual capacity -- manufacturing at Anvil will be brought in-house at Gildan, and how much will still remain third party? Like I'm just wondering in terms of -- are there some low-volume SKUs that you don't want to be producing in your facilities?

We're currently meeting with Anvil management today as we've announced the acquisition and discussing our integration plans. And we'll give you more color later on.

And our next question comes from Susan Anderson of Citi.

On the retail part of the business, maybe if you could just give a little bit more color on the destocking. Are you seeing it in your core Gold Toe operations, or is it more the private label? And is there any expectation of when this should end?

Well, we feel that it's probably come to a point where it -- we've been destocked. I mean, retailers are managing their inventory very tight and to the point where some of our retailers have holes in their -- in the pegs on the shelves. So we, hopefully, will see a restock. And then we're not sure why the -- they're managing their inventory so tight. It could be because of all the holiday seasonal products that didn't sell so well. But as we go into our back to school, hopefully, that will correct itself.

Okay. And so it's in both the Gold Toe and private label. It's like across the board then?

It's pretty much across the board.

Okay. And then on the Anvil acquisition, I think you mentioned they had a couple of plants of their own. So will you guys be closing those plants?

Like Laurence said, look, we haven't met with management, and we have -- still probably have no intention to closing their facilities. But they also work with contractors as well. And so we're going to set our plan with management as we meet with them in the coming weeks.

And our next question comes from David Glick of Buckingham Research Group.

Laurence and Glenn, just wondering if you -- now that you are -- you made the decision to modernize and reopen Rio Nance I, can you give us a sense for your latest outlook as to how you're going to utilize each of your textile manufacturing facilities? Was the Anvil acquisition kind of a trigger to make this decision? Just wonder if you can give us some color on that.

Well, the existing plants, after we shutter Rio Nance I, which is DR, Rio 2 and Rio V, are going to be running at the end of this fiscal year at 100% utilization. And obviously, our utilization is all a function of mix. And with some of the new programs, fleece programs we just picked up, that we'll see the mix of those facilities somewhere in the neighborhood of around 70 million dozen. And we'll be running at that run rate as we complete this fiscal year, and we project to run at that rate through next year. We've absorbed a significant amount of our inventory as we went through this fiscal year, as you can see in terms of our working cap and our cash flow as we go forward. But there are actually still a little bit of inventory drawdown, we think, will still occur in 2013. So based on that capacity and drawing down our inventories, we feel comfortable we have the capacity to support our needs for '13. And we're going to pursue one, and then depending on market conditions, that plant will start in the back half of the year and re-ramp up. And we'll have a little bit of flexibility, obviously, because when it comes online, it's going to have a significant amount of capacity, and we'll go accordingly. So we'll be pretty full, to answer your question, with the existing facilities and looking for additional capacity and opportunity.

Okay. And then secondarily, on the Branded Apparel side. I was wondering if you could give us a sense for your sales trends in the quarter, excluding the acquisition of Gold Toe.

Well, our trends are going okay, I mean, like anything else, I mean, retail is not gangbusters. But we feel comfortable with the guidance we set forth. Obviously, we'd like to see the retail environment more robust, but it's obviously a function of the overall broader economy. But we think we're positioned well. And really, if you look at what we're achieving right now as a company is we're looking at 2 things. One is to continue improving the profitability. So you'll see in Q4, we have a significant increase in profitability in our Branded Apparel. And as we go into next year, that's going to significantly increase on a year-over-year basis. So the Branded Apparel will be a big contributor to our EPS growth as we go into 2013. At the same time, we're focusing on our brand strategy, where -- Gildan brand right now, we've over doubled the volume of Gildan brand this year. We have a lot of opportunity to continue growing that. We'd like to see that grow significantly next year. So we're pretty happy with our positioning. And first of all, most importantly, we want to continue making good earnings, and second, we want to continue to drive our Gildan brand and make sure we reinvigorate Gold Toe. And we've done a lot of work this year with retailers under the Gold Toe side to continue reinvigorating it. We've got our young men's Gold Toe brand, which is our G brand, at Kohl's, which is very successful. And we're looking to lever our Gold Toe brands into other product extensions like we said before, and we have some tests that are going on in retail. And hopefully, that will materialize into new programs as we go into '13.

Okay, great. And just to clarify. I mean, I think -- is it fair to assume that, excluding Gold Toe, that your sales were down in the quarter?

They're flat.

And our next question comes from Pat Naccarato of Canada Pension Plan.

Also, just a follow-up question regarding the shutting down Rio Nance I a little bit early. Can you just help explain why the $0.02 impact this year becomes -- assuming you have enough capacity in Rio Nance V to take up that capacity, so is it just the incremental cost of construction? And then as a result, if you are closing it down a quarter earlier, do you believe that you'll open it up a quarter earlier next year and you'll get that impact back this time next year?

Well, I think that -- 2 things. One is that the impact you're talking about was some infrastructure that we had to write off because we're redoing some of the infrastructure in Rio I, which is maybe the impact you're talking about, the charge we took for the...

Is it the charge that we took that you're talking about...

Yes.

That's nothing to do with the timing of the facility. This is just now that we've made the decision to restart the facility and defined our plans for starting up the facility, there is some equipment that will not be reutilized. And that is being written off, now that we've formalized, crystallized our refurbishment plan. And the timing is being accelerated based on the projections we have for sales, and where we're going to need further capacity.

And also because of the successful ramp-up of our Rio Nance V, which is on schedule and meeting our objectives in terms of ramping up to its full capacity. So we have enough capacity to continue driving our sales for this fiscal year, as well as, as we run into next year with the 3 facilities on an annualized run rate running at full capacity, which will give us the manufacturing synergies as we move into next year. Also, on the manufacturing side in terms of synergies as we move into next year, we've now completed all of our biomass in Honduras. So all of our plants are running on biomass, which is a significant savings, and that impact will also be felt next year. And also, the full integration of sock manufacturing out of the United States is complete, and we have a significant amount of the Gold Toe socks that have been integrated into our facilities, which will also continue to increase the earnings in Branded retail as we go forward into 2013 as well.

And our next question comes from Jim Duffy of Stifel, Nicolaus. Jim Duffy - Stifel, Nicolaus & Co., Inc., Research Division: A question on the acquisition of Anvil. Do you anticipate an antitrust review of that?

We have no regulatory approvals that are required, and any divisions to -- closing at this point are standard red tape. And we expect to close the transaction in the next couple of weeks. Jim Duffy - Stifel, Nicolaus & Co., Inc., Research Division: Okay, great. And then Laurence, can you just speak to how much revenue Gold Toe brought during the quarter?

The Gold Toe's tracking the same sales level that it had when we acquired the company, which is close to $300 million. Jim Duffy - Stifel, Nicolaus & Co., Inc., Research Division: How about for the quarter?

Well, I -- the business is now integrated into Gildan, and I don't think we want to separate out the sales for the Gold Toe brand versus Gildan. I think you can assume it's pretty well half and half. Jim Duffy - Stifel, Nicolaus & Co., Inc., Research Division: Okay. Because -- where I'm going with this is you mentioned 100% increase in the Branded Apparel as evidence of your return on the marketing spend, but it seems all that increase is coming from Gold Toe.

No, no, no. That -- I was talking about the Gildan brand increased 100% this year is our forecast on a year-over-year basis, which is what our strategy is. But last year, we -- beginning of the year, we announced that we're going to divest ourselves. Because the Gildan -- before Gold Toe, the Gildan standalone retail strategy was comprised of very little Gildan brand and mainly private label sales to mass-market retailers. What we've been able to achieve is the same sales level volume. We divest ourselves of unprofitable private label sales and converted those sales into go-forward Gildan-branded sales, and that was sort of our objective. And we're on that path. And what we were able to achieve was to double the amount of sales in our Gildan brand for this year.

This is one of the main reasons, Jim, why the profitability of the Branded Apparel division is improving, because we're seeing more favorable mix within the Gildan side of the business. So it's not necessarily higher volumes, it's more the fact that we're replacing, as Glenn says, low-margin programs with high-margin branded programs. And that's favorably impacting the results of the Branded Apparel division. Jim Duffy - Stifel, Nicolaus & Co., Inc., Research Division: I see. That's helpful. Can you speak to maybe how much of that lower margin volume is still remaining in the mix, or are you at a point at this juncture where you feel like you've successfully navigated from that to the higher-margin businesses?

No, we still have some. But part of that low-volume business is generating volume. So we still have some. But as we continue to go forward, we're going to continue to improve our mix, I think, is the way you have to look at it. And that's really our objective is to increase the mix, improve the mix and significantly improve the bottom line, basically, and get a better return on our use of capital.

And our next question comes from Susan Sansbury of Miller Tabak. Susan R. Sansbury - Miller Tabak + Co., LLC, Research Division: Way back at the beginning of this presentation, I think you mentioned something about startup expenses at Rio Nance V and plant downtime. Laurence, can you quantify what those expenses are going to be? I don't know if it was for the -- I guess it was for the year, or so far this year? Or can you give us some idea what these expenses are?

What I said is that in the third quarter, there will be some of the initial production from the startup of Rio Nance V that was produced at the beginning of the year being consumed in inventory. That was planned, and it impacts our results in the -- our manufacturing efficiencies in the third quarter negatively by a few cents. Susan R. Sansbury - Miller Tabak + Co., LLC, Research Division: Okay. And then the plant shutdown?

In addition to that, we just took a couple of extra days at Easter, which is also impacting manufacturing efficiencies for the third quarter. Susan R. Sansbury - Miller Tabak + Co., LLC, Research Division: But not enough downtime to have an EPS impact, or de minimis?

It's reflected in our guidance. Overall, we have year-over-year about -- excluding the Rio Nance I downtime charge, we have about $0.10 worth of negative manufacturing efficiencies that are nonrecurring, that are flowing through our results in Q3 and reflected in our guidance. And these are coming from consuming start-up production from Rio Nance V and the additional downtime, plus some input in -- some increases in input -- purchased input costs that will be eliminated from the startup of biomass. Susan R. Sansbury - Miller Tabak + Co., LLC, Research Division: Okay. I appreciate this. One -- is working -- going back to Anvil, you expect to be able to increase their working capital -- I don't know, efficiency, if you will. Is there any ratio or number that you can point to at this point, to tell me how much more free cash flow equivalent or efficient you're going to be now that you own Anvil?

Maybe about $10 million would be a good number, Susan.

And our next question comes from Scott Rattee of Stonecap Securities.

Laurence, just a question for you. Just to be clear on taking the downtime. Will you still be taking the downtime in the fourth quarter as you normally do, or was that -- or is what you were saying is that downtime that you were normally taking in the fourth quarter was just moved into the Easter period so we will not necessarily see it in a fourth quarter?

Yes. We basically took the extra downtime in the Easter period. Based on where we are today, we're still contemplating and looking to see if we'll take -- if we need additional downtime in the fourth quarter. But with the integration of Anvil, that will consume some of our capacity, let's say, for example. And hopefully, we'll have our inventories in balance, where we think we want to have them, by the end of the year.

Okay. So put another way, what you're saying is your current guidance does not actually explicitly have any downtime in the fourth quarter at this point.

We have a little bit of downtime still planned in our guidance in Q4.

You do. Okay, okay. And then sort of switching gears. I just wanted to circle back around. At the beginning of the year, you had noted that you were going to introduce some new sort of higher-value products, more stylized women apparel, sort of polo shirts and stuff like that. I guess we haven't touched on that in a little bit. You have also just sort of brought back -- obviously, brought back your market share guidance. So I guess I'm wondering if you could maybe give us a little bit of color on what that sort of initiative is looking like, sort of year-to-date.

Well, these types of products in which we anticipate to continue developing as we go forward are usually developed on an annualized basis. So really, our catalog was put to bed in June of last year for this fiscal year, and now we're looking to place new product for 2013. And we do have some new exciting products in our lineup as we go forward that we're offering and showing to our customers as we speak. A lot of the trend-right, more youth products that we maybe could have put into Gildan line now we just acquired through Anvil. So we have good diversity of, I would say, trend-right fashion products that are going to be now in the Anvil brand, that already have distribution placement and support from customers. So that's something that accelerated our ability to have product placement in the market, and that's one of the advantages of the acquisition. We're also looking, as we go forward into next year, into the performance category. We're going to have a lineup of performance-type fabric. So we're continuing to have lots of innovation in our products, and we're very excited about our positioning. And we think that this will all generate more market share than we anticipated. I mean, the 70% base that we're talking about, we think, is a conservative number, and we'd be disappointed not to continue driving market share closer to the 75% level as we go forward with all these initiatives we have in place.

And our next question comes from Anthony Zicha of Scotiabank.

Glenn, if we look at the new SKU count that you introduced this year, maybe you can give us an idea how many that were introduced. But I figure there's several hundreds of them. Furthermore, now you're adding the Anvil acquisition to the numbers. Considering the cost of carryforward distribution, do you believe there's any risk of distributor pushback?

Well, no, what we're going to do -- look, we spend a lot of energy making sure we partner up with our distributors and there's not going to be any product in either of the brands that won't make sense to our customers, because if it doesn't make sense for them, it doesn't make sense for Gildan. So that's why I said earlier is that all of the products that Anvil will sell in the future will be distinct in nature and provide value to our customer and our customer's customer. And that's really what objective is. So there are some of Anvil SKUs that will be eliminated, and they'll be replaced with maybe more productive SKUs as we go forward. But that's what our sales group is in the process of doing right now, is making sure that we convey this message to our customers. In fact, that's really where I think that our customers are going to be, in a sense, better off with Gildan acquiring the company because truthfully, as in the past, there might have been some duplication. And now we're going to eliminate that duplication for our customers and allow them to be more productive in terms of their SKUs in their warehouses as we go forward.

And with that, I thank everyone for joining us today, and we look forward to talking to you again at our next earnings conference call in August. Thank you, and have a nice day.

Ladies and gentlemen, this does conclude your conference call for today. We thank you for your participation. You may now disconnect your lines, and have a great day.