Welcome to the Q2 2013 Gildan Activewear Earnings Conference Call. My name is Christine, and I will be your operator for today's call. [Operator Instructions] Please note that this conference is being recorded. I will now turn the call over to Sophie Argiriou, Director of Investor Communications. You may begin.

Thank you, Christine. Good morning, everyone, and thank you for joining us. Earlier this morning, we issued our press release announcing our earnings results for the second quarter of fiscal 2013 and our interim shareholder report containing management's discussions and analysis and consolidated financial statement. These documents are available on our website at www.gildan.com, and will be filed with the Canadian Securities Regulatory Authorities and the U.S. Securities Commission. I'm joined here today by Glenn Chamandy, our President and Chief Executive Officer; and Laurence Sellyn, our Executive Vice President and Chief Financial & Administrative Officer. Laurence will first take you through our second quarter performance and provide an update on our business outlook. After which, a Q&A session will follow. I would like to 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 in the U.S. Securities and Exchange Commission and Canadian Securities Regulatory Authorities that may affect the company's future results. I will now turn the call over to Laurence.

Good morning. We were pleased today to report record results for the second quarter of the fiscal year, which were ahead of expectations. These results were achieved in weak industry conditions in both operating segments. We also provided strong sales and EPS guidance for our June quarter and now feel comfortable to narrow our EPS guidance range for the full fiscal year to $2.65 to $2.70, compared to our prior range of $2.60 to $2.70, in spite of the impact of higher than previously anticipated cotton costs for the second half of the year. Adjusted EPS for the second quarter was $0.59 per share, compared to our previous guidance range of $0.54 to $0.57, and $0.23 per share in the second quarter of last year. Consolidated gross margins for the second quarter were approximately 29%, compared with approximately 18% in the second quarter of last year. The main factors impacting the results for the second quarter compared to the second quarter of last year were as follows. Firstly, the significant reduction in cotton costs compared to the second quarter of fiscal 2012. Cotton costs in the second quarter were approximately $0.85 per pound, compared with approximately $1.60 per pound in the second quarter of fiscal 2012. Secondly, the impact of lower Printwear net selling prices, including the approximate $5 million impact of a distributor inventory devaluation discount in the second quarter. It should be noted that the majority of the benefit of the reduction in the price of cotton from peak cotton prices had already been passed through in advance to Printwear customers in the reduction of Printwear selling prices in the first quarter of 2012, even though we continue to consume high-cost cotton in cost of sales. We believe that selling prices are currently in good alignment with cotton…

Thank you, Laurence. [Operator Instructions] Christine, we are now ready to start the Q&A session.

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

In your Printwear business, you mentioned that volumes were up 4% year-over-year. Can you tell us how does that compare on an organic basis?

Well, I'll walk you through the change in sales dollars for Printwear compared with last year. So last year, sales were $360 million. Lower selling prices this year compared with last year, including the $5 million impact of the deval, reduced selling prices by about $20 million. Organic growth in the Gildan brand, combined with the impact of Anvil, added about $30 million to sales in the U.S. The impact of lower replenishment compared with last year, when replenishment was higher-than-normal because it was starting from a low base after the de-stocking in the first quarter, plus the decline in overall market demand, reduced sales by about $15 million. And then our growth in international markets was close to $10 million, which brings you to the $367 million this year.

Okay. I was -- yes, I was trying to see where your volumes were on an organic basis. But I guess -- yes.

So for the $30 million, about $20 million was the impact of the Anvil acquisition and about $10 million was organic growth.

Okay, that's great. And on your Branded Apparel, the profit margin was down a little bit sequentially. Is that mainly due to the Super Bowl ad?

Yes, that's SG&A, not gross margins. Gross margins were again close to the gross margins in the Printwear business.

Our next question is from Kenric Tyghe of Raymond James.

Glenn, I wonder if we could just touch base on the sock discussion. Specifically in last quarter, they were short shipping and mindful of the challenging retail backdrop. Could you just perhaps highlight, is there any other dynamics we should be sensitive to with respect to the sock business through the balance of the year?

No -- well, if you take a look at Q2, I mean, we were somewhat a little bit disappointed with ourselves, but that's mainly through -- due to the cold weather, obviously, and the tax refunds and payroll taxes, which primarily occurred in January and February, of which we saw the -- a larger decline in socks than we originally anticipated. March, we saw sales come back, and in April, I could say that things are back to normal. We had more of a decline in Q2 in the mass area versus the national chains and specialty, which we actually grew, primarily because of the Gold Toe, as we're seeing the vibrance of the Gold Toe brand in the national chains and the specialty stores. Our market share actually in Gold Toe, and which is paying off of all the advertising, our market share in Gold Toe in Q2 and Men's, in the department, basically went up about 4 percentage points and varied [ph] #1 brand, but we're up to about 27.5% percent share. So overall, we're optimistic. We're projecting to have growth in the single digits, but in the high single-digits in the back half of the year in socks. And we're projecting to see new growth in next year, based on programs we foresee that we'll be obtaining as we go forward in 2014.

And then just with respect to the inventory devaluation and your commentary with respect to selling prices being in alignment with current cotton costs, et cetera, would it be reasonable to assume that we've now sort of cycled through a period where these inventory devaluations are good business, or necessary, and that it's not sort of indicative of the new normal in the industry by any measure? And rather just be dislocation from volatile cotton?

Well, that's exactly it. I mean, cotton prices spiked. And effectively, we've now aligned -- we think pricing, with the future price of cotton, if you look at where we'll end up this year as an average and where the futures are, you're relatively roughly at the same price. And if pricing was to -- if we need to reduce pricing, we would come up with more promotions, or we can reduce the amount of promotions. So we can adjust, I think, pricing based on a reasonable level of cotton within the marketplace. So we're happy with our pricing, and I would say that this is a normal go-forward price list, and then there might be a little bit more or less promotional activity, but the price list is pretty stable at this point.

Just a final point of clarification. You -- and Laurence, you commented that you're covered through fiscal '13. That was fiscal '13, not calendar '13, correct?

Fiscal '13, yes.

Our next question is from Andrew Burns of D.A. Davidson. Andrew Burns - D.A. Davidson & Co., Research Division: In the prepared remarks, you talked about ending some of the commodity Anvil programs. How much of the legacy Anvil mix is that? Could you quantify that?

The proportion of the Anvil products that we discontinued. You can just explain the Anvil.

Okay. So what we've done basically is, there was a large duplication in some product categories between Anvil and Gildan, and our strategy for the Anvil brand is sort of to have a unique positioning within the market. And the position that we've chosen is to be a little bit more contemporary and have a little bit different fabrication. So the Anvil brand, on a go-forward basis, would be 100% ring-spun type products, as well as a portion of sustainability -- sustainable products, like recycled, organic cotton and so forth. So -- and the fit of those garments is going to be a little bit more, I would say, different than Gildan, in terms of the end demand and end-user of that product. So we're trying to position it a little bit different. And the products in which we discontinued, are products that we can cover with the Gildan product lines, that we're currently carrying in our Gildan lineup. Andrew Burns - D.A. Davidson & Co., Research Division: Was this a significant portion of the mix or relatively small of the legacy Anvil?

In style numbers, whatever we've discontinued, let's say, for example, in some of these products that were similar and that will be replaced by Gildan, we've added additional styles. So from a go-forward basis, we really are going to be having about the same amount of SKUs, let's say, in the market relative to what we had in the past. But just, there'll be more contemporary and geared to a different part of the market, so we can capture an overall larger part of the market and generate more sales as we go forward. Andrew Burns - D.A. Davidson & Co., Research Division: Got you. Your strategic long-term supplier commentary was interesting. How much capacity would you be willing to allocate to that business model? And what time of returns would you expect to achieve if you were to grow -- pursue that avenue of growth?

We'll continue to add capacity, Andrew, to support all of our growth initiatives in all of the markets. And I don't think, in our minds, we're allocating it in any particular way. Obviously, we want to support and service our core Printwear business; our main thrust is driving our brand in retail. But this is also a very important, big opportunity for us since we go forward.

And just here for a reference point, another thing that in terms of capacity, we're revamping the Anvil textile facility, where we're going to be spending approximately $10 million this year and an additional $5 million next year for its full completion. And the purpose of the Anvil facility is to focus on performance-type fabrics and specialty fabrics, such as stretch, and other things that are going to be used to service, not only our existing customer base, but also that segment. And overall, net-net, when we bring on Rio Nance I, we'll be looking at approximately, I'd say in -- based on basic T-shirts, because mix changes our capacity, but roughly about 100 million dozens of capacity. So we have room to grow. We'll bring on the capacity as fast as we can. Rio Nance I will be coming online in our Q4. And Anvil we'll refurbish by, totally, by Christmas of 2013.

Our next question is from Taposh Bari of Goldman Sachs.

I was hoping you could quantify this opportunity as you invest in higher quality ring-spun manufacturing. So I guess, ultimately, how big is the opportunity both in the U.S. and globally? Maybe the question really is, are you planning on taking share from another competitor? Or is this more of an initiative to catalyze growth in the Printwear category overall?

Well, look, I mean, ring-spun for us is an area of opportunity. I mean, for 2 reasons. One is that typically, most of these products are coming, are not produced in this hemisphere. So with our investment, we'll be able to produce ring-spun yarns at very attractive pricing and add value to our customers, particularly in our retail segment, but as well as in our wholesale segment. So objectively, what we're trying to do is create a niche for ourselves, and what's made Gildan and what's grown our sales from day 1, even in wholesale is, how we make a difference by adding value, either in fabrications, detailing on our garments, and ring-spun for us is just a big added value, where we think that we can make a difference and provide consumers with better products that they can currently get in the marketplace today. So we think it's going to be a big sales driver for us in all segments of our business.

So how large do you think that category is right now? And how much of that is manufactured in the western hemisphere?

It's probably about less than 10% of the overall capacity in this hemisphere. And that's something that we'll evaluate as we go forward. We're putting up our first big facility. That will be up and running in 2014. And we'll consider putting up additional facilities in ring-spun as we go along.

We'll be moving in the market more in the direction of ring-spun products.

Great. And a follow-up on capital structure. We're seeing a lot of companies take on debt, take advantage of these historically low interest rates. And my question for you is, do you consider your balance sheet to be under-levered? Would you consider taking on more leverage, and what would it take for that to happen?

Well, our issue is that even though we're continuing to spend the most capital in the industry and reinvesting in new capacity expansion and cost reduction, we're financing all of our organic capital expenditures and our working capital for our organic growth out of our internally generated cash flow and generating free cash flow. So our issue is finding the uses for the excess cash flow that's accumulating in our balance sheet. So we bought Gold Toe and Anvil, which we think are very good acquisitions. We've communicated our acquisition criteria. We'll be looking for further acquisition opportunities that are comparable with these and that fit with one of the other aspect of our organic growth. And to the extent that we don't find acquisition opportunities that provide us with a higher risk-adjusted return than buying back our own shares, we will look at share repurchases. And also, of course, we'll evaluate our dividend as we go along.

So should we interpret that as the priority set? M&A being number one, share repurchase, number two, and then followed by dividends?

Well, we're going to continue to reevaluate our dividend. And then I would say, we've said that acquisitions, provided they provide a return on a risk-adjusted basis than buying back our own shares, we will look at doing further complementary acquisitions. And we've also said, as part of our criteria, which was part of your question, that we will not take on high level of leverage to finance acquisition. So we're comfortable with the increase in the bank facility to finance Gold Toe and Anvil, but we wouldn't over-lever ourselves to finance acquisitions, but primarily be financed by our internally-generated cash flow.

Is there a sort of leverage metric that you can share that you feel comfortable with?

I don't really want to throw out a number. But we certainly would -- it would be important to us to continue to be investment-grade from a leverage point of view. So I would say, if you go up to 3x, that would be on the high side.

Our next question is from Vishal Shreedhar of National Bank.

One, just on the acquisitions. You noted, you stated some criteria. I was just hoping you could...

Vishal, we're having trouble hearing you. You're very faint, I'm afraid.

Can you hear me now?

That's much better.

On the acquisitions, you noted -- that you highlighted some criteria. So I was hoping you could remind us what that criteria was and perhaps, give us your thoughts on what the market is like for acquisitions right now, if you see several opportunities or not very many? Any color you can provide on that would be helpful.

Well, I guess, I just touched upon the main acquisition criteria that we communicated. One is that acquisitions have to fit with one or the other aspect of our organic growth strategies. So an acquisition like Gold Toe, which is a brand that complements our retail strategy, an acquisition that consolidates our position in our existing businesses, something that positions us in international market. We also said that we're looking for acquisitions that can be well integrated from the point of view of size and culture fit and that are in significant turnaround situations. And then for in terms of financial metrics, like I said, acquisitions that provide higher IRR on a risk-adjusted basis than buying back our shares and well in excess of our cost of capital and that don't stretch our comfort level with the financial leverage.

And in terms of the market...

And as far as the acquisitions, I mean, the world's full of opportunities. So we're in no rush to rush out and do acquisitions. We don't mind having cash accumulate in our balance sheet for a while. So we're comfortable with the right opportunity. But yes, we think there are plenty of good opportunities out there.

Glenn, as you ramp up capacity, as Anvil and Rio Nance I comes online, is lower price something that investors should consider as a tactic that you might use to help drive capacity utilization?

Price is only a small portion of what makes a company successful. And in fact, you know price is, if you look at our company, I would say that the value equation, the quality, the product, and the price is probably the fourth dimension because you have to do almost everything to be successful, and that's the reason why we've been able to grow our capacity at the levels we have. So it's all about, for us, building a better mouse trap. And you'll see that as we develop, like for example, ring-spun, we think we're going to create a niche in the marketplace that's not there today that will allow us to drive additional sales in activewear and underwear and pretty well all of our product segments. So that's the way we've sort of positioned ourselves, it's by making huge capital investments and taking those capital investments and putting in the price for quality of features and that's what drives the top line of the company and that's consistently what we've been doing for the last 15 years.

Our next question is from Brian Morrison of TD Securities.

This question has been alluded to a couple of times. But can you elaborate on the restart of Rio Nance I, just in terms of production as it restarts in the fourth quarter and how we should see it ramping up, moving into fiscal '14? And also, do we have organic growth currently to fill that capacity?

Well, what we're planning to do is continue through the modernization of the facility. It will start operations in the fourth quarter. And it will be fully ramped up through the following fiscal year basically, through our '14 year. And be completely ramped up within 12 months. At the same time, it's ramping up Rio Nance I, at this point in time, we're also in the process of evaluating our next geographical expansion and our next major expansion, which is something that we've been working on, as we speak. So we'll be communicating that as well to the market in the upcoming months or by the beginning of next year.

Okay. And then just in terms of housekeeping. In terms of your heightened advertising expense of $15 million, I think year-over-year increase, I think the total budget's somewhere in the high 20's. Can you just provide an update in terms of the percentage of that, that you've incurred to date?

Well, we've incurred -- the major thrust was obviously, we did the New Mexico Bowl and then the Super Bowl ad. And just to your reference point, is that the Super Bowl ad generated over 300 million impressions for Gildan, which we think is a catalyst for us in terms of our old branding strategy. We're investing still in Triple-A Baseball. And we have a series of back-to-school ads. So still a large portion of the money that we're going to be spending is going to be focused on the placements we have to support our back-to-school launch in our Underwear and our Activewear segments. So we haven't spent -- probably I would say, to answer your question, probably around 35% to 40% of the money's being spent, and the balance will be spent in the back half. Just putting things in perspective for us, we're not only just spending money on advertising, but we're also spending money on promotional spending as well, which, some of that is actually in our margins. Like for example, we're going to have quite a bit of pallet drops in some of our mass retailers, which will give us good visibility in our launch of our underwear, where we're going to be promoting our products as well as they launch. And we introduced and placed over 1,500 fixtures in regional accounts this year, which are permanent fixtures under the Gildan brand that will house our underwear, our activewear and various products. So we'll continue to drive signage within the stores, our whole advertising plan. And we've seen big spike in our awareness, not just in Gildan, but as well in our Gold Toe advertising have been very effective. And just maybe one more point on Gildan is that this year, we're going to have about a 200% increase of retail sales in Gildan. Our sales in retail -- that's not our sales, but the retailer sales, will be close to about $300 million in this year. And we see a significant increase next year based on all of the programs we've placed that will be sold on a year-over-year basis, as well as the new placements we're driving for, for next year.

Our next question is from David Glick of Buckingham.

I just, Glenn, wanted to get some sense what to expect when we see your new major underwear program. Maybe you can take T-shirts as an example and kind of walk us through how you're pricing those packs relative to the competition. And what should we expect from -- should we see the traditional kind of value pack strategy periodically? Will it be promotional? Just so that we have some sense kind of going into the launch here very shortly in that program.

Well, first of all, look, I don't want to comment about our competition. But I would say, when you go to the stores, first of all, you'll see that the quality of the products that we're placing in retail are far superior than what's available today. And you'll see that from the fabric, from the elastic, from the packaging. And really, I would say that when you're looking at our pricing and where we're priced in the market, we're priced to grow. That, I'll leave it at that. And we're very comfortable with our placement. And we think this is a great opportunity and will be a catalyst for Gildan as we go forward.

So we'll see those on the floor in the next week or 2?

Yes.

Okay. And then a follow up, Laurence. Just on the Printwear business, your guidance suggests -- I think you have mentioned low double-digit increases in units. I don't know if that was this year or the second half. But your sales guidance implies low single-digit Printwear growth. As we think about this business, obviously, you're about to anniversary some price decreases when you get into FY '14. And if we think about this as a more of a growth business on the top line relative to the second half, is it your assumption that once you anniversary the pricing, you're going to get a healthier dollar increase driven by units and less erosion in price?

Absolutely. You saw in the analysis that I went through in Q2 that lower pricing had a big impact. The same thing in Q3. Pricing has a big impact in mass, the unit volume growth. And absolutely, as we anniversary the year-over-year price declines, we'll get the full benefit of our continuing volume growth.

And so that low double-digit unit growth, was that for the second half or for the year?

No, that was for the full year.

Our next question is from Chase Bethel of Desjardins Capital Markets.

I just had a quick question on the Branded Apparel segment. I believe in the past, you had said that about $15 million annualized would hit this year, mostly in the back half. So I was hoping if you could please provide some color on how that might break down? Would it be weighted more to back-to-school or holiday or? Any color would be helpful.

So I think you maybe missed Glenn's answer to a previous question. I think -- is that not what Glenn explained?

How is the new program going flow through on the second half.

Is it the new program, so the advertising spend you're asking about, Chase?

The new programs?

Oh, sorry. Okay.

Most of what we've -- we had -- some of the new programs were launched for spring. But the major new programs will be basically launching for -- back half of the year, for Q3 and Q4. Basically, we'll see the big impact to sales. And what we said was that the annualized sales for these new programs -- or the end of the year sales for these new programs were $50 million, but the annualized sales on the year-over-year basis will be about roughly about $100 million. So we'll get about a $50 million lift from next year just on having it for the full year.

And it's probably more -- relates more to fiscal '14. But for the Starter brand, the brand owner recently announced several collaborations with the NFL, NBA, NCAA, et cetera. So I was wondering if you would expect to see, with the increased profile of the Starter brand at certain retail outlets, perhaps, some spillover into other categories, such as socks and underwear.

Well, we already have quite a large program in some of those categories. So we're -- the more [ph] they promote, but we're supporting Wal-Mart, and it's their decision really to decide how they're going to expand those categories.

Our next question is from Stephen MacLeod of BMO Capital Markets.

Most of my questions have been answered. But I just want to follow up on a couple of things. First, in the Branded Apparel segment, Laurence, would you be able to provide sort of a year-over-year breakdown similar to what you did in Printwear?

Year-over-year breakdown of the sales?

Yes.

Or the EPS?

The sales for Branded Apparel.

Yes. So most of the year-over-year increase was the impact of the Anvil businesses included in Branded Apparel. We did have growth in our retail Activewear business. We had strong growth from a small base. And we had lower sales in socks that offset the increase in Activewear, which, as we said earlier, we attribute to the weak overall retail demand in January and February because of the factors that we mentioned.

And you posted a new [indiscernible]. I'm sorry.

Just this one point is that with most of the new programs being dropped, right now, in Q3 and Q4, we'll have a major pickup in our branded Gildan sales.

Right, okay. And in terms of industry demand in the retail channel, have you seen a pickup subsequent to the end of the second quarter?

Yes, like we said earlier, January and February were actually the worst months. March, we had seen, we saw some big improvement. But April, really is, I would say, back to normal high-single digits growth basically in some of the categories in mass. So I think that things are more normalized now. And we see this actually in both segments. So it's weather and combination of everything, but I think April's sort of a -- we think things are moving in the right direction.

Okay, great. And then, can you just -- Laurence, you mentioned with respect to the cotton costs in the fourth quarter, you said it was a negative impact of $0.05. Is that negative $0.05 on a year-over-year basis or relative to your previous...

No, $0.05 higher than what was assumed in our previous forecast. So that was the impact of the recent spike in cotton. So our -- probably costs in Q3 will be slightly lower than Q2 and Q4 will be slightly higher than Q2.

Our next question is from Tal Woolley of RBC Capital Markets.

I was just wondering if you could speak -- you talked a bit about your cotton view. You've raised your expectations for Q4 in guidance. You talked in the past that you thought cotton might move lower, given the demand supply imbalances. Has your view changed much there in terms of the way you think cotton might trend up for the medium term?

Well, we really don't -- prefer not to discuss our view because of -- for competitive nature. But I think we've locked in our cotton for this year. We're comfortable with our positioning. And we'll see what happens as we go forward. But I think, most importantly is that we feel comfortable with our positioning and our price is aligned with cotton as we go forward.

But your -- with the long-term -- I'm not talking specifically about your positioning relative to the cotton price, I'm just talking about the cotton price overall. That -- do you have a...

Our view is long-term. Where prices are today is really where I think the long-term price will be, in the $0.85 range. And that's probably if you do any research on cotton, I would say that's probably a pretty good range.

The next question is from Mark Petrie of CIBC.

I just wanted to ask about the retail accounts that you guys are selling into, and as you grow that business -- or, as you have been growing that business, is it much of a proliferation in terms of who you're selling to? Or is it a matter of selling more product and Gildan-branded product to a lot of your existing customers? And I guess just as that relates to leveraging off the other distribution points that your Gold Toe acquisition would have brought, for example.

Well, look, our strategy, we have -- really, our strategy for both brands. But I mean, our strategy for Gildan is really to be the opening priced value brand in every channel of distribution. This year, we've been able to place our Gildan brand in all channels of distribution, including National Accounts and National Accounts stores, which we use the Gildan platinum brand. We use Gildan for mass and we use Smart Basics for the dollar chains and discounts. So we have a strategy where we're basically driving our brand strategy sort of a good/better/best strategy in every channel distribution and being the value brand within that channel. Consequently, the same thing we're doing for Gold Toe is we have Gold Toe in every channel distribution, and it's the better brand. So the objective is we have good distribution. We are continuing to grow our distribution. A lot of the products and programs we have are new placements and new channels of distribution for our Gildan brand this year. And that's the reason why we're seeing our sales at retail close to $300 million and $200 million increase, and that will grow significantly next year based on the momentum we have and all of the opportunities we have, and as we continue to just get new placement for spring '14.

So just as a ballpark then, for the $100 million in retail wins, I mean, how many would have -- how much of that would be at retailers that you hadn't previously been selling or supplying private label to? And how much would've been...

Between our Private Label business and the acquisition of Gold Toe, we saw almost every single retailer that's out there and that was the reason why we did the acquisition. So partly because of the brand strategy, partly because of the management that they had, and as well as the ability for us to have relationships with all the different channels of distribution. So with the acquisition of Gold Toe, we saw almost every single aspect of specialty, sports specialty clubs, department stores, dollar stores for Gildan. And so we have now relationships. And one of the things we're doing is we're continually focusing on working on our relationships. And that's sort of the part that takes time, but we're working with the senior management at all of our big customers and we're continuing to go tell them the Gildan story, our investment strategy, our quality strategy and our brand strategy. And we're just basically optimistic about the future in every single aspect of our business.

Okay, that's helpful. And just on that last point of view. Have you felt like you needed to or will make any changes to your sales team in terms of investing in that regard as you build those relationships? Or are you satisfied with your team as it is?

I think we've got the best sales team in both of our operating divisions. We've got the best sales guys in the industry because everyone wants to come work for Gildan.

Our next question is from Jim Duffy of Stifel. Jim Duffy - Stifel, Nicolaus & Co., Inc., Research Division: Laurence, in your prepared remarks, you listed off a number of growth opportunities. It sounds like you're very excited about the retail opportunity. Could you perhaps rank order those in terms of their expected contributions to incremental revenue in 2014?

We'll do that, Jim, when we initiate our guidance for next year. But they're all significant opportunities, which are major areas of focus for the company, and I wouldn't want to say anything is more important than anything else. We're bringing on capacity to support our growth initiatives in all of these areas. Jim Duffy - Stifel, Nicolaus & Co., Inc., Research Division: Fair enough. A follow-up question, you have been in the retail initiative for a number of years now. Can you speak to some of the key things you've learned over those years, which you think now make you a better company from a retail standpoint and will help you on a go-forward basis?

One thing I'll say, while Glenn -- before Glenn answers that, remember, that while we've been in retail for a number of years, we've only been in socks because we've needed all of our capacity where we make activewear and underwear to keep servicing our increasing market share in the Printwear markets. So it's only with Rio Nance V coming onstream that for the first time, we have the capacity to support growth in activewear and underwear. And up to now, our growth has been in -- our retail business has been in socks, where we built separate facilities.

And as far as retail, I mean, look at -- our plan is for history to repeat itself. And we're planning the same matrix that made us successful in wholesale, again, by better quality, better products, better prices, working with our customers so that they're successful selling Gildan products and making sure the consumer gets better prices. So when you look at our strategy in retail, it's really replicating the strategy we have in wholesale that successfully penetrated and allowed us to get 70% share over the last 15 years. So there are some nuances in retail. And through the acquisitions of, the 3 acquisitions we made that really position ourselves to have the management team, as well as all the systems and distribution requirements to service these retailers. We think that we're placed for major expansion. We're prepared to invest, not only in capital, but we're prepared to invest significantly in our brand strategies and looking obviously to acquire new brands as needed to even open up other channels of distribution. So the great thing about our company is that we've got a great capital base. We're going to spend as much as we can to drive our strategy. And we think there's nothing stopping us and we'll be very successful.

The next question is from Anthony Zicha of Scotiabank.

With reference to retails reviewing the supply chain, how soon could Gildan capture some of the volume?

Well, I mean -- look, the thing for us is that, look, we are recognized today as probably the leader in CSR. I mean, at the end of the day, that's what our brand stands for. So what our objective is that Gildan is being a value product with great quality, great prices and most importantly, I think, is a great CSR practice. So that's really what's going to drive our brand strategy. And our emphasis will be on Gildan as a brand and hopefully, we'll see significant placements in Gildan as we go forward as part of the reliability, replenishment, CSR aspects and all the other features that we put into our garment. So we think it's a big opportunity for us. But our objective is to take that opportunity and drive our brand strategy.

And our next question is from Chris Li of Bank of America.

I was just wondering if you can maybe share with us how much cost savings have been realized through your biomass energy initiative so far and how much more run rate is there to go?

I don't understand what...

Biomass, he's asking...

And what percentage is it?

Where we are in our biomass.

Well, biomass represents about 80% of our usage right now. And with the -- new phase that we're in the process of constructing will allow us to increase the amount of biomass to capture the increased production of our Rio Nance I and take us roughly to about 100% of our consumption of steam.

So it's fair to say a lot of the benefits are still to be realized in your numbers?

No, we're going to benefit about 20% on the existing production. And as we bring on Rio Nance I, obviously, it's going to come on at a low-cost because it will benefit from the new investments in biomass as well. As well as all the new technology we're putting into the plant. And just for your reference point, the Rio Nance I, the equipment in that plant was only 8 years old, and we basically gutted the facility and we put in a whole brand new infrastructure and all new brand new equipment. So Rio Nance I will come on stream as equal to the cost structure as our latest equipment in Rio V.

Okay, that's great. And just a quick follow up, just on the yarn-spinning. I know it's still 2 years away before the benefits are realized. But I think in the past, you mentioned the capital you're investing, you expect an internal rate of return of in excess of 30%. Just curious to see what is -- what will be driving those returns?

Well, those returns are driven from all of these capital improvements we're putting in. I mean, the biomass, the distribution center, the yarn-spinning. This year, we're going to spend the $200 million. So by the time all the equipment is installed and running and you look through our cost of goods sold, basically, a lot of the cost benefit will actually materialize, savings will materialize in 2015. So if you look at the investments we made and you figure you've got a 30% return, those are the types of earnings power we'll be creating in 2015 as we go forward. And we're not only going to spend $200 million this year, but we're going to have a significant capital program next year as well. So we're going to have -- continue to spend. So as we go forward, not only are we going to have top line growth, but what's driven our company is continuing driving bottom line and cost reductions basically. So we'll have a big tailwind as we go into '15 and '16 in terms of big synergies from manufacturing savings.

That is all the time we have for questions. I will now turn the call back over to Sophie Argiriou.

Thank you. Once again, we appreciate your interest and thank you for your participation and we look forward to updating you again at our next earnings conference call. Thank you, and have a good day.

Thank you. And thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may now disconnect.