Good morning, and welcome to Newell Rubbermaid's Third Quarter 2014 Earnings Conference Call. [Operator Instructions] As a reminder, today's conference is being recorded. A live webcast of this call is available at newellrubbermaid.com on the Investor Relations homepage under Events & Presentations. A slide presentation is also available for download. I will now turn the call over to Nancy O'Donnell, Vice President of Investor Relations. Ms. O'Donnell, you may begin.

Thank you, and good morning, everybody. This is Nancy O'Donnell. Joining me on our call are Mike Polk, our President and CEO; and John Stipancich, our EVP and Interim CFO. We appreciate you joining us today. We remind you that this conference call will include references to certain non-GAAP financial measures, including core sales and normalized EPS. The reconciliation of these non-GAAP measures with the most comparable measures in accordance with GAAP is available in the earnings release and on the IR portion of our website, as well as on our IR app. This call also will contain forward-looking statements reflecting our outlook for future periods. Due to the uncertainty of these forward-looking statements, actual results may materially differ from current expectations. An explanation of related risks and uncertainties is provided in our earnings release and in our filings with the SEC. We assume no obligation to update these statements. And now it's my pleasure to turn the call over to Mike Polk.

Thank you, Nancy. Good morning, everyone, and thanks for joining our call. Over the last few weeks, we've announced a series of strategic initiatives that are important to note in advance of our discussion of results. First, on the heels of the completion of the Ignite Holdings acquisition in September, we have recently completed the acquisition of another leading marketer of on-the-go hydration and thermal products, bubba brands, inc. These acquisitions establish Newell as the leader in the key channels of the fast-growing on-the-go hydration and thermal beverage container category in North America. We also announced our board's decision to undertake the next phase of Project Renewal, one that will generate an incremental $200 million of annualized savings by the end of 2017. And finally, this morning, we announced our intention to hold for sale our Calphalon outlet stores and Calphalon Electrics business and our Endicia online postage business. These strategic choices are designed to strengthen our portfolio, increase the growth potential of the company and improve our margins. In our discussions of results, we will treat Endicia and the Calphalon businesses as discontinued ops. We delivered a solid set of results in the third quarter. Core sales grew 2.7%. Importantly, in our Win Bigger businesses of Writing, Commercial Products and Tools, we grew core sales 7.5%. Normalized gross margin increased 140 basis points to 39.2%, driven by positive mix and positive pricing, partially offset by meaningful foreign currency headwinds. Strong gross margin delivery enabled us to more than double advertising support versus prior year. And despite the resulting 190 basis point increase in SG&A, normalized operating margin decreased only by 50 basis points to 14.3%. Normalized EPS was $0.58, an increase of 11.5% versus prior year and $0.03 ahead of consensus. Operating cash flow was $339 million, and we'll…

Thanks, Mike, and good morning. Before I begin, I'd like to remind everyone that effective Q3, we reclassified the Endicia online postage business and the Calphalon outlets and Electrics into discontinued operations. The results of these businesses are reported separately as discontinued operations in the company's financial statements, and my comments will focus primarily on results from continuing operations. The restated normalized quarterly EPS numbers for 2014 are available on our earnings presentation on our Investor Relations website, and the complete quarterly restated results for 2013 and '14 will be uploaded to our website in the near future. Q3 reported net sales were $1.48 billion, a 1.3% increase versus last year. The Ignite acquisition contributed 60 basis points to net sales. Core sales, which exclude the impact of foreign currency and acquisitions, increased 2.7%. Strong volume growth in Commercial Products and Writing, along with broad-based positive pricing, drove the growth, partially offset by declines in Baby and Home Solutions, and by planned EMEA product line and country exits. Reported gross margin was 38.8% and normalized gross margin was 39.2%, up 140 basis points over last year. This improvement was driven by pricing and favorable mix, which more than offset input cost inflation and unfavorable currency. Normalized SG&A expense was $369 million or 24.9% of sales, up 190 bps versus the prior year. We increased A&P spend in the quarter by nearly 150 basis points as a percentage of sales, driven primarily by TV advertising in Writing to support Paper Mate InkJoy, Mr. Sketch, Sharpie Neon and Sharpie Clear View. We also invested in marketing campaigns at RCP behind BRUTE and the HYGEN microfiber launch, and advertising in Baby to support the introduction of our new 4Ever Car Seat. Normalized operating margin was 14.3%, down 50 basis points, reflecting significant increased…

Thanks, John. So let's now turn to our 2014 outlook. As we told you at Analyst Day, we're tracking towards the low end of our core sales growth range of 3% to 4%, the middle of our normalized operating income range of up to 40 basis points expansion, the high end of the normalized EPS range of $1.94 to $2 per share, and the middle of the operating cash flow range of $600 million to $650 million. This morning, we reaffirmed our prior guidance. Our 2014 full year guidance assumes the following for the fourth quarter: the negative effect of worsening foreign exchange and the dilution related to the businesses held for sale; a return to mid-single-digit growth on Tools as the U.S. distribution center ramps to speed and we recover most of the lost sales from Q3; sustained strong growth in Commercial Products, but a pullback to low-single-digit growth in Writing, as the Venezuela and Mexico SAP timing impact in Q3 reverses out in Q4; stabilization of core sales in Home Solutions as continued repositioning of the Rubbermaid Consumer business is offset by sustained momentum in Food Storage; and a sequential improvement on Baby as building U.S. growth is partially offset by continued exits in Europe. There are 2 factors that could influence where we fall in our 2014 full year guidance ranges. The first factor is the planned recovery of growth on our Baby business. We expect Baby to stabilize in Q4 despite continued European exits and tough conditions in Japan. The key variable that will shape the Q4 Baby outcome is how quickly strengthening POS growth rates in the U.S., driven by strong innovation and new advertising, translate into core sales growth. Q3 POS in the U.S. increased about 5% versus prior year, and POS growth rates…

[Operator Instructions] Your first question comes from Lauren Lieberman with Barclays.

I was hoping you could talk a little bit about this Tools distribution center issue. Just, I guess, I want to make sure I understood correctly that you said you expect to recapture the lost sales. So is there a sort of pent-up orders that you're expecting to ship to meet in the fourth quarter?

Yes. Lauren, so let me describe what we are doing. We're moving the DC from Indianapolis to the Southeast part of the U.S. And we have a start-up curve we envisioned occurring, and it didn't deliver to our expectations. And so we were constrained in terms of our shipment activity in the last part of the third quarter, and we didn't expect to be. Some of those shipments -- I'd say, most of those deferred orders will be captured in Q4. Not all of them though, to be clear, because when you don't deliver to customers' expectations, they'll go somewhere else to fill their -- some of them will go somewhere else to fill their demand. But we do think we get the majority -- most of those orders back in Q4. So it'll reverse out as the distribution center in the Southeast comes -- ramps to speed.

Okay. And is it at speed now, Mike? Or is there still a little bit of fixing?

No. We're coming through October, I think we'll be to speed in November. This thing, this is -- obviously, execution is everything. And this is an example of us not executing. This cost us 50 basis points of growth, core sales growth in the third quarter, so it's really a bummer. The good news is it's a discrete event and we'll work through it and we'll learn through this experience. But it did get in the way of us doing exactly what we had hoped to do in Q3. But we'll come through it in Q4. We'll get back on track. And as we move forward into more supply chain transformation work, we'll make sure we don't lose the lessons learned.

Okay. Great. And then on the Home Solutions business, a little bit of a longer-term question. With the exits or product lines or rationalization that's underway, the Endicia planned divestiture, the Calphalon retail shutting down and then the acquisitions, where do you feel like you are in terms of reshaping that portfolio to what you want it to look like? Are all the steps in play already? Or there's still more that needs to happen?

I think there's more opportunity in front of us, less on the disposal side but more on the acquisition side. We've said we're going to deliver the Growth Game Plan ambition organically, and we're well on our way to doing that. But we also are a very cash-generative business. And we'll put our cash to work probably in 2 ways with the board's support: buying back what we consider to be an undervalued asset, that's us; and also looking to scale the 5 core segments that we have. And our model for doing that is a blend of organic delivery through the Growth Game Plan activities and then complemented by M&A. We think bubba and Ignite are right in the wheelhouse. And there are some other opportunities out there that, if the conditions were right, we would pursue.

Your next question comes from Bill Chappell with SunTrust.

This is actually Stephanie on for Bill. I just had a quick question on the inventory rebalance for Baby. Is there any chance you can kind of quantify the impact of that? And then if you expect to get any of that back in the fourth quarter as well?

Yes. So Stephanie, it's a good question. John, in his section, talked about our North American Baby business being flat. And he was referring to net sales. And I talked about our POS being up about 5% in the U.S. So I think that's as specific as I'd like to get. In the reality, those numbers ought to match to each other. So sell-in and sell-out ought to be lined up if you've got a consumption-based selling model. And that's where we hope we get to as those 2 things converge by the first quarter of 2015.

Okay. Great. And then just a quick -- is there any update on the growth to net optimization program that you announced at your Analyst Day?

Yes. We're making progress to a 1-1 implementation of a new model of going to market in the U.S., which significantly simplifies how we deploy our trade promotion, our customer programming funds and perhaps, more importantly, how our customers earn those funds. So it becomes more of a performance-based model versus a more traditional model that you might have seen over the past number of years of fixed fund deployment to opportunities. So customers will earn money based on their purchases from us and then they will qualify for that money through performance, which typically would be merchandising or new item distribution or things of that sort, shelving initiatives. And so we're very excited by it. It empowers our sales force to sell more. If they sell more, customers earn more. And it creates a very dynamic way of going to market. It's not new to our industry. It's new more to the consumer durable space than it is to fast-moving consumer goods. But what it will do is ensure that our money flows to our growth customers rather than the fixed fund approach, which tends to oversubsidize declining customers and underfund growing customers. So it's a much more progressive model, and we're very excited to deploy it and leverage it.

Your next question comes from John Faucher with JPMorgan. John A. Faucher - JP Morgan Chase & Co, Research Division: Just want to talk a little bit about the incremental savings. You guys have had big increases in brand support over the past couple of years. So can you talk about how that's going to flow through from a timing standpoint and kind of where you feel you are in your brand investment? Do you feel like the marginal return is still where it needs to be? So how much of that investment will flow -- how much of the savings will flow down to the bottom line versus sort of going back into the business?

Well, John, we haven't gotten that specific in our external communication. We obviously have plans that are laid out by quarter for the third phase of Project Renewal. Let me just start with the strategic side of your question, which is how much in brand investment do you want to put into this business. We're pretty happy with the SG&A ratios in this business. If we were between 25% and 26%, even if we held ourselves to 25%, we've got the right amount of investment firepower in the P&L today. It's just not shaped properly. Too much of it has been tied up in fixed overheads and not enough of it has been behind our brands. And so the last 3.5 years has been about variabilizing that spend and trying to get our A&P investment up and making the right choices with respect to selling investments versus maybe our business partnering functions within the balance of the overhead lines. We have more work to do to get the A&P ratios to where we want them to be. There's no one number system because, obviously, A&P will be highest on our Writing businesses and it'll be lowest, probably, on our Commercial Products businesses, where selling expense will tend to be higher. So it's not one set of levers that we're pulling. That said, on balance for the company as a whole, long term -- and I won't give you a time-bound metric here -- but long term, we want to be in that 6% to 7% A&P ratio range. And in order to do that, within the constraint of SG&A being roughly right between 25 -- around 25, maybe a little bit higher, we've got to get the overheads in line. And that's what we're on and about doing. Or we…

Your next question comes from Bill Schmitz with Deutsche Bank.

First quick one on cash flow in the quarter. Obviously, it was down year-over-year. Is there anything sinister there? Or this a timing issue?

No. It's just timing. And John, you want -- any comments on cash flow?

No. It's good. We're still -- we're on track to deliver what we committed to, Bill, this year. And again, it's just timing. If you look year-to-date, I think we're up significantly, so we're in good shape.

Yes. Last year, if you recall, we were -- we didn't have positive operating cash flow through the middle of the year. This year, we did. So it's really just a timing and phasing thing. Our payables are shorter. It's actually a healthier cash flow delivery this year than it was last year, to be honest with you, so.

Okay. Great. Pricing has obviously become a pretty critical component of the organic sales growth algorithm. And I'm wondering, is this commodity pass-through pricing. Or is it real pricing? Because the U.S. commodities start to sort of stabilize and then maybe decline if some of the spot rates hold. Like do you think pricing still is an important variable or do you think it can stick in that kind of environment?

Look, I mean, a lot of our pricing actually is coming outside the U.S. connected to transaction ForEx. And in general, all of our competitors face the same dynamics, except for those folks that are producing locally. So we expect to have to price to cover a lot of that next year as well, so that should sustain. There'll be some caps on what we'll be able to do in Venezuela versus what we've done historically, given the new gross -- new margin cap law. But we still expect a material amount of pricing to flow through. In the U.S., we still expect inflation next year. Despite energy costs coming out or coming down, we have -- we get hit by 2 things. First of all, there's a decoupling of the resin markets from the core commodity that's related to supply, refinery supply and capacity. And that will be an issue for resin for the next couple of years. It really doesn't ease until late '16, probably '17. So that's not going to be -- people like to conclude that oil down, resin down. That's -- or natural gas, resin down. It's not that linear. So we're going to still have inflation. We'll have inflation in our low-cost country labor -- sourced goods through labor rate -- continued labor rate inflation. So we're going to have to price to cover that or work to get the cost out through accelerated productivity. And we're going to have to do a bit of both.

Great. And then just one last one. Just on the SKU productivity, what's the sort of timetable for us to start seeing some benefits from that from the SAP implementation? And then maybe it's just me, but it seems like out-of-stocks are becoming an increasingly bigger problem. So is that something you guys are focusing on? And I know that's sort of part and parcel with the SKU productivity because, obviously, the faster-turning SKUs are the ones that are out of stock and the stuff that doesn't turn are the ones that you're putting pretty quickly on shelf?

Yes. I mean, there's 2 ways to manage out-of-stocks. One is to get your shelving right. And you could -- if you're faced out properly on your highest velocity SKUs, you end up being able to manage that dynamic. I think, for us, in the here and now, some of the concerns on out of stocks are related to things retailers are doing in the moment. I don't get fazed by that. I think that's sort of the normal dynamics that go on as people rebalance their positions, et cetera. So that's not a strategic thing that we should worry about. Your point on complexity driving -- increasing the risk of out-of-stocks, and also all kinds of other costs through our business model, is right in the middle of what Project Renewal Phase 3 is going to be about. I've told you guys 21% of our SKUs in Writing in North America account for 90% of our revenue. Well, that's pretty absurd. And there's all kinds of costs tied up in that, and all kinds of issues tied up in that commercially, as you point out. And so this is the type of thing, which is complicated to address, but this is the type of thing that we will address in Renewal 3. And you should expect, as we come through '15 into the second half, for us to be able to expose some of the very specific things we're doing around our Writing business, in particular, as we set the stage to simplify that portfolio and get both the manufacturing efficiencies that come through that and the working capital benefits that come through that. We should expose you to that. We're not ready to do that today. That's at the heart of what Renewal 3 will be about.

Your next question comes from Connie Maneaty with BMO Capital Markets.

I'd like your perspective on the Baby business. When you took over as CEO, the Baby business was so pressured that it got its very own segment. And now it recovered. It recovered very nicely, and once again, we see that the margins got crushed. So I'm wondering if you think it has the right characteristics to remain as part of Newell's portfolio, and how you -- and if it does, how you manage this business given all its volatility.

Yes. It's a great question, Connie. So when I started this job, I was pretty skeptical about Baby. That's why I brought it direct to me. I didn't like the dynamics that were happening between us and our partner. I was really concerned about the gross margin. I was worried that the brand wasn't strong enough to be able to hold up or premiumize. I had a lot of concerns coming into it. And that's why I asked Kristie to report directly to me. And that's why Mark and myself really got into the guts of that business to understand it. And a year later, we moved Laurel Hurd to be the Head of Marketing in the context of the new operating model. And it was the Laurel and Kristie show in Baby. I want to be really clear, I love the Baby business, and I'm really positive about what we can go do with this business. The step back in margins is completely related to the first slug of A&P that we put in the business in Q3, which was a sizable one. We hadn't advertised Graco in a long, long time, when we advertised the 4Ever Car Seat launch. And then there's some mix effects of our Japanese business being under pressure. But I think -- one of the reasons I love this business is because we have an incredibly strong brand. And we've got our relationship with our sourcing partner really focused. They're great collaborators. And so we have a very strong position that we can leverage. We don't love the margins in general, but you have to remember, we don't have the fixed asset base, we don't have the inventory. This is a DI business so -- the majority of it is, so our working capital ratios are very, very favorable. So if you look at the return on net assets on this business relative to the rest of our portfolio, it is almost as strong as our Writing business, despite having a very, very different margin structure. So if we can grow it, we can create a ton of value for shareholders. And given the brand strength, given our building track record on innovation, I'm prepared to invest in Baby and take the hit on operating margins for the sake of investing behind the brand, because I do not think our competitors will do that. And there maybe 1 year or an 18 month contraction in operating income margins that we need to absorb for the sake of catalyzing growth. And so I've changed my tune on Baby from the time when I started, where I was really concerned, to me being way more bullish about this business, particularly in North America and eventually in Asia. So Connie, I don't know if that answers your question, but that's where I stand on it.

It does.

Your next question comes from Chris Ferrara with Wells Fargo.

So I guess -- I know you don't want to give quarterly guidance, but with only 1 quarter left, that's what it is. So Mike, it looks like to the do low end of 3% to 4% for full year '14, you need a 4% in Q4. So I guess, with Writing, as you're saying, low singles, and I think commercial facing a much, much tougher comp, can you just talk about, I guess, what the run rate x the unusual stuff in Home Solutions? Just like how do you think you're going to get there?

Yes. Chris, so on our math, right now, Q3 year-to-date, we're at 2.9% core. So to get to the low end of the range -- the bottom of the low end of the range would be, I think, 3.2%, 3.3% is what we would need in Q4. And who knows, a tenth of a core sale point or 10 basis points of core sales is $1.5 million of revenue. We do about $20 million a day. And so 1/10 of a basis point is $1.5 million of revenue. So I don't know whether we'll be 3.2% or 3.3% or 3.4% or 3.5%, but I think it's within grasp. And do I know exactly where we'll end up on year-end? No, I don't. But it's that -- that's sort of the fine-tuning required to kind of get into the range. So we're going to do our best to be in that range. I know the sales teams are focused on it like a laser beam. I also want to set Q1 up for great success because I want to get out of this year, where we had to absorb all these challenges from the recall and from the weather in Q1 that sort of derailed our momentum. So it would be great to kind of put a punctuation point on this year and move on to the next. But obviously, we feel a sense of urgency to be where we said we were going to be. That's why we've guided the way we have. We're tracking to the low end of the core sales range and the high end of the EPS range, despite all of the challenges.

Got it, got it. And could you just -- I guess on advertising real quick. 150 basis points of total A&P is pretty big and it's so far -- I mean, and maybe this is a function of your business, but it's been pretty lumpy, right, episodic in each business based on, obviously, different initiatives.

Yes.

Will it always be like that? Or do you think you'll get to a point where there's just a higher underlying run rate on spend in these businesses?

You know what? I think for at least the next few years, it'll be like that, Chris. I mean, we'll try to help you understand why we're doing what we're doing, but money flows to ideas. The money that we're putting into advertising isn't thematic advertising in general. It's behind innovation. And I think that's where -- that is a premise that you'll see us continue to embrace. So it will flow to the ideas we're bringing to market. Now as you think through our portfolio, those ideas are, obviously, Writing. First priority, because it's a beautiful business, high margin, great brands, lots of innovation coming. Baby will be a priority, even though the operating income margin will contract when we do that, because we have a pipeline of big innovations coming and we want to establish ourselves as the leader, and also take steps to -- while protecting our flank, premiumize the Graco brand because it can carry more premium and more functional benefits to mom. And so that requires support, that requires messaging, that requires convincing people to try. And you'll see that on Baby. You'll see that on Calphalon. You'll see that on Food Storage and our beverage businesses within Home Solutions. You'll see that across our Writing portfolio. You'll see that on the Irwin business within Tools. And we're going to learn on Commercial Products what the right levers to pull are. We're doing a bunch of print right now on the new BRUTE can that we've got. And we're doing print on the new Maximizer Mop that reduces the amount of cotton in a mop head while improving performance. Reduces the cotton content by 30%, so it's much easier for the janitor to use. We're trying print out there, but do we -- we're not sure whether that will work. And if it doesn't work, we'll put the money off and put it into other investments. We're managing the company as an operating company, and so -- not a holding company. So we're not yet in the position where I want to let go of how we deploy what is still pretty scarce A&P resources, even though we've increased it substantially.

Your next question comes from Olivia Tong with Bank of America Merrill Lynch.

Can we talk a little bit about sort of the next year and the key areas that have to perform to get you closer to making the high end of the sales outlook range as opposed to the low end? And in the context of the macro backdrop, it's certainly gotten a lot more interesting, even since the last time we met at Analyst Day. So maybe you can talk a little bit about the macro assumptions that you have embedded into your outlook.

Well, we think the U.S. is gradually improving, as we've talked. It's interesting that we see this divergence between the macros and our underlying performance in Europe, which is interesting. The macros have worsened in Europe, yet our -- particularly, in the core countries like Germany and U.K., to a degree, France. But our business is actually strengthening, as John mentioned in his remarks. So that's a divergence. The key will be the investment profile -- if we want to sustain that momentum, the investment profile we put behind those businesses. In the emerging markets where -- I certainly read all the earnings call transcripts and see what other people are saying about the emerging markets. And the GDP dynamics in the emerging markets really don't connect at all to our own performance in those markets, because we're in the early days of deploying our portfolio, we're investing significant money and we're getting nice growth yields out of the investments we're making. So I don't think that GDP dynamics are -- have a material impact on our developing or emerging market businesses. In the developed world, obviously, if we faced a U.S. slowdown, that would be a challenge. But we don't envision that in the near term. We also don't envision some wondrous growth rates and tailwinds turning behind the business. Some of the things that are going on from a currency standpoint, so Bank of Japan last night, again, it seems to be a race to the bottom on currencies for Japan and for Europe, which creates a dynamic for us on ForEx. We've proven we can manage through that stuff this year, and we'll do our best to do that so that we can sustain the commitment to increase A&P investment in our business next year. But it sounds like it's going to be one of those dynamics years next year, where we have to manage the movements of currencies and the impact on gross margin. And we may have to embrace more pricing in some of these markets where we end up with a transaction ForEx effect beyond what we've assumed.

And Olivia, to answer the other part of your question. I think for next year, for us to succeed, we have to continue to create momentum we have on Writing right now that we've established. And with the incremental A&P we're putting behind the brands, we should see that. Baby should be getting back -- in North America, back up to the growth that it had before as -- recall, we were hampered quite a bit in Q1 and Q2 as a result of the recall, so we should be able to get that business back to growth. And then probably the third thing is we have to execute. As Mike mentioned, our DC consolidation in Tools was a bit of a step-back for us, unfortunately. And we have a lot of plans for next year, so we're going to be flawless in our execution. Those are probably the 3 big things to make sure that we deliver on our commitments to you next year.

Yes. And remember, the other thing that we won't have is a down elevator next year, Olivia. We don't have the -- we'll have a little bit of flow-through of the European exits into Q1, but then that will be behind us. We've taken a real -- some real lumps this year in core sales related to our repositioning of the Rubbermaid Consumer business. Well, that will continue next year. The degree to which it impacts our overall results will sequentially lessen through the year. And we're very optimistic about Commercial Products and Tools. We've got great plans in place for those businesses. So where do we end up in the core sales range? I don't know. I do know that we will see the benefit in the back half of the year as a result of Ignite and bubba coming into our core sales metrics. We've chosen to be really pure in how we manage that, so even though bubba is small, we're not counting it in core sales until -- the growth in core sales until we lap a year of ownership. And that's the right way to look at things. So you should expect our Q4 numbers to maybe push the high end or even break out above the high end. And as we move through '15 into '16, you should see our progression out of the strategic phase of the Growth Game Plan into the acceleration phase, where we've said that, consistently, we will deliver greater than 4% core sales growth. And we're right on track to do that, in my judgment.

Got it. That's very helpful. And if I could just follow-up on SG&A. I understand that, obviously, 150 basis points of that was advertising. But even excluding advertisers -- advertising, I was surprised to hear that SG&A would have been up. So was that incremental overhead? And if so, what's driving that and how do you think about spending going forward?

Yes. It's the absence of a couple of unique things from the prior year that create that dynamic in the quarter. So it's not -- believe me, there's no new overhead. So we're really tightly managing that.

Your next question comes from Jason Gere with KeyBanc Capital Markets.

I guess just 2 follow-up questions. One, just in light of Project Renewal 3, and I think you're seeing the phasing of the savings somewhere maybe in the back half of '15. And also your last comment about trying to accelerate core sales above 4%. Does this allow you any flexibility in terms of accelerating the expansion into Asia? I know that's something that you're really focused more in Latin America right now and I know Asia you talked at the Analyst Day. But I was just wondering if this gives you a little bit more flexibly to kind of start that process a little bit earlier. And I have a follow-up question on something else.

Sure. You know what, Jason? We're going to be very disciplined about how we take our Writing business into China and parts of Southeast Asia. So we're going to do the work the right way. If we can accelerate, we will. But I'm not -- we're not going to be opportunistic about that because we have to get that right. We want it to be a sustainable growth thread for us for many years to come. And so we think that's our early '16 initiative. All the funding of the research, all the planning will happen this year, and we'll see how that plays out. I don't think we're going to need any of that, nor would I use that lever as a way to strengthen core next year. I don't think we're going to need it, and we won't be ready for it. So I think that's going to stay a 2016 initiative, and I think we're comfortable with that being the right timing.

Okay. And then just, I think, going back to an earlier question on, I guess, the step-up in A&P. I was just wondering if you could talk maybe about the ROI that you're getting, I mean, maybe use Writing as an example during Back-to-School and kind of the replenishment there. Can you talk about the learnings that you see? Where you're happy with the spending that you're doing? Where you think that it can be strengthened? Or just maybe a little bit of context, especially as A&P is going to go up again another $50 million next year. Just wondering the evolution of the process.

Yes. So we're learning and adapting as we go. So I think Mark showed a couple of charts at the Analyst Day that really showed a strong correlation between trial and investment on new items. I think he showed a Baby chart that showed you the lock-step relationship between advertising spending and the kind of POS growth we're getting. Where we're spending our money, we see good POS momentum. Not everything has worked. That's for sure. So we learned from Tools last year on some thematic advertising that we did on the Irwin brand, and we've not repeated that this year. We'll learn on Commercial Products. I've got questions as to whether that's going to drive sell-through or whether it doesn't as strongly as we hope. I hope it does. I like the fact that it's focused on our new items in Commercial Products. But that may or may not yield the best growth return for the investments. We'll learn from that. But in general, when I look at the performance of our business, I see good point-of-sale growth rates on the things that we're spending the money on. And we see market share up across every one of our measurable categories. So whether it's Food Storage or whether it's the Writing businesses in aggregate or whether it's -- even the Goody business, which we don't talk a lot about, we see good POS momentum and share growth where we're spending some print advertising. And so we're quite pleased with the yields, the growth yields we're getting on the investments, in general, but we're not going to waste a penny. So our mindset is it's our money and we don't want to mess around with it if it doesn't drive strengthening of our brand or sell-through.

Your final question comes from Steph Wissink with Piper Jaffray.

I wanted to just talk a little bit about the out-the-door pricing at retail, what you're hearing in terms of feedback from your retailers in terms of willingness to lean into higher pricing to help offset some of that cost inflation. And then secondly, just related to your A&P. I'm curious around taking some of those content assets that you've had some success with and really globalizing them. How are you thinking about some of the development behind some of the creative that you've done and how applicable is that around the world?

So pricing is tough in static markets. And I think in the U.S., it's probably the toughest market. U.S. and Europe, it's the toughest market to land pricing without commodity inflation. So we're getting -- where we've had inflation, we've been able to price, but it's a tough conversation. And at times, it causes us to lose some of the support you would normally get from a retailer if they don't see that being in their -- pricing in their interest. We have to be disciplined about this stuff. We can't -- as commodities move on us, we're going to have to capture price, we're going to have to get the gross margin progression we're looking for through productivity. And we are being disciplined about that, even though at times it can be very painful. Outside of the U.S., we've gotten pretty good pricing traction because, in our categories at least, there's -- the core competitors are either U.S.- or European-based companies, and they all face the same transaction ForEx dynamic that we do. So pricing is never easy. But with the right lead time, with the right conversations, you can get it done, even in a tough market like North America or Europe. The transfer of insights and then marketing to new markets, we're doing it today on Writing. The work we've done on InkJoy is traveling. We're in 5, 6, 7, 8 countries now with the same advertising idea. The innovation platforms are traveling. We have to be sensitive about landing both in a locally relevant way, so I don't think that we can be simple-minded about this. You have to make sure you get the kind of traction you need with local consumers with these ideas. And so we don't want to blindly deploy. But there's lots of opportunity to take the core of an idea and move it along. And particularly within our Writing business, which is the most -- Writing and Tools, which are the most global of our businesses, we've had some success moving ideas across geography. So with that, I think that's the last question that's on the table. We appreciate your support, sticking with us through the Q&A and through our commentary. We're pleased with our progress. We're delivering solid results in the context of a continued strong change program, and we're quite confident in the road ahead, in our ability to deliver the guidance we've articulated for both 2014 and 2015. Thanks so much.

Today's call will be available on the web at newellrubbermaid.com, and on digital replay at (888) 203-1112 domestically and (719) 457-0820 internationally with the access code of 8028301 starting at 12 p.m. Eastern time today. This concludes our conference, you may now disconnect.