Good morning, and welcome to Wolverine Worldwide's Third Quarter 2012 Earnings Conference Call. [Operator Instructions] This call is being recorded at the request of Wolverine Worldwide. [Operator Instructions] I would now like to introduce Ms. Christi Cowdin, Director of Investor Relations and Communications for Wolverine Worldwide. Ms. Cowdin, you may proceed.

Thank you, Sue. Good morning, everyone, and welcome to our third quarter 2012 conference call. On the call today are Blake Krueger, our Chairman, CEO and President and Don Grimes, our Senior Vice President and CFO. Earlier this morning, we announced our financial results for the third quarter of 2012. And if you did not yet receive a copy of the press release, please call Brad Van Houte at (616) 233-0500 to have one sent to you. The release is also available on Moneynews sites or it can viewed from our corporate website at www.wolverineworldwide.com. Before I turn the call over to Blake to comment on our results, I'd like to remind you that the predictions and projections made in today's conference call regarding Wolverine Worldwide and its operations may be considered forward-looking statements by Securities laws. As a result, we must caution you that as with any prediction or projection, there are a number of factors that could cause results to differ materially. These important risk factors are identified in the company's SEC filings and also in our press releases. And with all that being said, I would now like to turn the call over to Blake.

Good morning, everyone, and thanks for joining us today. Before talking about our third quarter results, I'd like to take a few minutes to discuss one of the most significant and exciting events in Wolverine's 130-year history, the acquisition of Performance + Lifestyle Group from Collective Brands. We're extremely excited to welcome PLG to the Wolverine Worldwide family. Its portfolio of authentic iconic brands, including Sperry Top-Sider, Saucony, Keds and Stride Rite are leaders in their respective market segments and will add significant additional depth and breadth to our already strong brand portfolio. The inclusion of these brands with a combined brand equity of over 380 years expands our footprint in the men's and especially women's markets, strengthens our athletic and outdoor offering, helps move the company into the younger casual footwear market and provides access to the retail doors and the infrastructure of one of the world's most trusted children's footwear brands. PLG is an excellent, well-managed business that has been growing at a solid double-digit rate for over the last several years with fiscal 2012 revenue expected to top the $1.1 billion mark, another record for PLG. Looking ahead, we will be focused on accelerating PLG's already robust growth pace with a concentrated focus on brand expansion into international market. We also believe there are opportunities to achieve higher profit performance from the PLG business as the team has a clear path forward for additional gross margin expansion and operating margin improvement. In addition, although this acquisition is not based on the realization of significant efficiencies, we now believe that we will deliver ongoing synergies above the high end of our previously disclosed range. Now I'd like to provide some background about our newest brands, beginning with Sperry Top-Sider. Founded in 1935, Sperry Top-Sider is the original boat…

Thanks, Blake, and good morning, everyone. Earlier this morning, we reported our financial results for the third quarter. Revenue and adjusted earnings per share were in line with the expectations we shared shortly before the quarter closed and, as Blake discussed, reflects solid performance across the portfolio in the United States, our largest market, offset primarily by ongoing difficult macroeconomic and retail conditions in Europe. I'd like to share more details on the quarter, discuss current global trading conditions and provide an update on our revenue and earnings guidance for the full year, which now includes the impact of last week's closing at the acquisition of PLG. Taking a closer look at the third quarter's results, reported revenue for the quarter was $353.1 million, 2.4% lower than the prior year, when revenue grew approximately 13%. As anticipated, FX was a drag in the quarter, negatively impacting reported revenue by $5.4 million. Our U.S. business delivered another solid quarter with single-digit growth from our 2 largest U.S. brands, Merrell and Wolverine, accompanied by double-digit increases from Hush Puppy, Sebago, CAT Footwear, Bates and HyTest. Our international distributor businesses for Wolverine, Sebago, CAT Footwear and Harley-Davidson Footwear and markets outside of the EMEA region each delivered impressive double-digit increases during the quarter, helping drive single-digit growth in Latin America and double-digit growth in the larger Asia-Pacific region. Turning to the EMEA region, where we generate about 20% of our reported revenue, continued difficult macroeconomic and trading conditions negatively impacted the quarter's results, with EMEA unit volume down in the high teens versus the prior year and revenue down over 20%. The tough economic environment in the EU is driving consumers to trade down when they're making buying decisions, not only for footwear but also for many other consumer product categories. A soft…

Thanks, Don. As a company and a team, we've grown accustomed to delivering a record year every year in terms of revenue and profit. Actually, 16 out of the last 18 years, to be exact. Despite some things we can't control and while the company will have solid earnings performance this year, 2012 is disappointing to us from an earnings standpoint. I'm confident we will overcome these headwinds and overachieve in 2013. In my 30 years of association with the company, I have never been more excited about the array of future opportunities for global growth for the company and really all of our 16 brands. I wouldn't trade our position today with anyone in the industry. I want to thank everyone for your time this morning, and I'll now turn the call back to the operator so we can take your questions. Operator?

[Operator Instructions] Our first question comes from Kate McShane of Citi Investment Research.

I was wondering if you could break down the drivers of your revenue strength in the U.S. with price versus volume and then with your sales guidance for Q4. How much of the top line growth that you're guiding this morning is being driven by the sell-in of M-Connect?

Yes, as it relates to the first question, we had mid single-digit unit volume growth in the U.S. and we had revenue growth in the quarter that was a couple of 3 percentage points higher than that, so obviously, there was some positive mix and price reflected in that reported -- in the U.S. revenue, so we did have mid single-digits unit volume growth.

And Kate, your second part of your question was on M-Connect?

Yes.

Yes, that's going to be -- it's not even present, really, yet. That's going to be relatively small in Q4. A number of our key retailers are really asking us to pull ahead and we're pulling ahead some product for Q4 delivery, but it's not going to be material, really. It's going to be largely a Q1 2013 launch.

Okay, great. And then my follow-up question is what you announced last week about raising the accretion for the PLG acquisition. I wondered if you could quantify any more how much of that raise is from capturing the back-to-school business from PLG that you didn't have in 2012 and how much of it is from improved momentum in the PLG business.

Well, I mean, the raise in the accretion guidance was 2013 versus the prior 2013 commentary, so it would have been 12 months versus 12 months. And so as we noted last week, the higher accretion versus the range we had talked about on May 1 was driven by increased competence regarding PLG's full year profit delivery, slightly higher -- slightly lower interest expense based on the better rates we got on the notes as well as the term loan B, partly offset by the higher noncash amortization expense. But clearly, the accretion in 2013 versus the dilution in 2012 is related to full year of PLG results in 2013 and the unusual seasonality of PLG's business subset. The stub period in 2012 has 2.5 fairly low profit months for PLG.

The next question comes from Edward Yruma of KeyBanc Citi Markets (sic) [KeyBanc Capital Markets].

Which revised revenue guidance for the balance of the year? I'm just trying to understand the moving pieces there. Obviously, that's some cost commentary on Europe, but I think when we last spoke, you were still looking for very strong at-once business in the U.S. I guess, when I drove down the different components of your change in revenue guidance, how much of it was to the Europe and how much of that strong increase in the at-once business are you still expecting?

Well, I guess, with respect to Europe, we're expecting and planning continued a tough letting in overall in that market. So that's factored into our guidance. We've seen Europe kind of deteriorate all year, a pretty significant deterioration this past summer, and we expect that to continue and we factored that in. The U.S. business has remained fairly good the entire year. I would say the attitude of consumers actually spending their dollars has been a little bit better than maybe the retailers' mindset, but the U.S. business has remained fairly robust throughout the year, as has our business in Latin America and Asia.

And we still -- this is Don. We still have expectations for double-digit revenue growth out of the U.S. in the fourth quarter. As I mentioned in my prepared remarks, on a quarter-to-date basis through the first 5 weeks of the quarter, our at-once orders were up in the mid-single-digit range. We are expecting an acceleration of that year-over-year growth over the balance of the quarter because this is -- we're entering a period of time last year when at-once orders really started to dry up, so we expect strong double-digit increases over the last 11 weeks of the quarter in the U.S, in particular on at-once orders. So we are thinking that we're going to have double-digit growth in the U.S. for Q4 revenue, which is down from more the high teens revenue growth that we had been modeling before. We are forecasting Europe revenue to be slightly down versus the prior year; and Canada, mid-single-digit growth; and the rest of the world, where we typically grow at a double-digit rate, that continue to grow at a double-digit rate in the fourth quarter.

And I guess one second question. You had indicated that you had a lower outlook on incentive comp. Did you reverse any accruals during the quarter?

I wouldn't call it reversal of accruals as much as a true-up of the accruals. So we -- Q4 -- Q3 results would reflect a lower full year outlook for incentive comp, but it wouldn't have been a reversal of the prior accrual, just to true it up at a lower amount than we would have accrued in last year's Q3.

Something we do every quarter.

The next question comes from Christian Buss of Crédit Suisse.

I was wondering if you could provide some color on how you're thinking about a stabilization of that European business and what you think you're going to need to do to drive incremental revenues there going forward.

Yes, I guess, from a macroeconomic standpoint, we don't see any immediate solution or them working together towards an immediate solution in Europe. But all that being said, part of what's happened in Europe this year has been our fault. With hindsight, we probably did not widen the price points in many of our brands efficiently to react to a kind of a downward shift in consumer buying. It doesn't mean cheap shoes, but consumers have clearly in the vulcanized and canvas area migrated lower. We probably should have been more responsive to that, especially in the European region, for our Hush Puppy brand, our CAT brand, our Merrell brand. So we are working on that at the moment. Despite the macroeconomic environment, the good news about the footwear industry is it continues to do fairly well in just about any economic environment. And so if you're there with fresh product, product that's priced where the consumer is buying, you've got room for growth, and we're well on the path to addressing those issues.

Okay. And you'd come into the year thinking high-single digit, low double-digit growth rates for the core brands was the go-forward plan. Can you talk about whether this year has caused you to reevaluate that or how you're thinking about the strategic planning for the core business going forward?

Yes, I don't think our longer-term outlook has, frankly, changed. We've had some issues in Europe, we've had a few issues in Canada as well, but when we look around the world, when we look at how early in the life cycle our brands are, despite some large businesses in Asia and especially in Latin America, we see plenty of room for growth. So really, our long-term outlook has not changed at all.

And then, Christian, I will say that we have set probably -- I think we started -- starting back at ICR Conference back in January that our pre-PLG portfolio, that over the medium to long-term, we would expect kind of high-single digit growth out of that 12-brand portfolio. Clearly, 2012, for a variety of reasons, has been a disappointment. Our full year revenue is going to be well short of that, but when you look at the opportunities that exist for our most important brands in many markets outside the U.S., and as an example, Merrell, our largest individual brand is in about 140 countries around the world, but does well over 90% of its business in its top 20 countries. So it has very, very small market share in the other 120 countries, and so there's enormous opportunity for Merrell to continue its global growth. So our expectations regarding the ability of our pre-PLG 12-brand portfolio to grow at that high single-digit rate has not been diminished by what's been an unusual 2012.

The next question comes from Jim Duffy of Stifel, Nicolaus.

Blake, there seems to be somewhat of a convergence of outdoor and athletic. How far down the path towards athletic are you willing to take the Merrell brand?

We're already there. To be honest with you, Jim, the way I view their leap into really the athletic side of the business, they skipped over a couple of categories when they migrated to -- a great job when they migrated to Barefoot. They have -- they were a leader from the beginning that continued to be a leader there, but they've now with -- especially with some of the M-Connect categories, have backfilled, whether its Mix Master, Bare Access or even the kind of a real light hiking casual product, Proterra, they've backfilled those categories. So when you look at Mix Master, for example, and you look at a lot of the offerings from any number of the running shoe brands, there's not a lot of difference. So they're responding. They have responded really on an accelerated basis to the shift in consumer taste.

The -- Blake, the Barefoot category has, as you would expect, become increasingly competitive. Has the market grown at such a rate to absorb that incremental competition? Or is there any indications of inventory buildup in the channel in that category?

No, we're still continuing to see that category build. Every specialty running shop now in America has a Minimalist wall, a Barefoot/Minimalist wall. We don't see that ending anytime soon. Certainly, Merrell's own experience there this year, almost up triple digits kind of in that category year-to-date, would indicate the category continues to be quite healthy.

Okay, great. And then, Don, when you sum up the cumulative shortfalls from Europe over the course of the year, it's a big number. What does Europe -- what for 2012 will European revenue look like as a percent of the total? I'm trying to get my arms around what the potential incremental risk is there.

Yes. I mean, as we said, on a year to -- well, on a trailing 12-month or year-to-date basis, the broader EMEA region is about 20% of our revenue. If Europe grows at a slower rate than the rest of the business in the fourth quarter, that will drop to about 20% or a little bit below 20%, but it -- on a full year basis, that's still going to be about 20%, but it could be 19%-something, but in that range.

Got you, okay. And then how would you characterize inventories in the channel in Europe. Is the de-stocking at retail over with there or is there still inventory that retailers need to move through?

I think de-stocking is largely over with. I think the European retailers -- I made a couple of extra special trips to Europe here over the last year. I think they've been on their overall macro situation for some time. They've been very conservative. They've been very stingy with future orders. They've been relying on brands to kind of have what they need when they need it, as opposed to placing everything in future orders. So we think in Europe and, frankly, the United States, inventory -- retail inventories overall are in pretty good shape.

The next question comes from Mitch Kummetz of Robert Baird.

Don, you've given us a lot of color on various components of your international business, but I was hoping you could maybe just sort of roll that up and on a consolidated basis tell us how that came in on the quarter in terms of the year-over-year change, and then maybe what you're thinking just kind of all in international for Q4 as well?

Yes, I don't have the -- I have the detail, Mitch. I don't have the roll up of international -- of all non-U.S. business. I'm scanning what I do have here. Revenue in the quarter out of the U.S. was up 6.5%, so if you take all the rest, I mean, obviously it's down. I can do the math on it and get it to you when you -- if we talk later today, but...

No, that's helpful. With the U.S. up 6.5%, I can back into the international. And I know you talked about your expectation and acceleration of at-once orders from this point on in the U.S. through Q4. So kind of, again, if we can't talk about international rolled up for Q4, can you maybe just say what your overall expectation is for the U.S. business in the fourth quarter then?

As I mentioned and I answered the first question, we're expecting double-digit growth out of U.S. in the fourth quarter.

Got it, all right. And then on PLG, I really appreciate the color in terms of pro forma sales for this year, but can you maybe help us out a little bit thinking about the margins, at least from an operating income or operating margin standpoint, in terms of how that looks on a pro forma basis for your calendar 2012?

Yes, I mean, it's about $85 million of EBIT, or it should be about a 7.5% operating margin on a Wolverine fiscal year.

Okay, that's great. That's helpful. And then lastly, I know you guys aren't referencing backlog anymore, but can you give us some sense as to how your spring order book has come in? I know that -- if I recall correctly, your initial fall order book was down maybe mid-single digits, if I'm not mistaken. I mean, are we seeing -- or are you seeing some acceleration in that order book as you move from fall '12 into spring of '13?

Yes, I guess, just to give you some direction there. We see -- it depends on the brand and the geography, but we see, frankly, fairly good momentum. We see especially good momentum on the PLG side for spring, so it really depends on the geography and the brand. And they haven't been very predictive in the past, frankly, on where our sales are going to give up, so we're more than reluctant to go into a lot more detail than that, but I think there are a couple of things working in our favor. Now the fact that retailer inventories are in line and, frankly, have been in line for a couple of seasons, and I don't even want to say this because I don't want to jinx it, but it looks like we actually might have a fall and winter in the United States and in Europe, and for us, most importantly, the U.K. this year. It was 34 degrees driving to work this morning in Michigan. And on the East Coast, there's just been more weather this year. It -- again, I shouldn't even say anything. It looks like it's going to be a normal fall and winter, which, obviously, helps our portfolio.

The next question comes from Chris Svezia of Susquehanna Financial Group.

So I just want to go back to this observation when you guys talked about fourth quarter and kind of how you think about the revenue by geography. You referenced Europe down slightly. I think you said it was down in the -- about 20% in the third quarter. What -- is it just an easier comparison? What gives you that confidence you get a swing to be only down slightly during that fourth quarter?

It's easier comparisons. I mean, the slowdown in at-once business last year in the fourth quarter also impacted Europe. As Blake just mentioned, we're seeing weather in Europe, in the U.K. in particular, so we're not changing our forecast on a daily basis based on that day's temperatures, but we have expectations, as we have had all year, for a normal start to the fall-winter weather season. And so the fact that we are forecasting Europe to be down but down a lot less than it was in the third quarter reflected the ongoing economic challenges, but also the expectation that we're going to have easier comps in terms of at-once orders.

Has the -- just on a quick question. Has the at-once business improved thus far in Europe like you referenced, I think, in the at-once business in the U.S.? Was that mid-single digits, or no?

That was a total of at-once revenue single digits.

Okay.

Actually, I don't have how it fell U.S. versus Europe at my fingertips.

Okay. Just switching gears one second on the Merrell brand. When you broke out performance outdoor and outside athletic and lifestyle, when you think about kind of the growth trajectory of those 3 segments, just add some color. I mean, it's really most of the growth that you foresee over the, I guess, the next 6 to 9 months really coming in outside athletic? Or how do we think about sports, outdoor and lifestyle in terms of the growth rates of those businesses?

I think performance outdoor, where Merrell dominates, is a smaller market than the other 2. So when you look at the runway in front of the brand in outside athletic and active lifestyle, which is really all casual footwear, those are significantly larger markets. So right now, we're not -- for the Merrell brands especially, we're not seeing any ceiling whatsoever in outside athletic. In fact, we're just still fairly early on our growth cycle there. Active lifestyle, we simply got to do a better job. That's a huge market. It's always been a huge market. Merrell has pretty consistently overperformed from season to season in that market. And frankly, we've underperformed the last couple of seasons in active lifestyle, and we're taking steps to address that through some accelerated product introductions and focus on design.

Okay. And then if I can go to this 2013 sort of general guidance in [indiscernible]. Just so I have this correctly, you mentioned on PLG double-digit growth versus 2012. I mean, 2012 year looks like a base of $1.1 billion, but when you talk about the high-single digit versus pro forma, just -- what do you mean by that exactly? Just want to have that correctly. Is that just assuming you have PLG -- all PLGs as well?

Yes, that's giving -- the 2012 base year reflects PLG's full year -- full Wolverine fiscal year revenue of the $1.12 billion that I referenced, approximately $1.12 billion. And then the growth in 2013 is what -- we're thinking that's high single-digit growth for the new 16-brand portfolio versus 2012, with PLG having a full year revenue in the denominator in 2012.

Okay. And when I think about 2013, I know in 2012, you guys had -- in the first half of this year, you had some discrete tax items, and I think it was like $0.19. I mean, do you anticipate revisiting that, or as you go into next year, to have a more normalized tax rate?

We will have a more normalized tax rate next year.

The next question comes from Sam Poser of Sterne Agee.

You mentioned that the efficiencies in the synergies were above the high end. You'd said that on the prior call when you announced the deal closing. Has anything changed from a few weeks ago or is that the same comment?

No, it's the same comment. That was just a week ago that we made that comment, which we kind of made also in July, but as we continue to work more and more on the integration, the ultimate synergies that we're going to realize from this, we believe, will be at or above the high-end of the range we've talked about. As I mentioned last week during the call, Sam, 2013 is a bit of a muddy year because there are a number of discrete yet significant projects that are going on related to bringing the 2 organizations together, particularly in the systems area in which we're incurring some incremental costs beginning in the fourth quarter of this year and into the first half of next year, that are in the kind of ongoing operating cost buckets, so therefore, we're not excluding those as nonrecurring integration costs, but they are costs that we have to incur in order to realize, ultimately, the synergies that we're talking about. So 2013, plus or minus, you won't see net synergies of $10 million or $15 million necessarily, but when we get to 2014, which is the first clean year for PLG contribution, that's why the PLG earnings accretion accelerates so much from 2013 to 2014.

And then you also -- 2 questions about SG&A. What are -- you've kept the SG&A really right in line, so on a non-PLG related comp comparison for the fourth quarter, how should we be thinking about SG&A? Is that -- I mean, are you going to -- is that going to be up now? Is that going to now be up...

Yes. As a percent of sales, that'd be modeling a flat to slight -- very slight deleverage, possibly.

Flat to -- okay. And then will the charge or the dilution of the $0.25 to $0.30, where -- should we -- does that all go into the SG&A bucket at that point, for all practical purposes?

No, it will be revenue -- PLG's contribution to our results for the...

Right. I understand, but I mean from an earnings perspective.

It will be -- it's PLG's incremental revenue, incremental gross profit offset by incremental SG&A, including the costs we're incurring related to integrating PLG, offset obviously by interest expense and the incremental amortization expense. So it'll hit every line on the P&L.

How can we -- how should we think about, let's say, the gross. Can you give us one of those, the margin or the SG&A line, so we can back into the other?

I really can't right now. I mean, you'll need to make some assumptions on the revenue number down to the dilution number and make some intelligent judgment calls on the individual line items.

The next question comes from Diana Katz of Lazard Capital Markets.

Just wanted to go over 4Q guidance for Europe again. I guess I still don't understand why you expected only down slightly versus the current run rate.

Yes, I mean, I don't -- maybe we're getting into semantics here, but slightly could be upwards to high-single digits down in the quarter. So I mean -- and remember, we've got somewhat easier comparisons versus last year, but we're not anticipating anything like the 20 -- the range of 20% decrease that we had in Q3.

So starting next year in the first quarter, have you really anniversary-ed, then, the issues in Europe?

We think we have, but also remember, starting in Q3, Europe kind of ticked down to a new level, at least for our business. So we will be anniversary-ing some of the challenges in Q1 and 2, and then there was -- it will be a much easier comparison in next year's Q3, if you're kind of thinking of your model in that way.

Okay. And then on M-Connect, can you talk about some of the new distribution that you're getting there both here and in Canada?

Yes, I mean, the distribution is really in the athletic channel, for the most part. Merrell's had some distribution there in the past before Barefoot, but frankly, it's been pretty minimal, so that was pretty much complete whitespace for us. It's new distribution. It's great distribution. You look at the run specialty channel in the United States, full-service sit-and-fit, it's the kind of distribution that we love and that you need for running or minimalist or some of the other lightweight product that's out there, so -- but I would say the whole minimalist lightweight trend continues to spread across a number of footwear categories, and so you're seeing M-Connect migrating also out of the pure run specialty channel and then into the sporting goods channel.

[Operator Instructions] Our next question comes from Scott Krasik of BBC (sic) [BB&T].

Can you help us understand what happened with Merrell in your non-EMEA, non-U.S. business? I guess you didn't mention it in the -- when the reference about the distributors?

Yes, I mean, are you talking our Merrell International business?

Right. Merrell International -- when you cited a bunch of brands did well with the distributors, you did not cite Merrell.

Well, yes, I mean, our Merrell business internationally continues to grow. Remember, we had a huge last year in the international market for Merrell, so the comparisons were a bit tougher, but quite honestly, Merrell's still early in its growth cycle. A year ago, Merrell would have had about 130 standalone Merrell stores around the world, for example. I think we ended the quarter with 186 or 189 this year, a lot of that being fueled by having a lifestyle, a brand offering, apparel, accessories and footwear. So the Merrell business around the world continues to be very healthy. I think there are some significant markets around the world, India and China for example, that are very early in their lifestyle in migrating to this outdoor concept in the consumer's mind. So we kind of see that as kind of maybe longer term, but double upside for Merrell in some of those most significant markets.

Okay. And then as you migrate more towards outdoor athletic, I mean, is the -- are you going to have to hit the athletics specialty chains in a big way? I can't imagine that specialty running on its own will deliver the growth you want.

Yes, we already have some interest from some of those folks. They're always looking for something new and fresh as well. A lot of those people, 18 months ago, didn't have a Minimalist wall or a Barefoot wall. They now have offerings from not only Saucony and Merrell, for sure, but a number of other brands. So it's a great opportunity for the Merrell brand in particular, and frankly, a great opportunity for Saucony.

And then how quickly -- you said you're going to accelerate from product development in your lifestyle piece of Merrell. I mean, that's one thing we heard from department stores and independents, frankly, that you just sort of gave up on that category, very little innovation in women's sandals, for example, some of the men's nonathletic. I mean, how quickly can you get that business on track?

Yes. I wouldn't say we ever gave up on the category. We may have taken our eye off the ball a little bit as we focused on more of the athletic side of the business, but that's also part of the heart and soul of the Merrell brand and where that loyal Merrell consumer, still #1 or 2 in intent to repurchase, expects us to deliver excellent product. So Merrell Barefoot, for example, was developed and brought to market in about half of the normal time. We've got a number of projects going on right now in that active lifestyle area on that kind of a timetable.

Okay, and then just 2 more fast ones. Don, I know it's a little confusing, so what's the -- now that we have a base for '12, the $0.35 to $0.50 accretion for next year, would that be off of the full number including the $0.25 to $0.30 dilution or would we exclude that? Help me understand.

No, the $0.35 to $0.50 of accretion next year is kind of -- put your blinders on that. That's just a standalone -- the incremental contribution in 2013 compared to Wolverine's pre-PLG acquisition-based business. It's not an earnings increase from the dilution of -- in 2012. So if you're looking at the year-over-year incremental impact from PLG, it'd be -- depending on which end of the range you use, it'd be $0.25 dilution compared to, let's say, $0.50 of accretion next year. That would be a $0.75 EPS lift from one year to the other.

Okay, that makes sense. And then just last, you guys had talked a lot, particularly in the first half of the year, about how the hangover from fourth quarter last year was impacting at-once business. In terms of the pace of at-once orders you're seeing now in the second half of this year, how much of it is industry-focused? What are the retailers telling you in terms of their approach towards winter and cold weather and Christmas and does that give you more confidence or less confidence about meeting your short-term targets?

Well, Scott, retailers always tend to be a bit optimistic. They always think they're going to have the perfect weather season. So they've been watching their inventories. Their inventories are in line both here and Europe, our 2 largest owned regions, and it looks like at the moment we're getting the benefit of weather, and our brands are out there with some fresh new products. So we expect the at-once environment to be especially good, and that's partly because over the last several years, retailers have been kind of very stingy about their future orders and they've been relying on brand owners to have the product there when they need it more and more.

At this time, we have no further questions. I would now like to turn the call over to Ms. Christi Cowdin. Ms. Cowdin, you may proceed.

Thank you. On behalf of Wolverine World Wide, I would like to thank you all for joining us today. And as a reminder, our conference call replay is available on our website at www.wolverineworldwide.com, or the replay will also be available at other locations, and it's available through December 31, 2012. Thank you.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.