Ladies and gentlemen, thank you for standing by. Welcome to the Ralph Lauren First Quarter Fiscal Year 2017 Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Instructions on how to ask a question will be given at that time. As a reminder, this conference is being recorded. I would now like to turn the conference over to our host, Mrs. Evren Kopelman. Please go ahead.

Good morning, and thank you for joining Ralph Lauren's First Quarter Fiscal 2017 Conference Call. With me today are Stefan Larsson, the company's President and Chief Executive Officer; and Bob Madore, Senior Vice President and Chief Financial Officer. After prepared remarks, we will open up the call for your questions, which we ask that you limit to one per caller. During today's call, we will be making some forward-looking statements within the meaning of the federal securities laws, including our financial outlook. Forward-looking statements are not guarantees and our actual results may differ materially from those expressed or implied in the forward-looking statements. Our expectations contain many risks and uncertainties. Principal risks and uncertainties that could cause our results to differ materially from our current expectations are detailed in our SEC filing. To find disclosures and reconciliations of non-GAAP measures that we use when discussing our financial results, you should refer to this morning's earnings release and to our SEC filing that could be found in our Investor Relations website. And now I will turn the call over to Stefan.

Thank you, Evren, and good morning, everyone. We last spoke at our Investor Day in early June where we shared with you the details of our Way Forward Plan. The Way Forward Plan is our multi-year plan to build on the unique brand strength we have, go back to the core of what made us iconic, evolve from that core and build the business back to sustainable profitable growth. Today, I will share my key takeaways from the first quarter and then provide a brief update on what we have achieved and learned so far in starting to drive the execution of our Way Forward Plan. Then I will turn it over to Bob to review the company's quarterly financial performance in more detail. Beginning with the quarter, performance was mostly in line with our expectations with some minor puts and takes, as we would expect at this early stage of the execution of our Way Forward Plan. On the revenue side, the domestic business, as expected, continued to be challenged while the international business delivered a strong quarter, posting 10% revenue growth year-over-year. The main drivers to the decline in North America are what we shared in detail during the Investor Day. A combination of not having evolved our consumer offering enough in product, marketing, shopping experience, and having had an operating model that has generated too much excess inventory. Having these self-induced challenges are hurting us when we, like everyone else, are facing difficult retail traffic trends in a highly promotional environment. In our international markets, even though we have a much smaller presence there than in North America and we globally have much improvement work to do ahead of us, there were valuable learnings in the quarter that we will use in building back strength in our…

The first question comes from Omar Saad with Evercore ISI.

Good morning. Thanks for the update. I guess my question I want to ask – maybe for a little bit more information and insight on what you learned in Asia as you kind of improved the quality of sales there. It is a different market in terms of it is a lot more owned retail or concession model, you don't have that kind of big wholesale piece. Trying to understand – I also think the brand maybe is a little bit – the architecture is a little bit simpler in Asia. Maybe help us understand what is the difference between the Asian market, what you are learning there, and maybe what we can expect in North America, which is – because of the omni-channel wholesale brand architecture might be a different path towards elevating the quality of sales. Thanks. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: Yeah, thank you, Omar. The biggest changes that we've made to support and strengthen the quality of sale that we're seeing in Asia is to really significantly cut back on our promotional stance two different ways. One, significantly shortening the length of promotion. And two, just the depth of the discounting and the markdown. And what we've seen is overall from a quality of sale perspective, whether it's looking at discount rate, which has decreased significantly. We've seen a very significant increase in average unit retail. And although we've seen a more moderate decrease in UPTs, overall it's driving a stronger average transaction value for us. That's been the biggest change and the biggest benefit that we've seen from that.

When it comes to Jeff Kuster, who just started, as I mentioned in my opening remark, he is starting with an assessment of the challenge in North America and diagnosing that in detail so we get a facts based view on what we are up against. And then we are pivoting to building a plan to increase quality of sales in North America. So differences there, Omar, coming back to your question, there are definitely differences in Asia and North America based on channel differences as being one big difference. But it comes back to how we plan the inventory, how we buy the inventory to demand, how our promotional strategy, our promotional execution and how that plays across channels. That's why the fact based diagnosis is so important. Jeff just started three, four weeks ago and he is underway with the team and will work with the different channels and that's where we're going to add the most value in this analysis, and coming back, that's what gives me the most confidence when it comes to a plan to increase quality of sales. But we are doing this for the first time cross-channel and we're going to do it together with our biggest customers as well. So we are looking forward to come back and provide our insights when we get them. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: I mean, one other thing, Omar, related to the Asia quality of sale improvement. We've also done an in-depth analysis of points of distribution and we reduced approximately 48 points of distribution in Asia this quarter that we felt really didn't properly represent the brand but at the same time we also identified a number of additional points of distribution. So, for an example, in our wholesale channel, which is a relatively small business in Asia, but we saw in the quarter a 48% increase in the number of shops in our wholesale channel, too. So it's both cutting back on promotions, whether it's depth, length, but then also making sure that we're in the correct points of distribution for the brands.

Next question, please.

Thank you.

Thank you. The next question comes from Kate McShane with Citi Research.

Hi. Good morning. Thanks for taking my question. Thanks for the update on the supply chain efforts. I just wondered if you could maybe walk through some of the mechanics of how you are reducing the supply-chain lead time, especially in light of your commentary today about the 50% reduction in lead time this year and 90% by next year.

Let's see. Yes. It's not a 50% and 90% reduction of lead time. We're moving – it's a 50% – we're going be 50% on a nine-month lead time by the end of this year and we're going be 90% on a nine-month lead time by next year. As I mentioned on the Investor Day, the biggest change here is a cultural change and it's a change of how we work as a team. So instead of working in a sequential way where you hand over function by function and by that you build in slack in the lead times and you extend the lead times, we are working together cross functionally. So, one thing that has really excited me over the first couple of months digging into the Way Forward execution with the team is to break down the silos, to have design, merchandising, sourcing, sales distribution channel at the table from the first design idea all the way in to selling the actual product. And just by that, we cut a lot of time from the lead times. And then it's about going and mapping through and Halide Alagöz is leading that work. She's mapping every single component of the current lead times and looking at how is every component and every day and hour spent adding value to driving brand strength and profitable sales growth and driving a stronger assortment. And I can say that I'm very encouraged by the facts that we are digging up, that we will be 90% on a nine-month lead time by the end of next year. Parallel to that is going be the eight-week test of rapid response pipeline because that's going be a big enabler as well that in a very short period of time we're going to be able to test any and every new big product idea before we go big. And rapid response part of that is to say when we sell something and we see a bigger demand than expected, we will be able to much faster chase back into those products.

Next question, please.

Thank you. The next question is from Michael Binetti with UBS.

Hi. Nice quarter. Just one near-term I guess modeling question to help us think about the year, then maybe just a longer-term question. On the model could you help us think about the planned cost-saving split between SG&A and cost of goods sold as we look at both the second quarter and the second half? I guess I thought – I guess we had a little bit upside down in our model. I thought some of the cost reductions you had already taken would have meant more SG&A leverage this quarter, maybe not as much cost of goods. And then longer-term, as you guys laid out the plan for the next four years at the Analyst Day you referred to as 2018 as revenue stabilizing. And as we look at it with the guidance you gave today we were able to do a little bit of math around the year. And we can see that the back half of the year looks like revenues will be down by mid to high teens it looks like. We know in the fourth quarter you will have to lap an Easter shift and an extra week and that you will be closing stores so it will naturally be lower. But certainly some of the drivers on why the growth rate leaving the year will be so low will extend into the first half of next year. I am trying to think if – a little bit of time has gone by now – if you could help us think about how to maybe start quantifying what your reference to stabilizing revenues will look like in fiscal 2018 given what you know about the business today as you start walking into the plan. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice…

Thanks, Bob. And to build on what Bob just said, Michael, when it comes to the phasing of the Way Forward Plan and the financial outlook we gave on a four-year basis, if you look at – let's start with the phasing. We guided top line, from a phase perspective, to reset and stabilize 2017, moving into 2018, and then pivot to growth. And so why Q3 and Q4, why we should expect an increase in the sales – a decrease of sales in Q3 and Q4 versus the current trend, it comes back to the work Jeff and his team is doing in North America. Given how our – how big North America is of our overall business, the assessment that Jeff and his teams come back with will include several additional quality of sales initiatives. So that's why we have guided the way we have guided.

Thank you.

Next question, please.

Thank you. The next question comes from Lindsay Drucker Mann with Goldman Sachs. Lindsay Drucker Mann - Goldman Sachs & Co.: Thanks. Good morning, everyone. Just as a quick follow up on what Jeff's team is doing. When would you think after they come back with that analysis that those implementations would be in the market? So are we talking about spring of 2017 where we might see a difference in quality of sale? Is friends and family and couponing on the table? And then just on the supply chain, the speed dynamics, you've talked about building a speed pipeline, as you mentioned, on test and react in department stores, which is pretty new. As Halide has done her work, I know she is early on, but I am just curious how that dynamic will work when you're not a vertically integrated retailer, you are relying on your third-party retail partners to get data to test and react to. So maybe just building a little bit on how that might work. Thanks.

Okay. Thank you, Lindsay. So let's try to cover all your questions. So starting with Jeff and his team's work in North America, how soon you will see that come through. What I can say there is it's top priority. It's by far our top priority to assess the North American challenge. And as soon as we have clarity within the next few months, we will start to implement additional quality of sales initiatives. So we keep you posted on a more detailed schedule. But the ambition is full speed forward to assess, get the fact based and then lay out the plan and start executing it right away. So, we should see an impact at the end of this year. When it comes to friends and family and other couponing initiatives are on the table, everything is on the table. Then it's – everything is on the table, and then we look at, how do we drive brand strength and sustainable profitable sales growth in a responsible way from where we are to where we are heading. Eight-week speed pipeline. So I mentioned a few times before that coming into this role, the wholesale relationship partnership was new to me, and I was blown away by our biggest customers and their willingness to take on the challenge together with us. So, they are waiting for us to come back and say, relating to the eight week speed pipeline and a number of other areas to say how can we partner up and create joint value out of this. Because when we get into a more balanced inventory and cut most of the excess out and be able to react on eight weeks, then we will be able to create value not only for us but for them. And they are very clear on that. So we have an ongoing dialogue with them, and they are waiting for us to be ready to start to execute on it. What excites me is to see by the speed Halide and her team has come into not only assessing the state but also reaching out to the suppliers. As I mentioned, we went to Asia, Halide and I, and met with our key suppliers. The suppliers that were there represent 70% approximately of our total volume. And we invited them into co-create this journey, to co-create the sourcing part of the Way Forward Plan, which also it didn't surprise me because I'm more experienced from working closely with sourcing partners that they were more than ready to dive in. So, I've seen several concrete examples of how working differently we'll be able to increase quality, decrease the cost and increase the flexibility and the speed.

Thanks. Next question. Lindsay Drucker Mann - Goldman Sachs & Co.: Thank you very much.

Thank you. The next question comes from Matt Boss with JPMorgan.

Hey. Thanks. So, on your wholesale reset, can you just talk a little bit about the process, how you select the doors to consolidate? Is it location volume, is it retail or partner specific? And then just more multi-year, what does your plan consider in terms of a potential larger scale department store closing? Any strategies in place just to offset the potential impact if that were to transpire? Okay. Thanks, Matt. I'll take that question, which is – it comes back to Jeff's assessment that we need to do the fact-based assessment first. I'm a firm believer in getting the facts crystal clear on the table, put everything on the table and then look at where we're set out to go. Which is one common goal for the whole team which is in the US, for wholesale, for all channels, strengthen the brand and drive profitable sales growth and then map out the path to that. So I'll have to come back to you on the details.

Thanks. Next question, please.

Thank you. The next question comes from Ike Boruchow with Wells Fargo.

Hi. Good morning, everyone. Just to go back to the low-double-digit sales decline outlook for the fiscal year. I was wondering if you could give us some more color on the moving pieces that kind of get you there, maybe meaning how much is negative comps from your quality of sale initiatives impacting the retail side of the business versus wholesale decline as you reduce sell-in on inventory. And then maybe just specifically more detail on the North America geography within the wholesale channel for the year, would be really helpful. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: Yeah. So it's really driven by a combination of things, some of which I've already mentioned. Store closures plays a big role in that as it relates to the retail business. We are planning retail comps at the mid to high single digit level for the remainder of the year. In addition to that, as we said there's a number of quality of sale initiatives that are being undertaken, whether it's pulling back inventory receipts, whether it's significantly reducing promotional cadence, both timeframe and depth of those. All of that is going to drive a pullback on the revenue side of things but it will help strengthen the brand and improve our profitability going forward. Those are the main drivers. One other item worth noting, which is very significant, is pricing harmonization across all the regions. And we found as we did our deep assessment of the business and the challenges that that was a huge issue for us particularly in North America across all our channels and that's a very important initiative.

Okay. Next question, please.

Thank you. The next question comes from Dana Telsey with Telsey Advisory Group. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: Hi, Dana.

Let's take the next one, Raya. We'll come back to Dana.

Okay. The next question comes from Erinn Murphy with Piper Jaffray. Erinn E. Murphy - Piper Jaffray & Co. (Broker): Great. Thanks. Good morning. A couple of questions, just first a follow-up on Europe. Could you just quantify the impact of the timing of the wholesale shift in the region during the quarter? And then I think you mentioned that North American comps were down high-single. How did comps look in Europe? And if there was any variance by region, that would be helpful. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: Yeah, so the impact of the timing of the wholesale shipments in the first quarter were roughly about $20 million. And then relative to the comp performance, Europe had a low single digit negative comp in the first quarter. Erinn E. Murphy - Piper Jaffray & Co. (Broker): Okay. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: And we don't really... Erinn E. Murphy - Piper Jaffray & Co. (Broker): And was there any... Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: We don't break that out by region or country. Erinn E. Murphy - Piper Jaffray & Co. (Broker): And then if I could just follow up on the e-commerce, I think you mentioned it was down 6% in the quarter. And I realize you have got kind of the impact of the pricing harmonization. But how should we just think about that channel going forward and what is implied in your guidance in Q2 throughout the balance of the year? Thank you so much. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: Yeah, you should think of that guidance as mid- to high-single-digit decrease. Really again, driven particularly in North America by the pricing harmonization and the other quality of sale initiatives. We are clearly looking to be much less promotional within that channel. Erinn E. Murphy - Piper Jaffray & Co. (Broker): Okay. So e-commerce and brick and mortar will be down to the similar level? Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: Yes. Erinn E. Murphy - Piper Jaffray & Co. (Broker): Okay. Thank you very much.

Next question, please.

Thank you. The next question is from Dana Telsey with Telsey Advisory Group.

Good morning, everyone. As you think about the Way Forward Plan, Stefan, how are you seeing the product evolution evolve? What should we see as we go through the next few quarters or to the next year how you want to see the product resonate with the three brands that you are focusing on? And do price points change? Thank you.

Okay. Thank you, Dana. So when it comes to the product part of the Way Forward Plan, it's all going to be about going back to the core of what made us iconic, and the core of what drives the business, and the core of what the consumer already loves. So the core for us is what we have been known for which is classic, iconic style, and how you will see that refocus and evolving the core, the work that we're doing, how you will see that is that you will gradually see it in spring 2017 and then gradually season by season you will see the core being focused on in terms of, we will make sure that we have an updated classic, iconic style that has an effortless twist that makes it current today. So it's about – you will see that the core from everything from placement to presentation to marketing, it will cut through and it will be one message and it will be a core that is updated and relevant for today.

Okay. Next question, please.

Thank you.

Thank you. The next question comes from David Glick with Buckingham Research Group.

Thank you. Good morning. Stefan, I just had a question on this lead time reduction. I just wondered what are the tradeoffs that you have to make as you go down that path? Obviously having shorter lead times, there is the potential of having to have higher product costs, perhaps not. But I am interested if that is part of the tradeoff. Obviously you are trying to save markdowns by being six months smarter about what you are committing to. But I was just wondering if you could kind of walk us through that. Thank you.

Okay. Thank you, David. So when it comes to tradeoffs, what's been very encouraging to see is that coming back to the work behind and the drivers behind moving from 15 to nine months to start with and adding the eight-week test pipeline, it comes very much back to the disciplined approach of working cross functionally from design idea all the way into the store, and reading the sales and responding to that. So working with Halide and her team and putting sourcing at the table upfront together with design and merchandising has led to that we have been able to move towards the nine-month lead time, have an eight-week speed, increase the quality at the same time as we see costs on comparable products go down. So Halide has, like everyone else working on the Way Forward Plan, she has started – she and her team have started focusing on the core. And that is what will make the biggest difference from a consumer perspective and from a business perspective. And very encouraging to see that we're able to cut the lead times, increase the quality, decrease the price at the same time – decrease the cost price.

Next question, please.

Thank you. The next question comes from Jay Sole with Morgan Stanley. Jay Sole - Morgan Stanley & Co. LLC: Great. Thank you. My question is about the store closures. Can you talk to us about what types of stores you're closing? Where they are? What criteria you are using to determine which stores will close? And Bob mentioned, taking a deeper look at store closures, does that mean that you're considering closing possibly more than 50 stores? Thank you. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: Yes. Thank you, Jay. So the criteria with which we selected stores for closure was really two fold. One was is the store strategic in strengthening the brand? And then secondly, the overall level of profitability were the major drivers, and the major criteria that we looked at. Yes. We are looking at possibly closing more than 50 stores. There were some stores that went through our initial evaluation using those criteria that we may have felt were strategic, and that we could turn the productivity around in the stores. And we're going back and just validating that and questioning that.

Great. Next question, please.

Thank you. The next question comes from John Kernan with Cowen and Company. John Kernan - Cowen & Co. LLC: Good morning, everyone. Thanks for taking my question. It seems like the Way Forward Plan is definitely gaining some momentum. Your gross margin ex restructuring charges was up pretty significantly in the first quarter. Bob, you talked about lower inventory reserves on the balance sheet, but can you help us understand what we should expect for gross margin that's embedded in your guidance for the remainder of the year? Thank you. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: Yeah, so, the first quarter was benefited from a few things that we consider to be kind of one time in nature, right? So one was the significant favorable sales mix shifts that we experienced from products, geography in a channel perspective. We don't see that magnitude of favorability on the go-forward. With respect to the impact on inventory reserves, and that's really a commentary relative to the guidance that we gave, that as we were working through and executing on our inventory initiatives, whether they're restructuring or other initiatives, what we found is that we did not have to record the level of inventory reserves that we had initiatively estimated when we gave our guidance. So it was just a function of refinement of our restructuring and inventory management activities that were going to be one time in nature relative to the visibility we had when we gave guidance versus how we're seeing things play out as we look at the plans materializing relative to the forecast going forward.

Okay. And we'll take one final question, please.

Thank you. Our final question comes from Robby Ohmes with Bank of America Merrill Lynch. Robert F. Ohmes - Merrill Lynch, Pierce, Fenner & Smith, Inc.: Oh, Hey. Thanks for taking my question. Just a quick one, I was hoping you could remind us or maybe tell us how e-commerce performed for you guys in the quarter? And maybe, Stefan, remind us where dot-com business fits into the Way Forward Plan globally and sort of what the initiatives are underway there right now? Thanks. Robert L. Madore - Chief Financial Officer & Corporate Senior Vice President: Yep. So e-commerce comps were down mid single digits. We had better performance in Europe than we experienced in North America. In North America, our top line revenue was impacted by two things primarily. One again was the pricing harmonization that we talked about. And then also, cutting back on our promotions. We cut back significantly on the length of the promotions, the number of promotions and the discount rate depth relative to how we've historically operated. That's really what drove the North American performance.

And longer term, John, in terms of the e-commerce role in the Way Forward, it's going to have a really important part. We have mentioned a number of times before that we're going to follow the consumer, where the consumer is going. The consumer is clearly going to e-commerce and mobile first. We are developing an e-commerce platform. Since a while back, we are on target to deliver that. That's going to enable us to not only build a flagship online that's highly aspirational and stands for everything that's Ralph original edition about a life in style and be very focused on the core product strategy, the icon strategy, and it's going be very shoppable at the same time. So when it comes to its role short-term here and now over the next six months, it's going to be a part of Jeff's strategy that he is developing for North America because that's multi-channel and e-commerce is going to play an important role.

Okay. That was the final question. I look at Evren here, and she smiles and nods. So, before we close, I just want to say, on behalf of Ralph, myself and the Board, I would like to thank Bob for all his contributions to the company over the last 12 years. It's going to be your final quarterly call. Thank you. From all of us, and to all of you, thanks for joining on the call today. Look forward to speaking again next quarter.

Ladies and gentlemen, this does conclude your conference for today. Thank you for your participation. You may now disconnect.