“Because of variance holding and because of our contract structures, any major deviation in terms of oil prices outside of maybe transportation will impact half one of next fiscal year.”

In context

“ls over the past few months. So Andre, can you maybe just give us or unpack what you're seeing or expecting across your key cost buckets? And then just kind of looking at the first half impact and the full-year guidance, you kind of alluded to Steve's question. Are you anticipating input cost deflation in the back-half of the year when we think about our gross margin bridge? Thanks. Andre Schulten: Good morning, Peter. Input costs for us, obviously, you can appreciate as a wide variety of different materials and commodities. What I'll tell you, which I think is most relevant for what you're after is, any variation that we see now versus what we already incurred in half one, which is the majority of the $200 million impact that we are talking about will likely not hit the current year P&L. Because of variance holding and because of our contract structures, any major deviation in terms of oil prices outside of maybe transportation will impact half one of next fiscal year. Most of our materials and commodities will impact the first half of next fiscal year. So we feel relatively good about that end-of-the equation because it provides stability for the second half, where more of the volatility is again in foreign-exchange rate and that doesn't mean we don't look at our input costs carefully because as we said, we need to get ready to deal with it in the first half of next fiscal year, which then comes to Jon's point on appropriately developing pricing plans with innovation, productivity programs, et-cetera. But the variability in the current year, we believe is going to be limited. Operator: Our next question will come from Andrea Teixeira of JPMorgan. Please go ahead. Andrea Teixeira: Thank you, operator. Good morning, everyone. If we step-back from the ton”