Good morning, ladies and gentlemen, and welcome to the annual meeting of the shareholders of The Scotts Company. I'm Jim Hagedorn, Chief Executive Officer and Chairman of the Board. Before we begin the formal portion of this meeting, I'd like to introduce other members of our board of directors who are with us today. Please stand and remain standing until the last person is called. Alan Berry. Adam Hanft. Steve Johnson. Gerry Jurgensen. Tom Kelly. Carl Kohrt. Kate Hagedorn Littlefield. It's like we put all the tall guys up front.
Well, not quite.
Nancy Mistretta. Stephanie Shern. John Shiely. Also present today is a board nominee, Michael E. Porter of the Harvard Business School. Mike is not just a friend of the company, but widely considered one of the top academic minds in the world when it comes to business strategy, we're lucky to have him here with us today. I'd also like to recognize long-term former board member, Joe Flannery, who recently retired from the board after 25 years of distinguished service. Thank you, guys. Adam, Steve, and Kate are standing for re-election to the board this morning. Michael is standing for election to his first term on the board. I'd like to introduce all the members of the leadership team at Scotts Miracle-Gro, a group that plays a vital role in the success of your company. Barry Sanders, President and Chief Operating Officer.
Vince Brockman, Executive Vice President, General Counsel, Corporate Secretary, and Chief Ethics and Compliance Officer. Dave Evans, Chief Financial Officer and Executive Vice President, Strategy and Business Development. Jim Lyski, Executive Vice President and Chief Marketing Officer. Denise Stump, Executive Vice President, Global Human Resources. I've got a few more introductions to make before we move on. I'd like to introduce Bill Marsh from IBS Associates, who will serve as our Inspector of Elections. I'd also like to recognize some special guests from our outside legal and accounting firms. Steve Patterson of Hunton & Williams. In attendance are Tony Puckett and John McEwen from Deloitte & Touche. Please stand to be recognized. Thank you all for your attendance this morning. Tony and John, on behalf of Deloitte, will be available to answer any questions.
With that, the business portion of the meeting will now come to order. Vince Brockman, our General Counsel and Corporate Secretary, will assume the chair. How you doing, dude?
Good.
Okay. He will assume the chair to conduct the business as outlined in the proxy statement.
Thanks, Jim. I'd like to add my welcome to the annual shareholders meeting. This is the more formal part of the meeting where we address matters that are set forth in the proxy sent to our shareholders. When we have finished, I'll turn the podium back over to Jim to discuss results of operations and other matters related to our recently completed fiscal year. During the course of our discussions this morning, we may make forward-looking statements regarding the company's future performance. I want to remind everyone that actual results could differ materially from what we discuss based on a variety of risk factors. We encourage investors to familiarize themselves with those risk factors, which are spelled out in detail in our Form 10-K, which is filed with the SEC.
Copies of the company's 2012 annual report are available now outside, and after the meeting, for review by any shareholder or interested party. We can now proceed with the business of our meeting. First, with regard to last year's annual shareholders meeting, I would like the record to reflect that the minutes of that meeting have been filed with the records of the company. Next, I would like to recognize our Senior Vice President of Investor Relations and Corporate Affairs, Jim King.
Thank you, Vince. I would like to present the affidavit of Broadridge Financial Solutions, pursuant to which Broadridge has confirmed that the notice of the meeting, the proxy statement, the form of proxy, and the 2012 annual report were timely mailed to the shareholders of the company.
Thanks, Jim. The affidavit and proxy materials are directed to be filed with the records of the company.
I'd also like to present the list of shareholders of the company's common shares as of the close of business November 21st, 2012, the record date for this meeting.
Thank you. The list of shareholders is directed to be filed with the records of the company. Next, I'd like to offer the opportunity to any shareholder present who wishes to vote by ballot at this time to please raise his or her hand. Mr. Marsh, please present your report regarding the number of common shares present at today's meeting.
There are present today, either in person or by proxy, 57,943,766 shares, which is in excess of 94% of the voting stock.
Thank you, Mr. Marsh. The proxy, substitution of proxies and ballots presented to the meeting are hereby ordered to be filed with the records of the company, according to Mr. Marsh's report. A quorum is present so that business may be properly conducted. As set forth in the proxy statement, the business of this meeting includes four proposals. Proposal number one is to elect four directors, each to serve for a three-year term, expiring at the annual shareholders meeting to be held in 2016. Proposal number two is to conduct an advisory vote on the compensation of the company's named executive officers. Proposal number three is to approve an amendment and restatement of The Scotts Miracle-Gro Company Amended and Restated 2006 Long-Term Incentive Plan to, among other things, increase the maximum number of common shares available to grant to participants under the plan.
Proposal number four is to ratify the audit committee's selection of Deloitte & Touche LLP as the company's independent registered public accounting firm for the fiscal year ending September 30, 2013. Proceeding to proposal number one, I recognize Denise Stump, Executive Vice President, Global Human Resources, for the purpose of nominating the four directors.
Thank you, Vince. I hereby move that the following persons be elected as directors of the company, each to hold office until the annual meeting of shareholders to be held in the year 2016, and until their successors are duly elected and qualified, or until their earlier death, resignation, or removal. Adam Hanft, Steve Johnson, Kate Hagedorn Littlefield, and Michael Porter.
Is there a second to the motion?
I second the motion and move that voting for the election of directors be closed.
Is there a second to the motion to close the voting?
I second the motion.
Voting for the election of directors is hereby closed. As a person appointed as an official proxy, I report that I have voted in accordance with the proxies received from shareholders. Mr. Marsh, may I have your report of the vote regarding the election of the four directors?
Mr. Brockman, I report that each of the four nominees for election as a director received not less than 50,173,712 votes.
I hereby declare that Adam Hanft, Steve Johnson, Kate Hagedorn Littlefield, and Michael Porter have been duly elected as directors of the company. The meeting will now proceed to consideration of proposal number two. I recognize Denise Stump for the purpose of presenting the proposal.
I hereby move that the compensation of the company's named executive officers be approved.
Is there a second to the motion?
I second the motion and move that voting on proposal number two be closed.
Is there a second to the motion to close the voting?
I second the motion.
Voting on proposal number 2 is hereby closed. As a person appointed as an official proxy, I report that I voted in accordance with the proxies received from shareholders. Mr. Marsh, may I have your report of the advisory vote regarding the compensation of the company's named executive officers?
Yes, Mr. Brockman. I report that not less than 48,059,626 advisory votes were received for approval of the compensation of the company's named executive officers.
I hereby declare that the compensation of the company's named executive officers has been approved. The meeting will now proceed to consideration of proposal number 3. I recognize Denise Stump for the purpose of presenting the proposal.
I hereby move that the amendment and restatement of The Scotts Miracle-Gro Company Amended and Restated 2006 Long-Term Incentive Plan be approved.
Is there a second to the motion?
I second the motion and move that voting on proposal number three be closed.
Is there a second to the motion to close the voting?
I second the motion.
Voting on proposal number three is hereby closed. As a person appointed as an official proxy, I report that I have voted in accordance with the proxies received from shareholders. Mr. Marsh, may I have your report of the vote regarding the amendment and restatement of The Scotts Miracle-Gro Amended and Restated 2006 Long-Term Incentive Plan?
Mr. Brockman, I report that the amendment and restatement of The Scotts Miracle-Gro Company Amended and Restated 2006 Long-Term Incentive Plan received not less than 50,585,627 votes.
I hereby declare that the amendment and restatement of The Scotts Miracle-Gro Amended and Restated 2006 Long-Term Incentive Plan has been approved. The meeting will now proceed to consideration of proposal number four. I recognize Dave Evans, Chief Financial Officer and Executive Vice President, Strategy and Business Development, for purpose of presenting the proposal.
Thank you, Vince. I hereby move that the audit committee selection of Deloitte & Touche LLP as the company's independent registered public accounting firm for the fiscal year ending September 30, 2013, be ratified.
Is there a second to the motion?
I second the motion and move that voting on proposal number four be closed.
Is there a second to the motion to close the voting?
I second the motion.
Voting on the proposal number 4 is hereby closed. As a person appointed as an official proxy, I report that I voted in accordance with the proxies received from shareholders. Mr. Marsh, may I have your report of the vote regarding the ratification of the audit committee selection of Deloitte & Touche LLP as the company's independent registered public accounting firm?
Mr. Brockman, I report that the ratification of the audit committee selection of Deloitte & Touche LLP
as the company's independent registered public accounting firm for the fiscal year ending September 30, 2013, received not less than 56,283,072 votes.
I hereby declare that the audit committee selection of Deloitte & Touche LLP as the company's independent registered public accounting firm for the fiscal year ending September 30, 2013, has been ratified. Mr. Chairman, this concludes the formal portion of our meeting.
Well done, Vincent.
Thank you, sir.
I want to pick up now by thanking you guys again for being here and for your support. I also want to thank you for continuing to give me and the entire management team the privilege of directing the company, your company. We understand, perhaps better than anyone, the unique connection our business makes with consumers every day. While our annual meeting tends to be a bit of a formality, I still consider it an important event, an opportunity to discuss the state of our company and our prospects for the future. It also allows us to talk about the unique qualities of our business. The lawn and garden industry is like any other consumer business. Only here can we help consumers connect with the Earth and nurture their backyard to transform it into their own special place.
That philosophy is embedded in our vision statement and is part of what makes Scotts so special. Our mission goes beyond that. It also includes providing our shareholders with the rate of return that you deserve. While I continue to feel confident in our business and the plans we have in place, I also know that our results in each of the past two years have been disappointing, and we can do better, and you should accept no less than that, and you have my commitment that we will do better. A year ago, I used this meeting to share with you a singular goal for 2012: to grow the lawn and garden category. As we did, we would take market share. Because of that goal, we made a big bet in 2012.
We increased our advertising budget in the U.S. by 50% and decided to absorb $70 million in higher product costs instead of passing them on to an already stressed consumer. We knew these decisions would essentially cap our earnings last year, but we believed we could still report earnings that were in line with what we saw in 2011. What happened? On many fronts, we succeeded. We did drive unit volume, we did gain market share. The combination of our advertising efforts, our sales force, new product innovation, resulted in a 2% increase in consumer purchases of our products in dollars. Measured in units, the increase was 4%. When you exclude commodity and private label, looking just at our branded products, unit volume was up 6%. Our market share improved by nearly 200 basis points as we posted gains in nearly every category.
These improvements, as good as they were not good enough. After a strong start to the season, the economy and the weather had a major impact on consumer behavior in May and June. Those facts, coupled with the reduction of retail inventory levels, meant that our sales for the year were flat. The impact of lower than expected sales, higher than expected costs, and product mix resulted in a 280-point decline in our gross margin rate. That resulted in earnings of $2.01 per share, roughly $0.70 short of our plan, and at a level consistent with 2008. Some shareholders and analysts have argued that we set our expectations too high in 2012. In hindsight, it's hard to disagree.
Some have also questioned whether the changes in the execution of our strategy from 2011 to 2012 and from 2012 to 2013 are too much change over too short a period of time. It's an appropriate question. Whether you agree or disagree with the answer, let me explain. I want to start by stressing that our strategy to drive our business to be more consumer-focused and less retailer-focused has not changed at all. How we execute against that plan has changed given the economy and other factors. I also want to say that since the merger of Scotts and Miracle-Gro in 1995, this has been a company that's been hardwired for growth, and we make no apologies for that. It's in our DNA to fight for growth, to invest behind our brands, and to continue to adjust our plans to perfect a winning formula.
With that said, some things are just beyond our control.
In this environment, the consumer is fragile. Constant choppiness of the economy and consumer behavior makes this reality even more challenging. Simply put, it's a damn tough environment right now. When things line up right, consumer confidence improves, and they open their wallets. Whether it's fuel prices, the stock market, or the nonsense in Washington, when consumers get stressed today, they shut down. As for Scotts Miracle-Gro, for years we felt we were largely immune to a negative economy. In the last year or so, the economy has definitely impacted the lawn and garden industry. In 2012, our sales moved up and down with broader retail trends. We weren't driving foot traffic, we were part of foot traffic. While this is a new reality for Scotts Miracle-Gro, it really isn't different from other discretionary categories. We're now seeing what they've been seeing for several years.
As a result, we are budgeting for no unit volume growth in our core business in 2013 and perhaps 2014 as well. If you think we're being too conservative, I hope you're right. Holiday spending was up only one-half of a percent this year. Hardly a strong performance. As we prepare for the peak weeks of the lawn and garden season, the Congress and the White House are bickering again over the economy. The debt ceiling and the credit rating of the U.S. is once again being threatened. None of us here know what will happen with the economy this spring, it's not far-fetched to see a scenario in which the consumer gets spooked again.
If you believe in media reports over the last week, even Apple, which has defied economic gravity for years, is beginning to feel the pinch as consumers pull in their horns. The good news for shareholders and associates and business partner of Scotts Miracle-Gro is that we can show meaningful improvement in earnings and cash flow in a low-growth environment. Let me briefly explain the route we're taking. I want to start by stressing that we believe the fundamentals of our business remain strong. Our research tells us that while there may be structural issues with the consumer, there are not structural issues with our brands, which continue to outperform the industry and are some of the strongest in the world. Our research also tells us our category and our brands remain relevant with both younger and older consumers.
It tells us they continue to love gardening and that they want to participate in the category. Even with those facts, our industry is not in a growth mode right now. As we benchmark ourselves against other discretionary companies, it's obvious we're not alone. In nearly every category, driving unit volume in the U.S. has been pretty hard lately. We have a choice. We can continue to make big bets and hope for a different outcome, or we can embrace the reality of the marketplace and develop a more conservative plan. We've chosen the latter. I'm confident in saying the entire management team is convinced that this is the right move. In fact, our team has been working over the past several months on a more conservative plan that we believe is appropriate for at least the next two years.
During that time, we believe the consumers in both the U.S. and Europe will continue to be under stress. As a result, we believe that economic growth will be modest. Over the past several months, we've created a cross-functional team that worked toward an effort that we call Project Max. As part of that effort, we reviewed every part of the organization, every business unit, every support function, and every dollar that we spend. To drive an improved level of financial performance in a low-growth environment, we focused on six work streams, sales optimization, marketing and media, product cost out, pricing and trade, cash flow improvement, and organizational effectiveness.
The outcome of this ongoing effort gives us greater confidence in these initiatives, some new and some that had already been in place, to drive gross margin improvement, to reduce SG&A, to improve cash flow, and strengthen the overall enterprise. In reducing our expenses, we're taking a balanced approach. While the environment is a tough one right now, we still must invest for long-term growth. So I'm not interested in removing work from the organization, only to reinvest in those same areas two years from now. That's why we've got to make smart changes to keep costs from creeping back into the system. I believe that our team has struck the right balance. For example, here are some of the changes we're making. We recommitted to our regional operating model, but reduced expenses by moving from four regional offices to three.
We've made adjustments to our field sales force to reflect operational changes implemented by some of our largest retailers. We've made changes in our marketing spending with the decision to trim back from the levels of advertising we saw in 2012, but remain committed to supporting our brands. The investment in 2013 will be substantially higher than it was in 2011 and will result in the second highest level of spend ever. We're also in the midst of a re-examination of our international business with an understanding that the current cost structure of Europe is simply not sustainable. We're also closely watching corporate expenses like consulting and other outside services. As I previously stated, we're budgeting for flat unit volume in our core business this year.
Modest price increases in the core business, coupled with the continued good performance of Scotts LawnService, should allow us to see company-wide sales growth of 1%-3% in 2013. That level of growth, coupled with the outcome of Project Max, should allow us to drive earnings in a range of $2.50 to $2.75 per share this year. We also expect operating cash flow of at least $250 million. By year-end, we expect our leverage ratio to decline below 2.5 times, giving us the flexibility to appropriately fund capital needs of the business and return cash to shareholders. Back to the question about the changes we're making in executing our strategy in 2013. I want to make one final point.
Sure, we might be able to grow unit volume and take more share by running the same game plan as last year, but growth for the sake of growth is not what we're after. I don't think that's what our shareholders want either. In fact, we've had direct conversations face-to-face with shareholders who collectively own nearly 75% of our shares. Each of them has been supportive of the approach we're taking. They want us to do exactly what we're trying to do, improve the profitability and cash flow of this business and take other actions that drive total shareholder return. Some shareholders have asked about the impact of back-to-back years of disappointing results on the company's culture and associate morale. Another fair question. Indeed, it's hard for an organization to succeed if associates are not engaged and confident in where we're going.
Without warning or prompting or talking points to help them give the right answer, we walked up to dozens of our associates over the last few weeks and asked them how they felt about the business. Frankly, we weren't sure what they'd say, but we were pleased with what we heard. Let me share a little bit of that with you right now.
Personally speaking, I think we are on the right course. We're a much more nimble organization, I think there's a different mindset that's being created here.
Every plant is like its own little family. For example, Imlay City, one of the oldest plants, probably one of the plants with the most senior associates, they care about what they do.
Scotts Miracle-Gro is a challenging environment. It's great to be a market leader. As a market leader, we have to kind of be ahead of the curve, and we have to lead the category.
In the environment that we're in economically right now, there's always challenges to keep the cost down, keep your consumer engaged. We don't want to price people out of the market. That's always going to be a challenge.
We have a lot of smart, motivated individuals that work together, and we're constantly bringing new ideas to one another. We're reaching out across functions to really think about how we can make the business better.
If you're always going in one direction, you don't exercise kind of muscles that actually force you to go in different directions. If you look from the outside in, I view Scotts as a very dynamic company and very fast-paced. While we may be a $3 billion company, I think at times we operate very much like a $30 million company because it requires an enormous amount of entrepreneurship and an enormous amount of personal drive.
People stay at Scotts, in my experience, and I'm going on my seventh year here, because they like a fast-paced environment where there are strong core values, but there's also a lot of focus on creative entrepreneurship. I think that's fundamentally why I like being here, and I think it's fundamentally why people who have been here a long time have continued to stay.
We prepare for the future by really reaching out and understanding what's happening. It's about knowing kind of the macro environment as well as the micro environment of our categories. It's using the data that we have and continually getting smarter about our own business and about the world around us.
We need to continue to support the consumers who have supported our products for so long. We need to continue to reach them and show them why our products are still better than the competition.
I think historically, we viewed our role as we grow plants twice as big. Now, that's a real benefit for the plant. We hadn't thought about what do we do for consumers. How do people grow when they use Miracle-Gro? The more we can keep the consumer central, I think we have a much more vibrant business and the opportunity to grow the business.
Well, one thing I've always said is I never get bored coming here every day. Now, sometimes that's not all friendly work. It's a lot of hard work. You come in every day, and it's not the same old rat race and figuring out what's going on. There are new developments. There are new challenges. There's new ways of doing things and new ways of improving things. I've been here 23 years, and that's a long time to not get bored about anything.
Over my career, I've had the opportunity to work in a lot of different organizations, and truly the sky's limit for what you can do here. I think that's the beauty of our organization, and I hope that's something that never changes.
That was pretty cool. That was random and unscripted. I've been walking the halls of this company for 17 years. After the merger in 1995, we had discussions about moving the corporate headquarters to New York, where Miracle-Gro was based. Those conversations were never really very long-lived. That's because there is something about the culture of this company that's palpable. You have to spend time here in Marysville to understand that. Our associates love the company. They're inherently optimistic. They believe in our future, and they're just as committed as the management team to driving profitable growth and enhancing shareholder value. The power of our people, the power of our brands, the power of our market position, the power and importance of the lawn and garden category to both consumers and retailers means this is a company that should not be operating with a gross margin of 34%.
This is a company that should be operating with a gross margin of 40%. This is a company that should not be operating with a 9% operating margin. It's a company that should be operating at a 15% operating margin. This is a company that's putting a line in the sand to make strides against those goals. We're going to leverage our cost structure with an eye toward margin improvement and total shareholder return. I'm confident in the plan we've put in place, and I believe that shareholders will begin to see strong improvement starting in the second half of this year. I want to close this message in keeping with how I've done so in the past, and that's to talk a little bit about our history.
This year, we'll celebrate the 145th anniversary. Some within our ranks have already been discussing the ways we should celebrate the 150th anniversary of The Scotts Miracle-Gro Company. Companies don't exist 150 years in this ever-evolving global economy by taking a short-term approach. You succeed by balancing the near-term challenges and the opportunities that are farther down the road. We're committed to growing this business, to growing our people, and to supporting our future. I'm convinced that we're striking the right balance. I'm convinced that we will bequeath to the next generation of leaders and shareholders an even stronger company than the one we inherited. On a final note, there's a person in the room who understands the great history and legacy of this company. It's Joe Flannery.
I want to close my comments by acknowledging Joe, who's been a member of the board of directors for 25 years and who's officially stepping aside after this meeting. With no disrespect to any of the current or former directors of this company, I consider Joe to be the strongest director Scotts has ever had. As a former CEO himself, he understands the role a board should play in providing oversight and counsel without crossing the line to the day-to-day operations of the business. Joe's service to this company is without equal. The wisdom and the counsel he has shared with me personally over the years has helped me evolve and grow as Chief Executive Officer. On behalf of every director, associate, and shareholder of Scotts Miracle-Gro, I want to thank you, Joe, for everything you've done for us.
Your presence in the boardroom will be deeply missed. I want to thank everybody for being here this morning. If there's any questions, I'd be happy to take them. I think a hand for Joe. I thought you weren't going to ask any questions, Rob.
No, I remembered one, actually.
My younger brother, Rob.
It's kind of a tough one, though.
Well, thanks.
It's jobs for people who are coming back from Afghanistan and Iraq, and going out, finding them, recruiting them, getting them before they fall between the cracks, and then bringing them in.
I wish we were hiring more people. I wish the economy was better. That would justify that. If I had one thing to say to the president of the United States, I'd be saying that, which is, we got to grow this economy. All that being said, I think given a choice of hiring somebody who's a veteran compared to someone who's not, with me, they would have an edge. I think a lot of you know, my youngest son heads off to the army to go to ranger school on February 25th. I'm a veteran as well. I know your boy is in the Marine Corps. I would say we're biased toward the military, and I know Barry feels the same way.
I applaud Walmart for taking the move they did, which is any veteran coming out who wants a job at Walmart is going to get it. Any other questions, y'all? Yes, sir.
A couple of product questions. Occasionally, in the magazines, I see reference to the Roundup tolerance turf grasses. Where are we, or is that a continuing project?
Can I ask you a question?
Sure.
You for or against?
Oh, I'm for.
Okay. Now I just want to know who I'm talking to. This company, and I'm sure I'm going to get in trouble. We submitted, almost a dozen years ago, an application to deregulate Roundup Ready turf grass, where the only difference was the same gene that's in most of the food you eat. Definitely was not a weed issue, and that permit, that application has never come out of the U.S. government after more than a decade without any evidence that there's a problem with the product. Effectively, it destroyed our commercial relationship with Monsanto to exploit their genetic library for consumer lawn and garden. While I think a lot of people maybe would have abandoned ship at that point, we've continued to do research and development on ways that would not require a deregulation petition from the U.S. government.
I think Scotts is one of the few companies in the entire world to develop a very robust grass portfolio that will be, we think, ready for the consumer in the next couple of years. We've gotten an opinion from the U.S. that it doesn't require a deregulation petition. It does not require us to have a relationship with the big ag companies who I think are sensitive to the politics of biotech. It gives consumers a grass that grows slower, is highly resistant to glyphosate, the active ingredient in Roundup, and we believe requires significantly less water. This is a major innovative step forward that Barry and his team have continued to fund. We believe that is an important product for the future of the company and for the industry.
Second question. Occasionally, I go around, and I see Whitney Farms products just scattered around. Is that going to be developed more or?
I'm looking at the chief marketer, and I couldn't quite tell what signal he was giving me, yes or no. Let me talk a little bit about what Whitney Farms is about.
That's fine.
Whitney Farms was a brand that we acquired when we did an acquisition some years ago on the West Coast. It's a brand that's really focused on natural and organic lawn and garden. While the natural and organic lawn and garden products are not a big number today, we believe, a little bit like non-regulated biotech, that it's an important thing going forward for us to continue to participate in. As part of figuring out how this company can progress in natural and organic products, Whitney Farms is today an important part of that. It's one piece of an effort that I think we probably all would agree is taking too long, but is an important as we look to engage with women and younger homeowners who have a higher level of sensitivity toward more chemically based products.
This is an important effort for the company that I know Barry and Jim share, and Whitney Farms is a piece of that. Frankly, I couldn't tell you if Whitney Farms will be a major part of the business five years from now, but natural lawn and garden products will be an important part of this company. As we figure out how to do it properly, I think that brand will continue to exist. Did I say anything wrong, Jim?
No. I think the focus is.
Hold on, just because we have folks on the phone.
You're correct that the focus is on that category and on the brand, we have decisions to make that you need to be briefed out on over the next year. Which brands are we going to pursue most heavily in that category?
Anything else, sir?
Fine, thank you.
Well, thank you for asking the questions. Anybody else? All right. Oh, yes, sir. Sorry.
I have a question.
My son is an F-16 pilot, you're the man.
I have a question that I'm formulating. We have a foundation that works in the inner city with the homeless, we see a lot of attempts by Scotts to fund neighborhood gardens, I believe. We also appreciate your area at the Franklin Park Conservatory. How or what can you do to force the products into the inner city, where people also need to have that recognition of value? What are you doing, I think is the question I have.
Well, I guess I'd start by saying as much as we can. Everybody has memories that are important, the things that you remember. This goes back early days. My brother was running public relations when Miracle-Gro was a private company. We had a very significant relationship in New York with the Green Guerillas, at the time, I think many people, in spite of the, I think things for a lot of poor urban people are not much better. There was a lot of abandoned buildings, especially in the New York metro area, a lot of abandoned buildings that had been taken over and were being misused by and infested by drugs, and et cetera.
We would give sort of everything we could to feed this outfit called the Green Guerillas, I know Rob and I were pretty involved To see what a community can do with a derelict piece of land and a little bit of help to sort of develop the garden that not only puts the land to productive use, but provides output to help feed folks is just a really wonderful thing. We have a, I think it's GRO1000. I think we're trying to get up to 1,000 community gardens. Would I like it to be 10,000? Yes. I just don't know that Jim's going to get the funding out of Barry for 10,000. I guess I'd underline, which is to thank you for the work you're doing, but also say that the effort for us to do as much as we can.
Community gardens are hugely important. I think Barry has led an effort with a coalition of urban mayors that, I think Barry was in some pretty scary neighborhoods down in, I believe it was at Baltimore. We've been doing them sort of all over the United States, and it just, unfortunately, I wish we had five, 10 times as much money to put to it. Any other questions? All right. Listen, I want to thank everybody for coming out here. It's actually great to see some civilians. You're more than welcome to join us. I meant what I said in that speech. We put a lot of time into it. Thank you all.