Five Below (FIVE) 18 Mar 212020 Q4 Earnings call transcript

Good day, and welcome to the Five Below Fourth Quarter and Full Year Fiscal 2020 Financial Results Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note that this event is being recorded. I'd now like to turn the conference over to Christiane Pelz, VP of Investor Relations. ahead. go Please

are as both statements provisions Good certain Act us filings. Cole. uncertainties fiscal has may and this and could meaning the Financial and you statements. undertake to Bull, today's amended. thank XXXX Below's Executive and Thank unknown Those cause statements and as Officer; to need questions. for to forward-looking that afternoon, management the statements formal Five joining Ken call On are differ made comments to actual uncertainties call. today Private results during to and Securities Anderson, we forward-looking in such Below's statements. for and update President of call made financial and that Chief this you, Chief conference everyone, made Joel fourth any of year Safe risks and forward-looking to are Officer Five After will materially pursuant the described known XXXX remarks, Litigation in release from do The Reform constitute Harbor our not I risks forward-looking and remind Such of their press we Treasurer. of and open call made you the the within date results subject the SEC obligation are today call, of are quarter

Joel. release, today's turn Relations do now at may you over I page site, If Web press one call you our fivebelow.com. by the have of copy the to of a obtain visiting Investor not will

it will questions. quarter the year-end to in us year Then Ken discuss for share financials more for as and earnings up well thoughts detail. before highlights for of to Thank you, call. the fourth our joining call handing fourth XXXX Christiane, quarter on and will fiscal some as over we performance our our open everyone, and review I thanks

how to want business year our our this impact results, year was. Before At last speak acknowledge COVID I time lives. XXXX idea unprecedented our what I to much little would an have and we

fellow So many of deeply our and remain crew by pandemic. customers, impacted the citizens were and

the and thoughts recognize our enabling the crew, customers, in ways customer have came and and pandemic, before. truly issues I I impressed from associates others, of change, realities Below. thank new loved to them, ones. with our prayers especially Our our for faced am pivoted remain customers embraced together and to the solving during creating those never and operating vendor trend-right offering how lost Five the expect from adjust our back want us who we problems partners with of this experience our environment. products and who to relentlessly Working the store

a muscle was became to a of new company developing will as it difficult in it, very Below serve Five environment. stronger that operating an period, is us sure remain dynamic well, Although extremely because what

We priority, to will crew, discipline historically safety our operate top and with the as our we of demonstrated. have financial health and while the customers maintaining continue

remarkable XX% comp or of achieved. exceeded best results in our in the by fueled guidance the we delivered leading grew January, We the that to with Sales Now turning fourth XX.X%, quarter And round ever holiday million stimulus. to the weeks. announced earnings nearly accelerated strong and have of QX nearly Comparable QX sales our to up fourth representing $X.XX. announcement second quarter, $XXX.X share conjunction sales we growth of per were XX%. were sales

openings, X,XXX in more states holiday With comes New of fivefold our the our to XX comp from top continues a XXX pace net grow with in remain even increase the in the significantly with runway overwhelming stores stores. e-commerce respect XXXX. however, stores, the for long of stores, our year the performed a public faster States. restrictive July across Our York small nearly continue marketing. to XX total in at and two environment base, growth fourth total XXXX, opened store the when stores, a Bronx, to quarter leaving than potential see our plus for went due in X,XXX the grand to We our still top we new Notably, business and a to reach majority we of stores, ended the store reduced United we growth opened which opportunity, new

internal and about Before I quarter, our external fourth specifics mention holiday that performance. factors I both and contributed speak to to to acknowledge period the the strong key selling want the

a did team external entertainment. we our favorable have shift ongoing areas factors While such spending like holiday, the and and successful a safe, an as from consumer ensuring and outstanding travel calendar, smooth in from job benefited

stores our work for The while Five as factors, worlds. the value our seasonal store, trend-right year. hand with customers COVID, the remodels, room, in was both we strength and sanitizers, sports direct stores resonated saw Regarding the as the mask experienced and to year items. and customers. other based at captured internal in from and holidays our perspective, benefited in play wall continued. the trends merchandising buying the tech home throughout among second stores throughout Beyond the and our to the By tech a style, contributing for amazing products broad from beyond sales, that trend, style code the well of related permanent offering, especially all also impact We new Room

TV approximately front, shift to continued stores. decreasing of to On the the marketing fully paper our and digital XX% eliminated our while we circulars, reach

previously avoid our this shopping everyone. for given provide to to environment big holiday desire As year early a stores, our in safe campaign we crowds mentioned, stopped

are social focused increasing more through on on various of through search retention On our awareness brand marketing, front, and and digital we conversion acquisition the the and our platforms. focusing targeted customers

operational helped respect Without our a front, Conroe big a fulfilment stores infrastructure, we vital helping distribution west overall factor we and with our offer are fully online. holiday Conroe, our Texas, allowing our was to Ohio supply efficiently. serving from With we pleased and and holiday, center stores addition our chains, have customer in hiring. center In fourth to our to execution doubt, flexible On ever In us was customers to stores. summary, achieve tests in the with e-commerce the piloted especially further operations the and options in very demand experienced. more smoothest increased addition, Instacart, to of serve merchandising us and to the Texas facility became quickly more shop the during with to quarter, our

None safely nearly of the per to accomplished achieve environment resilience close earnings against pivoting sales chain, while opening and innovate. milestone. our of much stores to turning namely to this without have to $X XXXX ways priorities, share X,XXX of agility, new proud our and We possible us so fleet grit incredible and product, our enabled existing new the strategic $X.XX. during accomplished pace, plans as We with record store reopen supply our of year, strides continuing Now making their experience overall new in all entire this billion, our been while while would store so key quickly and well XXXX, were team, complete personally adapt of working. I and for as of to am

and back with Number we the in-store Five first new two, with our launch test in stores three Bugha our the Beyond our to accomplishments. deepened stores. Number of innovated me gaming Let of commitment collaboration to some we with prototype one, the our with exclusive product store. Localhost opened adjacent of experience our the highlight

our half about the the We our process three, our experience, do also App, was digital Hollar.com our holiday regarding crew e-commerce helpful which including which made integrated accelerated implementation the assistance the now we very of and the of checkout customers. Below offerings. Five self-checkout, assets, of the chain, the season launch efficient for Number member more during improved

services we customers, curbside opening We and number locations, new DC, with by Core partnering supply Merchandising on new future in test stores. our same day select systems, growth. pickup to on for new also in in support our with System, which our open platform of to a us offer completed ground provides which XXXX. West We Arizona, our over and Oracle Coast the XXX to chain delivery the Instacart Retail to summer four, addition the of piling a online in Texas, And broke while DC will added implementation

We the in our Pedricktown system new in Northeast. management growth also upgraded our warehouse to store support

for normalized store let Now, XX year fiscal stores the states XXXX, the plans XXX to to growth me are turn more XXX and a program, to really we return open across XXXX. to excited in this

bringing Mexico, the and our will as states in of and week. California now end including stores, opened stores, continue the York, of This home XX. Florida, states the the and grow Utah Five of terms of New New in of By and already Below number fact, to will year, today, new to we two these operate to this have we we opening more we have state expect states. densify Pennsylvania XX entering Texas, of surpassed be year, In in the

play with to initiatives. in excited Allow strategic furthering elaborate. We also are me our and offense, to continue execute to discipline progress make

as Five all very core relates Below. First, is starts during to new promise. we and customer what are needs COVID. WOW Innovation Adjusting our product, is factor and customer it it with Five to as demonstrated the does to that agility well, trends Below

plan In offense. Five little more section color in amazing on filled is it to tests new Beyond we we XX% of XXX with our we positively and Beyond new our The XXXX, Below the and great Beyond categories to which example to are Ten stores, a Let assortment, our more number year-end. Five to approximately how chain in by our in play from customers. emergence making what available items me than has was permanent you product a value Five of approximately give with responded fresh, that and double XXXX, Five doing collaborations. Beyond pivoted customer The is

Seasons did to also all New We plan offering. in we wall like the in wellness the in stores with January select Five add Beyond

Five of online working In on addition, Beyond we're exclusive the as offering. items part overall

to collaborations, product gaming exclusive well expand the XXXX. plan more as Bugha in to we as do collaborations offerings, As

year create we kids of focused Pippins, In kicked off who's imagine, illustrator with tweens and author. teens lives Pippins The the aspects with Andrea and fact, to collections of new partnership the helps products shine. on a and an creative

been Our inspiring like these very more areas in We cross our opportunities to plan other popular. have and teams create colorful stores.

our with new customers store do Five to In to through both store Beyond build our relates experience, in goal it We that? store, the and digitally. is for are experience featuring a elevate How new we backend that remodels. as prototype stores the to and do innovation, crew. do our both in Second, we and

to continue in to temporarily While our was we will interrupted restart initiative more test Localhost COVID, add locations Localhost by this XXXX.

continue in expand emerging eSports. partnership We be Gamers, our continue Nerd pleased see our with Street Expect with gaming. leader us capabilities in and to a to them as to

XXX chain. journey, added This us a which assisted majority to behind crew stores bringing also our stores, and system move self-checkout of overall. self-checkout to makes to XX% to our assist a over more of customers the the about with the including customer new We total with our register from floor, shopping better stores remodels, experience for allows to the their

awareness, digital marketing. the on focused are we increasing and On more brand our targeted front,

we successful various social we'll upon the Instacart acquisition XXXX. I our focused and and As customers on through build trial previously into platforms, of our with retention to stated, continue and search are

And technology in planning experience, capital crew we system. a management plays our upgrade role. human to key for XXXX, our As are

chain, progress processes our make optimizing making our inventory in on while network, distribution core ways and other we're developing on more focused Finally, efficient. to supply management,

Buckeye, Arizona year. will this and We West open our DC

to center new ground The two out XXXX. In to to we core expect on allow our days. configuration distribution Indiana, in our This break Midwest will the addition, in of us initial should center we open service complete all which distribution within our plan stores build network.

for optimizing data forecasting. implementing also and are analytics inventory new We new demand warehouse platform for our and a cloud-based our management system,

a delivering to those especially All these challenges Another is focused committed ongoing to and to other. and change. period for trend-right helps holidays. to contend excited promise company, gifts, back and and With Below stuffers, pallets candy, that ongoing we're for will efficient be to we're X, and resulting of the optimize be supply and as important like with goes over April remain believe never from around packaging basket turn successfully have the on value, and to whether we find products including like joy initiatives others, inventory a has With difficult brings really history from and we this vaccination this environment. transportation. making will We we operating Including about long pandemic. in our We got our laser In else a Five normalcy, our subsequent dynamic on year, focused customer just offering, that style. as financial the of extreme the adapting it all remain customers customers project all out shopping the are global destination on more work the return or environment. times, that our regarding and safe Easter corner summary, to them Ken, I'd economic navigating a creating. chain through that, and to to, the to celebrate nimble value discussion. Easter And it never

a our and fiscal I good afternoon, with and review Thanks, XXXX Joel, fiscal will then results, of remarks discuss begin quarter my fourth XXXX. and everyone.

XXXX fourth quarter of up from year-over-year fourth sales stores, the were XXXX. XX.X%. of stores X,XXX the Our of increase net XX.X% quarter $XXX.X new We or million, ended a in with quarter the XXX

remodeled in quarter the stores fourth a the of holiday in for quarter the average fiscal of XXXX was quarter comparable the of fourth addition, record driven fourth for was in decrease sales increased XX shopping a impacted The by decrease XX.X% days. to versus fourth In ticket, transactions. year. a X.X% XXXX. increase by XX.X% by sales offset X.X% six partially comp during comp Comparable XXXX, quarter fewer The increase comp we

the in the quarter through year. the last basis of in sales XX.X%, second of the round sales driven accelerated of increased weeks XX.X% XXX profit $XXX.X holiday million Gross million, from XXXX. government quarter, nine reported by comparable margin from stimulus. Gross the and decreasing to approximately first XX.X%, Our XX.X% January, points fourth finished increased $XXX.X record to

sales XXX to approximately leveraging percentage a impacted was from driven pullback sales as costs sales. offset margin SG&A expected, was to higher decreased fourth in basis XXXX, fourth a by gross quarter As the the store in customer largely XXXX, which decrease partially primarily Joel for from by items, in of preferences mix of XX.X% by due pandemic-related as from expenses the discussed. marketing, points of the intentional quarter XX%, occupancy

increased per to quarter fourth tax driven by $X.XX outperformance previously was rate. from last $XXX.X Net in year-end for $X.XX a XX.X% or XXXX. in XX.X%, In partial the which to fourth XX.X% million, adjustments approximately the year. fourth $XXX.X of rate year resulted fourth in XXX the million. higher tax quarter offset. quarter, in sales leveraged while share costs, addition, Operating we the income The increase diluted our the compensation to incentive of effective in Operating income last increased fourth decreased points XXXX fixed diluted XX.X% compared to estimated compared XX% XXXX. quarter to was of was quarter tax share XX.X% the margin to the from per basis The million $XXX.X rate effective for of or

merchandise X.X% of in net XXXX, total million, prior and $X.XX XX.X% other expense higher expense the draw billion, six-tenths balances driven corporate X.X%, was versus rates, year's XXX expenses offset temporary decreased the for increased closures, Gross to a to sales Operating Gross marketing a occupancy and in million million million. an in closures, charge margins and costs interest the for for expenses by of were reduction net transactions, of in XX the cash primarily XXXX, a the $XXX.X basis XXXX sales expenses $X.X Comparable This increase XXXX, costs income was over second XX.X%, fixed XXXX. amount SG&A and $XXX.X net the in for XX.X% XXX reduction comparable XX.X% by total expense on to in the to combined of store deleverage sales interest XX.X%. line of year downs net approximately of of primarily approximately from and interest of in margin in decreased of X.X%. pandemic of year. XXXX. income full first-half income other decreased driven $X.X due closures The sales quarters. basis due versus a the percentage XXXX. Lower approximately margin from of the a points decreased interest store of total margin a increase the driven and in XXXX operating to operating profit in year store by X.X% to with of net to points of comparable pandemic-related fiscal due the of expenses. sales and below decreased due primarily of a first decrease by as percent during For Operating resulted lower credit, invested a interest income last reported versus year. deleverage part

recognized XXXX, in our Street non-controlling related loss interest of Nerd we’ve to Gamers. a addition, full In pro-rata in the year

$XXX which We XX% securities, $XX a basis was tax XXX,XXX shares compared at tariff-related planned share the XX% share cash, of year. and quarter Diluted the diluted no and accounting. fourth inventory decrease per versus benefit a rate for was primarily rate based end the at $XXX based for the from sales debt. end was approximately fiscal the ended XXXX, XXXX, for benefit to in year-over-year, The share XXXX. share $X.XX elevated short-term earnings $X.XX to a XXXX. repurchases balances the due included XXXX, per an lower for million, million accounting fiscal of Inventory inventory years of of accelerated year lower during with investment We tax in as fiscal cash in share effective the year the was both to million approximately made XX.X% earnings store result receipts. and of per equivalents benefit and compared $XXX.X decreased $X.XX on earnings approximately share the in Diluted $X.XX year of Our end XXXX. XX.X% than per of fiscal against were at million Ending XXXX. of in

was ending chain well to year, resulting fourth global addition, congestion expected demand and due With quarter as this In product CapEx, inventory XXXX we delayed to sell inventory as higher gross by supply elevated in from impacted disruptions, receipts respect on Texas for tenant opening fiscal million through stores, ports. at spent XX the cost approximately XXX payments center, infrastructure. systems and in distribution the new XXXX, the excluding completing Arizona in fiscal This of center, $XXX new CapEx reflected investments and new allowances. remodels distribution and opening than

I XXXX. would to Now, to like turn

quarter first the a the uncertainty impact we providing guidance, COVID-XX, consumer due for are are full formal potential continued We future in but to spending, to year earnings of and to and both guidance related unable sales XXXX. provide ongoing shifts

on sales period. year, we that for on selling quarter in Easter are weeks for the how on With pandemic However, store are fourth season. Friday will first on our directional in be declared key comparable March reported These this commentary X.X% closures increase loss XX, X, to the date currently following last stores when year, we resulted year's for I earnings we to quarter. different last quarter the sales than a And spring the the XX. due pandemic very the viewing Last This March offer our call. quarter year, Easter year. and closed was will we Wednesday, the April of

first $XXX of the this $XXX sales we third benefit current the round to period increased trajectory expect the same comparable the XX.X%. on to sales expected million. from in Based quarter year, range be For stimulus, sales million to government of and our

the is we there. to first the $X.XX. XX already as to halfway of approximately to quarter, over expect range We mentioned, are EPS expected $X.XX Joel in Diluted in be open stores

based Our to share effective any tax planned approximately for the share is and repurchases. excludes rate XX%, fourth it impact quarter or of the accounting,

actual tax outlook we report when to our results As quarterly, with rate the earnings. practice you know, is update

how providing For not the of guidance, a EPS about sales we thinking we are year. the for like year are although, full would framework fiscal to we XXXX, formal provide and

normalized XXXX. more year where year be year fiscal XXXX a reflects than rate scenario be growth and flat operating relatively margin growth as pandemic a high compound Accordingly, In the XXXX. two impacted for perspective. a XXXX we in a a sales the view expect to operating to fiscal to it teens, from expect comparison fiscal fiscal We would better margin growth fiscal we XXXX,

second-half and expect the XX% currently sales With of of of be XXXX lapped second-half interest to net in regards when a XX.X%. expected at to high Street a for We XX%. is Nerd we results, non-operating a approximately comparison, other as minority difficult we effective in in sales tax fiscal of strong to have were a impact, XXXX, comparable very record rate a our year-on-year And are $X.XX. negative also fiscal Gamers larger an expense resulting XXXX planning grew

stores, opening approximately expect to XX we stores fiscal to complete stores, to of and XX XXX to XXXX, For XXX new new the open XXX remodels approximately in with the year. in first-half XX

and million in executing are impact the new distribution tenant systems reflects opening in infrastructure. of the stores excluding in construction opening approximately $XXX new with allowances. a and center planning distribution Arizona, remodels a spend in new Midwest, on beginning investing and center to gross along capital and This We expenditures,

results, For the closing to back all comments with some release. that, our we it questions. I Joel? for to turn provide our to Joel, to refer would up please And before details to, other related over earnings call like press open

our demonstrated strength Jude, very for unique the overall quickly including our Hospital those with our approach. need our and donation with our merchandising Worlds communities, with Eight other our of We Chop flexibility to are decisions and success. for Toys customers programs. we our connected the crew for to customers pleased I'm and pleased and we St. inherent providing the acted difficult our summary, in In Lemonade, with and Alex well of of model, We forefront. proven how made Tots, always Ken. Thanks, played at The XXXX. keeping Yes. XXXX has ourselves in offense while experience performance again position

we XXXX All an even and stronger has momentum. made of this great company, us with enter

halfway X,XXX to plus target. operator to build today, as growth are excited grow We than we promise raise the on our our deliver this company bar store continue well-positioned for our amazing progress, to on and year customer our XXXX for less to really and to relentlessly We're and But turn for call stick must a share we the the that, had over like operator? one questions. with remind back that really question beyond. to to analyst. and With per that, you to we With I'd you need lot

Thank you.

We And the ahead. [Operator come question-and-answer will question with today Gutman begin Please now Stanley. session. Simeon Instructions] from our will first Morgan go

you've better margin is? there incremental Hey, the point Can was the see so It's Because maybe of really like beyond back-half how this going the curious 'XX is forward? My X% you flow in everyone, I even X% is anything think In past, to margins us, to margins, changing in first going bigger the but the in incremental I that's the X.X% picture, the of EBIT because what And QX, really range, is that broadly, think I you algorithm holding Gutman. question implied is comp may can't from to back us in being Simeon around incremental than the looks that's 'XX? business the we QX, that in the if Is comparison, change leverage told is I anything do there year-over-year the it's there's hard or on it EBIT to ask considerably see and broadly. you anything quarter conservative guess implied X% X% through? which then of XXXX. terms tell margin. X.X% of

forward. second leverage Simeon. your the part answer around as our points we first move question Yes. of Thanks, I'll

be year we going anniversarying forward, the unusual As But before have to -- to about business. year, we and leverage meaningful see said our XXXX. on start a you what ex investment mentioned, our from we impression it X% should point, a leverage is here any for comp, an going see

we really think Relative quarter, comparison you holds make I very least And but we're hard the 'XX, SG&A. the the to see right QX, flat, And now for call true. what most 'XX, our relatively estimate probably that leverage as still seeing given you that margins would a closures, think mentioned So, driver, QX, would on some leverage make over to at that -- QX, up comparison XXXX. it I lift be first have we to majority that in be QX, and difficult the and we and to part, you you in are mentioned, versus against in a continues overwhelming -- what park really [ph] store would meaningful again, it's SG&A. XXXX of see gross that XXXX,

Thank you.

Thank you, Simeon.

next your Please Gordon question Grom will come Haskett. from with Chuck And go ahead.

the particularly Patrick's better Hi, quarters. on guys. acquisition, of question relative St. light my Happy in couple of customer is Day. to new in past And the traffic performance the quarter, fourth

five time those way over and the gains Thanks. PPE and them So the if you that Rainbow when saw Spinner years maybe Craze? at you And first supplies, isolate to XXXX, that that Looms a for compare for curious or chopped say look there's past with to the you cohort? the

normalized so like more I the I But so shopping it. thing there's customer PPE And going and and really easy and on then pretty specifically just we I when isolate got the only noise looking back years I hope for, closing little times, and and XXXX my clarity and specific on. patterns guidance isolated, the really changes operating costs asking normal you're as much think is great to isolate Chuck. you much then mix to to year, what going you to around. it's you hard there's think But really at times Ken am it's sure get on, trends one feel associated and here. Chuck, in rather certainly to with addition really Day Patrick's in back asked on that off, question think I that's reopening other really making year. by margins, than a this -- St. got on green Happy helps it's of unlike the we're I a because it's that any our a much you're message just that, being we why focus to

Yes.

Chuck. Thanks,

come our with Boss from JP go question will And next Matthew ahead. Morgan. Please

Thanks, and quarter, congrats guys. on another great

quarters then for So, back-half company I attribute basically rank the how would about goes recent decade, talked back, comps, the performance? do see think and the opportunities about you as on you what elaborate market we approach. that? think I inflection you as we share guess, just taking company-specific the other maybe Joel, more? a It opportunities do side think different as in a we pandemic, on -- to I to more couple exit you've What about And last think, of the offensive accelerating best the

mean, And Matt. and were thanks, factors. internal external clearly, we forthright both acknowledging very Yes, about I

you the large first I nine Beyond you're XX.X%, at attributed piece of of see, certainly of I think we're think you period, well the stimulus. overwhelming the and coming together that starting Five played we a lot what as seeing the the very backwards acceleration Matt, comp, second what is look offense as holiday, ended that majority quarter, work, forces, then the to XX%-ish to in as if the that. to week a at to where external quarter work But

merchandising really to of how in same, job but pivoted emerges I out customers a buying lift weird and merchants both room, you change. pandemic Our if the specific And think patterns year. the we we something our had the the in as back-half the And, to quite stayed the wouldn't is categorize of saw the mix. move a we assortment, seen as have if think examples the when kind I And trend, called way it, nicely. of style

look pivot into us Matt. And it And allows continue more Worlds as lot before. the there well, to may this Eight people So, than to and was be. us emphasized these probably serve a room home, seen was wherever ever we especially at lots product trend in stay room

that job. team do overwhelming market, And to we reacting kind of got and at ‘XX the rebought salvage was goods. continues The run started end toughest planners cancelling hundreds the nine out we’ve you, we being ‘XX ever was probably great holiday momentum as the the in the us So, all great merchant with on that nimble trends is well. up after operated clearly tell week out momentum the to what back seen. start we've of and saw. the to we the but Matt. external, now majority with a entered cylinders And and And of to millions team I’ll really finished Thanks, year of first

John next And from Heinbockel Guggenheim. go ahead. will question with Please our come

specifically Guys, back-half the firepower towards product more year? You marketing, point through got them phasing of by got you investments. right, the the the about you to how pointed type guess, easy same think stimulus, the do in investments, the and I those compares, one either and second-half you product you of How gauge design sort elasticity the marketing of year? do and or if things

John, question. great Well,

as historically normalized And, the has of shift that one, back seeing in But, really it's on two back you're believe the is, piece something this I But a we'll into we front-half it. that become what specifically pull the of pulled back-half think stay year, I base back-half year. needed. of while focused to X% our marketing think been that in back we’ve marketing of can and which think kind year. use three X%. really spend, we of I back remains more the last And we next marketing to to somewhat on we we're

that, asking shift about I'm you're side, product the sure not there. I'm On John, what that following,

more there profits of in introductions, may with first-half. new [ph] a the Beyond than to product on you back-half, particularly more buzz need in is just generate and the Well, focus Five

of innovation. show Michael out product the habits, the front-half come spend his excluded, in then a more mean, tends to holiday, itself the those, year, we new team. chasing things pivoting of the year new buying of and really and merchants look, And really emerge, we for is see know and year. It back-half always probably I back-half there's you the because No, craze the

craze like the new product was many the us were talking And Now, example Bugha if a We more a of about great in that trends lot, on a that was But read around we XX. emerges, just speed. March in operating one is innovations, observed one. Spinner about show product we product the and And gaming, back-half and now back cycle see in the be the Thanks, the John. of I we buyers going to general the think continues assortment, of just again. new out marketplace up buying to are with in the that general. largely kind it's flywheel in innovations

will Please question ahead. go Lasser Michael next with our And UBS. come from

saw likely year, should to question. you average break improve and pieces? XXXX dynamics course traffic, between likelihood from Five that drove about think And what having structurally in now the my higher over ticket the growth given Below comp X.X% UPT, we XQ, you than XXXX? AUR? it those those Good evening. down if all Thanks retail a taking a of And the and Can will for the

Yes. Thanks, Michael.

Just on your component ticket question.

I the mentioned When your that, I from was didn't increase understand XX%. part I the retail historical. a is deeper average question, increases. UPTs unit into dive really of around over think the really bit just we then saw and second the little it you And quite both

Yes.

retain is piece second structurally Five sales store higher growth. to able this we structurally store Five in you be And same in it's Because And of how a drive growth as a forward. Below figured level to you'll ticket that ticket. sales clear same lead The level will moving forward, about returns, the think should growth out having past. moving higher that achieved growth has traffic that to Below of

Yes.

this a a think from longer-term that's answer point. and I to difficult question perspective, at

transactions going our further to Joel had mentioned out, the Where business. content, ticket. of something longer comes the significant hard I and look and to the year, we have But back-half just part see. combination in last recall, have we It that further. I in a comments, this just as up against we'll I it's to just and again, just kind one the But year. both that's of we're the be could from? the going I into much normalized and we challenge a record out performance of a think expect think would year, think of mean, both, that more really peg anything I thing to

that Michael like this got I times got little in a things great ambiguous to get Five long time us to a give trajectory. think where back we've what think, to change kind just And on I more through now range are, some can period, Beyond question. we services. impact to that But Yes, is shifts consumer normal of you see growth that

you're is are until beyond you get really how it in just we've product starting happens come But about potentially And play to -- exactly many that and can a might lot a both play And initiatives we're what thinking so to it. that play of what those we of But that offense, those business. some think of and more little kind to bit call drive alluding bigger I the I a forecasts us give here e-commerce that marketing, got that watch that. together, time need out. of to

Makes Got very sense. it. much. Thank you

Thanks, it. Appreciate Mike. Hey.

go Capital Markets. And come will from question our Please ahead. Ciccarelli RBC with next Scot

afternoon. Good guys. Hi,

margin are from can in that you the and that Is awareness, you the call, to distribution? sales and going be guys densification expansion quantify just because because mentioned strategy, the on that you densification guys it's brand line, Just certain you're of color Joel You marketing whether through? to states. now in helpful be at leverage benefit would maybe the on XX process any going like there way or any expenses, get better given that the states stores of

really our on something year-over-year markets It's one basis seen up seven last ambiguity sorry been are always look, years kind two to seeing is from rather to of in this just is than about awareness But both, I Scott. low. all some we thing But our moving because been awareness it's points brand and year. mean, of to And, the open the I faster think used watching brand the anywhere Yes. noise we've it XXX what we've is XXX X to. really is

picking to tell year. all I can't that. closer outweigh around it's up think awareness And up show so payoff's to the really specifically, I And bps and of we've internally We of and market seeing last slight cannibalization year, we're far And in stores. you believe share impacting it's XXX Scott. not because afraid But awareness. brand because the that you, directionally, shared densification. due with we're Thanks, from cannibalization a noise that, individual the both,

Thanks, guys.

Paul from will with next Lejuez go And question Please Citi. our ahead. come

front. the assortment the of just seeing on parts Thanks. can of if which Curious inflation, so, attack? guys. plan talk inflation you thanks, Hey, If if you anything about noteworthy the are what's some and

guide margin. hold We've our opportunities is relatively it real able all there's our certainly don't we're I everything, we're mixes supply Paul, feeling estate now, scale I out. mean, the to operating on And Right seeing in but and been inflation, flat. in pressure I relatively overall check side, … through also to side. flat relatively and we've Ken the think hence of it kind chain know,

chain we products about offset able There we earlier, think on out to Yes. team, or is I even business, scale Joel know retailers. the and from we to getting some in that throughout benefit our of cost obviously mitigate freight, disruptions. perspective. have and than freight Paul, it's hit. which maybe going be are way and all And those, out has and and rate up there always chain back increases the capacity supply credit little in contracts other whether and standpoint a to otherwise. and a different bit the supply out ahead a that mentioned negotiating locking And the both Joel But what's go we operate, to

other there. seeing out as are as we businesses although increases, it's probably So not much

negotiating there. nimble being our scale really us combination either navigating are really and or the So, combined that of to with a out offset increases that all vendors, and with mitigate help

Thanks, Paul.

luck. Good Thanks.

ahead. from will come next Please question And go our Short with Karen Barclays.

much. very comps go to comps the in comments on to-date, pandemic. versus quarter to pre in wanted Hi, your I the thanks just closing quarter the for the

closing, the in get like So then to of the I January I mid the to XX on in can comment think, comp we're XX.X% range. range. And comps kind you high pre

the at from to I that look what spread the March to the impact much stimulus? is follow in the is, Thanks. way that I more of then had kind impacts dollar is of up asked any or So quantify be impactful than Beyond context right will And the obviously I'm that wondering, that the there I comps? Five the differently stimulus And January. just way on wise on guess

Thanks, Yes. Karen.

the And your math say weeks in the always estimates that were sales reasonable. benefit they the we this they there. quarter, QX you're pretty or mentioned are again, range impact it the we total versus total comp the we be from of last. how are gave quarter. as to a And include magnitude sales estimate and relatively do of measure think guidance in the and your stimulus would gauge, payments for a stimulus of the we the extent year, mean, I weeks long in through provided third are for whether in for tough what but pretty it that, did in round the the of kind I the our reasonable the where XX.X% would estimates and nine think comps you for Your probably nine around knowing quarter, XX% then Yes, the I then around the could math reasonable. I

Thanks, Karen.

Karen. Thanks,

our next come question with Fargo. go Please Wells will Kelly ahead. Edward from And

just given in this coming customers households the I it this be with for it's the living just stimulus Hey, curious, benefit? that, monthly positive to that don't you increase payments the what year, believe know assuming child quarter. do summer? follow-up as tax guys, how follow-up in are guidance, And I of in the you nice looks within I imagine Ken, I'm here. for then, would to that credit stimulus want your majority a will like to you later QX on that kids. in

that Just kind as about as well? maybe curious thinking of you're how to

Thanks, Yes. Ed.

what you reported guide consensus to that terms what stimulus. from consensus really of the last of we other don't third well I seeing the and embedded total at into day. too the amounts the mentioned, around, of can tell to analysts number guidance want include we call. estimate benefit for less quarter I I it. the the we're it's in prior was terms how an this round know, Karen you the what's were. mean, I for that and the specific does asked how what in number question end from As In get the of the in and words, our than

there's was that. mean, had and from it any external those his or taxes. Joel always out well, credit, mentioned, mandates impact well, yes, So With regards in change the the childcare an that's types factor if And of there's are that remarks less I that benefits as in than there to factors. things external policy, internal in

historically we've third in or seen seen our that's round similar that, spending. that overall We increase currently and traffic we stimulus, in in of an to could the that have benefit And normally, business benefit because an stimulus. the round to what increase, second of

could impacting traffic time. the if during way, it our rules summer the yes, up change, that So end

other around on though, entertainment and and vaccines, mind, things could to really where spending the be may start and increase. the predict start that, then it's in goes, I travel as overall consumer to keep -- COVID-XX spending hard happening may Now, too. to mean,

historically which that, everyone's make don't lot hopefully, a you we one points why is, data Yes. also clearly stores, XX% directional tailwind but year. taken growth. for provide away And of felt have it's do, to we on of But a mean, our the on, it's I Ed, us. important be I more our we new up

we're growth You them, the thinking rates. and bottom-line know on how the cadence about

it pluses here. pretty shift we're can be external takes Ed. other to of back feels to of but Thanks, controlling end growth we a of of got some also in But going these starts the tailwinds. seem good consumer what predictable it add the And we too. so, And And way be cycle to most events, pretty it we're and control. in have the a them great to in into to And number. again. And first behavior now watch quarter triangulate we to in position

Ken. Thanks,

bet. You

go Goldman will Chandni Luthra question next from come our Please And Sachs. ahead. with

successfully year. Congratulations navigating an difficult Hi. extremely on

what ability in more down to to you the the quarter you you on some the say the managing fourth show had and going you second-half confidence your likely capture quarter, hindered that, the could especially about challenges given of Thank the gives you year If all then sales leave table. half colors And Would exited as in as XX%. some on first some well? globally, you that think you. levels, into and on inventory

Thanks, Yes. Chandni.

tremendous again, probably One, last store. basis As you down we that in were And remarks, a XX% when look in we And we fourth then avoid sell And some some kind half had earlier, a to things flip related also we and throughs got mentioned to related year the from I to a at year-over-year oversold some year up sales there tariffs to in the then going inventory of and inventory couple when you tariff on this were delayed of right on about were quarter. moved there. receipts. the prepared then average there.

seeing to that, and through position the and provided. the I that pretty tell vendors, supply sales and you, year. team come feel is delays chain with where, managing the well think material based we it now, to that very Joel two mentioned a move But our we related on right also disruption. global the that again, don't we some that are the in with guess as we're I that related to with to our I chain. supply good QX, But like the guidance navigating We of on then more we impact see to got well. pretty

Thank you.

next go question of Please will ahead. from America. with Bank Lorraine Hutchinson come our And

up see to Five comments little chance I that wanted the a will follow WOW afternoon. throughout you bit we at the year? Good those on wall? I if pictures Beyond, and just about this fleet talk frequent more on to Thanks. you some a strategy made there's some Can adding permanent the of think point

the Wow at two refresh affectionately in of the what where Beyond. Five at Beyond point we're me question. then And rest that's Great and Wall chain. Yes. Because everybody let Five components on the this with There's we in prototype, just there's actually call the there's time.

for will go the now prototype class chain. of And -- used will Beyond new stores the remodels most throughout the for at then seasonal the and part, of of all Wall 'XX in back store. so, rest Wow will incorporate be the forward the times, our And the Five

we about year Beyond also about rest who more round. going. it's continuing respectful the our am Five pleased think convert very We're We have I it's that stores the I prototype. And of our customer And all carefully less namely customer, I with us But and brand where shift like to with to obviously for. and in is, it not what it. more violating it's want the pretty more walk with being agreement World. chain the Five really stands to

And separate they factor, is they think them feedback Five the value, delivering but so, it keep the and segregated. that, love the Beyond, keep we've Wow I gotten love also from

XX% quickly. very happy And do ahead so, will year. I in and with our we Five think of end found and to mean, now the moving chain out the we've seasonal of nice, yet a way presentations, Wow Beyond have at prototype that,

from path the it. it think this right change the Maybe. good then But We'll fleet. that's Ken, prototype, on balance this now, moving of in and the Wow towards pretty new so And with timing we're Could in I time? it. nice on a there? anything some watch dropping over kind

hit No, it. you I think

Thank you.

bet. You

will Capital. question go ahead. from Chukumba come Please next with Anthony Loop our And

me on a strong add congratulations Let well finish the year. my as to

how you fact that going as I obviously, your given probably of But XX% year. to forward, your sort I'm TV eliminated -- circulars, circulars are talked advertising I best pull comping fully is history, you. assuming thank you're paper company do ads mean, I not just fact your forward? what you your question, -- your the of when anymore. I TV your and you guess, going marketing you about you TV back, sort did mean, in marketing do back did we're about the think my So going extraordinary guess an paper this about your you stores. pull think you thoughts your But of

shifted with consumer the the allowed Anthony. Hey, dependence We're for where a we path our done it thanks what also were pandemic think strong much I more that. journey pleased heading back. learned And the us were targeted digital. look, we of our And paper. we reduce on to And we're But to at. had on We're clearly, a already behavior some lot. pretty support Yeah. national not is where the going success more we pretty of TV accelerate

But towards X% for I leverage. to more be to here I another as today not to But right for more we so, but platforms. pending of number ways I our certainly kind that mean, always consumer hold there, will think, again, marketing as think We've for marketing, performance And I right use and I'd sit now, and change, gives of we go to opportunity there's need us normalized some as the X% social reasonable seen a much to down. spend be path still think we're that'll the shift have it reaching I paid the in we're into the a think of opportunity looking efficient.

Anthony. setting the nicely. taken think is out stuff we've us I up Thanks,

Jeremy Hamblin Capital come Group. with ahead. go next Craig-Hallum from our Please question And will

add in of additional year you months how in back testing looking sense down it ago, Street of vaccine rollout punting to you maybe you provided any share people anticipating EPS road quite or of maybe something is that at several expanding bit drag a the little my that the the may to on talk kind on the to initiative? coming for maybe and can front were here really half being as color how ‘XX? XXXX, do for center and a you're $X.XX Nerd Thanks, or more accelerating sooner than but and that Obviously, here a bit little the have guys, just for the terms that you're stands a with I’ll on congratulations. I sooner evolve wanted and year,

was and here wasn’t. XXXX Ken I in [ph], Well

-- So kidding, just he Jeremy. no, am I

we control about how we're tell remarks back quite comments to can and we during algorithm. we really what honestly, you can by prepared tell to how our the thinking tried think just that You our and focus we're the growth business on

factors out leave analysts the great going than can to and or what two You argue pluses of or example. with think and the just they're what want could out. external some business. to Five headwinds. normal I keep and to going ever. And you Below awesome and and gave think this there. going message offense is see to whether control But to they're we're tailwinds We it the more and and sit rest probably getting there's is, one making overall play concept other minuses and probably go I to about downs. ups think We're Net-net, to I more And get back playing innovating three back I better here we

hope that you clarity. that's we're gives I enough kind thinking it. But how So of about

guys. Thanks, Good luck.

go will question ahead. Please next our with And come from Bank. Paul Trussell Deutsche

afternoon. Good

the productivity of to the think on regarding as new your with just can that store metrics stores, terms just of are relative capacity you or about curious provide kind XXXX? DC rest also of And what on year, returns, through kind you digital next on the system Just in can you of breaking a be we what in center that open will prototype the question support base. any ground

support half the Yes, all capacity it that to theory, D.C. on thanks, gives back X,XXX up, of stores. the the Paul. next certainly one us Taking the in side, is when

kind efficiencies our and investment multi-year overwhelming another regional doesn't were honestly of to also us heavy hear which at look lift, in now a or say But you'll the some you you point ahead. because never something. behind Now Northwest distribution at we center, want that mean and smaller we're Pacific phase time, them, open

at feel we open think year. I are and Store mean, get I Midwest pretty this year Arizona so good more metrics we getting that the And next as obviously, tough. productive. stores

doing. continue the We in remodels less we're see to

remodels. to much open states because stores, So stores, those we've we've stimulus having forward prototype really obviously, and of from move you levels you productivity and to we for been give before ask we expect from I'd kind gains it parse grow. the done trying out continue a remodels specifics, different feel little patience to guys money shut seeing so dropping downs, it with noise this you're closed of good in. just and as there's But we us about

with June. on I our And end up think with here, Thanks we'll Really call, evening appreciate which Paul. there. in wrapping Thank joining. We quarter Thanks, a you call everybody’s Paul Have we're first speaking will getting you early with [ph]. us. the be and for again appreciate to support you. everyone look and on forward good

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