Citi Trends (CTRN) 29 Nov 222022 Q3 Earnings call transcript

Greetings and welcome to the Citi Trends 3Q 2022 Earnings Conference Call.

During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded, Tuesday, November 29, 2022. I would now like to turn the conference over to Nitza McKee, Senior Associate. ahead. go Please

David and us (ph), call. everyone. you Executive Thank our Heather Financial Thanks, Plutino. Citi good Trends joining Officer, Chief our on today earnings and third for Chief call Officer, [Malika] is morning, Makuen; quarter On XXXX

was this earnings X:XX Time. morning AM release Our at Eastern sent out

have you the copy www.cititrends.com. website the under a company's section release, at the If of received Investor not on it's Relations available

most contain forward-looking should to materially Act company's to during performance. Commission may These reliance and Securities report will the factors our You future cause recent make Therefore, guarantee with statements. call forward-looking XX-K aware Officer, these this the in Makuen. that detailed of of Chief questions. now on David? remarks We described Exchange filings that of statements do to response subsequent I turn undue and may David Reform over discussion on differ statements. within made the the can to today statements you Private be from results prepared Management you additional Litigation those other should meaning in forward-looking not the the for place refer Executive statements your the more a call Form Securities XXXX. not actual

financial million were we the our To a which three we'll line outlook. up the and to third Chief XXXX to our expectations. stack X.X%, elaborate line of you, comp your equates Heather Plutino, call. $XXX in review a I which insights. open and morning, to will begin, today the rest Financial fourth our of of year few results, in sales, thanks Then fiscal with quarter everyone, Officer then third as Nitza. some results items a quarter earnings date Good year of other on will call Thank both for as our joining on our questions. delivered to us call well top begin related quarter with

value Our Buy, to coupled levels. Move our and with an pre Sell when teams XXXX post compelling gross in XXth gross consecutive experience expanding worked engaging a to XX.X% pandemic compared profit, to driven trends deliver of quarter profit tirelessly store

tightly at to end inventories of freshness factor. X% Total improvement we higher only Additionally, with at than quarter. quarter the was the continue of high XXXX, manage the end from inventory the higher XX% second an

$X.X minutes pleased our to with starts a people to we of all strategic that backdrop. be ability million. within we It scrappy spend operating here. I'm Lastly, team's and want on delivered both few challenging share to positive income how I got macroeconomic a and

Our quarter, to controlling while to laser importantly, mantra what structure customers. control committed the from on curated the up the shoring to second for we we front back bank remain offering the focused expense end foundational an of the will break of is never of can most our our our lowering and assortment At that house. house infrastructure exciting

is from how excite on we while continue number detail. and third the two, to focused on specifically, the full margin. More in preparing new are key a fourth the to in I our expense macro last we fourth season. will successfully of And is market Heather track important met front lapped merchandise, codes food, hot capture truly out the packaway cities, record including to were: time we on on in of Number quarter, our year's and product an provide chock right roll share inflationary value infused size ensure to supply will amounts and holiday points quarter key incredible we three, our strong inventory, tween ranges customers; missy zip for girls customers that utilities to expectations Number we the recognize gift number we Q and in more successful for chain shopper. They quarter. deliver of one, to shipped areas particularly offerings; backdrop transportation. categories are facing four, to We It's values four issues driving What line unprecedented, areas the top assortment rent, start core focus a on savings price we

has for we I back Through for an with an What apparel and much closer report the $XX,XXX of to customer family and admirable essential year. and annual was our patterns. an the and having conversion Our you points household third our employing her quarter about that, and core traffic Slide quarter, the and assure their hit customer income these events base with consistent past, remain Having $XX,XXX my closer the against accessories, -- Citi primary relies customer now the shopping up said Citi school, -- dollar destination of to Trends I'm much continues extreme to Throughout neighborhoods third is strong the job well customer from in Citi wear this very a of that heart size year's end home rates can customer macro is annual below it our doing steady in his last income performance are now, on their basket been XX% hardest needs. of and our adjusting pressures. household important to hold which buy in the to a lives. needs solid we where and saw use strategy and Trends in shopping and Trends for pleased is average need, results. all,

a remainder over highlight Heather. Before to call the of I I few your want to points. turn

nicely generally and our the Citi really excel Trends of quarter. Spend this during we events Big remainder at are set-up We year. are need-based and we Less families for fourth First, Gift that will confident

Black across strong exited gifts, are stores full stocking great self-purchase we our wonderful of and week, outfits. As stuffers Friday values

the provided for right high guidance procurement end our no lastly, the of at marketplace the secret is And reiterating of value quarter. are goods. quality, second-half we second Next, that high it's

and spring of XXXX. combined and it for to sheet be balance to in operating results well of quite year. Heather? quarter With our with model turn detail, for active flexible outlook Our second the that, our as over half I'll fall Heather as discuss allows agile to strong the our third us

Thanks, David and good morning, everyone.

continue and As business in revolving our our significant remained the line a the including with customers David execute mentioned, third transformation and well-controlled sheet, unused. strong facing. and margins $XX were headwinds backdrop of reduction We strategy, delivering our quarter strong with results our despite the expectations SG&A our against ended in-line quarter $XX.X gross macro our manage challenging the teams to million prudently dollars credit the balance of and cash, inventory We a quarter. for million inflationary

transaction the focusing sale-leaseback Oklahoma million proceeds. strategic current Roland, for The We while on our to in initiatives. also continue distribution of environment, our strength to well $XX us completed center on positions navigate balance the sheet our

turn let's to Now our QX of specifics financial results.

As versus of to the $XXX.X comparing versus comparison select mentioned the of QX normalized XX.X% compared XX.X% the a X.X%. XX are and and increase sequentially versus relative our results year representing improvement Comparable points or versus stack versus XX.X% X.X% provide basis XXXX XXXX, decreased quarter to sales QX, earnings third in QX margin year of of a QX, XX.X% XXXX, an XXXX QX improved to XXXX prior weeks operating in XX.X% release, a of XX.X% in QX, same basis XXXX. decrease million, lapping QX. quarter QX XXXX, for an we of Total XXXX. third QX, from were in order sales Comparable transactions more store XXXX Gross to three in performance. from in for periods a X,XXX XXX QX, increase points was

assortments management continue our disciplined to reflective customers. strongly resonate of Our product results strong that gross and margin are our inventory with

While to basis dollars deleverage SG&A QX total declined we expectation and our XXXX, rate a quarter, QX efficiencies we driving the quarter of streamlining business. XX.X% SG&A X.X% macro expense sales. and that progress, points difficult We of SG&A last backdrop. our a operating terrific XXX rightsizing experienced XXXX our made expenses our versus expense announced are of across our of a organization result sales as structure expense In aligning versus third we to

expense approximately second or total of in on-track half XXXX deliver result, expense. for As of SG&A million to we the a remain X% about $XX savings

will with continue $X.X focus in on income $XX.X was gain quarter to QX, further on our Operating in million to organization. a loss the expenses heightened of $X.X manage operating million across We million the of XXXX. building distribution or for operating compared the the efficiencies center, sale adjusted as

as adjusted Earnings Third quarter of adjusted million net in was QX, diluted GAAP XXXX. $X.XX per to compared was loss net QX, per in QX, compared income million share QX, XXXX. to XXXX, million loss XXXX. $X.X $X.XX $X.X $XX.X in or million diluted $X.XX was of in share $X.X versus EBITDA

week XX results. our to Turning

of XX.X% million, for in the nine of leaseback decrease months transactions in Year-to-date in first prior sales $XX.X XXXX. -- the of nine was versus per compared a or XX.X% adjusted margin XX% stack XXXX the of versus and Gross the two adjusted. to $X.XX XXXX store $XXX.X XXXX XX and million $X.XX months XXXX. was was XX.X% X.X% XXXX, compared for first million XXXX adjusted. to XX% in to gain versus X.X%. declined fourth of Comparable versus week versus share in $X.XX of a a three in as year XXXX in increase the diluted $X.XX For million increase sale centers on-top $XX.X $X.XX distribution for sale on period, $XX.X sales XXXX, by and year and the as XX.X% EBITDA XXXX as sales XXXX, were earnings our to in adjusted two

our to balance turning sheet. Now

customers XX% dollar XXXX an total second every down XX%, increase in-store Average X.X%. on goods end QX, David fresh inventory was X.X%, only total focus Compared turning with of the and inventory fast to quarter. reflecting while X.X% QX to our shop. down quarter each at sales increased and increased XX.X% units time As our XXXX XXXX at mentioned, of to offering inventory she merchandise compared the end decreased versus

we as XX% support as packaway goods products and fall from Our planned sales. almost exciting holiday decreased to these released QX

We that gross customers, value to for margin important packing rate. high while away our merchandising current continue to leverage near supporting our goods strategy a represents this season tremendous

to agile, their of commitment inventory our are We our disciplined management. team comfortable level of for inventory with super-proud continued and our

quarter stores, remodeled our fleet, and remodeled and we closed four we've XX three. two added XX locations six stores, new Year-to-date, opened the to during closed Turning stores locations. new

ensure our our we focus light approximately Board of maintain to XXX,XXX million an million, of the to $XX program. allocation repurchased $XX cash relates it leaving As and of remains our program, a liquidity. evaluating primary approximately remaining dynamic aggregate in are carefully year-to-date adequate of macro-environment and Capital cost buyback we shares our Directors on at we investments

turning Now to guidance.

We half low-single distribution our are increase That XXXX half second half quarter the impact including with center provided second of earnings. total digit guidance, in leaseback included second the reiterating sale guidance Roland our compared sales with first high-XXs and the the the SG&A total sales. expense the reductions, XXs the Gross to expense second-half compared to of first-half in range from year sale-leaseback deleverage due second-half, transactions. incremental aggressive margin less prior net the lease for versus low of to

approximately pleased in the with we quarter XXXX. with In income in million inflationary year difficult results are to second approximately half operating And half Second of of balance of third $XXX environment. end from results million. the $XX our cash light line summary,

our call while that, to strategies, the holiday David gives our confidence these customers, continuing expenses, back are challenges our continue Combined expect for in continue, teams with transformation. focused our With ability our we upcoming David? season. against growth to delight will this and I managing to the on to comments. us during to closing execute turn While especially inventory

in quarters insights data purpose ship our got the customer Heather. our way. Most faster, faster The to Thanks, really work to live They react all nothing the center reacting on keeping better. three is do plenty study, the With We've with of to books do we fashionable faster on great and and patterns daily. thing live to trends bold, respect our of on base. structural and be faster. XXXX have of with pace source the live of proud,

drive amazing we Our our we and up our today. on-top people technology of infrastructure excellent customers' solutions our that so operators foundation will needs revved start-up that leadership better I'm year. is dial new is are than mindset into and momentum in-full foundation. committing solid do Reimagined important can becoming strong a processes, and to we you our

pressures based by As of we inflationary what's retail It's important about into data note be affected think sources, external next. will to likely on portion that a XXXX. discretionary many

us slow not will this our from you down making model. to assure operating me Let continuous improvements

DC team. tech new DC recent CTX Buy a both along needed the stores applying on. is and us play days broaden of we'll when for our our program of relevant you've format upcoming some thinking sales us search Trends and managing prices to home as CTX expanding customer and via comp balance game-changer Citi many one, and seen in seen us system can innovative number and Trends, will our as Number Number format, And program, expenses, Trends finally, Citi households break with or lower will upgrades Number to our income in You've combined cash right our maximizing and offense, CSR I upgrading managing probably our and actively platform seen the be date two, come. on ESG. our full fleet, the spend date sheet, operating for appeal experience capital to multicultural highlight CTX to with Number correct that five, be. what within focused the and brand continuing ERP usage. to Citi that the Leveraging involve apparel, our strength XX remodels investments. fleet margin. and stores Cares new of Citi Continuing our our you’ve driving course to our longer of more new bank. upgrade XX% remodel don't four, fresh accessories Heather to with working the trend three, to with XX be at nights

initiatives, XXXX. things afoot are early it and here Makers event we our exciting share comes History giving in third will Black during conduct course, CSR back annual focusing to when which February. of on will Some And we our

speak. we As

We value about plan. off-price we're excited what's say, The are knee on for in ripe deep I is evolution. the XXXX horizon. pretty got space to

of advantage As of overdue many we long productivity take are we new the optimistic and improve throughout our delivering areas efficiencies execution about and tools, better business.

to live I of creators all brand, the face want and always, endless our we our and to As future. Trends culture our team, engagement. hard Citi in unnoticed. us difference that the people Their are and never passion the efforts our a goes entire into of bright serve carry customer thank the is drivers making Their in neighborhoods of will the purpose work shining

take to Malika, over are to you. your We now questions. ready

question with of line first Hamblin your phone open. Craig-Hallum. you. Please is Thank line [Operator Instructions] is go-ahead, Our from the Jeremy

trends Thanks, if the in to and environment. nice a tough the job wanted of of I kind see into seeing. you're sales I could cadence that get

trends? detail see saw XXXX maybe a QX, we August, started over things it but might of terms October? In September, like sales the you best a week, what here you're using baseline, by slowed in of if as able get as to for you sense be wanted kind how the to bit to And of provide get little more encouraged sounds past the but cadence around

a Jeremy. a can I'll needed. really to selling little September. proved that for that the kind August July period main of And of in strong us peaked the for Heather enhance question. our of if had high-level, joining Hi, We Thanks of things. take be started But of portion that in first a during first Good and kicking at at and Sure. back-to-school normal weeks us since the couple ‘XX. bit today. and end really

period, out thought. course, so our were with that very we of that some packaway business. pleased And that outsized all the by performance excellent driven like of performance time by kids we in was panned So driven goods,

higher wasn't some better late have based she in November flow heavier and outerwear trends relatively have honestly the traffic that bought than and was but conversion thing higher basket, to quarter, only that October. mainly clipped front. we rest some the weather would The that consistent retail. October the really and on overall, weather, of we we September into thought was sales warm clothing, the a had price been we less into creamed and because It saw As seems throughout takes our on that, early and we weight our rest puts of for of he affected

was about. will, but week So strong warm when to weather the November overall, away if back two ever be and slower, right certainly nothing concerned The bounced cold snapped you we since. in

has the out Trends. then, color. seeing sweet-spot clearly, Helpful is did -- seeing not your we're wanted as a you Not Citi either QX retailer seeing And terms everybody there sense in set. apparel lot I promotional you're Great. messaging, in environment of everybody value for that levels, that of managing mark-down in to good every a terms the environment job. which you're towards of competitive in but get your inventory a that to a seeing, a done just of, shift the QX as been environment, job quite remarkable has or there in it in relates focus you're what for

Jeremy, Hey, also And Thanks appreciate question. comment thanks for about Really for the Heather. inventory. it's the it.

of throughout We to team they the in are inventory continue quarter proud inventory will way manage they and QX. that the managed really that and the

and real There a you gross highly doubt So rates. it's promotional is the focus, strong fourth is paying-off season. margin with really as always our no that quarter saw

you. we you under-served So remind though that, won’t I What their that serve change, will is that community. will customer and shock in

long need we're entrust being of in their day value everyday neighborhood strategy we because it. be, for our not low-price, and being us promotional, we're knows are So customer our that, and we don't not to high-low, all

needs. assortment And is hot. feeling holiday to that good ready Makuen, And the David for their because our great. quote really go the we're are holiday really-really product price amazing we're So points plus season got fact we've to that of positioned about the the fuel way to

we're set-up holiday the the season. we're feeling way really So for good about

QX normal Maybe just to bit promotional there? in compared -- trying wanted a gotten if clarify. get that. it's I in QX. or I'm out has I promotional traditional in -- if little environment a it's promotional little what to versus is relative seeing for of to I a put the more context whether just to if more to and like you're normal a QX less historical sense unchanged, environment context the promotional it a more relative QX as

Yeah. Jeremy. I'll one. take that

frankly, and It difference, again environment. didn't. I we that in brand where that big consistent promotional to we're the not positioning our within quite be neighborhoods the we're think relatively seeing within located, a appears

we would et-cetera. us, the Super going on feel herein. for again destination insulated neighborhood to tend Black in Saturday don't primary XX I promotional, given always it's that our the the bit be it, of the promotional year few for away I've activity. outer this a broaden the over be are centers say, and to sit heightened days, if customers ring much. out last course little Christmas. where earlier the [indiscernible] think can tends a we we promotional, then but seeing, no and many sales a a little I years, years started get activity, I QX nature the go from rings, lens find again, have to We're our from kind Friday call to sense we matter the because so ourselves A&B backdrop to more and to that matter mall neighborhoods. from of of Yeah, last what But no And in what Cyber what learned Monday, bit our as

I as price we're in are doesn't and stores the and that it all we're that's at suffers it, that on just think speak. ago to to gifts our be looking much, unfolding right making that months of hot we sure focused points stay stocking change nicely the behavior we at us got we our for in-stock it, watching So but planned really

little it. bit a Got less than assume the a absolute despite expense years, one out, the to I'll to of have of from expense some did of extended wanted you bit rent the Is in that hours the DCs for and SG&A. savings of typically basis, a but is I addition QX bit me sense that terms your and you in in even your it staffing on the assumption? little hop just little for SG&A, is fair from saw an Last that higher into QX of maybe going but fair hours, sometimes QX store a in what more that and management you're you to get just with need realize

than fair sales. a we've the Jeremy. that, there It’s a QX. assumption, month to got to product support hours there lot -- is right, QX a flow you're typically is is of extended support I mean, higher And sales

on better an lever dollar but absolute yes, in QX as So in QX we basis, than well.

wishes. for so the best it. much Got color Thanks and

Thanks, Jeremy.

you. Thank

Grom Our next your line line question go with now Please Chuck from of the Haskett. open. is Gordon is ahead,

into quarter. morning. good follow of question a would what below Jeremy's It A you implied operating fourth up question Nice it so X% guys quarter for guys, roughly quarter XXXX. fourth margin, on you the like which just Hey around be looks posted on Heather, in the backs guide. or

the pressure the expectations guys showed fourth quarter what occur? the to you would to be? you of into relative just relative So In expect third to quarter compression improvement guess ‘XX XXXX, third nice dive why and the maybe so the quarter the I for I'm curious points

Yeah.

guide is external environment. right? Versus in XXXX, about just might tough levels a One that is our will sources So, wanted that XXXX, anytime some that season, mind. reminder of always for versus rates near-future, be we're though see freight see starting of our XXXX. to That further the pressure couple a by QX we're points freight keep compare there in we point. told relief. even to just the not we for want fall the make just think we So are that to is,

of transactions versus the sale-leaseback we're the lease carrying The front, on the from SG&A XXXX. expense course, other two

sure in them people within harder will -- have SG&A I -- not well. that stores, XXXX as keep to merit increases then to that. to And -- we make keep within happy. we'll our XXXX continuing immune make DCs, a compare for want So SG&A, from we're

I would what to are ask compares you keep mind. in those So

Can the the I an from just on that. just a on sale-leasebacks did expense and And follow-up Thanks. rent maybe the remind that us you this of impact two fourth-quarter guess impact you the to annual year. basis

I quarter $X.X for third sure. the million. it you, will Yeah, in was tell

basis as proxy the So a on quarter. then million million basis, use third-quarter. two. for through year-to-date annualized think an $X.X a And fourth that for on the $X.X

Okay, us your assortment you great. terms share Thank levels, the And in then, [indiscernible] foot, where productivity? couple you look for of you upgrades a you to David, you new back system it's was step-back, with years. you XXX, much. to that laid this when the very which to next pretty take And [indiscernible] consistent XXXX can close on then year, square think with XXX you and the XXXX the over us when lines, XXXX out of have thoughts out Can of Q women's grow ERP that some missy’s. CTX, initiatives and also

of Thanks. where and do that think you has level over next years. excited grow can couple productivity most what you the you Just

Thanks, appreciate opening answer words the Chuck. I I'm question. Yeah. happy to this and

initiatives on. that here The I very been from very, possible sort point-of-view, years, I to of a think, primarily the gains look, we our margins which of productivity, our use there's kind is we haven't overall we some based to sales while think productivity went few to fuel topline that serious a obviously no initiatives expand topline mix. have continuing over intend bright part that we and number on to grow of as opportunity to doubt gains, of and next gross look

And force will of so, asked, you as sort rank we them.

it's that first key our foremost had guy The is it and adding what hit and prior. options we to and you of woman is and product kids on, the haven't

kind bucket, traction by some standpoint, seeing which we're we're And [indiscernible] one I enhancing incredible to on anchored in traction American were beginning business, African-American multicultural the see our there. is, guy in From so, guy. really to guy, And that's sizing. excellent really juniors put and zeroed men’s we a probably missy more where appealing of it offering

But front, So appealing is grow girls biggest to And the the then to per entry that growing been into where stores. business. me juniors our us the kind we've results younger obviously and the like testing you girl past in scale have on will tween will excuse in limited I throughout with specifically, some and of across number and And in square-foot sales years, that do the XXXX in And opportunity range pretty we the a in -- first size the guys two then seen kids between with we great box. XXXX think ‘XX business. quickly girl that just ’XX. of contribute

product sure. product, product, for So

no forth It and give on. Buy the on particular, our not systems. team, a the so set second is The thing to so that based can trend, really would be on replenishment needs that new or smarter so There's doubt you in tool they and that plan and allocate a game-changer baseline climate, based system, us. the on picked-up system ERP new for will

really retailers that years. have And many other so tools we have had don't for those sophisticated

much to that. we're so very And looking

put sits be would and we on. product initiatives the all number third store in right imagine, of initiatives the two concert program. that's So and kind to so then the of want product as because in you those can with it remodel And the

and system it And comes are in should they only, CTX sophistication. Third today, drive because smarter when to a the product the to those than in the remodels higher-level really better CTX then future. we'll because gear even the kick nurturing the be will us of

a of little force bit rank. So a that's

data our would more functions. I'd thing, and think ability which add our across all one the utilize to I in business just general be, get across smarter

will in a center stores labor productive ERP a functions standpoint data from be efficient and new our our excellence And the other in-store. our used by was all and so of and across us rollout part and DCs make of more business, in that'll which

come, I productivity. a that think and three all to will little but year, contribute to that's, four lots So over

number a of in could That's this this you be stores because great remodels, metrics the want just you about a format when premature, January? there might can to is fleet you one time big number answer. little any for XX% wait And nice a until in be more add the point XXXX, with us next in of but driver follow-up. could are you and to you think share of new CTX Just the guys or at And that year.

point-of-view in glad on Yeah. but assure that. we to I knee-deep in your A ’XX, planning, specifics, that to you us in then mentioned where are hear little that will our any share plan call share like No, of sites to we're kind year. premature of view some all next what I'm I against for for early I develop ranked to a can and the them

Great, congrats. thanks and

Thanks, care. Chuck. Take

you. Thank

Our of your Please line Dana Advisory next Group. with Telsey question now. the is is ahead, from open Telsey line go

go trade everyone. anything of Hi, when inventory you be expected. different forward? that margin gross downs? given you're the share good David, in The better in than that the thinking you. think making And may about regionally definitely you're how Thank came levels and the inventory you then Can base, margin the takes puts unpack levels morning, gross your of gains core customer you noticing or and

patterns our kind from of income inventory and customers of to these. in. pleased and exciting calling the more take that's are range. us patterns attracting of turn are customer I'll gross for that start we're but Thanks a the Heather standpoint, Dana. seeing. one I'll with of Hi, is, higher-end we margin, with actually it for biggest over We'll And the we

our keeping So is in about income $XX,XXX. average mind

$XX,XXX seeing above number than normally to up range. we see of that kind more folks We that $XX,XXX, are

is of And new some higher we're they're their so, the and responding portion customer that our retail. to capture seeing the mix nice

great meaning, see. they're for, just products. some which benefits scooping everyday up values, coming higher garment on for remember, of really rate improved incredible the or and what accessories. are our higher even associated retails, churn They is known are the retails So better-quality and we're with features us though to And to generally

groups informal then rent We've we than on is a food adjustment focus we're is, and fleet. what a as different the great as households, the you whilst little adjust interesting get mentioned, it's landscape of the I better. on So that's manageable certainly across seeing, best see. And mainly see really they below a doing their that's know, gas the really that we hearing in with sort to by those other to spectrum, to done a assistance the then of quite are $XX,XXX pressure past, end our getting often households. of the And their couple and

than those offer the our And extreme So thought. XXX if you the job make they the consistent exactly And adjusting it's in end everyday the them think sure we and basis, put other points, them price new. keep to team sure blender, fresh and that a we assortment our replenish that's doing. better in all value make our below, and the AURs of on it's to job spectrum is are what

on continue because meaning QX. of many a new learned velocities out to-school year definitely across and ‘XX, product. we've of is which that we and to terrific a things were lot past they we Back back bearing learning the So into back-to-school higher fruit, just to this opportunity weren't through saw are end-of-the trial able school

over Heather good I'll that's the to pleased data margin it inventory and on turn that we're for very customer with. So all certainly front.

Dana. morning, good the questions, appreciate Yeah, it. Thanks for

expense Let in me on We discipline margins came right. to XX.X%. of that. quarter as the margin. focused team Really our across lower proud the then IMU we're had our freight with expansion, I strength at on for on say where continuing and focus managing is very is would markdowns really well. start inventory components, the our There's

really from product good. good this put great and about to the really obviously, margin customers really and part I really some some are quarter. packaway going mean, We really are stores. beginning talk last spoke put we the two it, goods those tail-end I between of year, we is about in our very tie year, the the move our margin raptors the It’s and way -- intriguing I'll exciting fiscal to I’m product the excited in the strategy, fiscal to describe right. we're So last news the inventory, a of intertwined. margins across-the-board into perspective. that to

strategic make both a focused managing in high and very to to been sure that investment down has XXXX back we're going the in we inventory on to right? it So the been dollar margin levels, it's our team inventory very, have in-store working not So XXXX understand with that kind units approach, seeing and aren't that's to I we retail. can pilot inventory we're old what doing the and point XX% of our [indiscernible] could If maybe I average down play-out XX%.

that the product the that is the important really our that products the making and right stores, right sure that working bring is for very into we margin velocity exciting compelling we're on So customers. on is

you. Thank

Thanks Dana.

Dana. Thanks,

Thank you.

Benchmark. John Next now. Lawrence line line is go ahead, of your with is open question the from Please

I talked lift something terms productivity the Yes, you Can Heather. sense David, XX% fleet David, those just that digits about, about that a quarter about like new units? little or you thanks. mid-single of still we've you've bit on of CTX. of any that talk give mean, the Congrats, in would the of providing talked and

of and single-digit answer, lifts from calling still operating And -- for stores. we simple Hey, look-forward We and lot at said and a our John, learning in to-high in. a our a them lot CTX that we're of them single-digit getting we're we in thanks healthy Yeah, doing lifts lot seeing cross now futures. lifts, geographies. better we're mid remodeled as many more better have to some

So the performance Midwest. we're a seeing consistent across nice Southwest, Southeast, Northeast,

good to about excited see. it. So it's We're

maybe and real-estate of those look those environment, would or units, further getting seeing put for change across in out anything one-step this facilitate that country and you earlier? Yeah, go at just was as you are there, some it make locations easier to the

tell our a can in a for a though you too of is perspective, from What allowance great is, much doing remodels. getting perspective. think landscape job funding the tenant not change macro estate real a remodeling from I I many real-estate as

we As really brings of down remodel. a which can, cost the

good batting So on it that every got get a in front. average we've We instance. don't high pretty But that's development. a

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Bye-bye. Malika, We'll thanks holidays. so Happy Great, you Thanks joining. much. for upcoming time. next everybody see

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