Caleres (CAL) 25 Nov 192019 Q3 Earnings call transcript

Good afternoon and welcome to the Caleres third quarter earnings conference call. My name is Kathryn and I will be your conference coordinator. At this time, all lines are in a listen-only mode. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions].

conference recorded. this reminder, a is being As

At call Vice over I would President turn the like to ahead. to go Chief Officer. this Financial time, and Please Ken Hannah, Senior

earnings thank I afternoon. joining quarter A tables detailed would release to as slides call Good at you well caleres.com. webcast. and as like our for third with financial press XXXX are available

risk differ to refer materially contains disclosed a today's release which filings XX-K any to to Please Exchange discussion forward-looking factors Actual update the statements our with results time. are undertakes Copies limited Commission. uncertainties. could this be Securities impact press today's other discussed forward-looking and to factors, obligation may of at number in to company risk these any and online. subject Please due The risks and information various Form available factors not in including reports statements. no and are other information and aware, which filings on U.S. the of but company's factors SEC for more call the

the Joining over is the call turn CEO, Diane. Sullivan, and to I on would like to Diane Chairman. now me President today call

your afternoon for good continued Thanks Ken quarter for support you many Day Caleres. to good in Thank and you see of It and everyone. at was of October. Investor third our joining call our

our brands broadened of strategies innovation consumers, During the and operations. accelerated with we third connections of continued and quarter, strengthened and as we capabilities on reach execute products, and successfully the to power our the

to at share the Footwear industry-leading our with leverage and increased same-store sales portfolio. investments growth combined to Famous our Our positive footwear brand us capabilities, allowed continued insights, deliver market within drive and

down the Square, the the to relates will with year. and the shopping we Herald This high-impact that have strengthening which City, them This a original store just store brand of with to street location they New brand York excited shop great XXth shops to dedicated our opened the little from Famous it the customer us our Footwear truly in emotional featuring in of deepen our trend ahead is Street busiest brands at consumers, new period of make a As and are the connections will us. to connection feel demand reach world-class with is feature enhancing famous going location when broaden value. enable

it brick-and-mortar family relates from performance brand Edit, components and our As while more elevating launched the premium doors, a broadening from products, combines XX This a all consumer feedback which Naturalizer XX brands collection that offerings. Halo to we collection fit identified comfort and was a of aesthetic. this our over our known based following successful with design power our footwear on importantly, division, brand target of Naturalizer our reach and also current the Most spring. insights from online demand contemporary and met our and for for not in the is materials customer brand

a made materials feature scrap all And Dr. made versatile make rubber. and brings and eco-conscious of rice shoe sneaker, eco-conscious home and to proud ever plant-based from first Excellence linings, new that and Scholl's the from Council brand's Herzog at Accessories honor prize soles the things bottles blend leather, mission Award. foam life also in footwear Dr. shoe, are We sports the repurposed this time a like more report This the natural Scholl's its a insoles, to way shoes. Design to took in top-cloths a will of and eco-conscious shoes next recycled featuring by and year, husks

in-house by completing distribution relates operations, facility also consumer the of our we and it further report has am to third the fulfillment final capabilities expanded planned that performed of our as the to very facility accelerating since as in cutover. quarter. capabilities I And automation the pleased innovation the

to the of excellent biggest back-to-school and This third eighth the to a us channels an Famous turning consecutive selling our details quarter. in zones. timing and X.X% and history XX Now athletic, of the growth. generate positive experienced for in We increase sales sandal Footwear, all we contributed strength same-store our in quarter. of sales back-to-school Famous of all year across was allowing to back-to-school At the weeks same-store the boots, our in increases categories saw had

business delivered styles in trend-right and premium quarter the our our of key elevate assortment was was for. strong kids particularly consumer Our programs what with our brands in-demand and decision looking to

benefited We from improvements our from quarter the vendor. continued also athletic in key

enhanced seeing our best our value. offers to offering customers the are great they Famous that at respond brands a as and recognize styles We

with shopping as are to that to frequently we occasion. are channels among In new existing our in phase results our of compelling in membership next members make the base. growth continue we of going loyalty program seeing we per addition move continued to Existing we products, delivering more course, engagement we And learn revamped and increased spending pleased and to this and with driving rewards Famously shopping are been the have all across to YOU more Rewards. that's that members consumers. reactivated And sure are continuing and and program, connect evolve

from forward a assortment. positioned for we our mix about standpoint very both are are total for confident holiday Looking well and inventory Famous, and product a

TV marketing a will to our feel place, strategy plan. in have return and promotional plan a sales and margin We including deliver that we a

we again internal with were at our core to moderation fall of the the quarter. over course to able In total, short of along we turning our plans where replenishment products experiencing start the programs. and the sequential associated our Now were share portfolio a take the brand later in sales as brand improvement experienced a to portfolio quarter of

adjust at our are e-commerce shift industry is dynamic continues that to our seeing the brands we the relative by with ordering our in Our to as evidenced to The resonating partners and related styles an retail boot of more sales. and increases the selling outpace we consumer strong. fall on-demand our market, while are very sellthrough

carefully and are we made have more demand in managed these critically deliver on become with consumer where are that retailer increasing focused changes the to our balance, is meet that this the on It's and agility, us in quarter, capabilities enabling well-positioned nearly have preferences environment quality reduction and flexibility consumer for year-over-year an have in to we freshness discipline. the retailers newness in an exiting X% model the happy of the have inventory we investments On the built and even Importantly, because marketplace. efficiencies. giving with we speed, we important our inventory inventory our into the allowing

to trends young and constant delivering next with newness from have and what's just Don most of and assortment, terrific the really two Blowfish positioned spirit, job forward let So, now by on to really these a me price/value is marketplace very brief brand you This consumer That and Vionic. for naturally casual capitalizing you capture and update right results, recent well as in lifestyle, is off and top Malibu the well their product Blowfish the seeing acquisitions, we a fresh is are what looking Malibu the has the that and and performed give on our looking team equation. combination done beat a sport a team. it in very can't now. all

are Vionic, ensure and working needs at can agility the And that to with to react the we consumer. more brand rapidly the meet speed of

newness product the season We and to brand calendar. with the more frequently moved team already four have has the have deliver capabilities to worked to trend-right that and they ensure a

brand needed we the to and the mass-market They consumer this analytics when all And the no constructions you using make that add portfolio. that think to test products, and fresh our now chasing data and slowing our they have will we validate up we launches. found for inventories capability that to also longer and result We ahead be in sure as with going new predictive in of successful are then is frontloading end, items. in leaner

their Friedman weeks they and out this of a and unique provide to process development support worked such As and Gallagher Dan taking proposition. streamlined has Chris more calendar. already actions fuel brand have together, even have These commercialization value Vionic's that

turn I their impact to our address on business. and wanted Ken, I tariffs over before briefly call finally, And to the

tariffs headwinds in were some quarter, effect put increase the place that into in This in almost quarter. created immediate the early with September

action As by $X.XX increase. quarter. tariffs and a controls include our discipline third result, strong We maintaining were $X.XX still earnings $X.XX this of the results offset were earnings associated price quarter our headwind impacted but gross taking by with to the tariff able impact

$X.XX expect total $X.XX for QX impact in We net the a for of year. another

am I guidance. on adjusted can by to the confident As top are a operating necessary teams $X.XX range to the to and result, EPS discipline guidance what end full-year with $X.XX our $X.XX. deliver we narrowing our that the we control are focusing of

would the that, financial I And like turn a to Ken review. with for call to over

Thank good everyone. you Diane afternoon and

with reported Blowfish related strength $X.XX fair the mentioned quarter, to of adjustment the For of expense their and purchase in This included Diane $X.XX. mandatory earlier. integration for business per share the Vionic third obligation the earnings XX.XX related value Malibu, we associated reflecting

these in tariffs excluding went per $X.XX effect Our and XX.XX X. quarter the impact a was gross includes related impact that earnings items adjusted to and $X.XX into share September a the net

significant Famous a initiatives. the our marketing on up strong quarter product and Footwear progress year-over-year. quarter for Consolidated sales were of third reflecting million $XXX.X X.X% delivered assortment

same-store down season strong Famous fewer ended the are quarter were doors. and up as the million, and third Our X.X% total sales year months X.X% year. the the quarter first we XXX back-to-school prior of for Total with for were reflecting operated versus $XXX.X at XX sales up another doors Footwear nine X.X% the

the the additional Edmonds were portfolio well sales. two reduction XXXX Vionic up as brand planned year-over-year in Our in sales including as sales X.X% total months in of quarter, Allen

gained exceptionally market mentioned, performed with and share at the brand throughout quarter. Diane partners sequential As our retail improvements our well

turn profit and margin. consolidated gross Let's to

profit For XX year in points $XXX.X the Famous prior brand of quarter, gross from up consolidated million our XX.X%, reported X.X% was and from and approximately margin came contribution Footwear both third the portfolio. at basis with gross up

managed For of to XX% margin quarter third third resist from portfolio quarter, year-over-year. XX.X% basis approximately purchase team the them level The approximately the points allowing of the of experienced accounting prior temptation effectively up with Footwear, we was XX XX the reported improvement benefit the points associated margin margin inventory their Brand up QX gross increase as Famous in year, year-over-year. the continued the in promotion including gross marketplace. to basis in

basis incremental two expense down SG&A fixed footwear the At year-over-year, of $X.X brand of of for of year approximately loose sales, expenses reflecting by expense the million lower mix increase was driven Vionic X.X%, versus SG&A represented up consolidated last. Famous an XX from Our was the and months distribution operated the months doors. of XX higher expense including two fewer Vionic. up the prior this as additional quarter points reflecting approximately third XX.X% cost portfolio, shipped was variable of pairs year. they

amortization additional trademark versus the Our year $XX.X the of million depreciation amortization related Vionic and third quarter the acquisition. primarily was prior up our to X.X% due for to

third $XX.X sales. X.X% operating or million Our earnings of quarter were

Our quarter year-over-year third mentioned Footwear, adjusted of and X.X% and down operating represented earlier. Famous million represented X.X% were of as earnings margins $XX.X expenses reflected of higher $XX.X of operating sales million gross and earnings X.X% sales. lower At

earnings third of sales. brand $XX.X were or the portfolio, operating operating X.X% year-over-year. earnings up million Footwear Famous Fro XX.X% were Our quarter

Vionic a the down year of year-over-year. XXX versus operating variable quarter higher and same business adjusted an mix distribution amortization approximately increase related of margin Our the to basis was ago in dropship reflecting points cost the

interest Blowfish of adjustment to the million a our expense from associated value October million $X.X the ago net revolving $XX.X was facility the credit use quarter finance mandatory Vionic. third acquisition of Our year for reflecting purchase and the obligation the XXXX with fair up of

was rate Our tax third quarter XX.X%.

was $XX.X of Our million sales. quarter X% adjusted EBITDA or for the

for adjusted adjusted EBITDA XXXX of the million, of of nine X.X% Our EBITDA was sales. with margin first months $XXX

capital Our approximately the for million expenditures were $X.X year-over-year. down third quarter and $XX.X million

sheet. ended We quarter million with of $XX.X our equivalents. Now and turning balance cash the to

first $XXX stock were shareholders ago year $XXX common at following months third bought year-end Our million outstanding a quarter-end, and back the additional million an of Vionic. down We returned facility from of $XX XXXX and in $XXX quarter of XXXX. to million million acquisition under our borrowings the in revolving our nearly nine $X.X credit at million

the At quality inventory the end And with year-over-year inventory $XXX.X the quarter third almost channel. partners down XX.X% down inventory million, at ensuring X%. $XX.X consolidated year-over-year. our inventory position portfolio, were and we was X.X% of ended for million Our teams brand our Footwear, the or Famous at effectively the year-over-year inventories in-house and down of our freshness in balanced as quarter

result with us carefully to partners This with balance our particularly is ordering risk. to need. opportunities our requiring of inventory take our are retail to our in pleased ability closer increasingly commitment advantage light We these to of managing

year-to-date up XX% Our cash was $XXX.X same flow period over year. operating last million, the

As top-end per the $X.XX the capabilities in Diane EPS guidance of of strategies win business broaden doing net operations. of our with strength to with reflect our so, power believe mentioned, our per to In We long-term and will share tariffs share continue our we products, accelerate to quarter. we fourth innovation $X.XX in the range narrowing and model. branded consumers our we growth connections our and $X.XX the to reach to and are from by are impact well-positioned the third and

the operator Q&A. to would to I for Now, turn over call the like

Instructions]. [Operator

Rick first Your Company. & with the Patel of comes Needham line question from

the guys Good for back-to-school. and Hi. comp afternoon congrats positive momentum on

Thanks Rick.

my bit for up brand low implies low-double-digit year portfolios. the of in coming be up the ballpark. going a guidance With that teens quarter sales the softer, is to is on XQ So question this little fourth

acquisition were down wholesale there that the inventories relationships, also new timing acceleration lapped and comfort us you play around the into would here, brand other help give be this have at can digits portfolio, like coming great. context and Given shifts you now Vionic double

here Sure. think brand And Rick, in is about it's quarter. of Diane. fourth how the we portfolio the it kind

moved acceleration in quarter. through really third think as we the saw I third the quarter, we an

certainly suggest better actually sell and our was than rate August, growth would that are as even that forecasting October quarter September, September the for So we through is November rates was kind possible. better are that August, we of into than fourth

acceleration Our inventory been and terrific. has boot our

And into we Our are quarter, track our terms on pretty to and loose in really right positioning, we feel the satisfy pair current that ability with to our dropships. seeing fourth business. good believe direct respect on business going of that that I is consumer that to with our about our trend the

the thing. side, other side, again the same On kind on Famous the of

have We improve. continue seen the trends to

very plans. excited We about are about holiday and our pleased

at to adding for here We the fourth the back weeks quarter mix Famous, to in continue three those good. are media in look and TV trends

doesn't it don't Now, we us. our have work cut out mean always for

all demand, last we business, now, we trends year, actually but our to got as in ability drive sure to business And that shape. have to this we We look make year we at we great better position. our we in continue right light are a our were in like satisfy on are the and and boot feel little our inventory much

I a piece be that it. would of that So, think

points Ken, if I add a to… like know would couple to you don't

call XX%, up then QX, you you when guess QX over up think XX% double as I in, and it little and that in we brand portfolio Yes. we look I around if digit, we at was roughly low go in look go at QX in were a X%. where all

the be actually flat still in QX for be up XX% and year. can You

quarter, had you I double digit three sales. well ahead running for mentioned had we benefit the Vionic year-over-year as quarters had but the of know where we that just, are of the we So

then Got thoughts on for question it. And initial a XXXX. your

thinking tariffs? give and it curveball double there when look would it's EPS if XXXX Any you how wide. early we digit happening be the about that estimates out make see great. is in especially can for given Your should low-single-digit to long-term the growth topline call, color So, you for be or thoughts model? Do too at growth. this is range of hoping preliminary very some on I earnings algorithm was us you there, the

give double continuing to like. digit changed. It to we But put low-single-digit point long-term is of time. I market. XXXX than not think our obviously in to out what we Can't this out we in look kind any at better our Those in that guidance XXXX growth, were Investor that there drive tough Day growth has and intentions looking at or be at really going grow were and our yet say would our would what really laid at rate, we operating terms guidelines really margin. Well, topline what aspirations it's of

our We and this March. just changed we now, controlling finishing And will certainly right and to do and driving that year our you can position are paying attention in off know what we business. hasn't

Thanks holiday. very much. Good luck this for

Thank you.

Thanks Rick.

Your next question Champine Laura comes from of Loop the line with Capital.

any this because are is for quarter quarter, my at the that on from quarter, moving you will look us status $X.XX to comment $X.XX there in of XXXX terms taking give think mitigate assuming impact things of tariff sales rate quo? Thanks question. doing you see or just what run When seasonally next is lighter in next tariffs? kind we And are can if we the the you

$X.XX, much at on able Yes. by went the looked price. we those not the effect, time Laura, orders quarter. of gross QX we impact most tariffs were impact for when the of the have were of to into those booked I mean an

look, bit And price us So, the be expect from ability we most of then help would as in a rest price when we a there is to standpoint. going the we of move is to that into able of to QX. little that offset XXXX,

but don't we we orders a to of had the pull effect it's short went over long immediately We only in booked, have had the it said of really with consistent lots were term. we expect couple were negative where the So to before term, able that what and into this impact already levers. a

would mitigate hope more our forward, we a continue speed, of countries actions more can quality that different it. goods few to where maintain execute we of sure we making and could we just evaluate look we to will are and producing As and then we

Thank you. Understood.

Thanks Laura

of from Wedbush. Chris with next the Your line Svezia question comes

guess progress my all? I I go moment. quarter that pretty Diane, for everyone at just it you, to the questions. and any to X.X%? Was Footwear Famous afternoon for a about comps thanks Good color want first throughout Can how at consistent taking

It then in was A and very in again No. came weaker actually back little September strong in October. August.

the in So gamut, the Chris, it kind ran of at quarter.

Okay. And October to quarter? the boots pickup where Or made you inflected? driver. boots consistent did a that Was a that in reference being throughout

quarter bit It start you quarter. it really, was so throughout was it August consistent October, really was a the pattern, pretty in little did was But weather as But the that to in. the kick obviously warm. really unusual and know,

boot to and and was still good we athletic were opportunity the had early as boots on And selling an October, flip changed, sandals positive. as again. So weather kicked in good the to we

of have So job we very and where in always team we inventory nicely. The out it had the it quarter. a lifestyle we great well different so making to. was worked our sport did that categories And sure done position this needed no

styles right really balanced So was a the board. business brands, assortment, it too. a across And really nice nice right kid's

I you, Ken just the really in that new here Right. what's piece And the to for just tariff guidance, incremental really clear? be that X%. guess just Is is

and there X% XX%. there incremental of QX in of just all able the impact then to the was incremental Well, is the offset being not

math so $X.XX right. All to earnings then got I my $X.XX in implies your right. And if Okay. quarter fourth

million to $XX drive look increase, curious, of what I Just north just EBIT maybe walk if growth, through that of so for you can level of to am and for if takes puts you the walk through, in could?

Yes.

got the obviously, in, we when we about portfolio, selling, on have the we at boot talked the momentum look going the inventory. think brand I

to push We we we feel not that like margins. to through carrying lower excess are at inventory going have are

portfolio. that quarter. see are the we brand moved momentum, margin expecting some grow throughout as nice sequentially in to we we saw the across The expansion e-commerce So QX

contributing from we Famous And boots And think had athletic Footwear back-to-school into that really a strong, so growth. really continue three finished all and expecting then to QX. standpoint, to the the we We sandals, quarter with both a happy all great are were I season.

at about actually feel good expand And by the Footwear really Famous had basis points. that. odd you we So we XX-some margin

over QX all so And earnings year. to in some incremental leads power last of that

fourth Just quarter last me, year. to there Vionic I were [Indiscernible]. remind cost some

had of ago, A dilution we Yes. $X.XX ago, Vionic year QX. a of year from that in $X.XX

was that year QX So in our ago. numbers a

if he seems that to was acceleration and am still it know, regards go one last just me, am just the be or gauge the [indiscernible]. there some just you could you to that you I Well, portfolio are in on Okay. year. about like you in a maybe to outlook. can through, walk saying back trying this X% one branded trying potentially QX Is I stronger did XX% to understand, don't for perspective flat, I from QX. growth think are rate from to no? fair growth

of versus part and guess out, what we was I Vionic QX of a year month of pointing I think three ago. Rick this in so Vionic Well, one year, so had months

months when months. Vionic so QX, year three have a three back year had to go we Vionic against of this And we months of no will months versus QX three ago.

So Vionic seen was we of the what from terms coming had lot early a outsized of the in addition. on growth

So QX. an that apples-to-apples equates to in

Okay.

death, So to more you beat expecting this organic are not to growth. so

are this much everything Vionic, point. So lapping you pretty at

mean think Allen down supposed is potentially. core actually I Does some just to degree? the to accelerating that still is business be Edmonds

pull of in promotion remember, a decision actually year Edmonds QX, level we back to you made the the Allen on Well, if ago.

decision And began that in QX. so we lapping

Thank All all best for right. to all the you. now. That's have And Okay. you. I

Thanks Chris.

Chris. Thanks

of Your the next with Marotta King from CL Steve question comes line Associates. &

Footwear What quarter the evening, comp Famous as specific Good trend the in and Ken. Diane well expectations for quarter-to-date? as are fourth

with will trend quarter-to-date. The start I year-to-date.

we were Yes, the October seasonal had strong we So very a saw category to or all and be we selling QX, to we tried was, year-to-date. What to say not coming seemed as the are provide well. expectations. X.X%. good quarter, had we through we going And momentum were QX in fall quarter-to-date X.X%

new you peak you When fully the And also mentioned do helpful. is automated. that efficiency? That's at feel a DC run little

into would curve and that the expect coming we down labor so see in start QX and out ramping some XXXX. to we going are learning we come of to Well, be here

to give will provide look going think update on like that's what an we guidance. do our year-end and we we our when report So

would that of a expect certainly right. period we And time, to for continue

Right

some gains and business a to as in benefits that's But lot all done that and that, at There next help going the the well. demand certainly even productivity won't time. e-comm increased productivity some expect year. of more of we be to, We point our as there is we

Sure. One more question.

it through Footwear's to season, materially promotional from it last pertains at cadence As the Famous does holiday year? differ all

We was question, pretty of of third Great promoting, in some of our days that's promotional planning cadence if quarter, even shift were where but the little a quarter, Yes. A of shifted Steve. as to December what amount And you do much actually, little it very the of bit a total our bit the consistent. we during are at activities. we well. looked in

friends not of are to going events. We and family the have one

responded We the well. back consumer right putting the really TV investment way media. are go. into our to and We that was The the think

but materially what out so are of little promotional a at not fourth bit quarter, balancing doing And more we the in all.

will goes how now we early third our all continue We to is of pattern that developed kind but quarter. right the in it the plan see

helpful. very you. Well, Thank

Steve. Thanks

Steve. Thanks

[Operator Instructions].

comes Tim with Poser [ph] Your Susquehanna. the of line next question from

your plan for many you. got full year? and guess questions. Poser. did Jim name. many Thank for Hi. store I then you openings the what's I in Famous quarter? I And How am it. and close How A closings It's stores, stores open my changing Sam -- few stores, the Poser,

looking up. we that Sam, are

specifics. you get me Let the

XX said we are we fewer. think I

Yes.

closed it we loss So looks in We like XX. XX for opened net XXXX.

our plan. So XXX ending is

Okay. But where we are now?

XXX

XXX.

many you quarter? did the in got quarter you open but I close and in that many how did the how

We opened closed XX. and four

and four opened XX. We closed

again? are planning on more year, you For how many on how full are then you opening And opening planning many? the

Just quarter. one fourth the more in

I one that already, right. York, opened And assume. New That's

Yes.

Yes.

like then to XX And XX? close you going or another are

Correct.

And comp brand you. then was for the stores? Thank portfolio the what

was X%. It negative

Yes, exactly.

a reduction Edmonds. that And was planned Allen in

Naturalizer flat. the I was piece roughly think

that thinking XB have into Okay. would don't you or And significantly, about Dr. some probably and know of about your Blowfish Malibu baked I that how products specifically your numbers impacted then if be of are that because LifeStride. what brands, some those Scholl's by tariffs? the also you fairly

that how So XB about if List are comes? you thinking

into have XX%. we XB the taken mean, I that what current the Yes. and based consideration List on

List So China, XX% of China was coming of production so was we what XX% have on in on and of XA that is about XX% our about there out XB.

entirely, would and I assume, I is XB List brands those that guess three I mentioned Rykä. almost But

any kids-related product also Rykä and is on then of the there.

you us give what the they If Can idea down? sales were or an up, Vionic were up the there quarter? Were down? in

Well, they an were to months. we two us incremental because had certainly up

-- they So were results our in

Can you give number? us the

up. were They

in were the Ken's looking They certainly impacted third that. quarter. at

newness As I was and core of freshness saying, the replenishment that do accelerate their with were and them needed to to actually on the work Sam. kind that we we they need categories, to bringing the market,

four the more their that capabilities newness lot seasons using them added that, speed on making sure they some a all need little to continue a our and freshness team there. sourcing with could of so They that bear assortments. year, spent working to we to moving drive to to And time bring were a

at pace to are the quarter. third that. beneficial they replenishment as be we we into doing which in really about certainly were think that's We and core they during really to get going us to XXXX. the a pleased and But that are category little So light them

Sam much increase to to the by get orders January some portfolio? you the quarter digit for the What double, of ship think us orders? mentioned a need we a are to I are about, low brand be to key drivers you get in give are low haven't for just year that the all idea to today, or guess double teens fourth how spring. of you initials those portfolio, at And how some brand what to can you for for will are that brand much I initial get key that fill-in So low that, on? Edelman of And is do is mean counting of what that? drivers how

for the portfolio double get think... year, Yes. Sam, increase digit brand a at I to so mean, I to all-in

said you low But teens.

You double. didn't say

low misunderstand? brand I you for you teens year. I teens that's are your sales the teens You in low portfolio for to think saying said said on that year. you are expecting up did low the thought I your --? -- And Or for the year be that's

double we What could just to get to it in be back digit, said was, flat. Right. to

question need Okay. to what's my to low increase driving, we XX% get fourth get the to is teens the in quarter XX%. But an

the there? is what is much heavy doing the are it make up? going of lifting that So brands What to fill-ins? that How see really you

of that we the is, continue be Yes. initial throughout down have orders year Most seen year-over-year. to

was I to think down initial digit double orders as QX, replenishment. continued be in

the e-commerce are growth I the starting coming. related initial And where reductions. related significant sales, sales, year-over-year the of lap in So, to order the is some we that's dropship the shifts think

it's in a that's But seeing where are fresh bit So the you of growth. all newness product.

just across Diane what product big the those we really is Vionic, is on entire more doing. that's the Sam brand driving replenishment brands and to going businesses. and of where those as core portfolio. both think fashion-oriented mentioned the that's growth in both are have of consumer what I shift There there a really

that model your your business. me Because tell driving in-house a it's just dropship business portfolio with that's the are could of e-commerce own much your of Okay. business? sounds And you lot is like your then brand and how partners you those doing that wholesale e-commerce

are each the or of give percent combination of? you what those of one us can an idea So either

Yes.

that a some retailers, me of Let third was, a give flavor About it of what e-com the Sam. all well. year in of our was And see had same the substantially as our quarter e-commerce we of business of base fourth same quarter other own grew that kind dropship, in quarter. on to pattern, that XX% for And kind growth we in was related whether sale, to the that expect e-com. last sort you

an dropship e-commerce, your Right. mean Zappos, argument you your and am But for I from own consumer. talking a is you also I is to sake. which about which are sell-ins number automatically sell-through order a about asking

that to you inventory is percent, are famousfootwear.com. that to actual are what selling, also a as a sale their own That mean, then do selling they you what number? do So carry wholesale not order number dropships. as I and like out-the-door you

flash? dropship that what's So

Yes.

total that of year-to-date, direct-to-consumer. XX% is So roughly our

So that -- doesn't

Yes.

Our own dotcom.

brand dotcom the right own is now? XX% of Your business portfolio

Of direct-to-consumer dotcom. business for the

right. All

to drive You are right. am crazy. sorry you I

your the You that was what $XXX is quarter, million telling which you in of did this dropship which all e-commerce that be like all of own percent brand and business combination portfolio would direct-to-consumer?

That's Yes. was -- XX% Diane It what was mentioning. of like

include to that Zappos? orders that are to Zappos? you shipping does just wholesale what Or is But

The orders to the pair directly consumer. single No.

Okay.

XX%. it's So

you year of X% direct the own and other e-commerce business the is fast foresee and And XX% that business. is down growing sort how of about balance So do dropship business then the your the for your of road?

the growing XX%. business been has at Well, close to direct-to-consumer

of part I talking e-commerce the about that? am

has business similar been e-commerce growing a at our And rate.

not? not And it against expect do but the few guiding put looking when ahead years, ahead, as or do I have the know you mean next you that year look you more growth you that, effort expect to I I mean, you next over accelerate

yes, And continue. to it it expect would accelerate. We

the pairs consumer. And automation of of that I mean do on growth. is we is able case single to consumer that specific the obviously investment going we to forward part the to significant that made to that demand for can make was the in packs, able but been need all address and a distribution directly that's not just sure our facilities, being goal be capabilities

that that's in business direct I is the more that And fourth quarter the just there there. would number assume demand. I as nature up, Diane, of goes mean, that's that

Yes.

instead margin a having higher business? higher wholesale Is margin? that of that And is at

Yes. It is.

Yes.

EBIT? bottomline? the the On On

Yes.

Yes.

and All right. Thanks luck. Thanks. very good much

Sam. you Thank

Sam. Thanks

And line Partners. with of your question Monarch Wayne from Archambo last comes the

afternoon. Good Hi.

Hi Wayne.

are How you? Hi.

Good. How you? are

So good.

more the pockets of into sales overall more efficiently? those these in I the get manage details of to working you Sam but part bringing an place a of closely? down know, of stores? to turns and with Are there down? within kind So is quarter in net manage up Or closures inventories XX there lot strategy is different of that strategy inventory the Or an inventories capital and actively active X%, business, your accounts active is

at and working we to have that been been of early bring filling this closer and have not we for much the too while. making we product we of critical clearly, all want and need. sure in a grow follow to of and mean And season those is up we the in next couple much terms the pipeline speed been more are I And trying of Yes. what now model more we we going earnings are responding be kind Wayne, how in things, deliver, think part of a the key we over years. deliver to of to

Yes.

total our down was Wayne, at, about inventory look X%. you If

down, I with the doors, fewer X.X%. was think Famous, So

Right.

working to shorten is The we and are lifecycles at brand that were the portfolio, down we and of quarter the what year. product said hoping last of was were the had end we to by up we some end where be which

year-over-year ended through inventories able we So about QX the brand work in were in XX.X% down we that portfolio. in and up to

which kind us that's So newness. of behaving. aligned that is chain the is And consumer where with the across aligns is how now really consumer going the with more freshness,

to number, the Would next Famous? similar negative of XX next that stores And at of you decline see net would calendar net we year expect the year? on to a number the continuation

the I base. inventory. store so stores we in terms finalized that out, that about reduction think haven't of those is Yes. as in the are associated we mean net when But coming

consistent. So been it's pretty

Happy guys. holidays. Thanks Great. Okay.

Yes. Thanks Wayne.

too. you Thank

questions there And this time. no are further at

Okay. very Thank you much.

an we pleased capabilities we of this Just to see react changes model. with environment quickly the are to in our up, in wrap to seen ability the our really is people important and validation and that our our have

everybody like Week. to creating profitable, next Market a look focused stay forward you are growth over sustainable I longer we We that, to excellence to consistent going wish Thanks. on And seeing week with Happy Thanksgiving and operating always in of the just many and with term.

concludes and Ladies this conference gentlemen, today's call.

disconnect. now may You