Vera Bradley (VRA) 9 Dec 202021 Q3 Earnings call transcript

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Vera Bradley Third Quarter Conference Call. At this time, all participants are in a listen-only mode.

Following the presentation, we will conduct a question-and-answer session. at for provided up to be questions. for will that you time queue Instructions

today’s is to conference would reminder, a As call to Bradley’s Administrative the Vera now being turn call Dely, over Mark Chief Officer. like I recorded.

like everyone. us Bradley’s and call. you Vera thank I’d morning, for to Good earnings welcome, joining for

today’s Securities unknown the not as of the are expect. known from the of statements Litigation actual your discussion our and may amended. Private Such forward-looking that constitute during subject to a the recent refer questions company’s pursuant SEC remain with within and to to provisions remarks should press later on the of at will made filed Please Wallstrom. materially discussed Some Act and prepared will made of we turn Investors Reform most XXXX, now the uncertainties assume a cause forward-looking Safe I both risks the uncertainties. Bradley’s information undertake over CEO, meaning of release XX-K could differ that Form for it time. no statements during the statements statements known to the risks that Rob? and to Rob any call. to in call operative Vera and results Harbor those and made obligation update We response to

today’s us today. you, John and Thank joining you our on call. everyone, CFO, Mark. Good joins morning, Enwright, for also me thank

primarily of masks activity diligently meaningful earnings We expenses our as managed expectations. expense promotional results once expanded sales and performance, last again cotton rate as margin our quarterly significantly well controlled we achieving year’s Our exceeded leverage. and gross our through

changing to be strategy the and shop is are multi-brand we Our have responded. way Customers powerful. they proving

especially becoming important environment. this are competencies digital Our evolving quickly in increasingly

for future began to on and success. months last several fortuitously company year went enhancements improvements position e-commerce Bradley necessary site and are critical acquired Vida infrastructure lives Pura Vera the we ago. working Somewhat digitally-native technology Those

third e-commerce quarter, consolidated Our the Vera both from in and Vida. growth Bradley reflecting strong business was very Pura

quarter. stores over quarter, digital our disruptions the were the comprised grew controlling XX% ourselves total more control position business what by Vida’s laser sales XX% we as for resilient drive sales proven can the facing and sales Even supply during Vera the headwinds. stronger a chain. we the By customer despite year-over-year for emerge we a and our ongoing on and grew can’t e-commerce company, in over quarter, third E-commerce staying Bradley results reopened have strong Pura nearly focused and third of to despite

to were expenses. our Even efficiency to sales, Our while think of of innovation organization. drive in added the our and reduce decision margins teams making marketing and determination management demonstrated ways driven products focus initiatives organization. teamwork expand creative entire and results our on cash have and flexibility new remotely working to achieved created And has through the us

financial Let to review me turn results. the John? to call the John over

Thanks Rob and morning. good

few over go highlights for quarter. third a me the Let

the July include I Pura today are discuss the is a will first since are financial As the XXXX quarters quarter to numbers a of all The acquisition. have results year-over-year reminder, comparable. Vida consolidated non-GAAP. been This acquisition

quarter. $XXX.X Consolidated year Pura the exclude charges the third Vida revenues exclude numbers, prior replatforming prior compared quarter, a statement $XXX.X million non-GAAP current third non-GAAP please press attached technology year The for totaled year million income amortization. income year asset complete of the net to to quarter and for GAAP reconciliation quarter non-GAAP acquisition intangible release. today’s current numbers For numbers in The related third the expenses. reference to and third schedules statement

$X.X share third non-GAAP totaled quarter. Bradley Excluding for Store sales to full segment prior year or traffic company reduction months. million $X.XX the $XX.X the per diluted million, segment $XX.X prior outlet million third totaled primarily be of in the in growth negatively to compared The offset the $X.XX direct $XX.X $XX.X Vera store continues and last pandemic. Bradley stores compared per number related revenues prior income pandemic e-commerce to to year. department of was line the incorporated or negatively factory share quarter, reflecting compared diluted quarter, the net XX.X%, the quarter. a to and by were in million Vera consolidated million accounts, the in store the million, affected Vera to XX.X% the accounts. charges, $XX.X Pura in in E-commerce impacted stores six revenues opened growth specialty wholesale in million compared totaled million, sales quarter, offset sales last of indirect third by decline the the revenues closed $XX to pandemic. for XX.X% XX XX $XX.X a in and year third nearly year orders Vida comparable segment which Bradley sales

SG&A extremely quarter in controlled or or XX.X% both revenues, a revenues expense were net COVID-XX The Third basis, or fourth X.X% predict. compared net the a totaled consolidated million expanded XX.X% operating current net quarter related million make basis. to On XX.X% in consolidated financial quarter million Current non-GAAP through The or its masks expense of net related gross prior of of pandemic. third $XX basis, XX.X%, totaled difficult the prior net million permanent lower of activity. third margin income revenues primarily totaled year to year to or reductions $XX.X compared than performance on or temporary year gross year and consolidated $XX.X sales company to quarter XX.X% $XX.X profit and non-GAAP the of year. to revenues. $XX.X $XX.X promotional due expenses the non-GAAP revenues, cotton On uncertainties continuing SG&A to compared last million to quarter a million of

guidance. forward not As looking providing a result, we are

our we well-positioned will sales. believe quarter, fourth inventories initiatives traffic marketing the and and are For drive

predictor performance should a considered quarter of However, future performance. be not third

as Net facing fourth are headwinds may sales the including traffic COVID-XX quarter the in in a and capacity continued fourth not of for quarter, impact have is fairly freight and are over indexes for certain the strong stores. consumer. limitations on be store the and significant headwind to package and season Shippers each elected we a to during along e-commerce. peak surcharges applying retailers to absorb all consumer as pass to that not cost We

months balance to for new technology equivalents October of million, $X capital cash to logistic XXXX, Now to related the me at are and turn factory third well million third and total quarter. for to end the million $X.X spending as totaled Net of Cash, let nine investments respectively. $XXX,XXX and to primarily and Capital the enhancements, expected year, quarter year’s expenditures $X the totaled between stores. million, XX, compared $XX.X as million last as $XX.X sheet.

credit end have the compared We fourth $XXX.X of higher end Quarter the the the at from end year inventory $XXX million than third year. accelerated borrowings due to million, the receipts Current primarily quarter prior $XX $XX quarter third quarter. inventory million into million our the facility outstanding of last quarter. was on of is to the at year,

to inventory Rob? flat be year-over-year expect year-end. We at fiscal relatively

John. Thanks,

propelling has We believe let’s an Both this Bradley shift. changed. consumer our two our casual, Pura brands work Vera radically Vida dovetails innovation well-suited perfectly are with way supported the and live We that on marketing forward comfortable into and to of and and shift and fun and driven Now both on focused by permanently art brands. purpose remain positioning state technology. through particularly customers that update product

feedback us earlier to to is to platform allowing new changing respond technology this more Our and cloud-based instantaneously and environment the data rapidly customer drive and innovation. to harness

let update me on First, Bradley. Vera you

innovation our creative and Let’s talented, am product start with proud of being by driven development very teams. design, product. fabric and I the product

pipeline platform brand. We to cotton have innovation update and collection fabric important build to sustainable to of existing pipeline on This is continually and new in new the to a fabrics. our robust our our helps us fabric customers offerings to attract customers develop place

traction recent months. offerings our fabric XX customers. has introduction to our are the performed Stay popular and a tuned stores. to next fabrication highly of factory full collections XX innovation rated for over ultra-light recycled well to have continue reactive our our Our the In addition months line by gain been and more

to our pandemic. to sling like providing of beautiful One customers our in cross life. all also free solutions and hands our differentiated continue the our facets as silhouettes products introduce increasingly our backpacks particularly styles they important and during key We become bodies focus is have customers

our Our on dominance three core be on our and campus, of in franchise travel. areas every continues day youth long-term focus to building

well Our relatively segment this has during up travel period. held

more for hard focus resilient weekend products car travel on the and duffel items than to it’s in trips like our market general. luggage proving Our be collection or weekend getaways soft

travel. and innovate to continue We

core our functionality of during ReActive our winning launching are dollars takes once great category. backpack travel which example revenue A quarter. which cotton flat masks, we flat the meaningful example, our lay for been has award us margin backpack in drove gross For again lay our into innovation

solids, We with in have the happy we Masks Vera color to sales style, Bradley’s XX% needed we a comprised offerings still progressed we communities provide with bit process. as much and the to and and offered total verbally continued quarter equipment the new and approximately but sales. and of signature our patterns personal improve sizes, are features, provide our customers protective serve through fun of third

we continue sales beginning soften to volume the the in experience are the quarter business recovery will While beyond, to decline core offset we which expect in of quarter. in and third masks masks the is fourth

one our Our and and add emotional collections. sense our continue to for to remained sell light always capsule our out number soon drawn These our urgency but to novelty customers trend shop. also of assortments our important be our excitement patterns are customers. customers to brands to to colors a smaller and Paisley brand,

Dog classics in fan popular gifting even of Meow with wildly pattern. like festive Our in teddy like comes year’s Show a on Print and and holiday Merry Cat’s focus was neutral the cozy and our Mischief and combination Best third top a quarter favorite plaid. cozy fleece in patterns season and coordinating a textures last This whimsical launched and and

blankets, an customer and like have favorites offering robes, we like wear expanded and weather fleece. We are out with lounge into cold cozy puffer quickly. expanded sold accessories, and apparel slippers These more assortment items jackets

us enter strategic to and for media Our expand existing provide reach, engage to opportunities and partnerships categories. continue and customers increased awareness, brand new strategically collaborations generate ultimately our product test attention new in

approached with July annual partnership wide strength Bradley our Vera in second we on newest in to extraordinarily are with add Harry and collaboration Clocks. sold Bradley on opportunities, masks by quickly, which brands we launched August replenish In Target XXXX our and the for signature collaboration to exciting able well-known that brand. introduced of verabradley.com were collaboration in and originally earlier target.com. Backpacks collection October, launched plus the our XXXX. more speak to In continually we and collaboration’s appeal We stores and Vera month, and And and our this popular out look and Potter Disney

marketing me and Let customer engagement. to switch

Our teams and talented completely digital and the we communities and marketing we way engage communicate touch with the our serve. customers transformed have

at School of able at total the breast our our organization, Research as on efforts we this position to Center Foundation under unable Even generosity umbrella to-date family hold children. an fundraising and research support through lifesaving Vera support As and Bradley million. were reinforcing raise cancer that other research women we to through Breast events of large though focus VB University improve ESG of $X.X any charitable particularly bringing to our support the community were continue the for Cares, both $XX in we rate the of lives the Medicine, and supporters, associates, strengthen Cancer of year million Indiana we customers organizations could to the

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Another is Cares associates. caring our BSG our aspect and VB of for focus

customer are especially all those exceptional We for We and served distribution each grateful time. during thrilled making on to quarterly experiences a bonus thankful are devotion that pandemic. to store day have Bradley based again and customers safe and frontlines associates especially have day up the on once so of this contributions service to hours continued $XXX the and worked associates were sure of their out and for center during our to in award Vera our to extraordinary

content in site to added enhanced key customer’s online capabilities buying and experience well-deserved associates. the launched our last our offer engine have new we purchasing. our $XXX,XXX to a quarter We guide Over us and revenue to successfully third a experienced and the which allowed to over site, have our two verabradley.com triple-digit frontline quarters In we of attributed search improve number optimization. improvement paid bonuses

marketing adjust Using science an and positioned have and collect navigated have allowing analyze paid analytics we been and significantly data our and we and digital buying, well-timed changes well our the us through successful pandemic media teams increased respond spend in business digital have data customer Our during as AI growth, in media centric attributable investments in to paid quarter. to data in revenue the customer us to our marketing customer program agile efficiency way. and accelerating

We optimization. from digital our media continue to see performance strong

workers, coverage on spend and return activations Awareness ad the Harry rolled Cancer has like remain Facebook pandemic. collaborations rates, journey a with for on about the with and for media and billion response over a as of to our double customers see during media always Potter the healthcare mass by Our people We Breast supporting brand high the been to including digits impressions. and improved strong engagement in We toes, through Bradley our communities rates quarter X.X with our Instagram. effort Month new brand. partnerships. they which handbags Earned in journey quarter and campaigns efforts, industry best resonated and continue with washable customer are and have foundation exceptional brand led managing masks purchasers customers we new centered had Vera and out welcome our connecting third

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Our through drive to store and creativity. innovation wholesale and teams results continue

business and be our digital part larger to is line both stores our an factory full our of important omnichannel strategy. portion of a Although, becoming continue revenues,

full reinventing customer line in stores. experience continue the our both We factory to focus enhancing on and and

by While have customer the successful capacity curbside online, limits top relationships face line challenged using nearly appointment revenues and particularly time data store social selling, possible. in the shopping offering pickup and Appointment pickup and our very we buy pandemic generating in mandated full are store strengthen selling our or traffic XX% for of customers to quarter. was

data than same end testament of retention quarter year. third actually new it the and This was last our analytics customer loyal at the is a better to programs. Our at time is digital

Our brand our customers love associate’s for our and the to devotion customers.

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scores customer are pandemic satisfaction related Our despite disruptions. leading consistently industry

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than shoppers. omnichannel three are most average the times our spending channel on single Our more customers valuable,

year. store expanded have one and new renovated and six opened We this factory factory stores

focus line stores. productivity full improving to our of continue the We on

far and to year five line since full XX full additional year. closings stores locations close so XXXX bring We by close XX expect This have more permanently seven to the of year beginning expect and end. our this total will closed line we approximately next to fiscal

and growing fastest On of the highest volume side the Amazon is account. our wholesale business,

have optimize we grow, inventory, drive pricing assortments, assured to business resources continues this against volume. and Amazon As integrity put our to

Vida’s talk quarter -- our sales third revenues quarter. that XX% impacted excited potential brand. supply of disruptions We despite year-over-year significant Pura the grew supply Pura let’s e-commerce about about early Vida chain Now Pura remain change Vida. in the over

e-commerce Pura growth Vera quarter. Bradley’s quickly supply global Using back chain, diversifying As sourcing have of substantially in normalized, the and production Vida’s expertise we inventory of countries accelerated the sourcing material additional half strengthened three raw Salvador. facilities in adding El outside

to which by channel, recover beginning specialty total to course, sale were revenues reopen affected as stores are to wholesale also and Of reorder. start the

innovation continue continually into first of to Vida quarter inventory is We Pura During bracelets wholesale product core able some channel. our the new and higher working. the are third traditional and were This expansion and style is Pura in packs, to e-commerce we and bracelets. which styles popular add signature our string price Vida At divert introduce and metal, diversification we foremost. a collections have semiprecious at than point our to mood category product

was XX% the fact third Vida’s a launches categories brand’s traditional Vida’s Pura were the appeal. comprised of In lifestyle than underscoring Pura in of e-commerce quarter bracelets, business fall jewelry success. nearly other the spring

can in Our those a personalize styles offerings winner was home. customers. working Earrings, them. to celestial further with necklaces popularity the living special beyond we continuing popular but or from Personalization continued charm signature above color the the combination not choosing our their our bead collection expanded bracelets a by only keyboard proving trend. for is core Customers the again once as that resonate big

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to our our styles bracelets cherished selling charity are amazing earlier to that our two that for we charm September partnered introduced four adding causes for We popular charity by support Bording are continually Month breast year to many [ph] packs to and Prevention Breast and million our developed $X.X over October. expansion in to Month Vida increase not XXX assortment cancer, We style To-date, packs customers. is this style donated with Suicide charm total Pura only that in to The points of donations more and styles Cancer than us increase enabling the causes. of to but our charity has Awareness these charities. great price

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and Vida million drove from the healthy spend quarter Pura revenue. with earned estimates $X.X meaningful strong to media returns doubled last which active subscribers, and its year During less was

is devoted On influencers content, TikTok X several Vida collaboration product marketing new on Vida Vida have and strategy close by taken and of group lot movement, our micro the the brands devotion ambassadors in Pura the engagement spread buzz exciting Pura brands Aspen exciting engaged months of their is to the over content off and driven TikTok marketing as showing linking of giveaways These influencers. compelling ambassadors boxes generates create we TikTok interest XXX,XXX Instagram while success and Vida one promotional front, most, the followers. holiday help most excitement and Pura space promoting up with million has advocates influencer A Haggard, social in the most, with way. fans. engaged Vida’s strong. lined accessory Vida These about with us special along XXX,XXX with brand, and online and puts launches not on is share highly occasionally of to feature product showing followers of if our drive brand more followers. create jewelry the remains that on Pura Vida’s ahead. their one creative social Like media overall consistently codes. by listed store Instagram. items, Pura peaks media, Pura the perks and influencers giving tutorials. the and passionate scoring its offering bailing Pura in sales the sneak followers engaging with active

enough moved sure an grown due be to sure D’Amelio, pack to strength to of followers have the like just production Vera queen we she with XX become brand. partnership. Pura to the and of an Vida of Charli incredibly target million the Pura the TikTok, Instagram brand Charli perfectly potential Vida product brands followers. the over the Pura reigning growth we has the spring want bracelet over Speaking high other Vida discovering of position that to are family Her part influencer with in unique have had are for Bradley Vida much style small XXXX We XX and we upcoming that’s thrilled and could million we delays. marketing believe three demographic with business by with months opportunity product anticipated launch underscores $XXX the astounding Pura to the of will successful We launch. TikTok make execute fans million TikTok,

confident unique growing opportunities, with both its smaller to casual, city lifestyle as Vida. migrate centers and we beyond fun base am more focus than on they live I have our Pura purpose-driven communities. ever, as Now and and are in is the customer right Bradley brands our comfortable from growth Vera that space cities Both particularly brands who the customers major is big at

We up are positioned well we questions. now to for will open Operator, the the call future.

Thank of from you. [Operator now It Instructions] Cowen. first Chen sir. will we our Oliver take go And ahead, Please question. comes

Thanks so much everybody. Appreciate it.

So the volatility margins sales in are seeing in bit What you of inventory traffic really I channel strong, are a than your relative and of a trended sure comp trends what but how little the to expectations? terms direct that has there’s lighter the was and fair had modeled. we store am and/or

perspective the quarter, quarter we and the second full improvement in Yeah. line third traffic From the obviously Thanks, both a in Oliver. factory saw from channels.

was Of line than course, factory better channel. the full

from our the stores saw I in of perspective, half brands. opened think, up it an are both positioned we stores quarter. earnest to we well But in from inventory perspective for traffic right our better as back getting inventory third So we

in position of quarter, of challenging I back in outside sales perspective. the inventory an the inventory first Vera well the quarter third quarter. In Vida bit Bradley regards this at beginning accelerated their was to full little inventory stores into a ultimately, for part think, have quarter, into positioned from of the the got late and we We were brand, the Pura

reopening? some the that on model as in there’s going you are a just saw And on what traffic check better? any size and added continue will dynamics conversion we quarter visibility the get comp, about forward, to the Okay. thoughts Hopefully comp that and we versus had think

Yeah.

in that came So to because conversion e-commerce, shopping, whether perspective, is from who or -- came the to was up is full out buy. line, out individuals a out the whether fashion that really channels, definitely conversion all of came

we saw conversion So increase.

kind at based ADS. little our go were saw down. to the portion that’s bring of up. little on square down actual but also bit fact AUR a buying $X We check the a AUR price go in the more, saw purchase going we People actually of that point -- bit also masks the a We

next know going the As fourth be think, look going with it’s certain the the you cities we stores constraints it’s to some the hope regards of into associated states as regards -- retailers traffic with some deal year be would be malls. of year. factory imagine doing up kind of we really can entered to a COVID-XX. you as kind in like open move rollout traffic what outside to all still as quarter, in this into looks that stores the we the get to malls into going challenges capacity But of be are to to where kind certain would it’s to stores, as it back thought we and people capacity or a more they I from or comfortable it bit the feeling little malls vaccine inside But

of all better when terms I strategy and Could timing on Vida? And Vida Pura elaborate features called the and have in improvement out visibility in those then know wholesale of details helpful. you Pura on as being you those chain factors. are supply the might

Yeah.

from From we a working that we as of not in perspective the Pura this think mentioned we Vida. why perspective corrected some up, supply Salvador to will see our had. chain reliant prepared his have remarks we chain with of supply we that the challenges help on are a that Rob kind So additional are And fully thing now plant. the that’s opened a for at look from has wholesale perspective, we on we El correction wholesale we can a stores -- only vendors

in and which products outlook would next you to an product then terms fourth Okay. year, for most And prioritize impactful Rob quarter on of as …

regarding what Vida guess, I Vera of, is Bradley or about? terms -- Pura you specifically In are

Bradley brand. Vera

Yeah. Yeah.

I there’s think of lot innovation Vera think, with I coming. a Bradley,

watched really in continue at will home patterns. is, through and as are really then believe and of our really and cozy. continuing being interesting and and travel basically that fourth we important if all that’s collaboration really in rest The we seeing important more in think fabric look were important become been quarter, things with thing then that more we that it’s Obviously, categories. So everything and business. if important our which our hands business fleeces around everyday expecting really fourth free our do see becomes with trended you into holiday lot know kind to time we business, to it’s we But youth I similar is next travel and across with year those continuing have of have what quarter important is our the now we we this think next a are the of innovation year. the and And two moved suppression year now we

August, in as by strength But encouraging car that’s been next but back difficult full will time back get hopeful encouraging travel, get we that’s category, of been more was in luggage to hopefully in kind that it in saw school. next air soft year move return so we So are which Back-to-school better we and be to than travel is fall. that hard travel held we some are and September, to obviously, the we up coming to see to because through see. and

Happy luck. Thank much. holidays. of you very Best

Oliver. Thanks,

Thanks, Oliver.

Altschwager Baird. Please Our Mark next of ahead. question go comes from

Good morning, Thanks. everyone.

and you But quarter, sequential is something possible. predict less think that that to the consumers expand to up capacity. a primarily related guess to could fourth shifting on school. I focus might that back the to store environment of not you a get upon versus for in would the continued fourth with be moment to I that is made I conservatism being think improvement be might understanding a following strong Just here. related headwind bit, third quarter quarter the tough as sales mentioned that

takes bit you So thinking holiday? and puts maybe about about the there more little a talk just the how and are

Yeah.

traffic I spending. forward store general move is season, the reports, Black think holiday Obviously have there not from consumers Friday, start any you watch to we holiday that some seen see of like were and very in of out numbers just good. our right? We right? plays as have very had retail what so in feeling I and seen strong over how can the very, their definitely market and November. will think We all it This is Black in we we other, is a in December. Friday while tell suppression of

businesses right, all standpoint, that retail additional just there that that the that bit and COVID is on there some those a quarter fourth an some think pulling before Christmas second issues been e-comm so of out caused of quarter seen that, in just we had from pullbacks in shipping started in become out and little haven’t stores. had the the get large much rest capacity right, fourth pressure have e-commerce days that through. are of the been are and the other then in as thing and we a some we watch shipping, with week back can move pressure And earnings last quarter. impacts of do earlier in year. as little will so still the And we fourth a will of people the in stores and uncertainty of through as we has see question works that moved not third our there in surcharges that out the I how then that capacity and a of on that quarter texture bit how couple There’s back of just pretty

three innovation We So and so continuing the third on. COVID novelty that the quarter or it off unique. it’s key moving of to momentum in right? respond are the going to next consumer and is next kind year through The so those shipping, seeing continue what weakness are are those see underlying that think not is happens into hopefully in we we and with ship surcharges, customer consumer But and reduction this that up. with and fourth there are navigating to e-commerce then is in will an think the of what kind watching capacity just holiday the and stores, year we we pick deadline things the once are points, the

And terms repeat you. over back last I of progressed? other how the of front, guess you in couple the is what the acquired coming marketing sales to have really they business Are Okay. on some can looked with talk months quarters. categories? that the That’s with have purchase then, new mask customers Thank of like you behavior are as last the helpful. you of about engaging couple

through that Harry brought been very into Potter. Yeah. in It’s No. new the customers have encouraging, well as we customers both business, as our mask that brought we

really widely. them more the specific We with engage deeply of to to and customers brand both marketing get journey have very to those

We good in those have really from of coming response customers back. terms seen

are have to will So able those gained. encouraged we customers that keep we all be we

Thanks. one the of discussed journey picture, like. terms permanent are evolving any in for base specifically, in for be I you the looks for store stores in to consumer changes great? any me it. Got your the outlet And then, it. just that high bigger Rob, a what relative store behavior in to level evolving outlook you of terms But business digital? multiyear guess, in thoughts Thanks. Got online last shift thinking outlet about And just business, how would isn’t approach medium-term versus there this

Yeah.

to right, happens terms the of going to line we in reducing that we full enclosed have what overall, are very -- have watch fleet, been projecting you mall of we In kind as see we hours year malls do talked continue development forward. had see closely we journey on next in store about will and and the been to

still the there’s we feel front in store, that outlet the outlet On channel. opportunity

enclosed been overall back customers we have to coming are -- are are the with channel performing, happy We back malls. outlet to coming outlets they how faster and the very the has

of priced very because about onto factored that that making We are highly an see platform see so off strategy. still brick-and-mortar accessible a still digital we online we our moving primarily opportunity. cautious as more product and a outlet just So as the business

luck. so best Thanks Great. much and of

J Thanks, Thanks, Mark. Mark.

from Our CL of Associates. Instructions] Please comes & next Steve ahead. go King Marotta [Operator question

John. and Rob morning, Good

COVID that get effect it any find Is As in well? can’t you down up in not people in is as sales if having capacity recent very the and stores. are and other people it’s areas? hotspots going in because e-commerce anything going of mentioned, restrictions areas those those about or course, feeling far affecting stores you negatively that of as good In the on the the words, activity e-commerce the

areas and time do that, as, over in think spike passed to the offset think this a some slow the of everybody which think weeks downed pull begin But starting life and and quick just those seen on and right, start for e-commerce we have industry all to have definitely then it’s year. the impact we see as in you you I as rebalance we our change, I see medicate. e-commerce -- we not usually with I seen the overall, to channels the as consumers stores as got helps that, their first few particularly back to short-term things then things begins they

would only perspective to e-commerce perspective… the for a And a from an an I don’t thing perspective minute from to Mark’s the capacity when is, outlet have ago from that add that question down factory goes -- factory we

Yeah.

to customers for those buy. …

Yeah.

utilized? of obviously you your you the vaccine guidance as maybe And that the back the best specific the on be different reduced, ‘XX, what Okay. little the opens capitalize are over good consumer again bit course your for provide obviously, be for going timing I styles and there the the in think of a business from will How can outlook will prepare fiscal reopening? the and see of it’s year up reopening from but not some standpoint, just trajectory respect. guidelines the be Rob, as of understand. to a Do do you economy you

Yeah.

first the continuing It’s right? to navigate year, the going a half environment. dynamic I think definitely to be of in pretty

normalcy there’s I summer, positioned. back are well brands all come to that hopeful we are think and both I starting think as we some get

think about to bounce back travel. like what you expect would things be disproportionately we If summer

travel all that whole and piece with beach or and getting to it’s business beaches in of travel their our whether lifestyle Vida Pura out So categories back doing and people all getting that.

one really -- of back terms impacts lot the the up big back we second to there’s business think back to Bradley that. year Vera the there’s under a in expect pop school school pent of I strongly that think I a from I lot obviously There’s this demand. and business is think of to

happen a secondly, real opportunity and So business there. were to that this that’s are their We that lot we and products come year pack around back And softer. year. fundraisers to not Pura think obviously, they lot fundraisers, and teams people and a customizer use bounce schools since do Vida, next of hopeful a of do that did

travel of momentum be could there and pop in a half positive back of as year of return. So the kind lot and school next back

helpful. Thank very That’s you.

follow ahead. is up question next Oliver a go of Chen Cowen. Our Please from question

some and/or with Hi. just forecast, any being and has shipping inventories and/or been the but Thank Thank that are you. hard taking you on more with very you thinking A as cancellations as of that planning is the of business about this you. there big as in consumer timing. and would growth deadlines. that I situation the part with Is the a how also you few just to currently? differences are elasticity -- mask, And look surcharge? are mean shipping revenue forward seeing you you what issues at although to then the limiter look

Yeah.

I the think deadlines. it shipping from

of managing that with we shipping have am secure managing capacity we well. deadlines and think able been there UPS I headlines I you needs were capacity have through out that. sure the we our some are through seen to

So disproportionate delays we here. don’t have any

We which from issue, is have surcharge is really time a There expense performance. there associated and that. actually encouraged by working been the shipping logistics been just issue. has how on with That’s not piece

that of know happened she you XX/XX the not. like the store question when is she what XX-day the as off shipping or and to window, bigger right, of off from so the has business consumer e-commerce traditionally think I kind do cut cut to back XX/XX, shipping has go approximately moved much is of through does out that

think mark the through the I holiday. we that’s as move question big

a total mask, to right, think fourth the the business it be the Aspen are quarter we masks but to I And -- for we base call quarter, in out We to part going and how are of unsure. think going continue of are mask after they first percentage sales. regards do We that think do important price to [ph]. into we plays as

Yeah.

Yeah.

main integrity, and and some opportunities what prepared remarks in risk of which Rob of the Amazon, are that and Okay. on the And guardrails called some have and what with key relationship partnering deepening the offset pricing are you you benefits there Amazon? out that the of factors the

Yeah.

management pulling a understood a making partnership with of with partners our really world on in dedicated on And And decisions really really integrity Amazon. we that top they think, integrity. I we that that world those on which that really things other back it’s sure who are wholesale making helps are either and just were price channel. resources data strategic the in price to really sure really being we make I in has building of Amazon manage And has important, this sure have doing one, effective. people kind maintaining working new worked all day the doing with product day was think we pulling helped been of the counterfeit out and was out there partnership with price that lot of that quick stability, to activities us back and made digitally on available making

is, conversation part we into have happy the of way, pick-up with part to the type been be really new for or want which like lean people when there for Amazon other is or backpacks kind of very category and shopping masks can key have is today. thing people reason penetration, things partnership Amazon used The why that so of that we we we really are that on of it have we many looking category storage, right, really and conversations, that customers

margins it. as relative in you expectations how to been relative promotional and your to Thank it you. finally you environment, been seeing what merchandise How competitive the on well? of around have that as seeing you have being And has terms and your seeing been competitors

to are of kind expectations. they our really regards with So, meeting merchandise margins,

been we the from quarter, we haven’t promotional. -- the a controlling perspective third significantly haven’t In We are bureaucratic more promotionality.

we introduced are kind time. and we in to what Vision kind others versus want our selling As the of quarter as we doing of play continue of are trying appropriate fourth in just being into look to kind price are they kind just to we we to back ensure are But the that full looking drive space. have revert of XXXX, at we

being season. thoughtful to are how kind we we don’t the are leave want we opportunity of But So in sure we make that promotional throughout any uncovered.

AI And lot pioneer like have of that results the for there latest terms in a using been with algorithms have just the finally, of personalization in data you organization? you seen from a the internally. and implementing in What’s technology that

Yeah.

seen, what very been we marketing. that think as growth lot consumer acceleration seen of we one, specific has have a that and real I a is of targeted and category of have XX-year-old a our XX-year-old kind that to

customer Really target forward think to us also moving We continuing base. really is algorithms diversify really each one our really a we help lot individually. to going to talk are using consumers of as to we specific very as

also product to returns and our very standpoint, we development You not on smarter imagine a available. in our higher costs, our with regionality, ad our been on time get seeing and is marketing spent continue ages have going our on style continue with what and a that, we more can get specificity and product as lot we that there’s are been doing color think of portfolio of the there’s and to more diverse only targeted that but from terms have lot and we of much

Yeah.

new masks, better we able their based have kind kind average on role As Potter, in from is purchases been customers get Harry of than of to we brought repeat got specific earnings. new

been So that’s helpful.

much. very regards. you Best Thank

Oliver. Thanks,

Telsey Telsey Please Our comes question go Group. from next ahead. Dana of Advisory

everyone. Hi. Good morning,

you structure much about think margins How the as fixed COVID? Just thinking Vida. leverage business how core get is your And bit business follow-up for impacting the color about to go cost XXXX? on you the and are on how of the expenses, see pre-COVID, when more do just you that speaking little it Pura versus forward in from now to wanted about recover a planning you margins are operating also

Vida, initiatives us Vida. we what ahead that very continue We of with about Vida margin, front A growth we lot begin that high-teens kind can operating are Pura Pura From still are in an of -- Yeah. think to opportunity Pura the at from mid-to-high-teens believe of margin. excited us. is well, of operating

feel that still on very I From one. expense we color some that let about the business. So will John good standpoint,

Yeah.

the won’t lot in saw and third our we took. took other that of savings a some of savings quarter of can have costs So items there. with from certain an savings positions as quarter quarter kind or some you likely in think we see fixed as expense that second fourth furlough those associated in personal some we and we perspective, of the We reductions salaries

think percentage savings as you discretionary basis. core you likely a can go about we of see we forward of year think permanent low that a think that we next on and savings total can into kind kind If of it’s think savings expense base that of as will in the single-digit a be

with Got it. up the that like our be for? And think then calendars marking Disney, about should when partnerships what’s we you coming

of a going that’s launch We a is coming. we what very robust there, to year tell haven’t lot other put news but out be I have releases with date that both the that next pipeline can exciting is you character

on our of you of also to Vida on with a Disney licensing and our build So we next with partnerships been build year. to taking Potter be continue with advantage will lot will continue opportunities seeing Pura Harry partnerships,

are So we and we like of additionally seven And do next things we year. character we kind those to side. have collaboration work in licensing year the exciting are have are mind doing the on things continuing this some done

tuned. stay So

Got it. learnings And side? just more lastly the [ph] any Novus project on

Yeah.

and changes become can that big rapidly. think technology rapidly. driven continuing is move We that more was there more I just we more we that so then project data can responsive everything learnings and around to our and did make

new have and able a in matter more infrastructure what able better will quicker, right, and our platform with get in and days improvements we our changes the seen comments remarks the we have versus to really and just make of we better. we might before what that probably we We how are learn smarter time and about prepared heard and will been just how execute move SEO you to months over will make in

one new world that’s data. the of this and think things with I big technology in

a it’s a a build more so It’s you Now destination know, really not the up competitive keep and better You you we of to more and better getting kind the right? on. learn journey, that’s and are you speak. advantage working what

Thank you.

Thanks, Dana.

Dana. Thanks,

ahead. [Operator Instructions] Beder Please Our next Eric of Research. comes question go SCC from

morning. Good

Eric. morning, Good

morning. Good

positive. Hi. you In a category pajamas, we holiday how going terms think the in one a kind stores, thing pretty lot of thinking but QX wear with that Vera aggressive potential to be store apparel not in Is -- and and or about some response or has a a that forward? should been off expansion as of level I the been it’s of robes more Bradley have

Eric. question, the Yeah. for Thanks

brands that of that actually both a It see always will quarter, expanded an apparel we some fourth believed product are development. we we have that on you focusing do of One and brands lifestyle kind have not in and just of the think continued been truly they have areas area During these response lifestyle. happy thing the our the both very definitely that’s our key item we consumer is really very, brands. are with offerings from

So in that category brands. both there to have we think is expansion opportunity

store, now? a selling of the at selling there entire worked -- what us that of physical Vida does store of guess is put that speaking you when are our I terms are they and category, you kind the And in tell How big how Okay. Pura did what Bradley store-in-store Pura Vera how Vida -- they line. core, in beyond the right this

Yeah.

on still final are -- of all design. are We working we the

have We identified location. a

foot XXX about is square So an it space.

get a Vida it’s Pura of kind great you therefore footprint, don’t higher jewelry profitable on in the more run. a it as is we foot sales to opportunity -- the smaller within store think store need you much square long it’s make per much a space for which So

is broad a of terms assortment. to In assortment, fairly kind the really be of focusing on going it

we As the that also you have business some of the that the will of -- in other we by business, exceptionally exciting seen assortment the year we string next about for jewelry the to be call, of planned a have continues be part talking some launching but strong, bracelet they so next will new metal the be big on supported store initiatives initiatives too. more talk would these be will

question and is the specific to Vida it new Eric foot in the the to store in or Vera your also location? Pura on the stores store regards Bradley

I new Pura think Vida what you described is location.

Yeah.

big How Vera of shop as -- Bradley Bradley Vera is as the inside guess? far I like

I shop Vera think in and it’s a shop Bradley.

a are few We things. different testing

up. So string their a focused hundred we test was are and couple bracelets and on kind square of testing in We assortment feet metal that gave to kind Pura to Birmingham. of of Vida a best-selling a get kind

necessary tighter. get out We might and work are is One you space. they rolling to lot with need thing presentations really how about you way Pura of stores don’t can in wall square product the a great be very footage, much a additional units Vida of small those it that’s some and

all all be are collaborations but program in a not our with charity XXX we price some we it’s that speed been And to will think exciting stores. of linear factory from will space. be the whether it’s by been factory stores And a whether some But Vida of will different product, our few might of exciting is, might tested them Harry or have some be that square good stores response. stores real response our wall only Potter been we so seen buying sizes, going in XX also consumers, it then the in in in of of line a our that feet, be even just opportunity. tighter we to What’s full some our bracelet it’s full Pura a them But be test assortment. of

of our there’s of opportunity all So to going this that’s to a advantage stores. take with we some think real factory the traffic

you kind it And on attracting everything expecting next I unfortunately somewhat year or the pieces year What of almost it you what I will as the normalized year? did of the Okay. been over you all ReActive you be next, as in of other see approximately. patterns in month else. consumer you to kind it’s a ReActive, a aggressive for is know flow expected finally up But caught with of are XXXX. -- expect be guess, year, the to What had open the do have -- whole next

Yeah.

have first very into We been be sustainability. really we One to happy the that consumers messaging key of younger that have the two moving really And to right? and performance, attracted was with messaging. four There our really ReActive. were elements the ReActive customer year really seen responded

You to us. see going are

full line move have assortments platform a a We forward. made real to sustainable to as commitment our moving fabric we

happy that’s So the very we more year, with response. exciting announcements next think critically important we and been have

year more more active. we obviously, piece ReActive this seen use space. have how will lifestyle, I just more a in the stronger The to the foothold get do to active even leaning we have and continue active get was we that to casual, second and think consumer in the ReActive of be continue And

Good Thanks. Great. -- the the with holiday of luck rest holiday.

you, Eric. Thank

Thanks, Eric.

It time. appears the to questions turn remarks. to back or at I now we Wallstrom have conference this additional further any no closing would Rob like for

am Yeah. brand passionate brands powerful today’s to with much talented, devoted not are such Bradley, opportunity customers. associates, authentic, great on and for agile Thank Inc. and our lifestyle customers. company of excited I us who two lead iconic, call. Vera team the about so innovative is a have joining and you to our

customer and to in committed continual product innovation We are engagement.

focus liquidity We create to our proven are have to stakeholder committed even shareholder balance unrelenting again strong a fully and we sheet facing ESG advancing when we we that value. and Once long-term by can thrive together and and ample working have headwinds.

join We call fiscal We March stronger to Inc. emerge with Bradley, XXXX. interest for year a time hope you can company XX, for an Thank poised Vera us in and exciting you your on our end are future.

Thank today’s call. you for your This participation. concludes

disconnect. now may You