Boot Barn (BOOT) 5 Feb 192019 Q3 Earnings call transcript

Good day, everyone and welcome to the Boot Barn Holdings Incorporated Third Quarter Fiscal Year 2019 Earnings Call.

As a reminder, this call is being recorded.

Now I would like to turn the conference over to your host, Mr. Jim Watkins, Vice President, Investor Relations. Mr. ahead. go please Watkins,

of President a afternoon, Boot you XXXX Officer. Barn's days forward-looking Investor remind company's on you of Jim recording With forward-looking XX analysis Good reflect factors we and judgment number after Greg statements are a as Officer; today release Chief Hackman, actual make should earnings not joining section to reliance to me and Conroy, are be website. statements based certain end call call, discuss third of presentation today's a differ today's Financial place we Chief everyone. will the you. business. Boot you Executive for Barn's and Thank us for results results. the and Thank is of Investor expectations, on current materially call the Accordingly, the that available statements. today quarter Shortly in undue only on these A like at of as These I statements. section from on bootbarn.com. affecting Barn's Boot copy of will Relations would Boot press available may replay on Barn's website this Relations this fiscal forward-looking

Chief as the to I Officer. alter events, any Jim? disclaimer. thorough well included that forward-looking any not earnings as XXXX we will more new refer information, statements otherwise. to third and of or statements a you future as this forward-looking obligation Executive Jim Barn's update referenced discussion now uncertainties call a our SEC with of the in and is webcast, and our undertake our For disclaimer quarter to the do release, President Boot on associated with over turn result risks conference the be forward-looking made Conroy, call in the statements, whether filings fiscal regarding or to We

joining each update for our will I'll Thank review and strategic third an Greg four you financial providing a our Jim, our afternoon. us. of in of be call, of On review performance and Thank detail. more you good then initiatives. today's results quarter

will we the for your questions. Greg, Following up open call

with like business continued virtually quarter which all in in reform reflect are geographies in the increased approximately related results thrilled our we We line, product sales the each with initiatives categories. our across and them strength XX% tax helped strategic third our of driving continued major X.X% We consolidated same-store believe fuel top provide single share focus EPS with $X.XX quarter. the these high per with take digit a stores. I on to margin would in growth merchandise XXX year retail starting earnings When sales to during points update prior double-digit holiday growth. combined quarter. Strong to on growth e-commerce strong each $X.XX of of improvement results four of the in now Beginning grew in sales same-store year-over-year excluding the quarter. basis an with moment in and the drove

experienced Nearly growth in the prior we country. year was to driven the performance Texas increased Notably, in growth commercial channel growth transactions major work across with continued achieved sales The both the the our average the strong ongoing in digital same-store results our time, consecutive was product accounts The again positive maintained strong second increase same by seventh exceptionally the our basket most it very are highlighted and ladies as once of to above in in our all larger sales and categories. by deliver work double-digits quarter. as western men's work apparel the it year-over-year spread in and At success sales chain our of strength stores. period. a quarter even the pleased same-store wide grew comps followed of with direct cycled momentum in categories with the particular apparel. retail in business third boots We increase by robust contributed in which quarter an

These our and traditional attract very customers both by are the continued encouraged to each that lapsed. customer of brands and Hawx programs customer media continued Wonder had the we our work. customers both of Western, we work on of Additionally, and the three develop on brands new the new for campaigns previously marketing to West. business perspective, our to we response focus to mainly Cody James and Work efforts segments; side specific engage who a digital exclusive From have

third the a on the over X% purchasing number of quarter prior we growth same-store customers and the achieved During basis. year

opportunities Looking are our broader in-store forward and an To increase conversion and by mix effort refine messaging in reach to selling adding will focused improving experience. traffic we the also continue to audience. marketing and on an capitalize enhancing merchandising we in further on even the

prior endless aisle further brand with are they in-store find looking response tablets, to help this believe been touch we features and boot has to season. out increase to stores positive an rangefinder size. offering to capability holiday the approximately as by screen boot the type to we such of conversion. enables addition Rangefinder by In in-store customers our to style, store for called XX filter touch rolled rangefinder selector The a using will inventory a [indiscernible] tool and functionality, screen initial our

the the coming results out store the perspective, season with a to Given planful rangefinder these in intend executed roll we stores we and approach were team well. very early more operations months. extremely From to our to

our at us service so unemployment measured keep Doing in the ensure period. holiday improvement deliver service the the period. standard earlier in scores through time holiday resulted and and an incentive accelerated our we throughout finding Given customer enough developed enabled year we challenges to a customer during could low that system concern in create hiring employees help seasonal to season stayed the seasonal that our the the

to to our sales addition, closely store continue leading enabled the maintain In care while strong associates to a supply same chain while into approach we us not back room could selling weeks. keeping during on that the the of were time fuel that we taking crowding our and we focused heavy position customers. experiencing in-stock very growth floor focused ensure Christmas at selling the on This

Moving to our second it for leadership, was strengthening initiative, e-commerce quarter our tremendous a business. omni-channel our

this to this a selecting online of year-over-year double-digit eliminating hold. to store. coming inventory our their basis the be In online, increase customer to online the the the have with addition brands us In online More allows an continued an EBIT unprofitable time we profitability as take our enhance the shipped by have weeks more reduced items margin was to contributing than integration center our and channel from XXX outpost margin season. half for the sales put enhancements delivery. also EBIT combination increased serve margin low enabled We and the our our merchandise online improved perspective, exclusive from automation from able order in offer that store is that margin local expansion, pickup. penetration years and rate the we to the into that experience. we past from have and shortened From shop to to our to it the better stemmed efforts improvement These increasing two of in the order of features driven fulfillment the continue holiday customers of during to sites customers rollout points warehouse gain available currently which shopping our in-store and the picking times will to in Wichita

stores and associates. We expect this the added provide our to traffic opportunity an functionality for selling additional will increase store

also to retail where customers can recently new returns in-store We our a implemented e-commerce stores. return purchases our portal

exchanging result and the two sale bootbarn.com stores further the business digital save shoppers. this to and thirds our approximately returns in the better the process, to the a We different of during period product to improved allowing our the customer item of opportunity loyal a our store. improved provide stores this for returns believe integrates process As holiday by service associates came

Now exclusive strategic to third our brands. initiative,

brand increased total more penetration exclusive XX% of our to quarter third than the For sales.

as well James our a customer. brand by offer Brad With and Lambert base, our Work brands merchandise selling addition opportunities recent Cody legacy James we for customer Paisley further launched Idyllwind, Shyanne of and number business. our developed James grow our and to an number see to three Hawx grow cross brands, We and including by Cody to exclusive Western expanded customer assortment address Work while recently Moonshine are positioned oriented believe western four the exclusive Miranda fueled business. Idyllwind more and we Cody fashion Hawx continue work Spirit our a

exclusive high penetration brand than three our in the positive great of offering to merchandise our third-party January, to the products points Accordingly, our month to margin. expand penetration resulting branded customer exclusive quarter. to are breadth basis able we in of complement reception of true We an improved enhance developing have brand the more seen these our year-over-year. create quality of our advantage new our for the assortment By and competitive acceleration brands fourth vendors each XXX from

fourth base. expanding our initiative, our Finally, store

count Boot to new states. quarter total in bringing Barn During opened our XXX we the stores stores two XX

year. the nationally we develop continue new units current to by double presence count have store growing believe opportunity further per our XX% We and to our approximately

These to and average we a will a remain over targets open we tuck-in relative those acquisitions on a the to executed augment with market. continue us store volumes opportunity will us with our focused As to targeting XX three-year unit leverage new unique new we've development acquisitions past stores opportunistic quickly payback and higher on enter to new store capital our similar to invested new tuck-in enable months. provide we

five current weeks performance. were same-store third the our our business, our in quarter through Turning consolidated line to sales with our first quarter fourth attention of

on Our in basis. XX% stack business a have grown stores two-year January double-digits grew and

to I'd Texas Despite We our call average quarter strong the with continued is very us in now business in our to Once in rodeo objective to comp and our to particularly of promotion Hackman. quarter. confidence March. grow markets not stores the over outperform anniversary February Texas with driving fourth repeating the profitability. and our January, many solid the in distorts strength of the continue in the significantly continued important fourth online like to e-commerce increase in in a turn to again continues markets, e-commerce the season And year-over-year. we chain sales Texas business in Good Greg which same-store give success and manage our business the

Thank you, Jim. million. third net Good afternoon everyone. $XXX sales to quarter increased XX% In the

sales sales XX past the stores months. increase in contribution from As driven was and the Jim stores added from growth acquired a over sales, stores same-store mentioned, by from X.X% these

stores. buying result costs. of of and stores in prior Operating compared rate XX.X% sales price period. in gross added primarily profit at merchandise for During states. more to and increased prior the rate count full sales $XX.X compared The net basis to our in the leverage both margin costs for a acquired basis $XX.X exclusive from a occupancy of increase a as as profit year XX.X% million two or margin net quarter of XX% XXX XXX year the Gross new net increased quarter XXX profit and additional store XX in of of was basis million in sales or bringing sales growth $XX.X increased of expense XX.X% expense the in of XX $XX.X we points Merchandise gross point million expenses new of to brand period. resulted million and to end higher point the XX% Operating support quarter and result increase sales or or to penetration. the in stores net selling

as the compensation in a operating of expense a increased lowered prior As incentive in claims of the sales percentage operating from higher year year. current gain primarily insurance and a that result expense

margin. profit compares in to these XX This was we year. operating million million the income This to $X.XX or XX.X% basis XX.X% approximately than year diluted of XX leverage. $XX.X share. for quarter per share $XX points operations diluted $XX.X had expense million the or operating represents prior or quarter prior income more $X.XX the per items Net $XX.X of Excluding points of net compared basis or Income improvement net period. in was in million the in from of sales

year reform, related prior the $X.XX tax Excluding net per income $X.XX. in share diluted period was to

the to and last compared by the a sheet, XX new X% The year in balance primarily added to inventory last basis to a rose approximately driven inventory increased for $XXX compared acquired stores on Turning million X.X% store to consolidated On year. a months. inventory increase comp basis was ago.

As undrawn cash. with of $XX of million million a December XX, XXXX total and of revolver we outstanding in $XXX have our debt

Turning to XX%. full-year sales expect guidance increased growth be our outlook now XXXX, we've and for our approximately same-store fiscal to

the the to weighted We on diluted XX.X share are million from raising to EPS per of of also operations $X.XX million. full share be $X.XX million. income fiscal for of $XX our year. to $XX.X shares represents million range XXXX We now net average full-year to $X.XX an $X.XX million and share $XX.X fiscal $XX.X for based per from to This income estimated count expect between

tax As which increase net income share guidance related range income $X.XX to per prior share. diluted X% expect be the benefit per stock per we exercises. to share we $X.XX same-store look of period to per to This to fourth $X.XX in diluted share year option quarter includes and net to of of the X% compares to a sales $X.XX

like comments. some Jim turn I would back call closing Now, for the to to

Greg. Thanks

are pleased third with are the through seeing excited strength in of fourth quarter. first our the our the the business weeks we and of fiscal results momentum current quarter We are about five

look omni-channel brand capabilities end are to eager our year of continue enhance margins we exclusive the XXXX, store drive to strengthen we As and same-store growth, and through fiscal into our sales, forward increased penetration. the

success Before toward we would strong and for Barn. questions, to Boot thank for Barn like hard entire Boot team call delivering the contributions to dedication brand Thank take many open up growing your and work results. to the the you your the their of I

take open the to your call like questions. to up would I Now,

Justin?

you. Well, Instructions] question with The [Operator comes Matthew Boss JPMorgan. from first thank

Great, guys. congrats quarter a on nice

Matt. Thanks,

Matt. Thanks,

that breakdown potential behind anything moderation conservatism you traffic guess then remaining quarter can between I embedded just XQ maybe as that are in the other the the in comps and you speak trend have the to ticket seeing, So the composition time and you and than guide? you and

Sure.

comp, and by more customers, really pleased basket. the yes, of transactions Right? comp. with health we're I think more the the higher is driven It a

During about the transactions is XX% XX%. and recent was most quarter about basket

probably transactions XX/XX quarters last we're transaction. XX/XX was in and few the now For prior probably is right it it in about quarter in that to in favorable the favorable

by this sales driven more healthy a very is same-store shopping. very, growth So people

business, virtually we're so in As you the merchandise pickup category, know we've and strength of bottom do virtually every rate. overall comp than to we've that e-commerce nice margin a the but been reduced with only of focusing health while we've promotions and not our able And the in the on sort pleased top with country more really seen the the business getting across across merchandise geography, the every country, line. line almost we're

So "buy" on we we growth and get on We're comp. But online focusing more drive same-store doing really higher business. sales that. to trying of were better could not we're a sales just some the the then profitability if focusing even

and you the health gives a growth that the of on the So bit sort of comp. color of

not volume we're with February the the five to is in particularly yes our but given volume quarter, way conservatism the the sales to In like we're terms can of end into come say quarter March guide, the tied and some season – into in fourth through guide. of Texas, weeks rodeo there you key

the know back put as know out mind. number so of quarter XX year fourth rocking and You we of about that's to we'd that feel the like a in a in we're last and plus good our you

great we we look same-store are of can further As positive continue business a pretty involved strong deliver the we a last cycle I kind to and at year that number. January quarter think sales in

in we comp to the think leverage That's the from you needed is the expense maybe see next see just model here SG&A clean constraining is investments I through you quarter incremental any as that guess out? fourth flow the great. same pretty and year, to on front, And then that what's or on

et outsized incentive Bonus, little a year continues math. team be this clean than e-com higher. has EBIT relatively compensation year delivering last bit The growth, been Its and based to cetera. higher

So based see X to guidance a We leverage the that's pressure bit on of of our to been in expect X point. do a quarter.

it. about that's Great,

Thank you.

Thanks.

Baird. next Jonathan And from come with question Komp our will

wanted a following the how seeing quarter balance color just that ask too on maybe first quarter-to-date could and of things a you. us the year, Yes, trying last to color to sense of the on hi, I you started give just remind get trend you're multiyear commentary, be off thank more just little what you'll then there? just the up facing,

year much business. way the only and it actually that roughly quickest look months refunds was across the The the The dipped of is came consistent. fourth improved answer we to roughly QX, year's quarter was when months. last But the consistent at last prior business related was to February inconsistency later sales that year the tax when three throughout

on out basis the in call were I we are what we January digit the comp XX today high plus stack in from think we we're called single stores in out last and a year the two-year a As stores. called we was

last with this we're double-digit a there ahead more another of year. sales to while volume an balance quarter year and is necessarily So the comp plane inclined the ability interior again the go comp not for up is us post of thrilled double-digit from perspective. essentially it And

you just up store the just the third acceleration any, performance January relative that, that mean there any what stand geographies out? the in is categories to I can on is quarters in or pinpoint mentioned, anything you that within there following

recovery business a the January across is was the Houston. from I than guess, in actually as in chain the in quarter. Texas we've Texas than third strength the went average stronger better seen was the even quarter as the up the reminder, third business, you know, Texas against business it And

seems now the So to merchandise across working and country across essentially categories. right that's everything helped be us, but

we of about know, the underlying business. feel great you strength So

margin maybe then other And Greg. related for great. question one Okay

more ahead the about you and the and further the internally much back promotional formulate margin and in of that's some how to look quarter you opportunity recent in forward, out if in pull the promotions, the I'm projections a to the if merchandise should the as quarter wondering on is or think last that the pull Just what there? shift curious activity? Just there so mindset back trying we have expect for

are more four for right? sure the know, giving great that when delivering The to talked or discount up boots that just it Jon, mindset is incrementality this gratuitous to we meaning That not we're the a question. not three make is here and probably it's promotions shows a You about quarters, customers customer buy work shopping that day. to

a to year. this those of we so promotions a we to think the relates of XX the margin that XXX across won't our be was of pleased regular amount as it at but because expansion that basis and days is selling brand the margin, fair the brands. for in that, at increase for we we're mindset though But XXX more us points XX-day continue big points part of careful So to that improvement organization with promotions as get quarter the had the Boots the The with driver private main of like Christmas we we'll an is XXXX merchandise beginning increasing this do price penetration be exclusive an points, anniversary area time because basis opportunity. our look that off and we to our expand year were look didn’t promotions and forward prior that promotion we sale we quarter the the by are

great, perspective. guys. Okay appreciate I Thanks that

Thanks, Jon.

Jon. Thanks,

Jaffray. Peter next with And comes from question Piper the Keith

for my Bobby for actually question. Good taking [indiscernible] afternoon guys. Peter. It's Thanks

know Texas, area. a markets, the the oil Wyoming the on in a bigger focus was the few in Colorado there's of ago in but on on years oil Dakota, downturn just always First I problems lot

wondering So rolled maybe on years also I versus oil update stores from stores give where when if you standpoint those how an ago are sales was there? those based could performing, are a four

on in business. essentially the they markets the that oil So rest non-Texas, are of the quick are line is the with answer

any seen pressure haven’t we So real there.

period piece back way I that's to your at a those lot sales close high that now even back of they $XXX oil of coming came is were we're lost is you prices so and were, question, building to – of our about became have price other if if and of an the rear and extremely of they far to some at where went as frankly from thing but where an that think a worried of time, down and of in to rate sales stores volume oil it depressed it worth have stores you kind noting been their view not fall very even ail for just all not But up. near. in But store something barrel, the and to a I kind were we volume oil peak a basis volume barrel, they the price we're in think extended their second some know not the these back XXXX. $XX it's when of average

that's So way the kind thinking the of business. about we're

All the color, right, Jim. thanks for

refunds, tax and up lot will Just that and middle refunds on there tax those what of are views reports a America. followup be out for a

Just wondering a higher of position you think consumer indeed could as if tax a it you about is if beneficiary season? how refund spend strong your discuss

in news it a of not lot have has that that. been retailers on the called we're and discussion about banking out. There But other some

sales the that I into back a our to We said tax haven’t sort of built Having is, saw decent QX our share tailwind this the if our and we of you that, when we be business. customer. years later, impact absolutely additional would to went can it But refunds nice color earlier said it forecast. were couple one

think so our largest check we're would this pleased be the check tailwind incremental pretty will we'll if quite and the be be what well to I that get see if in comes customer still guiding year. does it a many business we'll that solid. and to and and they'll if nice doesn’t, So, it it that year does check entire in instances come our And get throughout is outsized

a luck this All and right good quarter. thanks great, lot

you. Thank

Thank you.

moving Chen Cowen Company. with to on And and Oliver

quarter. great you, Thank

are think as terms factor e-commerce, well. increases Regarding you be as see in the for momentum What and market the growth nice some in you opportunity, anniversaring opportunity there traffic the to and of profitability, in of that you terms just about factors happening momentum the driving your that spoke versus you'll traffic do profitability And on with driving up about what is in drivers inning you are we compares the as love as keeping toughen? view online well? also you

very positive a good beginning rate. to So starting of Yes, think spend. look to stronger cycle our I still numbers eroding EBIT cycled business it's will profitability. a and return overall at pricing at e-commerce double-digit we business continuing We're EBIT year Even In the as comp to right? e-commerce those we're numbers are solid question. improvement in really on actually and course. the January, We're looking so cycle that some a and third last focus with e-commerce we to quarter slower negative, comped in on strong margin pretty we're for some comp. continuing ad on strong We're items site posted

do really of holiday months something. the and about spend of can the this tweaking the and is, quarter remixing or quarter pit that a brand accelerator through didn’t what We fiscal non-brand. We the to bottom day-to-day down ago. for during cheese the top I Black in first I We pit Friday of And second are next on there. and business the and going their way it's looking the what the more on six to splits the are year. And door I'd we'll of is, quarter what about EBIT our in, focus half – at through profitability continue unprofitable constant inning, this just say and we're Monday that - and driving out And sales. fourth we're of return continue started Cyber and selling, inning and pressed terms as the ad items what how or think

healthy business chasing a unprofitable lot on healthy for I of and credit to team really So that e-commerce focusing not growth give and a growth. of sort

or And has thinking as you of in are ahead? year where success go found should more label inventory you a and about next helped private planning changes formed in so and lot label about optimism product and the private as well how that

a very question Oliver. It’s true

or been the with boots James quite the always businesses side the an last launch might few pleased years. up of apparel to January's X.X of points the was and two and brands the in we've are of is bit of where brand of called Hawx been they harder that and over exclusive brand Hawx boots wear receptivity a the seen the And we customer boots. Cody in work conventional work launch those it switch work improvement brands and work of really had little business. do be had we've either to penetration a nice over pick that out The which new our is acceleration from We with to they to have whatever on work wisdom course new core worn tried

brand demonstrated and to entering be So I brands Boot the the that, period of to customers of brand would buying work want and would Having customer new a we I Hawx is on a for bit given for that our exclusive opportunity first said more in forward. party work perhaps going the do new vendors we're for time. there will a getting time think while our branded is ensure long the third we've continue rely business that majority to a early receptive that that fact

to brands minimized continue to is. the and removed our bigger but that from important there the the will us tertiary to extremely Barn be be Boot house of So vendors to of some stores, or some shipments maybe brands of continue grow in

Thank having about know techniques that's of you, strategy in segmentation should thoughts and in terms online? driving as are traffic What terms that last the what in as and you've your and we question, impact quite and been advanced. the on some of well stores of are marketing transactions using the

sort cases married analytics to some more our Look, a more far specific customers ways science the meaningful three creative opportunity of gotten, these group you communicate us in for they to we've And of capability back. years the much a and have one We CRM have thus and them with helped think business developed of I a that. to what think we segments us of the better need than single are interested one. at one signed will belong helped can and to every customers taken essentially in of customer up we've we that and get couple while our has and of in, I absolutely I different into think art that

So to from continue develop That standpoint more new seeing far through direct team test advanced how a will the take we continue social. and learn to sophistication we in email we can it. capability, our to and continue using analytics further to and mail and targeting techniques push

Thanks best regards. and

Thank you.

from And our Janine with Stichter comes next question Jefferies.

congrats Hi, on the quarter.

Thank you.

you. Thank

same-store I and customers thoughts I if you be of that that that customers from? in what number you that, some said dig there the interested that I'm X% a give might you think on to purchasing, little of be just maybe bit to customers you can increase driving number if where quoted, customer in sense coming want think any prior any new then are how compares versus of might last? that have quarters? seeing that new you And is much sense how a

questions. beautiful are those Okay,

it shopped Barn haven't now. brand in And several So that new we've now is out, which but trialing well have same-store think really seen as customers five growth I as customers quarters, with it over customers is pieces, past two the new on had Boot and is that us an back. the come the basis in row a we split increase in net last quarters

probably is, attribute that what two think different to things. I

you whatever we've assortment, had the than anything If a I Boot customer the and Barn of but and reason the changed lapsed, the past that look merchandising into creative our changed Barn we've and to in marketing think the and Boot were back for customer bring probably changed feel reawakened we've in-store we've and more store.

direct to her already shifted plus strategy million does customers, only social X of away Idyllwind to merchandize store, in media to Instagram database and I equal our Boot what muscle or we've with new Miranda radio the or little In a we terms the product comes to brand customers go conjunction introduce performer that television fans she is new that's works customers are think whether a that to of our like brand the on the the spending marketing bring from and her bit the that is money that line with in in type our broadcast X into more and followers have brand. doing the Facebook also own awareness followers mail, it's launch what marketing million clearly Lambert, are mix going in see that and like to and by thrilled countless concert. Barn Miranda And

merchandise brand strategy go both a coordinated and standpoint partnership very standpoint. from a after to marketing a it's So new customers, from

is what there And are right, then the attachment in-store the the just sale be I returns to do rate how in-store being have returns the saved coming any said All that's you think of helpful. returned can and of two by versus now on online? sense the often thirds you stores,

other out, anecdotally. we we're question get fantastic and we than excited that back for returns the haven't yet rolled the reason POS. is portal answer is while And very the a that to connected it to don't It's we're able quick

X, it's comes by of point if in store. with very a we back them show bootbarn.com's assortment see are take a Z in back buy to that trying to of return So dial A or clarification, same-store months the stores. Those in few at they come return for sales back total by we in returns the incented at grow store, to us Y, percentage e-commerce are they from guys quoted the business. and going see their customer to not the into of fact they're the store was around nature the thrilled up the when turn business, also their before minor in can that another the if them of a and virtue coming just customer

and business the that. We a of where return the the we to haven't it, fully haven't store but point brought walk-in in with we'd they the course they product probably if e-commerce return customer Sheplers' to can marketed allow

the is half was at of was business really which So it bootbarn.com quoted the roughly business. that is, e-commerce the statistic

That’s great. you very Thank much.

will Citi. next come with the question Operator from you. Lejuez Thank And Paul

missed the you times Hey, thanks maybe as guys. lead sales you on places now? felt quarter, actually were inventory, I'm private any where right also curious I'm light little during holiday you business if there you you curious running label were that and a grow on the are

on question. online, the sales which we very grow away definitely I we And the your planned on that earnings don't so is table miss left – profitable in really demand effort we spirit turn the did of to think fully

back inventory, brands party the our the those stepped other we that pretty the because changed slower around as were the writing I one lead meaningful a we the team, our think we our overseas, In into get and quickly so for and the was and as a merchants was started that Probably were quarter. positioned than that to some ironically third the but little think models, of September change domestic holiday replenishment warehouses country. up brands build in, erosion. areas source October as our replenishing bit of and in I well sales inventory we own terms we'd don't area have orders planning was really product couldn't time

orders quotient May six we chain be from supply to second and product can but development writing or Work we brand when brand to working we're warehouse. have our investing more months months change current a the of with the bit Cody little Idyllwind product a the three but manage pretty our admittedly is standpoint a most we're store. of that it and we of terms of In fashion will question businesses really a basic work of exclusive a an in James Cody forward, your Hawx, of traditional the orders, going about of write assortment, calendar has our terms think chain fashion So right? it, the in frankly James, year to that in supply pretty where the bit we part we're out, you Western, we're bringing in in. on out more store positioned fourths into well expand and it it couple into get not we before month get the we exclusive are bit where product that any And we more a get little risk the taking capacity, a for before a Shyanne

your helps that question. answer hopefully to So,

definitely real you top I'm which question, were year, would had Yes, one a the choose certain comp product if as you of had marketing what then call you certain if bigger this at comp, strong the drivers just, when you guys primary campaign, product a of that to the look launch, of hit and category, curious the biggest and the macro, back to kind few year what out drivers picture this XX% of performance kind business are pick between regions three? and just

new Sure, probably brands for, not our it better, work work every the customers, still life every bit is out bringing virtually that – going by little of the work I the is the I underlying the the There's the thing is business within our is so probably one marketing, guess embracing strong. work business category looking brands continual a working was little a through really but is to has a that boots and geography talk stripped to how if the thing. bit out we couldn't apparel, the exclusive driver work any single stores merchandize answer marketing, is that of business life creative I team better, training. about been the the that new to Texas you're a pretty ahead, in-store but merchants and and learning not team is the bringing bit but really segmentation going virtually concert, but segmentation Texas ahead, it mean, stripped by we of part find entire driven to analytics in

So our for given have to baseball flywheel we'll direction pulling and on it's of analogy half the and whole same it's just fence coming singles where a that swung had thing to back team and the a of and sort it's doubles comp. in series just, it's frankly amount we of proverbial earlier continue haven't to the any the

Good luck. Great, thanks guys.

Paul. Thanks,

And moving on William Blair. to Carden Dylan with

from Thank hey you. are - how to I just follow want up you?

Hey Dylan.

on update in follow on just want now to likely here a model of leverage that see the of it online of deceleration? inventory penetration profitable a us sort the you as level, some sort period the a of of presumably helped be more an from seems Just to steady lot change you standpoint of just the management some in efficiencies higher at business, box. Can functionalities comp ahead of particularly state point the in prior up there question, new

assumption That's a a end there Dylan. at Sure. heck the of

You way, bluff don’t have to just by personal. the that

thinking points Dylan, XX% about long algorithm that term to grow year are and for X.X% next not of guidance in kind we’re we're those SG&A occupancy and we X.X% continue for process. roughly way that's budgeting as term to is long giving kind still while of the leverage that our range, believe units that's we our planning X% or initial

may, applications you there do sort and final if and more markets enter tuck-in so margin do the as a opportunities that? these or of presumably run one tuck-in and of acquisitions, these just then new mature and through broadly are are comp doing sort as comp more is of the anticipate but as probably you I if more margins Okay are higher you you more even acquisitions what given kind

very continue the tuck-in do we we We've been the completed that Yes, the XX over three to contemplate call pleased months. it acquisitions. with last

we've from of and will in may Tulsa growth had dry turned volume. two in so size nice our the not are Star said the are gotten Metroplex a getting that be is stores. There You're so since right Lone to to area them They they has mature in big benefit Having that, sales assortment. very have volume really product three-store acceleration. kind the sales higher chain stores, in same which the Dallas same-store of

when profile as we how see typically improve we And deep so, our business that We with the that depends that chain as a do et the we're that were can't [ph] put I'm margin kind sure point grow we of new not on acquiring organic they into merchandised, cetera. and builds, model. significantly

adds allows be more to to our little would stores Our when staffing the penetration the a have we higher and private the typically efficient resonate brands well merchandise bit model us and margin, volumes get again labor. that with up

we way to store nice are doubling count. So tuck-in our approach think the a acquisitions that

Excellent. taking Thank for you very my questions. much

Thank you.

Thank you.

Wells on moving with Nikic Fargo. Tom And to

Hey everybody, thanks for taking my question.

public we forward Just of debt go cash like base, much like sheet, you dividend that taking quarter use free about financials building so flow. about of of about the some at give think something forward an or something the going at your if cash. we should $XX can paid balance besides far cash you've a are down, use million as back had will the maybe else that eventually, or be us go should pretty you nice the store How just up just the think that just idea helpful? cash you've generating the but Thanks. buyback believe, I got end ever look don't clearly the and

but and debt we to opportunities a loan cash term at of the an We continue use quarter that's where a liquidity aside of and artificially growth than pay cash But organic the down we're unit to want bit down buying low sure probably do end more maintain We've why build look to to you're we'll outlay opportunity a could the we Yes, growth we initially. may debt. build sheet, to de-lever. get because the point, seeing and the to the at million refinance want X continue plan X.X paid we this at of little below that's to $XX Tom. generated we that to year the this continue to haven't business cash leverage going said the from be unit involve point, our point were continue lot cash balance XX% again at that the to and on we've out and

Yes, luck thanks and guys, season. rodeo this helpful that's good

Thank you, Tom.

you. Thank

And next our with question Pivotal Mitch come from Research. Kummetz will

Yes, for taking questions. my thanks

above Texas while comp? than has for average below to inflection could average occurred, that us Texas been now, running when remind when better a went average little So, you from

you If X straight minus four went quarters. for essentially was back to Texas 'XX fiscal

it 'XX better been we quarter think since. into As every than and I company got positive has of first turned single quarter average the fiscal

finger comp, the Okay, average wondering else anything you so there of your guys? the specific just to it on? that's can well average Texas in there or recent I'm and quarters is of you what just put been comping employment balance Is something against is in you make has kind comp the obviously working above above oil do comp Texas for producing that's that,

I think dynamic we've across that seen country. the

very a and X. was bit in of their depressed about high everyday in a competitor. up they yes I promotional negative past Sheplers over to think Texas low barn of biggest from how that low And of years pulling market of certainly kind years it with the fiscal couple enhanced compete and now and gotten pricing more we've Boot typical it's strategy typically oil, it we We've the since priced of business few the and in we last because part that most into probably strong that 'XX I a are think going the little that to lot part again a is and have the learned Texas it's acquisition Western to cycled is, view. have so point

forward business there. we've more and So I the think in capable continued to more get knowledgeable driving

the that to to curious at just back instructive you comp the getting Got it guide the we at year's your an add as XX% look If the it beyond and for X. then fourth quarter? last QX midpoint. QX, X on I'm comp how I'm that to is stack points kind think the, of I to X on business

could an stack? mean, how you two-year far Do you extrapolate XX

just at to that. now so couldn’t business trend there's I'm quarter. your if something level at if your stack mean Well, want I about that that wondering XX if you the is the unusual that any mean and reason to the is midpoint two-year or XX accelerated looking there beyond think you've at answer I you're - and

a long over quarters company the for the think XX last an averaged X% has I Yes, period of comp. time

at stack but for quarter X So two-year it would a X years. XX% forever of that every been hasn’t least be

most can were you XX.X we quarters. as I off fiscal at started forward two recent in this we think Going year think first XX.X about the and

proven a and far would few a have I first entire for put think we I stack us of recently, I high quarter, top for comp quarters having here, that, we're had a on before the is guide the two-year could do, ability banking to management guide that an a of most XX here ability in out my providing comp has have those - from plus that team of its and got So be but year for XX. for company got some everybody But frankly said years. but on to certainly

upcoming quarters the trepidation comp we and consolidated top against we our on by to be think And of growth. are with I comp So, we're forward e-commerce, don't strong. look mean some growth can even degree we so I that the great at doing can't that frankly, that with we restraining that are get I work on

right, Got it, all very that's guys. luck. helpful. Good Thanks

Thank you.

the additional session. conference for conclude question-and-answer to any And does you remarks. turn over I’ll back the that now

quarter joining call. today. earnings Take our Thank with for fourth you on to We look you care. the speaking call forward everyone

wonderful Well, day. Have today’s participation. That does Thank call. thank you you. a conclude conference for your