Boot Barn (BOOT) 16 May 192019 Q4 Earnings call transcript

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

As a reminder, this call is being recorded.

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

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

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

for going call, the strategic everyone, annual call. the Thank quarter an and highlights for this our results; we've the you, XXXX four fiscal will was discuss Jim, year our afternoon. and joining outstanding I'm Fiscal including today's initiatives. to us In then Thank then you, good our made performance of the results progress of Greg XXXX on Barn. each executing and of outline review walk through recent financial outlook. our fourth details Boot

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

for EBIT double-digit year. with the growth the merchandise XX% up merchandise comping increased by XXX X.X%. full-year, up basis set stores points, for results better margins time, the driven exceeded retail XXX sales we nearly brand and at growth margin Looking The margin same full to At Consolidated point price e-commerce EBIT significant the X.X%, increased selling XX%, our same-store expectations initially comps combination business. penetration. XX.X% achieving expansion of helped topline exclusive in and fuel in increase the and growth basis

year. We cycling the recently more Looking same-store quarter sales last QX in a quarter, well. during at increase business XX.X% fourth finished the the growth extremely achieved across year despite of we the fourth

quarter, gains. sales consolidated categories same-store product X.X% and geographies with posting the For increased major all

the Similar on terms same-store as margin retail basis with improvement sales, strength the fourth quarter our consecutive profit from throughout progress combined spend will environment improving the minutes same-store E-commerce believe business. I points in drove for a sales in EBIT increase the fiscal solid our initiatives few we now In and contributed a of XXXX. economic with the our same-store significant XX% steadfast the performance coupled positive in that store of to our strategic of quarter for a full-year improved our channels, sales XXX in to with contribution increased in remained improvement our X.X%, digital our comps. reviewing quarter. of eighth on X.X% merchandise focused the executing profitability, tailwinds a focus organization's We our we the plans strong made performance, year.

with same-store begin growth. driving Let's sales

strong several space perspective, categories to X.X% media store key apparel. than We investments basis. basis. reengaging account the of to field scores. From western once the same-store strategy, we new contributed merchandising the and faster XX% segmentation both and to The in the addition quarter an drive by resulted both strategies hats grew marketing inventory a store this apparel fourth on a With accelerating in growing our as attracting two-year in again, traffic same-store customer in sales quarter. followed mix, in increase believe respect new result continue to a store upgraded operations sales the comp ladies officially perspective, aesthetic product to to and initiatives. customer brand, increase and customer boots, selling to The plan reallocation delivered stack year-over-year, a particular and again of ongoing we exclusive saw to refinement a service labor more On the lapsed customer our our these strength improve quarter, on Our by service a continue major performance customers work customers. store and that our during businesses great hours marketing, improvement evidenced upon all brands, creative grew and in and with work retail categories merchandising by

us look in individual our each we even more fiscal we segmentation in to to enable can plan relevant our improvements additional to customer. communication forward to As that become XXXX, make

Wonderwest our evolve broader both with ranges new variety. digital and greater further assortments styles, to Work continue Accordingly, marketing materials their will improve our size with on merchandise emphasis traditional, and merchants an and Western, We the customers.

in apparel continue expand growing work stores of boot to the footprint our and part As the we expanding demand. this, work merchandise offering by the our meet of will to work

industry traffic process. and position sales in continue to training the for input our we and the store the service well encourage maintain and product purchase as in education store our Finally, all continue to assistance customer as add to to of associates authoritative seeking

second our represents also the our stack leadership. our improving resulted omni-channel In more channel growth and channel Once which sales focused than same-store efforts initiative, have EBIT XX% in business, two-year to e-commerce sales rate. strengthening our online on in profitability storage the basis. fourth quarter, on similar recent of meaningful in again, a grew X.X%, our Moving have to expansion our

inventory has us the common to efficiently. we've Over fulfillment integration fulfillment site each implemented the on consolidating years, operate our the of platform This Wichita, upgraded our our e-commerce to omni-channel center couple past sites e-commerce enabled initiatives, including into of several an of Kansas. a more of for while business in

progress a compelling, experience inside make great Additionally, stores. our digital retail to incorporating we continue

past years, Over digital in-store our several the we've innovations couple in-store. of augmented for shopping experience

navigate to their by store touchscreen need meets immediately today, example, or store, can their and For some our specific already in a in-store that assortment and And on item residing pickup. a for item can functional an select cannot browse their for requirements the reason, and shipped our the satisfied customer to rangefinder help to then, to capability web be they inventory house the toggle have preferences. that

our in Lastly, closing returns of online omni-channel experience. retail purchases on for the fully we now accept loop can stores, seamlessly the all

to a continue of platforms to plan our forward online to create merchandising shopping Looking e-commerce better XXXX, the and improve to we fiscal site experience. functionality

As which websites, for flexibility efforts, will our create options these customers. more adding part our of we're payment to alternative

more business in recently allow BXB our our coming accounts launched customers we large-scale leverage our developed also will e-commerce We platform access to business-to-business enhance and the commercial weeks, to this work better business. basis. the addition us will website a We national of our for on believe site

brands. Now to our third initiative, strategic exclusive

penetration exclusive more to of sales, compared our than basis For increase an brand the the total reached points quarter, fourth XX.X% period. XXX when prior-year of

by XX.X% fiscal exciting exclusive XXXX. year our sales Fiscal Cody compared James work. of This growth Lambert, and Miranda past Hawx with exclusive fall, brands brands For in of an XXXX the XX.X% launched full-year, we business. in total represented was Idyllwind

brands Cody which the and is led by Shyanne have are to growth of will in continue and brands drive brands positive each We largest James of selling fourth to exclusive exciting and our great our These sales quarter brand and we the five our brands, in exclusive two to both contributed in the these believe top new which growth seen to additions Company. margin. portfolio, receptivity

fiscal to only excited Looking all depth our expand of exclusive our growth have exclusive of we store brands, to our styles, in additional we to are not in drive brands brands, ability overall inventory but count. ahead the XXXX, new plan about of and breadth three

high-quality We our on merchandise that this area will focus brand. our assortment producing supplements the third-party from invest continue to in with

initiative, our Finally, fourth our store base. expanding

we quarter, Boot fourth six total opened our to stores. the bringing count Barn stores, new XXX During

in stores addition now the have of we stores With Mississippi and Barn in XX states. Virginia, Boot

and fiscal stores XXXX, we full-year, expand new plan new stores including to to We the five we combination stores. and payback tuck-in will on stores, year the Barn of added can believe XXX by units XX better. acquired market development Boot quickly we will XX% in and nationwide XX grow organic our through tuck-in acquisitions. us growth We remain to a or acquisitions continue a and new enable enter augmenting new opportunistic with store to target focused three-year For

of are of the we with our consolidated attention very X.X%. point quarter be sales growth the business now continues Turning to current quarter-to-date halfway first to our same-store fiscal at business, strong and

Once with categories. in continuing merchandise their is same-store margin with and far on better foot sales negative growth in and a topline In merchandise and performance, continued e-commerce Our result quarter-to-date quarter. with exclusive in line price basis. seeing our geographies the outperform growth achieve business to XX% across we're growth growth, again, we contrast, selling broad-based are brand penetration. Along virtually of solid stores retail a as the performance thus to are tracking fourth nearly quarter all

of business month the QX that turned positive by modest and roughly balance back reference, anomaly, to for that our growth the of rate April. expect last business has in XX% we of very e-commerce e-commerce was driven comp a a the quarter. to For partly continue year After the during strong, cycling

I from responsibility, source you some fiscal direct brand a we develop of is XX% two-thirds topical of exclusive XXXX tariffs. the like comes Greg, our think approximately Of the call on commentary our merchandise, was some China. when perspective, and give to moment. or subject I'd at approximately Before which we turn goods, those – approximately sales. provide to Certainly, over To only

additional to and any An would from XX% sourced factories Having a So merchandise. vendors. XX% that absorb the our about through portion total of our our functional of us like Greg our from Hackman. nature said direct of we vendor cover and given is that over China increases of could at pass-along is any business would expect tariffs. We I categories our much for least would passed And our our additional modest responsibility partners. their most believe somewhat third-party to turn price to business, only vendors that, of of costs non-discretionary we the incremental to call now

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

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

better per primarily income of in X.X% due sales was an fourth the quarter. XX% points XX.X% return our prior-year increased the $XX.X to full-year margin The was was projection tax support or than million the was XX.X% improvement new $XX.X tax XX.X% period to as million the for gross from benefited sales increase rate $X.X of $XX.X million $X.XX sales in million margin. margin quarter per of period. both or over increase year basis increased XXX The the related and income was new primarily expense tax at million tax we $X.X from of diluted expense Income rate X.X% price rate in quarter, period. compared sales compared six was in on the income XX we in rate in buying XXX from Income During the includes selling, of full result Operating sales of a or or result $XX.X a of option a and prior compared cost share tax points in sales point Operating tax expense provision the the increase Gross profit tax stock benefit and and for year in quarter, brand additional year in in the XX.X% of full-year occupancy. lower a year expense added states. or adjustment. stores, Net $X.XX share growth diluted a The XX.X% of of the rate XX% to acquired expenses projected XXX options. end of of period compared XX% shrink. in or penetration prior higher the current prior-year to sales fourth of to in effective stock million adjustment. Net $X.XX to million expense Merchandise as our lower Net prior $XX.X quarter the of stores. exclusive to increased in the XX% $XX.X million merchandise period. to as return lower basis share This for to to to of bringing $XXX,XXX in in income year to to of the profit quarter exercises. compared store provision stores from per per period, profit includes operations of leverage or exercise count XX related resulted of in $X.X the operating or share period. point basis resulting million basis represents and from prior gross XXX $X.XX

supports increased store primarily a the balance acquired in program. rose the new increase compared an purchase months which basis, X% stores inventory at to Turning sheet. our XX% $XXX full the our compared and container was last for inventory by distribution million basis last On to approximately a a and in to XX The inventory year-ago. driven year. Inventory Fontana brands to increase on exclusive added and comp center, consolidated

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

X.X. the debt end net of was at the year Our fiscal ratio leverage

for outlook fiscal our XXXX. to Turning

our of high on full same-store to guidance sales based fiscal X% to grow rate to the expect per per The of and range with for end tax estimated share per of fiscal share year XX% of our diluted XXXX fiscal earnings XXXX million share weighted range shares normalizing XX.X%. the share XX.X when be growth earnings represents approximately $X.XX estimated in year. in $X.XX We an average count

is million expected Our income million. operations $XX.X between from and $XX.X to be

We and fiscal net between million for income expect to XXXX $XX.X be million. $XX

be million million. expense million our be $XX to $XX and between expect approximately interest expenditures We $XX.X to capital and

per the look sales income As $X.XX X% and quarter, the increase net expect diluted first approximately in per to to of we we to same-store range share. share to $X.XX be

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

us. XXXX a fantastic Fiscal was year Greg. Thanks, for

XXXX. have pleased very momentum are as the We with we moved into

to exclusive excited new brands sales, drive very are We to expand strengthen continue about our the our grow omni-channel opportunities footprint experience, and ahead same-store national through unit growth.

sincerely the Before to take would fiscal in your XXXX. call we open to Boot up questions, I Barn the entire their execution thank for organization and like commitment

we result a dedication Barn grow and a further Boot your year delivered and develop tremendous efforts and of results. As brand, had to the great

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

first go [Operator Instructions] We'll with JPMorgan. Matthew to Boss

the Thanks and great continued congrats on and a guys. quarter momentum,

Thanks Matt.

Thank you, Matt.

And the same-store it current break you to the is run seeing gas a your Jim, in more Or Just you strength historical specific upside sales to you X% or you you there to this are both? of performance to you're rate, as and do more X% a markets? regions contributed what sense initiatives mature company’s company's down attribute So attribute maybe how and relative though. oil out of do seeing the – macro? combination what strength just

same-store a long-term low-to-mid to recalibrate, and just Well, have our from sales to like algorithm we guided Sure. perspective.

Candidly, back we've what I X.X% think you're outperformed that's right. to, to harkening the number X%. that

a and the low-to-mid exclusive constantly around growth and about Getting to an back oil your is years, to margin attribute right. to I single-digit is Employment third have nine of the algorithm, expansion strong. everybody unit macro, averaged darn portion, of through The plus some or maybe to move For brand. to and X% high. we've think a we near is though, all-time performance at the we look, question XX% root comps pretty which tried industry

think But the got guys well. a we've I So executed and there do looking our of products. buying people lot allowing company has out

very the been focusing We made that's to traffic. from mean customers, transactions change and healthy in two-year uptake is new center that four our people more to things those brand nice accelerate the got it's more higher our has keep day our same-store harp seen promotions, customers. of on about on QX mean And brand at be XX% X,XXX aesthetic the so XX% break a with and more initiatives. can into it. the think do more impeccable. really strategy are media plus were increase feel we're trying it's plus customers, the margins. our QX We've the our our working simple us. from to think We've we I the the a – got and less lot support the strategic segmentation and can new plus great standpoint, continue have there brought to brand mix that XXX you to based And kind I and people to or sales And four lapsed two-year that for I I stack so in creative a questions has so to roughly fourth a free we've in XX% up field, we think, and is, every just folks store because bump out from there Barn, And quarter. opened on of from back customers I Boot up have some able stack? execution or

place longwinded think more portion and of focus time. quite for to question, to of that on of it I answer bit half but a in your So execution it the a is continuing think we've and than is macro a I – had little some strategies

year good been historically about we half think the leverage. about it’s X.X% on – nuances I a first I point think the this should X% expense the then to be how for year just And front, the to aware? second for leverage comp needed of SG&A Great. versus That’s between And and any answer. guess

Matt, merchandise it’s really expansion growth. Greg. bit was had of topline a in strong of Good really growth a strong question. Last of year year, terms fiscal we investment XXXX and

so back And SG&A. we invested in into and into some back respects, the business

algorithm to X%. XXXX, rate our X.X% – same look kind we of expect achieve leverage we long-term to of to As fiscal that estimated

our count leverage our You get or design X% brand this both it X.X% with exclusive seeing And a on a product X% that's more some even getting and development roughly or that occupancy couple store at in of leverage leverage investment and year driving as the penetration. that and result buying EBIT X.X%. to expanding continued or operating margin you

it. Got Best luck. of

very you much. Thank

Thank you.

we’ll Baird. next to And go with Komp Jonathan

out called I you. little think how unique. you're comparisons, business. more be how insights thank comparisons want you about curious when for share you versus sales ask few you I on just Hi, the for overall seeing you'd bit impact about which Yes. was margins think the be April, to will to and the the any a that And really specifically. profitability if e-commerce then about the next channel, improvement I’d But know the channel? do that quarters willing

Good question. Okay.

So I of bit e-commerce on two cities. business. a with I'd a start tale of the it, guess

brand investing we It's the of higher get been about Our our customer. strong. in. course great we're extremely bootbarn.com a omni-channel lifetime has that, we feel And where the from value brand that's

the conscious, least about of Most traffic buying a is seeing current to way business think strategic grow kind And from you're time. disappointing, to of of business is that paper every and the bootbarn.com then quarter. customer this click. while the a is really financial in on e-commerce because it part coming seen customer. is business, of this from profitable kind we’re piece nearly probably erosion dig where the – softness bit sheplers.com our the all of we price including continued the nicely, And a a is perspective most And perspective, the we from in of the it, when business. it's in has little we've of the So non-loyal

I per a kind have chase perspective. profitability click be our from spending the moderated our EBIT our we to increasing you customers to business spending of spending to and a rather a paper give not eroding. traffic From on So would taken we contribution? We've increased an standpoint, Greg click decision our seen increase continue of kind topline keep little than strategic to EBIT a in drive the of bit some cost because of can think perspective, part that from the color just

the in profitability Yes. business that. We stores we nice a That saw work is continue QX try our less and still and do of really profitability toward e-commerce we to to improvement to business. continue year-over-year than improving profitable in

to comparative it last going we sense improvement profitability tougher it to on As outsized it makes marginal, because work will won't grow show But a I relates started that QX focus profitable to in to think do doesn't we're business, QX. we and to where be that. sales, year continue

a as you when maybe implies less just the And follow-up, start Great. work sales last so Okay. to that think initial I difficult. year, the comparison cycle is

back even So you to to what not come as expect do rate of profit comps seen? might the improvement you've same what the start though be the

more work Yes, that the of John, starts, May started year. beginning in in that I for last QX. We us think probably

in comp about, in the XX So April. e-com up were Jim against talked last we plus year

that We hurt year. same-store started sales the it work. And haven't last started that work, a we so bit performance

in think plus on quarterly, QX. XX-ish the still I we're

take business So we'll the hurt and completely, softer June. bit it May a have but and so it little didn't during did compares

relates the outlook the really Okay, question then great. to my And other year. for

how line outlook, So in the targeting of or downside an thinking range, you're right if of upside you just for in that at embedded you're guidance, meaningful your profitability your underlying growth that you're the the XX% opportunities high and takes end earnings ongoing see at basis. the kind any look guidance? so puts there's you comps and the I'm with about just wondering, the just towards pointing end on typical as rate what's high of or

good question. a No. It's

put the XX% of of I signaling I more top did year that XX% earnings we're out or think growth feel guidance earnings we think there, about we growth. a on we good

about of chance period and was new a in In a there we in today's economy, between about which from of takes, brands start a short taking from know, pretty there confirmation bit store terms have a for calls to strong the are new for an three our and industry feel growth, job three commented, call, of great and three share are XXXX. puts organization out look, the standpoint, like question perspective, and to root in cetera. When I new think brands relatively have standpoint, an last a internal et opportunity strength But out we think comps, always competitive execution of But an We've we taken is we from you exclusive year. stores on year. stores expand. set tariffs, less about the continued another in off launched honestly, the and had readiness growth, brands, We've as new building fiscal we're in well, more couple up there promotions. new our last those customers, standpoint, each healthy

XX stores been approximately them As of to Greg XX we grow and mentioned, have expect identified. already new

and is feel we like the across of pieces So that each conservative. we the putting number are guidance out we'd of that about think great different the execution to business our

all for Thanks perspective. the Great. Okay.

Jaffray. Piper with Keith Peter to next go we'll And

– anticipate appreciate tie you regards Hi. out, around would on bow Thanks but impact you framing guys. that on it, to maybe I results? well minimal you Obviously, as the the my I I a want guess how just financial the great on to commentary. overall that would results. up, shake tariffs to just And say with that congrats tariff follow-up

Yes.

One it's of I we mean import responsible alternative through we're are further – we a comes the China perspectives, looking of that for that admittedly, that we think couple and part to I just risk. different suppose. sources and about I mitigate specifically brands from when portion think at so. is exclusive

our from well. course, partners of a with are problem similar as all Of met We they them. China bringing as vendor with in

that are vendor alternative our of major source. months. of all the had got with we've for places chain. top-to-top, to last in "meetings" fact their I the partners at to do source believe opportunity pushing And China if their of back them factories couple and looking there's in efficiencies In And all them for of that looking some continue even they supply through product more to

passed guys are we customers, Peter, right? the So work the men's of vendors that So and to can functional cost us. our being working is get proportion, the along well steel a a bear lot along in right? and are part pass the boots, as of know, product product, claim it it's spend. really western used apparel believe most and work resistant does And you nature, We of in to factories can actually, toe discretionary by that outside and our not

pass tariff And it retail along price entire $XXX us, believe that about of we that to on be to is that So to what more If – our customer. up boot tariff maybe along retail, a of we color would to on the framing looks a we that $XXX. to most along cost on like to likely would whatever of portion the able of that go it terms costs up would a in piece passed one boots. pass pair customer a of get

So we'd relatively if along, we cost But rather for for sell. what do I not that. hope obviously be to that away entire we entirely. to non-discretionary most have goes the it's think of to increase pass modest this product had tends We even a

just feedback. business. And good the maybe commercial pivoting to and helpful very That’s Okay.

you're has of percent of for how late. where sales year, maybe maybe Could total So this launching BXB interesting as you website. growing and it should past been us an add that give commercial as efforts a update your on that a business

Sure.

because force. that of doors, leads – oftentimes, And to of training them our accounts commercial that crew. an broader equipping to of get that want is part and we've speak, standpoint our kind organization key, are we for and just looking been or BXB a an on in whole work stores got people new or store part a of crew are a Part or work they now, six of discussion accounts. sales engage And seven the boots. knocking really into trying in. outfit walk if We've to has can people to more direct identify to that Our investing we area is find apparel, see a help where been business so from

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bigger even particular sales national our their with I the their companies stumbling perhaps in and is and of the way block taking after landing with of the current of And their that proposition, and way subsidize more blocks we care bigger we once will going that their an even additional electronic team, programs think accounts they stores. had One commercial voucher from we've don't only selling or dealing handcuff accounts. the to accounts purchases have have success eliminate much stumbling in they business of accounts

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luck Thanks and coming good. Very so much, good year. this

Thank you, Peter.

Thank you.

Company. Cowen Oliver Chen and to We’ll go next with

Hi, great results.

Hi, Oliver. Thank you.

the and your opportunity as of see and love both full in price you going on do What impressive. hear you're would of segmented just terms of forward in react? also read they're engage the been how not techniques selling? how and in being to private of the that's brand margins, you. maximization to positioning level right Thank inventory cannibalizing brands terms Also the thoughts inventory and thinking merchandise also management management Regarding test, about and

first take price I management So parts inventory of and two opportunity selling. full that, the for can the

inventories been years. We are they've fiscal last of with cleaner XXXX exiting our couple the than

that. and we're from positioned really content with pleased well really So a perspective we're

selling, the the are talk we is or how over one that even we price going to customer. place that in that, that continue control at the a price, the full those full sales clearance were about of promotions promotions. at of of talked And to look days terms of done and we XX% clearer with fact split And we’ve when the about of to look In we between have at promotion. terms kind balance to opportunities level reduce

negative a that haven't we've the impact in past. seen done We and

we'll So on lever. pull to that continue

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core From the ladies standpoint, take those customer of I a dimension, you brand put customer legacy think, strategically, boxes, new private And each in brands, a customer, six Oliver. your the men’s, segmentation think right. three versus about if work. sort put about we can on other pretty I brands think and of different we've and bases, we brand together a on different second piece

go biggest life Cody introducing Boot Shyanne the to brands. the – customer why Cody and and across try and James the to traditional the example. Barn name customers. along Cody James to jeans, Boot [indiscernible], out the work store really side a pair three merchandise, the with walk that other their so purpose western brands kind going Barn extended and Work to James two product of bring bring intended are an they is assortment boots from net really for legacy James James to and work of our biggest buy customer side So customer are are with new of work that can the to for Cody But of Shyanne Cody We've into which same

are above contributing Miranda Brad bit, Lambert with So beyond teams Paisley them. place of strong any the and both partnerships and their and in have a with partnerships extremely those we quite agreement both that with of

[indiscernible] share positive Hawx Barn. have other specifically circle help business, The a a partners business that it or replace guys some but cases, either vendor They to the depends assortment incremental, is, perhaps And the in and the at for to western of those ironically, and core goal on of feel boots, is within both store. of come there, fill the own perhaps to to their our base. relationships. lines customer, question we brands. cannibalized fan us. store aesthetic. the after that are going we're be two to wouldn't is and brand. a get the losing most one that and doesn’t western introduce which I was a sort taking They because of aesthetic line the a extremely in their tends or bring brand share Boot or demand. western is work already cases, product new in combination, Barn think void Boot this weaker around broad partners And some it's similarly, be to otherwise fan tremendous concentric that brands that vendor base western of very or it we from but your customer aren’t a leans outside to their create So the like tertiary secondary innovative are industry a in on looking tend We Hawx course, think We of towards brand. brands have store into as One to have, all shipments in are best I the is piece or creative kind world those

off quickly. they to pleased and effort this that And the of and into positioned So are build the the we that have investment would get expansion they to assortment. three have that's ongoing we're the time ground put a hope candidly, seem brands, and out out of we they continue and new quickly opportunities really the with gate lot how they as and

that hopefully answer So helps your question.

how costs Thank What the customer are you. about That’s And also really marketing helpful. analysis? is customers, and value It acquisition did. existing question The your between and you're thoughts evolved? has new lifetime lifetime spend managing customer versus key value. thinking the the to active how your about drivers the on last [BOV]

question. an It's excellent

us segmentation, to Our couple one, specifically marketing to each of Number has enables segment. evolved speak a different ways. the

to or So a work about and go something wear versa. vice guy isn't traditional Festival fashion ladies getting stagecoach to

So I helped. has that think

net have – have direct step some we intent customers and giant in mix have sending from at positive that to forward from just customers dollars taken come pulled we an pulled a type customers has mail, the to And branding from a away media it We brand. pretty look the really across. catalogs standpoint having that to just of away standpoint, the the from And getting media. finally, creative traditional from shifted to give wider the broadcast example, a necessarily industry western dollars aren't way current then people with and response tremendously had

it's terrestrial customers new branding. creative is to social. of or of we A radio all a satellite – more is of brand. it a So radio. somewhat bring assortment, those online lot channels in more of updated some country virtual And And into music television. great A cycle. or cases, that's have We the virtually think and radio, goal whether lot

lose introduce all sight brand. us. core And core apparel. come fact our very that Boot the We careful are work they Barn. products And customers, work of we're want new that share boots know and and the kind to of to with excited about you customers western to They've and of them to not love

communicate we those – not through in often than So with one guys e-mail. more and

up analyzing has customers. that dollars virtually of segment response how are field, go on have rates really you communication us the we save much really et cetera. depending and put that creative into money This and far a most the receive, in from out terms on messaging and the e-mail. and enabled quick from pull open So importance. mail put and and frequent it It's away And you're new direct to free, the that you to rates, us is by receive in, customer through get of e-mail will looking pedestal a

you. Thank Very regards. Best helpful.

Thanks Oliver.

Oliver. Thanks

with Paul next go And Citi. to we'll Lejuez

will curious, year. Thanks. guys. of all the you And category But And sales that be were level Curious the increasing exclusive Will the do brands? thanks I'm you the that? the to Or in make increase think total you like that stores. Did you what work brands? if you that could that Hey, from credit second, a all past your feel how as curious SKU were plan across category? mentioned in with be count you are stores. more in focus in to the missing board, look card to this across there if share just – also learnings penetration year ahead? that then program, I plans And any

year. Paul, last year mid-single from single-digits digits low it's Greg. and past The credit was card grew penetration this

penetration. with to a business. points better to department buy the think So we be some back shop that and bit number penetration our to loyalty get of also store to of more stickiness customer, still pretty of think this an when it them added small XX%. us their don't with to we And with It's customer, do program, open create XXX the and what about roughly give I we about opportunity the was that expand we're one, create trying more. to piece basis a really little –

I continue we loyalty to that it maybe So Buy probably a a us from more to again, it. and think it to customer. is I loyal think a But even important want Best And is perspective, XX%. grow creates

about of the warnings you So Jim, that's talk can I work that. can? or

can I it. take

mean believe. boots. we through piece, hard I our but the sales? to It's On the quarters, you last strength taken was went strong, if several missing apparel the been parts think suppose business and to both are the on business, I look of of the decision back at example And sell – what as commenting we of work where about and so there's work we've pull work we've you the the would some kind much We country different some we space tend can – more boots. more markets lace up opportunity. boots not add work that's businesses, like. some that around sell indicate work that Give to

opportunity to to customers kind an While attract would one our we now SKU tend both of other. that way there's of some stores the think into or

and of some the the to store section the it the that sales foot that little with is the of will we include and bit kind and Hawx the both has perhaps the the of per of slower and rest in – there boots part turn work a inventory and assortment sure have work highest alleviate productivity business broaden So of more stores. line will a productivity of in the And square part to James. goal Cody the more of broadened assortment that part build section, capacity or

Boot have more So into wouldn't stores. so, come a that by and experience, otherwise work a more doing introduce customer products we'll Barn a perhaps, more the broader sell to comfortable traditional get assortment, shopping

care way you the we current and two last have think even different speak, pad, we bringing expansion customers all of questions, recounted introducing just the customer do that kind to do take also the store about of the few to our base strategies within think if the another is pieces. there – over it's and So of so I work more that. new while How

one one classes? the average we What for What's locked year's for new the already use this average this loaded. the to craft of should you The year, stores then compared craft? And Gotcha. and that's just box previous size have follow-up. planned that

feet square years, XX,XXX It past similar or so. to

tend that be As somewhere that stores acquisitions XX,XXX. we store made, you opened XX,XXX Paul, between know, the notably to brand-new of had larger our sizes. we've Sheplers and some But most

So number, pick if to to close it's XX,XXX. you had a

would the I average of X.X million versus Yes, productivity does million. about [X.X and store to say XX,XXX $X.X million million]

luck Good great. guys. Gotcha,

you, Thank Paul.

Thank you much. very

go Wells with next Nikic Tom Fargo. to We'll

other color on my that question. trends love differences region, by Texas Thanks if but or major touched of everybody. from for regions. any I’m sure between were perspective? or you Hey, taking I’d any California there the any not if

in Tom, strength whole was up line, is our but our perhaps districts we the was great very quarter little was Texas districts. The three third quarter, we underperforming the broad-based way positive, a the In bunch a fourth think runs it differences the saw were than bit fortunately, bit a regions. field and pulled regions All who Love, it regions business the across districts wasn't in were Texas and better all three that little XX very we have that pretty it of a guy so which XX business just a or much regions. the one and was testament better. store includes Mike organization. to about

enough the out. to notable of So differences weren't region call

it. Got

rodeos from Basically, – second about make get Texas, Christmas it quarter. had in in that the broad-based you QX thinking difference I'm strength. right? correctly, the that you So a the in wasn't didn't

the it whole We and just of Yes. Yes, very than all quarter, was the but did for at – slightly rodeo Texas have the good and broad-based just we quarter. of have season whole a Texas, than did in slightly was that better balance better chain strength. the

Got it.

today? stronger of there wondering to year, discussing or from margins are no lines, sort keep if I question us on basically that flow model. should just to margin drive we and expansion. kind sort in something of And buying Okay. get merchandise occupancy operating kind what function about full-year, the based my you of is of through the one a anything mix told that, if that's leverage on you income just the I'm hinder Handy-Dandy your of the – what there's for it's Greg, if quick get for just Excel perspective ability to your this so conservatism, I like might guidance on call that for that SG&A a and points even mind than want

growth during with especially Yes. merchandise expect do line Tom, year, see in margin expense we the to in brands. different

that is is of model different. guess number maybe your front but have my don't my me, guess sales is I in So your

that like. offline, you'd can we about talk if So

Thanks. Okay. of XXXX. fiscal luck That’s Best helpful. in

Tom. Thanks,

Thanks, Tom.

Mitch with Pivotal We’ll Kummetz to go next Research.

release. I’m taking for questions. right, the the didn't sale, All the my spot press mentioned Greg, see going put you to because Thanks Yes. I you in on

could number Is you're So take there for, for here. online a looking we the that range sales or that year?

Yes.

range. not Tom. We it haven’t have later provided the quarter we provide now, But provided next Perhaps in on. that, right we'll or the

a I think then the and gave And margin, points. gross you takes puts on us so about again, Okay. leverage

would the anything know I you're margin you're help – there has just there think merch to How provided should mentioned yet all taking Is a the up should to mean line part if shrink? don't that strong of that? on guys. about be you’ve be you is do you obviously around I about, thinking I don't some components either the whether I'm about it's you tariffs? you other channel selling? for label other factored I gross private price how guide? if about thinking Just the be I a into helped mix. for going don't about any – or imagine you're like adjusting I that's – commentary should how full know Are tariffs. know are year. we thinking that thinking things, merch lapping margins guess continue You shrink margin

Right.

merchandise brands, exclusive of will see are because or right, of penetration. we So brand improved you in terms – margin increased exclusive

shrink. The let bet us I'm making into do We on accountants not improvement wouldn’t guide a the our that. and aren’t incorporating and so that in

was at level. last it year's planned So

that. XX% we month. year. last points happened a tariffs, basis this earlier so little We probably have to that little in were a so But to able that's the year that this of do pressure baked XX% headwind freight of like bit will our in that we see guidance. we terms to be a In didn't do XX expect but bit that. We from or think see embedded offset of increase That's there,

Okay. go I ahead. – lastly guess yes,

again in pretty add. small fewer that's but piece I and less clearance a of a was improvement expect of terms promotions, margin little just overall do the bit going story. We to of

provide QX any a lining not want lastly, know because talk guide? shape terms straight compares? it. volunteer I if things to to of be you're thinking I know you for of versus about shape there in of don’t looking then stack. six I shape again, can any I But mean is think the Got to how year. the the the same-store you – we know you're don't if in a the about just comp impact you two-year for five so you Obviously, sales stack cadence comp three-year it year. that of of And kind for that the don't a sort might guide and the

get seeing up two-year great a a last plus are X%, year, quarter year, of And year's last be $XX.X guess of guided we last stack. on up a two-year said you question, XX% would It’s of comp a a X% and couple for of QX and XX%. against plus things. X% we XX% against up plus stack a Yes. plus a be I just would our We two-year – Mitch. or to we Number we strongest XX.X% plus two-year mid-single-digit this finished. plus that’s which stack second one, so plus going a million, the stack year, XX% And guided so

have trickier. we business, days The that a into right. fewer, it. time is of between you So one Further and as QX, I'd insight good and or the Thanksgiving the period out, between is This are make remind especially it's we pretty feel Christmas. good little Thanksgiving about shortest bit call Christmas the

the But the some you quarter we're there's I guidance that will, providing conservatism, terms specific in we business in quarter. current how if think not would say about we're in. so And of overall, beyond

Fair enough. Thanks. Okay. luck. Good

Mitch. you, Thank

time, speakers or this like would remarks. at And over additional I to back our for to the call any turn closing

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

thank conference. today's your conclude does participation. you for We That