Genesco (GCO) 9 Mar 232023 Q4 Earnings call transcript

Good day, everyone, and welcome to Genesco Fourth Quarter Fiscal 2023 Conference Call.

Just as a reminder, today's call is being recorded.

I will now turn the call over to Darryl MacQuarrie, Senior Director of FP&A. Please go ahead, sir.

Good morning, everyone, and thank you for joining us to discuss our fourth quarter and full year fiscal 2023 results. expect today, forward-looking be but call expectations reflecting different. the of as actual on to statements make our Participants results could Company's the for some Genesco release the made factors most this today. to cause of in XX-K SEC differences the could the statements from recent filings, refers its reflected filings, XX-Q morning's and that including expectations you and earnings forward-looking

their during GAAP to available refer in in and are to the measures call. section. expect financial measures release All quarterly also the to Participants reconciled on attachments adjusted to counterparts the press website this financial non-GAAP certain results the morning's Company's schedules in

posted George, me and Chair, as have President, We call Chief our Executive Vaughn, presentation well. on and Officer; Financial Board results Chief With Officer. Tom here today a summarizing the is Mimi

to like to I'd turn the over call Mimi. Now

effectively Brands both and weighed Journeys & conditions year. helped this navigate you with everyone year pressures areas headwinds XXXX us morning emerged Good Murphy strategy of the some Darryl. following fiscal Group Genesco in Schuh a allowed and consumer mitigate record of in on Johnston XXXX, its our business results to strong top-line and even shined both our Many footwear these Thanks, joining fiscal focused rapidly Coming environment. that in thank us off more today. XXXX. Record new challenging changing at past particular as for fiscal

team's the by strategic Nevertheless, XXXX ability in most. to fiscal navigate and multi-division, Journeys footwear was high The inventories market experienced expected decade's the to and some model, effect demonstrated its turbulence. business anticipated. performance consumer positioning, factors the tested resiliency on two channel our our enabled the that of we operating While we our the multi-channel impacted execute back and elevated the are inflation fueled us the than of stimulus get more differentiated gains, benefits our of

year, and Schuh and gain the the comps. strong finished Digital X% e-commerce fiscal from direct-to-consumer showing accounted over XXXX. to of comps we totaling In just of sales, XX% $X.XX, total to in J&M, up increase in store from we through XX%. include fourth both year the from EPS comp other addition our for pre-pandemic positive positive XX% the and pre-pandemic returned of XX% share culminating through fiscal an growing a highlights shareholders $XX with sequentially We quarter almost penetration compared with XXXX, of delivered in million outstanding shares, more than adjusted XX% improved repurchases

loyalty made also of years drive pandemic comp building the proving the against strategic key capabilities a in brand and re-imagining Johnston Returning successful notching progress creating absorbing include e-commerce XX% Murphy. QX growing & program and growth and to baseline re-repositioning several elevate Journeys with initiatives after for will build to We branded Access early our of meaningful with major the investments its connections future continued in Journeys this growth, Schuh loyalty making we All by year the sales, at and new powered drive building and expand consumer which stronger deeper core with insights J&M, our to imperatives growth ahead. Genesco's the year, and our launch awareness to platform gains our consumers, marketing in They brands. and digital and

to issuance and this our capabilities global finally, progress ESG IT the pleased with loyalty. analytics our carbon in advancements significant we're made transformation year, support including and new consumer omni-channel, ESG also And report. of e-commerce, inaugural assessment with our We capacity past and first our

more We continue progress. the and to priorities look ESG to build additional for strategic roadmap forward

fiscal let actions to by in retail Beginning team and business me sales On key record constant gain improve this and the Schuh, executing the and record you its after that and outline Schuh a performance share. holiday the to our the emerged start increased to last our sales handing year's by briefly season challenges address that Tom finish in basis, successful year. before platform a take growing call congratulating I'll in the I'll outlook, financials the execute successful a well currency digits, UK of and to market Now to through with XXXX on year. initiatives on into strength continues results double QX and market we're underscoring a discuss competition top as the out

and higher rent store one-time was to brand up combined the demand headwinds positive consumers. with position and excluding assortments COVID inflation capitalize selling with holiday relationships credit strong athletic advantage fiscal return great increased to Schuh profitability fashion considerably despite economic and for physical notable Schuh take in in credits to customer effective both Schuh's prices. footwear substantial a Schuh's traffic. and marketing service on chose the to high and shoes locations UK Schuh increasingly best-in-class especially product its improved was tiered Elevated to fiscal received and XXXX casual in enjoyed Demand of is as higher sales rewarding consumer access Schuh other puts facing Shoppers XXXX. progress

demand. in U.S., remained excess inventory and QX Back as footwear the consumer weighed Journeys the in pressure under headwinds on

back-to-school we in fourth big consumer to and teens on same available. a consumers with conserve money. spend buy saw was between not shopped for weather when there quarter in where was inflation as back-to-school, pressured to And pickup while during in the to slowly and year The from This strong the harder and shopped and bought in the cash choices made the less we expected periods anything retreated was holiday. December, it was warmer there prior by during started stock selling change November. environment a when at the level During the reason a

discounting footwear from heightened priced industry-wide and were the accessibly price little drop-off were a a sales move to sensitive volumes over January, down up the Journeys footwear backdrop above full significant gross to make prior discounting largely to And due normalized margins we it markdowns pre-pandemic levels. selling add-on inventory stronger worthwhile. compared socks. result, of incremental While marketplace, the while down to the like in boots achieved enough adhered benefiting in footwear overall trading did Against as including in units to quarter price a a more to year, additional customers response purchases and not

Journeys absorbed cost While the and to and major or of since time has expenses sales margins marketing gross growth both have other experienced were levels, above pre-pandemic support at e-commerce pressures. and retail this our and businesses other also other additional salary selling like

double Journeys in e-commerce demonstrated for QX. success grow to achieving into by effort strategic Our is the comps well digits

down but However, leading footwear overcome is to growth costs during powering growth this record for size actions critical challenging a has cost right efforts are expense rent Tom when teens, for reduce strong other side. greater detail, our economic must on economics. double the store a and on That through time of in right-sizing fashion these discuss the we store profit will and to outpacing as Journeys proven better cycles sales positioned destination said, with opportunities well growth. track emerging expense and

accelerated progress and of excited about repositioned our brand very growth. brands, for we with & Murphy Johnston as potential we're to pleased the the the Now

casual in suited store brand is an plan up with total with and were A to well while features. a Our sales today's contributing differentiated products, XX% a and up sales e-commerce apparel again lifestyle and for more J&M technical bigger considerably, sales were J&M's current did quarter with product strong even with to demand comfortable, record athletic out. strong design positive casual respectively, re-imagine and an with and Casual XX% matching highlight. products trends proving culminated team primary job exceptional year of as the traffic more fourth results. drivers the sales fresh compelling with

campaigns attracting to effective premium while price a younger points. a and marketing building proved on story in J&M's and positioning the brand, our broader consumer

fantastic on a is the The business holiday plan Congratulations future successful the year. brighter. a to been team entire has the season and for never working and J&M

announce branded Brands reinforces Genesco portfolio as name review, Brands to Genesco for Licensed Group. platform Group and commitment expansion now strategic our Brands of that is Finishing pleased brand to company's the growth. This Genesco change Genesco’s a I'm

tiers line our Our strategy business of elevate expectedly Levi's pressure stated year. to top higher on distribution to this the put

as inventories drive inflated will business, especially freight believe XXXX coming a which given points, longer-term. and that hard with distinctive subside more these product profitability improved its design fiscal to made issues this and We price progresses, higher the with business much XXXX. coupled allow the hit year channels, for in the costs the addition, will In combined fiscal very in challenging QX

to Now XXXX discretionary inventories. fiscal calendar industry turning year, a and holding footwear experience to the elevated we on this back purchases continue consumer

than stronger with actions to half sales As the planning school initiatives taking rather and consumer on holiday cautious on relying view. sales back such, rebound to we're we're overall than opportunities be and a back to a front taking drive and view the

the and to consumer remains by and actions top impacted QX while Lackluster well team's we're order as difficult will the be line challenging especially execute. predict, in Boot Nevertheless, taking the other to smaller am environment as book. retailer confident I our sales, ability with

we've our with starts talented and proud and this all our really are We ends of amazing focus made of the people. driving strides footwear forward strategy

thank Tom. to now for and way for efforts turn to the you success which it paved like great tremendous over I'd your ahead dedication, I'll and

Mimi. Thanks,

our Johnston digital, turning growth, on now efforts & see success improving channel capitalizing Brands As and you focusing driving review results, and the Group will I Journeys we're also having on profitability. shoe store Murphy's Genesco while around

growth. million, for positive Turning straight led from basis. and a of up comps sequential QX for both X% last revenue year, constant quarter, strong comp quarter, of on $XXX the the essentially performance in a third basis consolidated was the currency but to to On total the a to quarter results flat X% shoe J&M

store business were X%, comps comps shoe, comps X%. total XX%. total up Total and By XX% direct up increased while total J&M comps comps increased down XX% were Journeys were

Genesco declined Finally, Brands sales $XX million. Group’s

a quarter footprint ended fewer to existing store XX the store ago with stores continued and we as versus productivity estate. year our our in drive optimize We

levels last almost up year XX% XXXX. were total retail fiscal with of XX% year XX% XX% and sales accounting pre-pandemic sales up Digital in sales for digital versus from

last Gross points cost. excess a The year. margins basis freight of return essentially and to to XXX addition more warehouse none main the promotional last driver was in year from change the were compared environment year-over-year to normalized down

XXX a basis basis margin return better given down By gross business than normalized points still the levels. Journeys' points both but to were shoe’s XXX more promotional pre-pandemic margin was environment, gross and down was

basis normalized cost. incremental down was XXX points comparison, was XXX basis points margin Group Brands freight unfavorable pressured by driven reserve logistics inventory cost. an warehouse and margin gross by promotions gross down higher Genesco and reversal J&M's And

driven was better XX.X%, of and compensation leveraged credits by total Adjusted cost. performance rent XX expense and basis COVID expenses, higher time points. one offset The year. than was leverage SG&A increased occupancy government year's which basis points million and last marketing mainly last SG&A relief Without XX.X lower compensation based XXX expenses

the to increasing we our Although were salaries. talent increase legislative control and for is minimum to continue in initiatives. to environment salaries compensation especially in a able selling talent pressure and to competitive increases store general IT competitive environment living costs, drive our the selling other for wages Moreover, modest our

Rent roughly XXXX, remain years, credits This XX% fiscal for is occupancy XXX fleet couple good with to last average driving renewal for over this and coming key an a up company continues renewals lower. continue year. XXX reduction success renewals priority. achieve with With rent term the we our costs in XX% years. expense in of a to top of opportunity straight lease we XX% decide next line reduction and negotiated achieved X.X of a Across on the rent

time store stores will on through we XX closure. to and business online we for while Additionally, fixed space. are amount cost Journeys, potential lost We recover and up more our nearby of the and plan same at profits for the stores, believe stores a evaluating sales good our closing reducing

last fourth versus summary, and to or result. decreased environment had impact $XX million, corresponding versus the expenses $XX.X quarter while operating to pre-pandemic. In return markdown impact margin margin pre-pandemic was a X% X.X% the biggest X.X% gross biggest in adjusted had income increased normalized year, million The operating last compared a and year

For the tax rate XX.X% quarter, our was XX.X%, adjusted which to last year. non-GAAP compares

quarter, the all This $X.XX $X.XX compares year. last adjusted in diluted per to for resulted earnings share of which

of cash significant of $XXX now return the not the to allocation only Turning into the which capital but same capital task us strong re-inventorying million, sheet, our the business, also to in shareholders. carried reinvest we year balance about at enabled accomplished formidable and balances time

In net terms of share purchased million specifics, $XX we XXXX. fiscal million completed inventory $XXX purchases in in roughly of and

inventory year's we year-over-year, believe up compare pre-pandemic chain to limitations low to considerably inventories meaningful year. in are it's last inventories net more resulted levels, While this supply since unusually

the These higher we J&M. a higher would levels quarterly Journeys core Inventories year fiscal for to product inventory still all like of sales, X%. can on XXXX are inventory relative sales solid increase to attributed both but higher were than XX% than substantially be and

year by this fiscal markdowns a balance Thus, cash have strategic We trimming last to year adjusted we Selling adjust with the will believe along and do incremental take to be our for we normal and sheet half right inventory, with first through add us cash not balances remains accordingly. from levels. will that XXXX, generation asset. leave approximately future required inventory XX% will expect a buys size we receipts to

quarter. did fourth not XX% shares Over of any the the an outstanding price in We of average shares shares last million year, the $XX.XX. repurchased at we repurchased or X.X

amortization we were opened and XX% mall the with authorization, XX our depreciation We to million. can during past which our expenditures quarter outstanding $XX four quarter stores, and were $XX have years, Capital million primarily total closed million end almost of repurchased fourth stores. current XX used shares which we and was X,XXX the in off the QX remaining $XX fiscal on Over opportunistically. have

year million for net in including new in and not capital total million and depreciation depreciation our XXXX $XX headquarters. related respectively, $XX fiscal million were expenditures and For amortization corporate $X capital and

cost we strategy Now for and the the base other reducing footwear may on today. our turning cost prevalent pillar year, reshaped labor must pressure of reinvest double the growth manage to cost store the structure and coming as a down and focused emphasized, future to is

portion and targeted fees Areas with include for fiscal reducing million. expensed card action at implemented others salaries, the immediate taking XXXX, year in by we P&L. hitting among savings $XX selling are cost large the have We to a program credit aimed rent a expenses $XX have journeys of million

but from receiving anticipate of this from also much store projects increased future studies efficiencies in fiscal conducted efficiencies we to will We our being main like year, benefit for center at automation distribution cost of areas This additional more time labor structure are of is evaluating reduce Journeys program same of holistic to growth due. conducting our expense we savings. at since cost a intended the in while time rate review will

Moving to guidance.

quarterly to first by Given factors challenging I several that providing are very am quarter. than a is do. for more usually on and unique our touching first make we to that quarter combining than going typical different start QX guidance specific

average in chain fiscal in weigh were this the Group At and has from been last boot selling including consumer boots to when for dampened Journeys weather on sales. impacted the fronts, year accounts prices top-line. meaningfully a arriving same demand tough to points Warmer sell-ins late a down of Genesco net anniversary last time, with is price year. Starting pent-up in trade for on large continues supply multiple from Brands in comparison year to the holiday inventory. benefited replenishing purchases that business has demand disruption

year, we this QX as digits to year. down clear have expect single excess on this, work to they last product. discussed orders retailers high back be With I As sales versus materially cut

second gross quarter result taper an the Regarding markdowns points. expect QX of to supply XX to we we of basis the off on activity chain alleviating margins. decrease Comparisons gross at margins, will margin normalized in the points pressure through in experienced constraints unusually Journeys promotional levels Journeys to some low pandemic’s XX basis overall

fixed $X.X share is per basis shares. our what resulting in million around one in loss, account including cost and to million traditionally will a given points of a basis volume QX in result SG&A decline expense earnings deleverage sales XXX share XX.X roughly interest the basic However, of of base lowest roughly our points of quarters XXX high

subsequent year-over-year considerably winter and move comparisons expect away we We improve sell-ins. merchandise to and from as quarters assortments spring

near-term to business are the headwinds and a year. Based and just Journeys on planning Genesco accordingly. full mentioned, approach Now we our brands the macroeconomic I facing conservative taking uncertainty in

continued recently being momentum we’re we’ve J&M better of level not a but and benefit most J&M Schuh year, especially expecting experienced. position we through should the growth inventory the about For same excited in and from are

the spending consumer the other shop front better half Journeys during when half. view back the of parts to than the assuming prioritize continue is back-to-school will holiday of reason that are our will adding the a year and inflation We there to and feeling limit effects therefore the be and

to XXrd Taking all year near from this from with expect our week for flat share. million per share week earnings share into on per sales Note earnings fiscal per account, roughly to we flat X% sales XXrd small that X% current a X%, excluding to the earnings to XXXX adjusted to year. range per approximately the $X.XX up of sales or expectation down last best up range $X.XX to range negative the or $XX has and share of and midpoint and adds effect the

sales by business. Some color on

For first mainly Journeys, driven in we down, be expect first quarter. half sales by to decline the

the We in in initiatives expect our half roughly kick resulting flat is the in year. modest sales growth for back strategic

For last Schuh, moderate back at growth & expect same last year’s rate Johnston growth Murphy and we recovery modest more as Genesco first challenging than half a half. Brands pace at for the about the And in year. year for

inventory costs. other freight the costs we Schuh. rates sold to from the benefit expect that costs logistics basis lower will in as We freight be carries higher currently margin margin XX points come and see XX Once this benefit we down we have points significantly Container continued and we and back half. to these improvement and have up expect at basis gross through

other million $XX as SG&A to We the points offset basis cost XX expect and basis percentage $XX deleverage working to to adjusted cost with XX reduction sales to of actions pressure. a program million points

operating year expect we to XXXX. an similar margin summary, fiscal In

our industry efforts. expansion near-term margin the challenges With offsetting strategic macro and

which outstanding in XXXX no purchases, results XX.X tax the be shares million to Our additional share average fiscal of guidance XX%. assumes rate we approximately and shares approximately expect

back to like to would call Mimi. I the Now, over turn

Thank you, Tom.

the in the about digital This strategy between we’re exceptional and direct-to-consumer our space. expertise focused actions coming cost pillars and taking strategy and investment footwear product omnichannel, excited our platforms. We’re continued our that six innovation strategic reshaping consumer branded forward are synergies leverages the our in our to retail year. deepening driving and Fundamental business drive to our insights, emphasize team’s

higher have Journeys allocations place SMUs accessible elevate their gain higher spend how access Journeys. efforts Given our hard shifting entail expectation even tiered and making price secure products. products, greater to partnerships brand choices point focus Journeys to of expending These on consumers to year; continue efforts that and will to mix merchants to must to products this dollars products are about more more further also unique the talented

Journeys shoppers only focus area key strategic elevate insights our purchases is of and interact with the of Journeys. to give more third reason let program teens branded customers the brand with to of program building customer buy, incentivize pillar, forward teams also will consumer awareness, will to not a to before launch Journeys It our frequent part basis. and strengthen We're footwear the Journeys Another loyalty to promote loyalty; consumer but concentrate looking This School. brand's will their on a Back relationships. deeper engagement

signups We're versus our with X.X has insiders non-members. excess well the targeting customer base launch transaction for same members members those Shoe and Last XXX,XXX improved a and programs. program kind a of with its first be X% surpassed around year's loyalty will increase larger paired impact in overall nine program program other size. signups year months launch and and The in achieved with over marketing Journeys the campaigns of J&M in of to expecting the purchase our key frequency expectation repeat new average led about million the loyalty in with

further J&M launches we're Following from their gains the and as well. programs promising Shoe anticipating

more reducing and for spend to to With digital and access dollar even data inefficient leveraging party advertising, higher targeted and impact the driving these loyalty analytics tools initiatives first we're data, underway and more dial in investing CRM talent spent. into our

digital This online initiative will the Another pickup-in-store of our second anticipated more relating or pillar, see ability BOPA give how to also but to to launch between give availability will Journeys be will product in physical the growth of much J&M. of at program online. and buy and and consumer the to not their relationship greater only drive maximizing choice when receive purchases,

including functionality of Rollout management experience. inventory series order updated follows improve sale accuracy, a new and BOPA our and for store of to BOPA streamlined a investment rollout multi-year tracking inventory which hardware projects capabilities and software point of of integrates

follow Loyalty digital as XX% as this accelerating will loyalty following will key digital direct-to-consumers our of BOPA sales. digital much of a strategic only first contribute. part pillar, efforts, marketing later will added be of launch driver site expect online year. We represents with sales Shoes and as Journeys to grow also investment web and enhancements, inventory increased in BOPAs CRM

levels. Our absorbing and a goal pandemic be reaccelerate of profitability, growth back digital the currently of to our double-digit after this At will XX% meaningful is with contributor. gains levels double-digit to retail business

visual functionality his not In addition, America Jacobs and in Karl BOPAs brand of on with will and influencer point this with Completion hardware year. ambassador streamline seatings partnerships rollout software our only we're partnership XXX mobile Journeys the which and changes the from store delivered This also new of receipts, of and especially is social efficiencies. busting media North but followers capabilities the plus merchandising configuration sale system. million processing past XX brand building beneficial additional e-commerce orders will new are through peak for days. store operational this selling technology selling efficiently and new more activities during iPads for unlock like training line used incorporates and checkout, Onboarding

help immersive consumers is to maturation off and our product delivered that Success we're off test all mix online. determine learn optimal what We've very to is co-tenants to initiative up the to progress XX us of expanded to strategic mall the accelerate achieved advancement assets pilot develop an can the off on Another mall additional be stores stores curve. with designed a making like good in of from encouraged and PowerCenters' Journeys results different approach number refine experiences four-wall used attractive and open as locations places strategy. offering omnichannel early

comes rent potential to investment from away more us the cost We're marketing thereby the our several malls. hundred a we we putting and stores position growth this roll structure, us fixed of diversify but gives out additional about these quickly much more base opportunity. a enthusiastic With have in favorable locations drive store to can refined approach. It reducing awareness, once

Finally, and we're our fourth the of to prime XX% insight its are athletic the and featuring where having pillar can to footwear the efforts. sales J&M products Amherst casual innovation work of positive driving strategic aggressive product of is play. hybrid intensifying now Upton trend the work XX% example features or is success under transition casual these franchises McGuffey, resource categories technical business A to to the from has [ph] results. boasting done some wear and customers to

walking, For golf Further planning running offering this ever boot new collection, to growth. shoe. true J&M constructions J&M tiered will year into new a J&M is upcoming launch women's plus incremental boys expansion hybrid and four first and higher drive five casual

In addition, DTC XT-X as wovens outerwear roughly and revenue. XX% will blazers new apparel sales build well sizes now as of collections J&M fit and of new that constitute on

focus as advance excited close, the growth future while very remain novel to about and to we business footwear our many creation. our to posed deliver and value environment So optimistic the challenges, strategy of

now And to we're call operator to ready the open questions.

with question. from Mitch Seaport with line comes question of the proceed Instructions] Kummetz Please you. [Operator Our your Thank Research. first

a time. I'm I've just hope at that's for going to I Yes, got handful, questions. my go a okay. taking thanks one

to question is you I there on just are QX, mean, kind to I and So it range be the appreciate down my can sounds sounds any like Branch talking there it is more going kind color and would a to all like Could of comp helpful. be we of group mean, is way add Journeys the give Brands the Anything double-digits? sort us be down. going the group. of Journeys color on pressure I first you do more that? there and

the for thanks question. Mitch

are mostly are first We bit. sales. swing There's it's much a in a our sales it are so what seeing are year factors really comps is we're around unusually they quarter. this been to And holding what last get year because as and to year really Boot QX boot were and out Last anything particular and this making big unique year Journeys calling robust from the not weather sales just seeing are The to spending of month and good able new the were we not and sales out country a beyond back non-footwear that. really as warm year there it's margin budgeting we affected a that's quite down different into receipt we and year and product had were there's we last down and quite our system several for well. spending favorable mentioned, feed demand. this gross consumers

disruption the refunds Genesco to, expect last be not and down also Brands sell-ins all last this are with far in year, to credits tax be a little as but paced bit versus year going a all year chain that. And supply we’re they’ve aggregate this we due to the anniversarying had COVID We have tax lower year great in so you ago. said year,

that And point quarter more the and that demand anniversarying to we robust then that in anniversarying the times. out markdowns I’d the final we we just final that thing impacts going during normalized to fact returning pickups as be have had markdowns to big in this And essentially well. no that due us are that is is margins, gross been

Yes.

some driven the is you you curious kind and of to a improvement And I program. moving Okay. cost of that is ability maybe I way you mentioned, provide going selling kind believe by quickly in And from don’t how a that. to then kind that to million of cut? cost be on, how much Is talked much am then around of $XX in? to that? there there million kicks about I component salaries savings, how $XX of know any have cadence really

off that be million this it to is cost over I’ll and are selling $XX looking, it of selling to But to had rent are our going million some big success specifics. a give more a we then very program from targeted two a to of have are big bit Tom rent and expense get of Tom. year salaries. – to salaries color a that. we’re we had expense. for component lot are expecting $XX let of turn turn me we a But and what driving in We’ve down and drivers We’ve over lot

good there we $XX Yes, quarter. progress the in it – we achieve Most the that fiscal half do expect Mitch. the of and in million really our within fourth back most and half it to about of year. back the feel most Yes, in this of

pleased in-store understanding So salaries, business. we’ve to And been an in and e-commerce really do, the but stores that. selling got only, point hour perspective customers, digging and from there a within we it of good your about really on obviously on our to not what takes deliver fulfill

there’s and inner have some half that opportunities of of the reduced store salaries, a So looking think store reductions there. variable remaining portion we think We of expenses it been in rent. the we kind about activity. Then significant freight other is including are selling credit at cards is some half of then there, there we’ve opportunities

is week quarter. the some to plays by, think of point in savings the just word there’s that to fourth the meeting thing somewhat other of I quarter XXrd fourth the there that and savings in achieve muted in that’s the the we’re somewhat only going out

the and you closures help And XX year’s this you cadence then us of happening of the Okay. bulk XX of just of much Again, are pick also, assuming margin It or to those this can those can you up and process mentioned in year. those sales other closing looks kind stores store then that with Journeys. online, op transfer how XX closings the store like stores? of

Yes.

in transfer Mitch, warrants on we’ve it targeted the year, productive. and order given you the keeping overall that out targeting doesn’t are as that rising for So volume, to at based have looking levels them And if isn’t they why XX actually lot of and economics been where we’re take and a the stores that particularly some stores store operating, whether come about about at have contributing we this of if it, costs. levels are is you, think when

so expense fixed and the being leveraging fixed And to base a eliminating closed. can expense store relatively be amount the small from that’s another that store transfer base there of

we in to online. more transfer first a to lot data. And that, got addition have to We’ve party much exactly great dialed can how in we specifically

to they customers we direct to give information able customer us, be or have either that to us increased Our and store another trust online. abilities to the

of direct inventory, channel footwear sense elevated kind your to of maybe their the seeing about of talked some might how you versus, have you And with Mimi, as what think community you do and much of kind then competitors? discounting is, any retailer that when normalize? with And vendor issues this you’re

it the back was time. Both, we and had environment, supply chain the the Everything excited landed once demand best full was everything, perfect great lot ever at time where at about, the Really pulled Mitch’s? price consumers the Everybody consumer selling with of at a and come a inventory out same and landed backup the storm. of seen. we’ve

we’ve and so that seen brands doing levels as seeing retail been really also working well. down And partners inventory their getting on we’ve

is to translated that a much activity, into what lot more promotional markdowns. just more And

now, promotions, better by quite didn’t better, we’ve backdrop and a full hold have well. up right going move sell price half right of the our second tried it it’s to environment. to following needle a once now, thinking we continued in the been against said, we vigorous to this that such as the and seller, And off are We’re outlook have place promotional we optimistic we quite I in more margins but I the be be mean, were but in meantime the inventories we’d that continue a really frankly

We’re manage just until above overall to inventory point for and a Journeys inventory to right and pre-pandemic we where we’ll our our Schuh levels is both continue sized. get

then And Okay. book. last order on question the

put challenging about are the also? well. talked in being guess retailers the seeing does I brands around fall I that I group of in you in and the full Are Again, year, brands assume but the back half. pretty difficult spring book, that’s conservative would first your half that that group pressure being you function on ordering as a Tom, think, order a comments the

that pressure right seeing less we’re back It’s the half in now.

seeing We spots book in on green more orders. have bright we appetite back of is some spring retailers with robust and absorbed some definitely order and a are turning shoots, the several channel. lot value There the

seeing shift frankly. into down consumers We’re trying for to look quite value

in there to And of channels the – that? And are so Tom served? something add might differences are that, terms there being that

our that’s it. that think of Yes, I take on sort

these accounts. little they think, to able dynamic be to to us for risk. this especially the in go year, at a general this conversations how time of speak, bit that able branded, to our Brands brands I the at just change fulfill They our to they, the more group, want want season. And those in so case Licensed be same inventory time, take same of

believe get that we’ll year of the half in for the fulfill inventories orders. by mid-year to with be normalized normalized, earlier back the those So, by, discussion more when that consistent season ready able we they’ll the to channels and we then on be believe and

Yes. And we in year. be be upside happened the will of there year think we back the last the will activity because that do anniversarying promotional part there,

for best taking right. right. all and luck. my All thanks of That’s Well, questions

you, Mitch. Thank

that for floor the concludes Thank question-and-answer turn you. Vaughn Ladies and session. comments. Ms. to final our gentlemen, back I’ll any

quarter with joining Thank report you first we when look today, forward us earnings. we you talking for and to

today’s concludes This you. Thank conference.

participation. You this lines Thank may for your your you time. disconnect at