Hibbett (HIBB) 24 Aug 182018 Q2 Earnings call transcript

Company Profile

Participants

Pat Watson	Corporate Communications
Jeff Rosenthal	Chief Executive Officer
Scott Bowman	Senior VP and CFO
Jared Briskin	Senior VP, Chief Merchant
Cathy Pryor	Senior VP of Store Operations
Seth Sigman	Credit Suisse
Dan Wewer	Raymond James
Pallav Saini	Canaccord Genuity
Ray Jadrosich	Bank of America Merrill Lynch
Patrick McKeever	MKM Partners
Peter Benedict	Baird
Rick Nelson	Stephens
Sam Poser	SIG

Call transcript

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Hibbett Sports’ Second Quarter 2019 Conference Call.

During the presentation, all participants will be in a listen-only mode. Afterwards, we’ll conduct the question-and-answer session [Operator Instructions].

As a reminder, today’s call is being recorded, Friday, August 24, 2018.

to Communications. conference like Watson to would Corporate of I turn over the Pat Now ahead. go Please

Pat Watson

Thank you quarter Hibbett on operating of for joining year August results financial the fiscal for and X, company’s XXXX. the which second XXXX, and half Sports first ended to review

the Harbor Before I are questions, statements, Act those of anticipated including in to and made differ in to subject It reliance your on would views remind the and the comments These that management’s in Company’s facts, we XXXX this on discussed conference noted to reflect Private the and to Reform historical may forward-looking respect statements. Safe Company’s Litigation begin, are be which from and results risks. statements. provisions performance, during financial should call like materially Securities future those are forward-looking everyone not with based response uncertainties the of that events future

that contribute Report the on issued Exchange and could in refer and Annual earlier Company’s Some release these We of other for to filings the sources in cause you this news Commission. differences the to have Form information. described the or Securities factors morning, in been more with such XX-K

call Jeff of Chief period conference XX now go of Please like this August to date, turn policy like would it of XX, to archived over on conference is call XXXX. Rosenthal, Jeff. webcast information call management’s of point are information, days. Hibbett Sports to would I a today’s remarks Because Lastly, to time-sensitive based Officer. as the accurate the the this and Executive that out during of ahead, nature limit of this understandings the believed I replay to

Jeff Rosenthal

with Comparable X.X%. CFO; for for of Operations. to earnings sales the you I in X, total XX-week and due compared for quarter. with $XXX.X and Net from ending Senior Bowman, VP the of $XXX Chief sales XX-week Cathy have approximately this increased call. increased quarter Hibbett included August Welcome second of Store period Senior good morning, year. represented VP increase XX, last sales sales XX.X% an Briskin, Merchant; the and Jared X% Senior net Pryor, ending to period increase Scott Thank weak year-over-year also XXXX. me to The Sports’ VP, million E-commerce the the everyone. morning shift sales $XX.X XXrd million July the million week second store resulting XXXX

investments and see to continue of benefits to We make we in operations. our business for from long-term the these are starting investments the success

Although, we experienced and softness equipment in significant movement in apparel and the accessory in see we’ve branded our licensed business quarter, footwear.

are by of the acceleration We encouraged our very business. e-commerce

rate price margin and to continues cleaner gross our more selling. show improvement Additionally, with inventory full much significant

approach expect in store. initiatives to rollout we omnichannel forward, capabilities. enhancements omnichannel see online we Looking our in as upcoming will our reserve a holiday continue with the season assortments in benefit the pickup and to store improvement we and our in quarter, This buy from

our and with stores ability in-store buy initiative reserve store being your or items QX; a out sales the now in experience tested Birmingham online to and our most plans either online, the to during drive stores new pickup store Our choice is that shop compelling purchases. roll in to will both to to customers

site. to on a reserve robust can pickup dedicated store; that customers customers; Web our features will our We better they provide entire serve have Hibbett of the at can local an product to on advanced implementation items set a differentiate stores; shop to of in can and pickup section our you try stock buy in our also

merchandising investments we and that our consumer We by of online are marketing, online business, driven very anniversary Web in our last the making very report launch site. continuing results robust The from the QX we’re experience. happy couple continual weeks to in see marked to are

more which we positive to During effectiveness our of in on learn return advertising, increase invested was had about the our the investment. a the spend marketing. also quarter, decision Part to of

during investments on findings that us results. QX our plans had effective saw build These expected fully we positive As negative spend. and optimized going testing, drive to to allowed our and into QX and more have return stores advertising

half to the great deliver we that second As we in position the feel begin results. we’re year,

and Briskin, BOPIS and will that Senior now investments will long-term. in made about over for to to have the merchant our Chief Our marketing Jared trends. VP, people Hibbett merchandise talk set ROPIS we example I turn system and the call

Jared Briskin

Jeff. Good you, Thank morning.

accessories, During from headwinds acceleration the related trend. cleats quarter to first footwear second quarter, licensed continue and while products improve downtrend. equipment an to our continue we and Apparel, and saw

that business business sneaker up Men's gain, Trend posted digits, primary apparel its driver consecutive comp kid's improvement. were a both across double Our producing showed to women's connectivity double-digit strong was sportswear apparel all third store and categories. our apparel grew digits. low relevant a mid-single while

also remains the We in a cleaner down The improvement quarter, marketplace decreases, incremental sales performance our We had the a digits. of backpacks, with offset hydration. comparable sunglasses mid-single year our from third a well area from business. high gains most lap less This challenge we as and remains socks, phone declines and business as accessories. hydration single-digits. The in as was ago. solid challenged big to in year-over-year becomes down saw license headwind from Beginning sneaker saturation apparel accessory category

this is our over and While adjust the as trends improved it trend, we remains previous poor pivot.

comp items now investments our business results. Team business and to low improving trending headwear fan business are While sneaker has sports down remains the positive quarters. was business high digits. single connectivity Cleated challenging, consecutive core in apparel in strong very digits and three that have made single and been

for women's these offset into in Footwear kid’s Both football. models. double was a lack the very The fitness mid and the did taken quarter, mid cleated a sizing digit which gain. quarter, was retro by volleyball up and of while in impacting platforms, access single digits, whole, baseball, encouraged low We were product digits. in and strong for soccer single innovation improvements business categories store declines positive being consecutive equipment quarterly flat all of down on there's single track, allocation up led by fourth very the similar posting cleated were double key was business the trend gains; quarter, Men’s business soccer the was digits, for as positive not were up the trends equipment softer was were demand. down and are business all that comp the new while led digits; of capitalize a kid’s and kids which offset categories available up baseball, business,

of we’re pleased the efforts. inventory As we the head half with management into year, our back

for linear have Our flow much well us now and our position over connectivity than as of to relevancy position call back turn is financial results. inventory to category we a our fresher year Bowman the to and and inventory cross I’ll continue enhance receipts assortment. We half our ago. that the of discuss believe the Scott

Scott Bowman

and good morning. Thanks Jared

an points hundred and versus Originally, in the X.X% $XX XX.X% percent increase to XX month, we prior than comp in of sales in last store points benefit the result leverage approximately in to quarter basis volume mainly this as XXX the mainly higher accelerate to and XXrd $XXX sales a the difference effectiveness captured sales and much sales from increased and expenses The difference from Logistics would increased expenses XX the an were weak in slight weak more quarter, as week comp estimate quarter. Product and marketing low selling. At versus in Gross lost in E-commerce week in back-to-school sales July. and sales resulted to increase basis investments quarter the at shift represented The dates points, a a in is to in we start X% approximately quarter. G&A beginning basis attribute of increased second last year. million employee was May, rate sales higher to sales, June sales the year. mainly shift high being X.X%. and sales, overall sales point of million comp Due increase omnichannel weak this of mainly $XX.X of gain profit of percent recognized due We X.X% the in inventory percentage due to additional and relatively price volume decreased total to which increased in basis increased due total continued clarification, of increase the caused and costs. the in a shift quarter. of increased school is or year. By quarterly. X% mainly the points occupancy margin in a full cleaner XX.X% million. sales. XX shift, increase the increased For the due the very a

During reserve our buy to this we the looking it holiday development season. launch quarter. the store a an pickup later and on store online initiative, great out are training job forward to in team the we and prior execute The store rolling in quarter, initiative expedited effort and the to needed in in did to

brand increased which to allowed We awareness. acquire more our also quarter, traffic the in investment to us also increase marketing and increase but during help customers

year, This the customers was tax and to added loss the the of per last share our the per Cost As members was of to as share rate per quarter now loyalty of a year's transactions. represent point this loyalty of program rate quarter our in reduction $X.XX tax compared have decrease The reference, far a result XXX,XXX to compared which a XX% mainly so $X.XX was XX.X%. XX.X%, year. last rate for of we share income due reform. to federal for over

initiatives. for the opened repurchased with of authorization. we was quarter we existing decreased borrowings million for million a revolving XXX,XXX our to per $XX versus stores six end, our approximately balance Turning total credit Inventory last and basis. quarter facilities. new sheet, purchase from We made shares in the the $X.X the last quarter. X% Company year and under million on as the CapEx At in lower on year in $X quarter million million progress further the remaining major $XXX Also, had with store outstanding Company XX% ended the cash a $XXX spent on no

guidance to Turning our year $X.XX to we of of to $X.XX full to a changes; per earnings guidance, are are we guidance with the following compared updating previous $X.XX our $X.XX. share range with updating

compared For updating comp guidance to which negative X%. of to of X% our X%, previous to positive to negative positive X% guidance sales, we’re range a

X% X%. to expense, X% guidance an guidance are For of to to SG&A increase we X% of updating with previous compared

With million. that we previous CapEx, operator, now guidance million for questions. to $XX $XX we to expect are Finally update, with for spend compared million of $XX ready $XX million to

Operator

Instructions] Please on very first we’ll you from our Seth of much go Thank and the Credit [Operator Sigman ahead. get line question Suisse. the of line

Seth Sigman

cadence the just the of bit little think mid played I at in want as understand how to here, end, initial comparisons for comps more questions single-digits then demand throughout we the more in out And of any the guidance Couple the and better the your look Thanks. so the a you’re on the terms difference quarter, throughout is just running just quarter. difficult the what second at If that versus quarter. high color the early in got I recall you expectations? quarter, throughout change

Scott Bowman

May, of did did start We in into was see and In we June solid we're mentioned so for we quick started July pretty specifically little I and the the pretty did the got pleased pretty see we late soften X%, we week month. it May, a up end got as did actually front of July X.X% some we further in good As of and a the was as last weakness all-in pretty better. July. month up bit there. July, us, demand into

to week comp August And we so of little any that numbers, going of as first we of then into without indicated business a as pretty shift, got week see that did I August. July but the that saw with week giving we last soft

Seth Sigman

be internally SG&A And of basically growth? terms on year, external moving just driven think as pieces the here, next we versus driving about what's of then the then change. the any you should is level more How And Thanks. that in guidance that a similar pressures? much in color assuming increase of

Scott Bowman

bit increase build with of quarter. to the guidance that saw second the in SG&A was mainly we a in little just So the in overweight

the expect see I So tick somewhat and still back do healthcare part us were half being that be costs in we that. was time-to-time expense, elevated with of but self-insured, it a volatility moderate do in to so higher. from may

that bit put look overspend dollars mentioned. and that mainly We one that, in did expense because continue working, marketing a some was to and We’ll quarter The it. saw we the and some do in for things and we advertising. the so more did marketing for back other opportunities is we the half behind

And that increase so components main led those are to really the in two guidance. the

Operator

line Thank James. with much. our Raymond to Dan And of ahead. phone on line you from the very Wewer we’ll next get Please question the go

Dan Wewer

you question first is year activity Jeff, of would you balance I for promotional playing evaluate that and have that out see how a say how compared industry let's and to ago the XXXX?

Jeff Rosenthal

it year. a the same Dan, was pretty -- about as see I last

as be models doing promoting promotions they do are I in going really higher some on. that be there promoted. not new level and innovative some I these of to opportunity some come of is products think and you well same new end are not as the continue think to of see

So you say quite promotional. we second see But pretty I steady. I as it's get year believe into far will the as would this seen half, so it we’ve

Dan Wewer

Scott, probably in see you're this like the coming to you next question about rate margin think we’re drops it year going year. or that operating again margin X% you under Do year, this bottom? looks think a rate, operating slightly

Scott Bowman

flatten will Dan, it I out. to start think

app I have BOPIS with think that this moderate. was and year the next on comment we we Remember ROPIS, as investments this our elevated get stores we year and with wages did in did our mobile that and follow-up omnichannel that just so well. and SG&A should in some little increase into year

next as as Our into get gross fairly our we be probably margin year will is strong inventory cleaner.

that that into continued it will e-com as get some well there's profitable. does year, more will as carry of and positives next So acceleration as

improvement opportunity good that flattening not think So to next some margin see going that there's start operating out year. some in we to if into

Dan Wewer

It looks not fiscal it like half half line would the second correct, outlook, expectations. year reduction to that's second the half pretty wrong. the the me looks all outlook the the much the for and the Then given is looks reduce It pretty last question due the shortfall. quarter have second with the why I much is of correct issues original maybe If is you in outlook guidance in second like XQ? year I'm if like the

Scott Bowman

I think it’s a couple things.

back better in the will in much saw than look half. what As the pipeline we we half, the first product be

absolutely that some that and us we So will as in help BOPIS especially stores. rollout business, ROPIS, stabilize should help the us

opportunity We in with We margin this in half good inventory. and back much down cleaner have the we’re coming back into the some way gross were half. year year last

back things the those see we half. are that the half main the versus us So in helping first

Operator

on with ahead. get the Thank you to question the go line Camilo very we’ll our Lyon line of And next Genuity. Please much. from Canaccord

Pallav Saini

unfold Did traffic, Saini ASP you of the first the be well. on as Pallav QX. surprises provide on if My transaction quarter Were in there performances? any that’d performance can on This category is the you behalf And as helpful the and the question comp Camilo. metrics, is planned?

Scott Bowman

let I’ll progression and average cover the ASP his ticket, thoughts Jared give by category. on transaction and you I’ll

So in average were just single down transactions low digits our down stores slightly. ticket and was

bit. Our up. was our average basket retail We size a contract unit saw

on give category. And that stores. the So dynamics was commentary let Jared I’ll some the for

Jared Briskin

the the headwind a from Yes, we some talked categories. category remarks, about prepared perspective in of

negative had So during those well as But did perform quarter than more mentioned slightly below plan. last Scott of weeks anticipated. the two we the our the was as business

Pallav Saini

is And SG&A. on question my second

reflected the of in -- omnichannel you advertising the of assumption Is You why associated the and that an the some in there guidance, as there is in half And guidance is the increased your mentioned down being have your you is which back that talked launching, of going you projects increase in also that some advertising. are about well? taken year. expenses comp case, that for if forward, not are the accelerating with

So connect dots I’m just there. trying to the

Scott Bowman

much standpoint. half an is from pretty planned really back as SG&A The

expect said moderate. was recent in to of we of saw with based we in on what little the it increase do quarter. that just trends I Outside bit that the but incorporating a As healthcare SG&A maybe second higher most

Pallav Saini

gross last question margin. on the is And

some we’re merchandise in bit it saw lower what You improvement the than was you margins expecting.

in level should to look we margin, believe. more Speakers] recovery or see comparison expect QX, QX, than As we a gross I of QX from year do similar last you there? [Multiple opportunities in

Scott Bowman

We do.

probably take shift But there’s is there expenses, logistics thing that the change of numbers opportunity occupancy revenue the that QX. Again, on finished understand think based because to in of is at year. last week store with can important on more year's So merch where would the based a come numbers. million that based I for margin on look out little last $XX and about we but year’s last that QX

so those leverage margin there, that temper there leverage merch the will be we the be that in deleverage to But in saw And which increase will that will cause some to expenses, degree QX. you not QX. in

Operator

Thank you line the the America ahead. line of very go question from Jadrosich get to Bank Lynch. Ray Merrill We’ll on our Please much. next from of

Ray Jadrosich

you and is, question And first think should also clearance think half you? online the e-commerce talk year? and of part back pickup about of in as anniversary be could we the to of The significant last the you launch from comps benefit the for about buy store that, how how can

Scott Bowman

traffic -- there. From drive more we continue more a we expect e-com to and standpoint,

something. around time, app. work SEO against the of think lot are compares that we've to a year, which the this But the same done at be little throughout and and continue bit So continuing expect we year. went and a we search will Obviously, through as difficult going loyalty, we the we that saw

have we lot time last this things of didn't at that have a year. We

So the the that better selling. lot still our pretty coming of This aged site, we’ll the we we some think with clearance good lot in of third Also, from cleaner, increases year, full have Last we when being e-com a mix standpoint. inventory. inventories had launching will that balance We have online. were there year could and we and too. change price a sold an quarter much between

last have some inventory cleaning there, there up which we early. really was margin make an So opportunity to year

Ray Jadrosich

your about the And just online your store. Can in how talk for terms breakeven point the do about just think then sales? of of you for versus margins margins? online trend And early you online

Scott Bowman

So the online is look at when you freight margins, cost. drag obviously, biggest the

is a benefit, that do So the It’s have you occupancy for expenses store not like drag. you but because it see some business. But a total offset do help. you does and don’t warehouse

tick think that I on that’s encouraging. so It’s firm that’s to weighted I a online. going just be up as mean forward over nature will up we our seen But down, margin e-com it as gone has percentage always we have clearance go clearance little bit. a of

our Speaking number breakeven that clearance to point. I put a we our e-commerce. million will good breakeven just clearance It’s with normalized to think I to where little marketing into operations fluctuate than that that our normal penetration. bit, a a penetration decline will to we pretty off will million. point, $XX and somewhat close start continue bit get member level of before on that That it’s and marketing would think the around effort much how I have depending $XX said But as

Ray Jadrosich

category a flatten been we And think as is a long-term that about it for has to for there. to start you'll Jared think there should the soft How Do reduce then point longer-term? will one you think continue more while, about where about the license out? think or strategy that, you you as

Jared Briskin

expectation some perspective. business have was will felt I and e-commerce, a trend our regard always been we a there more trend. ramped hopefully up on back of lost license start the between we a think to fan somewhat Throughout we our Today history, from with may there's depending that we potential claw of is of branded like as to apparel product long-term push apparel. pull the certainly branded licensed a

our license but online assortment the with some pulling perspective, time and more from the vendors. category of and out of same at offering investments are are We an our broadening partnering

is hoping and that of So off the pick teams of losing. some licensed but fan to backup much winning based business so

times that how So lot and volatility have where trending out revamp throughout license does play Today, so Well, on history the investments were really to our the the pulling seem there's a teams we we’ll what’s our that products of then trend are based there performed. doesn’t back. there certainly trending area been be there.

Operator

you We’ll MKM from Partners. get our McKeever Please next very with line Patrick the to line of Thank on go the ahead. question much.

Patrick McKeever

Scott you then for $XX breakeven mentioned So the point million e-commerce.

it’s four right right, You’re around the for past because I pretty now, $XX think much million there quarters.

imply be in from the So back the of just on less absent or a that the of would omnichannel half investment would that breakeven normalized you year that more some incremental standpoint? e-commerce in

Scott Bowman

take could account into a Under close with you really into, more think breakeven. the and I what of I normal liquidating investments working is clearance, we're that's Yes, the very clearance. the because which of think lower some margin, margins to lower scenario

Patrick McKeever

then buy How pickup the model? that store you're the the the in the reserve online to does And how that labor and some store pickup does in to doing drive things impact stores. store traffic other and of online

Scott Bowman

that. model It part it the it really and procedures for and in labor up, really to the do ready getting biggest ready driven the just really It's stores. we’re much. business setting doesn’t really store affect was of of And technology and

the testing online, online most mentioned it unique time. one or doing buy do that the we’re or both I do, people other most earlier, As in Birmingham things don't reserve at feature will one which a as stores. such And or not does unique it is some feature really people that those

that go exactly the actually by is items store. look available are feature all at you’ll Another that

your shop if from or have not. see store anywhere in it to stock able be they and you’ll So

people a will we having to that get for really some our unique to ship of lot freight, store. money our the because very So customers our it’ll really it instead associates drive save all and their we once to up Also home. it industry traffic the hopefully trained that stores in of pick on really it and think it

encouraged very innovated can and buy think that we additional pickup we’re we’re drive in really online So store, have we business.

Jared Briskin

those some whether look back-to-school do at we be periods And peak holiday so of or and it’d forth.

time give on and labor had them during that so be do And know during or higher. labor those because those discussions periods periods, will we we demand

So discussions we have though. that. gotten in stores fulfilling do quite those done The have and product have efficient

thing to orders this And but be stores. so online that's very one and be will they have orders are more proven -- fulfilled efficient of online at our fulfilling bulk the from

not it’s so new entirely for them. And process an

Patrick McKeever

just And me. then last one from

you Just there really geographic and with any that thinking that you think just just the store geographic other, been if online closures if in print if about case, impact of store two that the other given of the way and thought have there. of recent there space, do closures the department you retail opportunities change store think some there's was been said -- retail, players, I maybe and your that had particularly Kohl’s you’ve and shifts kind announced, one much or Are where I thing? previously markets. was to -- change being some process footprint the in any market smaller share more had you’ve or -- see across wondering the don't the But

Scott Bowman

so department have we a close. I think you'll some pennies, in of seeing and few stores sears mixture both. started see markets, a the our some of In

bit that our believe does others, little more us, sometimes those places acres it doesn’t as going and some I times the that lend that have a we some couple those. of do last out specialty of affect few it years. affected markets over more in I to the some itself But we can think more the lower to seen online do we has But seen in we quite on seen have maybe a much of lot costs up. go you or things pick So mall that percent rent of way. categories, us we some of have as

Operator

line line you Thank And question go much. get from with the to of our Benedict very we’ll the next Please Baird. Peter ahead. on

Peter Benedict

impact could First the second on occupancy the isolate you in question, quarter? Scott, margin

Scott Bowman

was occupancy of points XXX basis expense the Peter, benefit.

Peter Benedict

And How about incurred then got think how that occupancy about versus base year? are this the we you store you’ve guys in thinking aggregate store closures. year now net the last what should dollars you

Scott Bowman

a bit because closure the number. of that net We said down come occupancy dollars

Peter Benedict

gross one for this then point the the were this we -- margin in at earnings thinking guidance. aggregate maybe year, midpoint your view of what XX points. basis terms does know and What in about margin And the maybe if I envision that you of XXX What's to like? will gross think look

Scott Bowman

I Peter. half were still I in first margin I in see points year. XX mean, the we that it’s higher of range, the for about think

really And so it's coming as I expected.

QX less the and favorability should it But point for little store still I merch warehouse And basis that expense. so maybe but said on XXX bit occupancy in similar expect on range in I the the back to as XX have favorability, margin half to be more the year.

Peter Benedict

year. last from half The more sounds similar guess getting in allocation narrow? you're like what's to are on the that year the on And then just allocations, I better of Just back vendors product ago, levels the coming latest they key that? the it

Scott Bowman

I much vendor allocation. partners and think from it varies by a But overall, commitment access a more category. both of regard to seeing with we’re our

Operator

we’ll next to line of ahead. question Rick go Please the line our the And go Nelson Stephens. with from on

Rick Nelson

year, there one-time that going the how on the as about Or SG&A? think look we to roll are off? costs we next should think the I SG&A growth As about are rate in

Scott Bowman

of I next we did that have the some tax reform This I mentioned year. think with year growth omnichannel. wages moderate increases with costs development see the you’ll rate and with some

are those that we’ll So biggest next year. the two moderate ones see probably

year. X% next so this And X% year likely we’ll off that that will see back to

Rick Nelson

would you And that year, about thinking next break into Scott, profitability? how are e-com the

Scott Bowman

we’re grow getting for I continue to things next BOPIS business. mean is well. year mean, do continue And I significant upside pretty to the we with ROPIS. as to to e-com see that SEO that try and we going traction into of especially

and year. to leverage there to growth a continue do better inventory. So continue is with good And some profitability good that because so of good the we margins some improve, as we expect lot as will continue next well we in cleaner -- see likely signs we’ll and the model

Operator

very on our go with David from the to Edge next Schick you We’ll the of Thank Consumer get Please question line much. ahead. Research. line

David Schick

I categories whether have customer, you you from in about on detail it's or see digital first us just two, more differences and give know AUR. could the what

day, just customer? at it -- to So the the for transaction what But the you or the will to an the understood end And like it’s folks you know there’s level. stores time sounds your optimize to over about that second, investments count traffic relative into store. the store about If persists, omnichannel store them, it’s drive strategy? how think at of either

Jared Briskin

a all from think participate customers our across online, I our of trend perspective categories. seeing we’re

We seeing clearance footwear the additional channel business cleaner our to are Scott some a as inventory as in well cleated our our as to certainly business. consumers, has significant, as much particularly our as was from into online place. Obviously, leverage mentioned, apparel the well and ability gotten

business the change brick-and-mortar balance are category significantly online. price. regular drivers We the drivers are perspective pretty see our from the But a between to and same clearance starting of

Scott Bowman

a come traction will store will question going their we members your Apparel them towards to in in to the will site, marketing so be is very Web offers concern seeing some our communicating come loyalty to directed that forward growth there of BOPIS/ROPIS dollars driving item. we’ll we’re give as us. pickup to to our for And store. that statistics that that remain our around traffic strong part with traffic, And an with be that out our that spend nice a benefit so usually with increase and purchase there. customer they apparel say There's expect see will in once some connectivity stores. obviously

we’ll stabilize for to we’ve that. And assortments to then businesses continue so to from the those those earnings to that some category, on well. look And as got expand good try opportunities and those we’ll and fine-tune on other try to at

Operator

Poser with SIG. question get ahead. next to Please Thank you online Instructions]. Sam go And much very we’ll our from [Operator

Sam Poser

at your footwear. the talk utilize we Could you -- the more degree, talked looking to in you those to starting to become? in -- it’s store make businesses inventory the and strength businesses in efficient the what you at within and online licensed about order remixing you and are than Are apparel weakness within better how re-looking

Jared Briskin

we’re We in licensed shifted apparel, historically into Sam, products businesses. absolutely a the into the looking at as that. that well portion as branded made significant investment we footwear of

are an partners. have as that opportunity for From pretty as licenses, significant to our perspective, There with categories assortments that are such vendor payoff are within broaden working We seeing the us. equipment vendor dropship weaker such a online we some programs.

perspective, while our channels. are of spend digital through are in-store getting actually some prospective wider reducing that from an So we space an and we from assortment

does that always sneaker and investment in. license of there's earlier, the core mentioned fairly between the business. current branded products is push of I certainly that And license as going So license part certainly fan significant dollars that's outperforming to pull we’re brand amount and then on business positioning connect some trend today a that is the there

Sam Poser

Scott, think we’re hurricanes so current guess, the that the I the lapping in trends, of in on. and then And I process Houston one? you. impacting last is from for How that Thank summer

Scott Bowman

don't big Right now, impact. see that as a we

the impact for think last a fairly there. I we’re was seeing so material impact isolated us year not

Sam Poser

sounded in the case negative. Was of weeks response said Jared, much another -- And the how two was quarter that were shortfall the in the you of there or like that that -- not? question last to the it

Jared Briskin

expectations, plus our negative, positive. Below not

Sam Poser

I And so number? little you on it think normally. about made your But I the to have talk going know XX% now have like would up then close -- right is trends more something are stock don't that you quarter-to-date on? and give I now, be it what perspective what’s current guess, least everybody you to at and that might

Scott Bowman

we up be And Sam between shift did or So we we in from that million recovery max, but and we some of the in in week of And July. it, to so a did cite one $X the see. week million last August. see first dollars $X the to week business see lost two clear, pick just it’s weeks what is probably

Sam Poser

some know some so of change. to what’s start it's one-time will But that of the half real to We idea happening idea right are e-commerce thing to the headwinds, there's with We business lap right I not the e-commerce on us you’ve on. us current make how the going going not and a now? year the about the give out at could play and/or back where going give BOPIS/ROPIS, -- trend, basically clear that to mean, you what's know you And headwinds that’s can guided what you flat. of this And you of quarter-to-date app a lot all have you’re and given of of visibility now?

Scott Bowman

are we is that All say that’s from good early will million $X July shortfall, the and numbers to that million gave of about see parts is quarter-to-date the $X that estimate. lot but I number the moving number number good I coming

negative the you say to does I at X.X, one guidance so think that that Year-to-date we look entire we’re on bit. as little a comp. so the is one back year, will at pull plus

I think trends good July you with very the here, at e-commerce strong business, e-com. look very as business

year So grow. as pre-holiday. especially season, fairly And that it’s still last we continue can holiday new into we’re to the confident get

there's So we in November-December that think upside timeframe. good some

Operator

question we’ll the line, Peter Baird. up follow on And question with Please our next line go ahead. another go to of on the so Benedict

Peter Benedict

plan, also terms of what half embedded rate? in tax Scott, Thanks. you're second the what's and just curious buyback, the in just thinking

Scott Bowman

the $XX QX, of on expect million as in million I in would rate $X far buyback, to bought QX as so lower the quarter. The in tax far the should we guidance range. that the is be We’ll that back so XX%. it likely As $XX end million, half to pick about range, and to back be but pace up around

Operator

Thank you any Mr. very time. turn to it we further questions at Rosenthal, this you closing back I’ll And much. remarks. for no have

Jeff Rosenthal

third the future. on in look you. Thank the being near call today. We results giving quarter for forward our you to Thank

Operator

for And and We very you lines. and you day that ladies Thank Have call much. today. disconnect gentlemen, participation everyone. thank that for ask your conclude a the your you good conference

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