FLWS - Earnings call transcript Q3 2021

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Operator

Good morning, and welcome to the 1-800-FLOWERS.COM conference call. [Operator instructions] Note this event is being recorded. I'd now like to turn the conference over to Joseph Pititto. Please go ahead.

Joseph D. Pititto

Thank you, Kellie. you Financial joining Third Results thank discuss today Quarter. and Inc.'s X-XXX-FLOWERS.COM, for morning all us for to Good Fiscal XXXX

copy corporate can be For yet at the issued who you section accessed XXXXflowersinc.com. this of of relations a our earlier release those release at our the have morning, investor press website of received not

be and to formal will open we Shea, call Our your Presenting and questions. remarks today CEO will begin then Chris today CFO. will the Bill with call McCann, brief up

Before we expressed actual to statements meaning These Reform need to results implied forward-looking today I of Litigation the remind from XXXX. cause applicable the in the some begin, may involve differ materially everyone risks statements statements. of within or make Securities of that the and Private we those uncertainties will Act could be and

these Annual description release our uncertainties, For company's the issued of Form Form reports XX-Q. morning on refer press SEC as this a risks well as XX-K and Report to including our quarterly and detailed on filings, please

Chris company. update turn to any today's stated statements call filings, GAAP forward-looking to in found I'll morning, the release the or as most SEC made addition, call the issued of supplemental are of today company intent that to these press the the measures The Principles. accordance expressly be call, of discuss except financial press Accepted prepared will any release and its in in now non-GAAP the measures In otherwise tables financial over not with comparable today's any recording Reconciliation obligation be certain directly Generally issued we by measures company's this can McCann. Accounting disclaims of the accompanying this morning. may or in earlier

Christopher G. McCann

who's of call another Thank bottom-line joined and morning. top we're pleased everyone report record to you, this quarter to Today, our and thank you Joe, results.

pandemic growth across than COVID-XX of building has further The segments. been our have more? growth pandemic. and growth strong for reflects as behavior by We to three we e-commerce the to to today momentum accelerated What's which XX%, country XX%, even emerge continue is Consumer years to continued driven Our business growth grow, of that our pandemic year the during business e-commerce, likely the start accelerated begins back. has several not of more than expect more from revenue our was shift a ago. in the to revert the changed since dramatically and

has built well company a in an positioned are As who for this shift tectonic platform evolved to business our benefit the growth, we from and e-commerce to future. now

and our connection broad In and our inspire singular important deliver continually a a ago. we are expanding are than bigger, suite Today, company to sentiments ever uniquely designed year help are we positioned of expression, help better, one to mission smiles human products a are the with addition, more in customers that to than more important people specifically were and These celebration. even company lives. we today has stronger their

key large our Mall. technology in brand, programs, the advanced recently, brands, invested customer platform Personalization of platform several our elements newest digital care & fast-growing our our We've brands, and and our most to customer Over and continued the our family Harry stack, our invest trusted marketing e-commerce X-XXX-FLOWERS file. particular, and in all-stock past signature years, David we've including of our in

and in a scalability. us on our Baskets Leveraging stack. for We've provide optimization experience We've a recognition, customer driven such with Food with social platform the care of leaned program, platform grown focus the our and SMS and enhanced with an floral integrated innovation, position results. in reach AI-powered that flexibility always effective analysis exemplary building Gift resides have expanding micro services area advanced channels, we've two-way and brand to enhanced proactive an virtual our culture with our an providing assistant, in and marketing customers and customer a reasoning learning market category enhanced video conversational programs we We've in the Gourmet and expanding display, we as becoming chat on our our fast-growing and of search, can the chat technology cognitive specific into provides skill adapt online bots gifts. personalized the business our space, that cloud, fly. Personalization result, platform our with personalized recently our that a released experience Mall, a extending to a new addition and a with Apple As have the leader functionality skills leadership enhanced understanding, digital of share, built in performance, leader

In we've terms as continued to tremendous well as metrics. of see our growth, file, behavior customer enhanced customer

in give added has at customers total the Our growth tremendous million now and increased retention months represented through year, forward. significant positive and business, continues strong to our Passport already have program and across pace. going our assets hitting XX% XX a nine active trends and members a the our purchasing of XX-month continued loyalty file revenues grow demand exceeds strong total that we customer grow X to drive customers, these despite comparisons The the that nearly all existing challenging to of double-digit Passport and with helping Even we achieved approximately new multi-category, confidence million in first frequency, fiscal us million for see behavior. X growth, of combination multi-brand celebrations milestone, customers continues membership now a customers. at new we've in the months current the rate, from past rapid nine outlook

more pandemic press to current achieved a by anticipated last we spike in double-digit was quarter top fiscal induced and in on revenue such, what fourth this nearly fourth achieving important in we revenues and this next the our double-digit anticipate for guidance to is XX% double-digit XX% enabling release that And growth the of billion total provided As quarter continue see quarter in e-commerce fourth growth achieve looking based expectation growth well. growth than it's as fiscal in our With we demand. momentum which us the forward, believe double-digit for growth on of the current X that year. our revenue with the this fiscal quarter, we will our today year, we driven year fourth note in in

future. is for As e-commerce I've scalable stated in built highly leverageable in the now and past, our growth the and platform

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

William E. Shea

you, Chris. Thank

here weather of period, shutdown including for reduces XX%; due achieved of third-party despite third carriers Valentine significant the costs the conditions; holiday, were several Sunday higher Day main and throughout including Our position. fiscal to our the demand during usually freezing unfortunately a to extending remarkable Valentine shipping results complete the the signature more to stay. and third-party than Despite placement our severe brand appears headwinds, these further far outpace at continued the to which quarter quarter, providers, headwinds, be market X-XXX-FLOWERS hub which the by Valentine's from competition leadership

technologies. using quarter, of we product Mall. in wine more This thousands picture newest performance personalization frames, be which dozen customized also the broad factors, strong can with combination offering a continued saw reflected items than a of from different During our glasses our to a including brand, Personalization

and in files more entry ability leverage to hours programs digital personalized customer and as enhance or Our as less, ability to customers effectively finished marketing industry-leading our a our XX order and go to excellence and little product enterprise expertise their from operational reach to unsurpassed ship marketing and to new ready efficiently.

marketing e-commerce led Baskets drive that to also by segment, to drivers drive and a of in younger programs across a operational of we e-commerce who our have and We Gourmet the flexibility our continues and growth to also of overcome & company. results Harry a for Gift Food thousands reflect triple-digit quarter which leverage gifting saw environment a built. digital David hard testament are record These platform work our challenging associates the everyday demographic excellence occasions. reach our continue brand, and the for and our to strength the to iconic perseverance They

from Now down the quarter. a few breaking highlights

of three million quarters, of to continued Gourmet EBITDA XX as positive as nearly when past significant gifting, an and well were a fourth shift the particularly This growth of adjusted our positive the years non-holiday quarter strong compared in prior-year brands, XX.X Food Our consecutive adjusted only EBITDA. reflects calendar period, quarter. the includes EBITDA everyday in increase our reflecting Gift we Baskets from in year-end million,

higher Our rising gross XXX with strong profit improvement QX than adjusted XX%, basis. despite total a of of combination an adjusted of EBITDA by was than more revenue margin driven operating than points e-commerce more basis more on leverage and costs, growth of growth XX%,

results. Turning to segment our

XXX of marketing e-commerce a programs, offset enhanced promotional triple-digit mentioned Baskets labor shipping basis I with performance segment, related costs. a strong strong gross earlier, Gift This growth leverage in As revenue margin Gourmet combination increased Food to profit reduced improvement by and and achieved our growth, along the points. of operating partially reflected and we

business, during gross holiday margin As margin higher nearly than contribution increased our lower and revenue a margin weather-related increased period. the we and XX% our which this segment In despite contribution increased Mall, segment, the than more revenue and incurred increase our to due percent $XX gross signature primarily Overall, the gross fourth the we shipping In results across contribution Gifts of This and of profit BloomNet and costs operating growth quarter. costs despite segments prior-year a lower X-XXX-FLOWERS profit business top Valentine of segment the compared the margin and we Consumer revenue our and XX%. margin achieved solid our growth, million segment into product increased fiscal strong reflected which period. period, includes XX% was higher head achieved three result momentum, as profit bottom-line more margin Personalization brand mix. and in exceptional leverage, Floral to in achieved XX%

cash million, the million which our year acquisition of our acquisition Mall our and quarter investments service generating, was of initiatives million than used strong the build cash balance finance was the earlier more million, and Personalization Personalization hand Reflecting both to having are to e-commerce position inventory cash our XXX to an on increase demand the of XXX over business period XX our Inventory Mall. of to the of seeing. includes Turning and our end sheet. represents this significant we is ago XXX reflecting that year at

borrowings in under debt, million of facility. revolving had XXX zero and terms In our debt credit we

flexibility in acquisitions. sheet our combined invest the As gives accretive us untapped significant noted of platform balance minimal add and and in past, line with credit, strength to revolving of business position the strong we cash continue debt, our to with our

we years. buybacks increases and two replenishes repurchasing past XX believe to is our morning, our has enables increased approximately had the investment additional We addition, our returned to in which shares shareholders for us Directors as and authorization by authorization, new repurchasing XX previous noted compelling our that our very our release our value we million authorization of The to Board In press stock shares return this million. stock over a shareholders. to under

Regarding pandemic holiday we the that prior-year Day created Mother's Gift floral Gourmet in In period. and our resulted challenging of guidance. The prior-year record that This fourth segment growth growth Food the our the compared occurred triple-digit of Baskets more with e-commerce than in complement unique the business. the comparison in a growth drove XX% start quarter of very our in at and last a us. year for e-commerce events period, saw explosion of

a year's prior-year strong increase low period. we quarter. addition, comparison, pulled Despite of adjusted marketing fiscal EBITDA and advertisers as revenue a This double-digit growth growth we record with million revenue and the in historically costs digital anticipate our performance many back. driving bottom-line $XX fourth this growth challenging this In saw both in over reflected dramatic

growth considering anticipate we compared on total the range growth For to in digital achieving anticipate year. quarter, growth EPS revenue X.XX record we flow morning's $X.XX with in $X.XX anticipate with share. quarter year. back our double-digit the EBITDA for to three EPS million adjusted achieving the the fiscal the XXX XX release, in of now last as to prior year $X.XX year-over-year also the record to growth the EBITDA XXX costs, XX% Revenue this million quarter. compared to free we marketing in the range the for in this of million. year. to of total year. compared results of per Combined than Chris. first XXX.X for the of with range of in we in and of with XX% the more compared the and revenue I with stated to our billion XXXX higher million full million, XX% approximately of driving year, following cash in revenue a the XXXX XXX anticipate $X.XX the and year's range the revenue will prior And more year range a consolidated achieving of Adjusted results XX in prior of Based call quarters turn X.X for million EPS than we in billion $X.XX fiscal

Christopher G. McCann

Bill. Thanks,

you, clearly the business. momentum our driven So, as demonstrate with our strong third Bill is in just quarter shared Growth and factors. continuing business several by results our in

First addition new file. is of our millions of the added to customers

with Second our frequency behavior of and metrics, is retention. customer the including penetration enhanced increasing base, along existing

of such categories, marketing from growth loyalty Third are over and cross-brand programs the and who is lifetime and value. cross-brand the Personalization of of product enhanced purchasing in expansion categories expansion driving our and multiple from purchasing million addition cross-category product the and number X Passport continued strong customers increased members, continued frequency is and with merchandising of as the resulting program our retention, fourth new Mall

our growth are addition, outlook to express In that very secular connect sentiments of shift the as of at the online for core purchasing, to well need our business. and as continued increased consumers reflects the both increased themselves; strong

our EBITDA. toward extraordinary was fiscal year close on we in expect line As more current year, of an look with than billion and we and million XXX fourth last X quarter adjusted top double-digit quarter the what growth revenue driving of in year anticipate we to final fiscal this over top

like platform call to we very and and are e-commerce for I'd we over take to brings. the your what a growth, have We future for that, excited highly now scalable turn With questions. can built the Kellie

Operator

Alex from from [Operator go instructions] ahead. comes Please The question Fuhrman Craig-Hallum. first

Alex Fuhrman

for all much Great. I mentioned, you're really existing customers and sounds and very XX% of that on question both new It customers year-to-date. And your to and cylinders been the the and a next suggest to year you? about have on customers opportunity both what really strong for How think acquiring firing new that the quarter. with you to that Thanks you've new taking continue like remarks year? does congratulations customers for really compare Chris, my business capitalize that acquired in existing into on customers about normal heading prepared year does this you'd another

Christopher G. McCann

the been and we've and the Alex, recognition thank thanks you question, for Great, for performance that of strong having.

XX% would of been say, than revenue So, spend. I first more more into slightly their average from the it penetration up their customers program, our months, more in existing customers the frequency, representing previously, one from is what our Passport increasing nine buying category, has as we're seeing thus

customer So new naturally of spend the existing is the higher than customer. an

one at base, and we that's of the the that that future and main see for some It's - into years, growing significant that of information forward, look of we why look pandemic couple grown to nicely As last and a you, customer greatest again, file growth. our which our over sustained we to we predictability wanted we with large is accelerating have, become asset file pandemic. the significantly and the the the prior assets share

that, we of coupled see in in read coupled leads forward, it's gives double-digit we what QX, us two with So how guidance can the going the that confidence growth. with

William E. Shea

pre-pandemic new and at on than Alex, as basis. our are We're performing right that and customers now new this pre-pandemic is strong new customer customers a customers But well growth Yes. better performing the better point Bill. across existing are than performed

Alex Fuhrman

helpful that's you much. Thank really very Great, guys. both

Christopher G. McCann

Alex. Thank you,

Operator

Markets. Michael next Kupinski The question NOBLE ahead, you. Capital Please go from Michael. from Thank comes

Michael Kupinski

a quick customers ticket congratulations you little A buying potential year, consumer I shift of Can larger couple flavor in the days? Can and a here. Are instance, items, obviously, of us pandemic? about you buying certain just to for consumers what during seeing starting to are bit last shifts add like the you well. patterns Thank questions my as you versus more products? toward talk these give would category-specific

Christopher G. McCann

Michael. Sure,

of the again, tremendous product from the accelerated. which we've foremost, pre a what seen to is has view, the just is this secular pandemic movement movement. well a right, as of we've just off-line online, pandemic, point actually, is and that some From of well, and kind seen, First been during shift

in we our lives areas and of different our As pandemic, accelerated many see the behavior. in basically change

category, this help for entertaining line as category what saw Gourmet had plants recognizing broad in as and was product the celebrating and Bill we have that be David good have & year has we David saw our pointed that what in products, to why in to define past tremendous in prior So assortment etc. different continue the we growing plants, the we Harry we product one his and since that acquisition we under again, to as personalized offerings. example, and then growth home made an ability going products and very taken off of the expand continues growth of needs, it's that continues And people ways. and in The grow, personalized out with Harry as & number Mall, we and comments, their a then Personalization can the to of were

that started a key So seen, since. but been couple accelerated they really before pandemic are and shifts those just have of the we've

Michael Kupinski

this of us spend Can your color or just related prices to you marketing it the for? us is just flavor is a quarter? for instance, what segment any on give or Mall, digital for a increased of related particular kind give keywords Is like little marketing spend for the to upcoming Personalization

Christopher G. McCann

Day Mother's at when what so obviously, for a the is is, marketing us we this we quarter holiday. look see the Michael, spend, Yeah, with floral

we Personalization from September, we're discounting point food marketing as And marketing well our expensive. the well now funnel a good last we quarter of tactics focused have look doing, Mall, we we're space, We've part from So is very the we've as but of as at play brand, for more is really but the to in costs of bottom August, at beginning our gourmet growth this extremely see the normal. categories. were with seen not gotten us. costs well, on previously, view, marketing floral a playing moving effectively. and competitors what XX% of but the which that digital That right cost year, many aggressively as where lot marketing upper said when dealing game, and probably that of And look coming spend working from a increased from about it of mid this in we've we've been managing reduction is really normal, the back that been kind low, returned so the funnel

Michael Kupinski

question. last Just

severe the it have competition you I your a talk had, maybe quarter, us faring experience you in you happened give have benefits lasting bit experience? You that of in little may just have about a little might Valentine's as your mentioned particularly maybe result might of Have impact any been right flavor kind terms about there well? the a Texas even what the after but not as Can seen of in what there? talk you can know your that of Day, weather been? you bit a can dollar-wise,

William E. Shea

the center third-party big the hubs, companies of actually through of they Texas, the the into to of and saw parts close some shipping really couldn't country weather, Northwest and right all this started week The for the the employees work. impact with down country week like after freezes and the their Valentine's we had of as lasted and week Valentine's and really get then happening major

holiday delays the a our getting the did and impacted Day credits, created gross for quarter. for create of in consumers higher and level So third Valentine's margin packages that some to which

in segment. returning at least and normalized, that back what saw the Gifts You Consumer new It's now. to more the Floral right is, normal

ability The more that them did overall third-party demand are a dealing on for it's not carriers delivering with timely fulfill they exceeding as in to to as packages back e-commerce pre-pandemic normalized But basis. the timely level. historically

Day. So weather of the any at Valentine's see long-term happened we implications don't what to

Christopher G. McCann

weather channel was we pointed just the saw network out, network an Michael, the keep impact, of being one our one benefit Bill and not too, things, focused. mind, to distribution as in while And of our the also fulfillment

that the not but of to was most etc. the while a that area, and during utilized to every in frozen on greater challenged were challenges able their utilize So hubs, network degree. time obviously, period, were network, were our Texas, carriers our we third-party florist florist

our having flexibility So is multiple channels between to the those company. a benefit real

Michael Kupinski

Great. Thank That's I have. all you. Thanks.

Christopher G. McCann

Michael. Thank you,

Operator

next Davidson. Thank from Linda ahead, question D.A. Linda. from you. Please The comes Bolton-Weiser go

Linda Bolton-Weiser

online industry Great of great to of estimate you Can outlook. online gifting maybe is of of online? hi. give was what that Yes, a was some shift off-line couple and of kind to industry the kind about ones floral us one you years ago? quarter Can Congratulations. the first talk percentage the and now to Thanks. what versus floral as

Christopher G. McCann

for to a and category really and ones [Indiscernible]. we Linda of thank appreciate congratulations. in one moved you, Thank floral when back started XXXX to the been early We has that online on we move you that. The online

business is and saw billion in shift it of from online, we product that I this we've and past offline this has saw gifting shift is estimation. So overall with the component two working BloomNet category all industry really overall I time. that the well and to well for about a Again, as the say online But and the a very, best how customers - we you in category can what probably think working and business see you're our long business off-line. I'm categories. extremely very having is it's we we're I can serves as we're it, is floral $X our look but with represented more still sure we is it generalization continue at But online ability our us about very the migrate to quantify if to online that for of opportunity continue see positioned. year, about seen to the migrating our the offline broad billion $X.X much with well opportunity this if a right, seeing versus that is really not floral BloomNet a florists, local we online been

We are to shift. very well benefit that positioned just from

Linda Bolton-Weiser

this margin you've kind longer-term but - margin targets having I term, Thanks. you maybe talked And the the do an imagine on a can potential over florists from of of sometimes. question. floral always long investors then there I more Questions the I gifts to on about EBITDA ask profit your with on side, get is upside share the side. food

talk talked that you should And target about XX% can seems it EBITDA a So that? that's but you've goal, about be margin your higher. like you goal targeting

So can that? you about talk Thanks.

Christopher G. McCann

So, to address Bill, please? you want that,

William E. Shea

operating a the there's been cost with and headwinds there going years. year. Yes, at higher both, look and We to greater margins we've number to We're to continue know with we processes going to a that. look we in costs, the we've Check box, operating we're margin. We our at And of that drive of automate we drive a gross with increased for Linda, to continue margins. forward. increases cost associated our shipping this out number target EBITDA that expenses, always margins, had look margins, our managing environments to doing labor, EBITDA to offset XX% of those as look been

drive to continue margins going So we are to going forward. improved

and we that. strive set what before, achieve we'll had set But margins new be. out new We target a XX% to haven't set that target we've just will we'll achieved that a yet like the

Linda Bolton-Weiser

having your there talk talked you you've Thanks. other then Asia? just from inflationary shipping and Are finally, not areas components about getting Thanks. or actually where also you higher about what everything. like And trouble materials you're you getting pressures? costs need? any are just And Can actual

Christopher G. McCann

seeing What Thank product destinations, it's point from significant fortunately, Asia, international getting we're as far as from part from our of view, of other source a business. we or not while do hard Asia you, a Linda. suppliers good most

and been the while able years challenges was other we're manage for effectively effectively. Suez with now the our last most as able have and recent blockage those add manage us So been to have challenge that way the a far that inflationary as certainly, in on couple Canal for the the of to that in some costs? We've blockage and anything the parts. Bill, through as to of

William E. Shea

and offset dealing Again, automation, labor distribution Yes. in we've we continue our call Again in those of shipping our it been several be increases through efficiencies, centers, to be those years. offset costs whether whether the cost through to with costs. operations for it last center look operational to

Christopher G. McCann

Great. Thank you.

Linda Bolton-Weiser

you. Thank

Christopher G. McCann

Thank you, Linda.

Operator

you. comes from Please Dan next ahead, The Thank The Benchmark from go Company. question Dan. Kurnos

Dan Kurnos

some Good easy of quarter just thanks. of weather even marketing, question, to of morning. we there granted, can over you with mix lapse XX improving are benefits, to the in pandemic Obviously, really quarter even of benefits. as some it, pandemic maybe look incredibly some have ways as to you found you quarter first back just on of sort the up kind there's end, driving XX have it's the months as Great, guys. call Bill, out you'll margins June keep well. nice a Obviously, PMall the margin comping you 'XX, the follow linear. the basically in benefits always because that and let's not but of next saying that kind though you But continue

William E. Shea

Dan, the Well, August able term, into operating that to But give not top over being going very fiscal In we're XXXX. to be but guidance extend for pleased QX growth only we're giving line call, double-digit also to drive believe include and guidance on can improved margin as and margins. leverage. gross guidance longer would forward, going we we both more details that to our

Dan Kurnos

PMall better just is in that growth the guys ex-PMall guess pretty in thought. little to a organic June there you quarter, you can your ex-PMall to is trajectory, is the in But than normalized close guidance My crushed and that color I would imply around handicap way But quarter you any a darn PMall June quarter? if it's that? Did obviously, you're some growth you expectations? for doing on to a relative were give give number QX hard with

William E. Shea

PMall still at quarter, challenges did in Floral despite revenue, growth the third showed Valentine's back segment or about in $XX the and which so XX% XX% Gifts so Day. grew Consumer the Well, million of

to again, the and grew So year off a third brand and that the March in but a January inclusive contributor and grew to XX% quarter going growth double-digit a as to ago, coming incredible over pleased guidance fourth quarter PMall. and quarter X-XXX-FLOWERS fourth giving we're is had quarter. in overall is in grew the PMall nicely to be of an nice we that over the very XX% be company, organically we

Dan Kurnos

are sort thinking you buy us Just categories, I the think you be how comp. quite you can there, - better, - is category. attack companies are you're personalization I that's and Etsy XX% staggeringly you getting deeper? How point some would to to your to about heard help expand away actually improvement out they opportunities. deeper quickly growth though sound opportunities. some for into customization not there doing with you And is you're interesting just I of some off Yes, can might I there there's you front. to ancillary I close able want lot maybe Are something that on personalization, PMall We sequential plenty if just guys like into the can't the guess, got it you, think that with probably. Chris, include that there's breadth high. partnerships about although some with areas within eBay right obviously mean the last I'm to like the I tuck-ins? about know but to that mean, scale more talking making they're meantime, then but, get night of a there provide in of competing organic be of curious of am

Christopher G. McCann

for is a Dan. There I'll across in right. come you lots and Great, Thank ways approach you're of and the we personalization. to categories, but opportunity of then us back opportunity different our number

the As expand offerings. we look to constantly our look product we at business,

model partners of through development world, around working Now we've more [ph] a or we in the country, marketplace internal and whether that different the do past. kind of the that about spoken around with

if now, and offerings look the channel, grow you the more capabilities the within adding gifts there. flowers been So Especially and accessories under we've right product more you've seen brand there.

said look great what we platform into Personalization add for to from space, at us Mall As beginning our was a that platform. very was the personalization we

personalized kind that So that with a expanded a as - that we've partner that on to Mall to land strategy talked a didn't launched and to Personalization need capability, candy third expand about grow we product working and and example small that recently of that with has that's with capability bring we're a look Mall we we be in-house. Personalization that we able of is

just the a build and that's upon. Mall example growth key great personalization opportunities platform a category small we've within identified gives several space So see but to Personalization that us

Dan Kurnos

and I continuing. Thank the Great enough. you, right. color guys the momentum appreciate Fair All obviously, see to congratulations.

Christopher G. McCann

Thanks, Dan.

Operator

comes & from next ahead, The from Company. Anthony instructions] question [Operator Sidoti Lebiedzinski Anthony. Please go

Anthony Lebiedzinski

impressive Yes, so with you good and job thank very morning and taking certainly for the great questions results, everything.

that provided, you're nice So certainly information as to the that see just wondering Passport, quantifying that. far [ph] you the as

AOV could give along us would that retention, far you that if you helpful. the with overall quantify if Thank that very seeing could frequency As to you. order Passport metrics, as some members, perhaps as you're any sense just of from - be

Christopher G. McCann

bit to share been Yes, the color a the growth because file. we're phenomenal little Anthony. wanted behavior that and we metrics Passport you, our it's really on seeing in to Thank drive it's of helping increased

we about way that and and valuable platform, about, expand are customer importantly, more our one was in example greater customers we Mall, people is, them one rates those buy help customers significantly major Personalization from that from X more our with value. time. XX%, X I is that gets express, increase see category. talked from we're value just referenced our to single as frequency grown communications greater and so start solutions a than bringing X.X just a by connect wanted their so we again, to candy and what more times we customers did is it's acquisitions, it's more an like to customers generally starts So us. the significant all category, and or to the buying partnerships to of membership see when than the even product enhancing average we as company, them the a a for or XX lifetime further, product to more more who And we more we one Passport single and as their through category, products, than one increased and passing celebrate to let what million program who continue Passport, And and that category, because threaded of membership migrate very categories by than And with you for product more and the Passport to more customer more our category numbers through number, increase retention see have just stay Passport know mark, to who threaded, to

Anthony Lebiedzinski

Got it.

Okay. then company AOV or for in Passport non-member, noticeably is with versus a the of consistent a And terms different average? member that the

Christopher G. McCann

the with is AOV average. Yeah, pretty consistent

William E. Shea

And little the the ticket. is a We overall, & David, food on a lower basically was bit it quarter flat. Anthony, for AOV with see Harry rising especially side, PMall

basis, enterprise, an as so all on is flat, relatively So basically, AOV a growth the blended our growth. unique is

Anthony Lebiedzinski

it. Got

that. Okay. talked bit then I you just Thanks know as - And as wondering about flow cash your that. little so priorities, for a far

and release you the a mentioned well. had that press separate about buyback You as

wondering for just and main as as So priorities far to appetite just if want allocation activity. your on M&A maybe your touch capital you additional

Christopher G. McCann

Anthony and really Right. Thanks, recognizing.

and will of and we our assets, balance good see it's - results, of of amounts more the you strong as our that good platform - that cash in platform the importantly, we've our our built continue generating at greatest core and is look one very build. one As sheet to extremely really, we we're

in to two the and capabilities you've look that we'll our to at value, we'll us acquisitions, that added invest of to And side, the that invest our automation, new gave acquiring distribution in believe continue Shari's Mall, business, to Berries Personalization has and with elements flexibility that etc. the value authorization seen different So the all in platform shareholders and we us as us years, this the manufacturing way. this enhance compelling right as a to platform, last then and and continue have, technology board referenced, continue like through return we gives well we're through in Bill thrilled core as stock we our that

Anthony Lebiedzinski

it. Got

question, or last of And Okay. less here. more a then housekeeping kind

as a that far tax third as QX the quarter? guidance, tax rate saw in versus imply So rate that's normalized we more embedded what in the here does the

William E. Shea

rate should or into of between XX%, and the for The we discrete fourth benefit that's Overall, XX%, factored make quarter, the items rate year permanent tax in some the quarter. rate and that XX% at continue and we had year have have benefit gone tax sync impact and in third we our to the throughout up an get to the less XX% so of the XX% and - got items what our Yes, to money, got Anthony. third effective as be the the annual get quarter. in has the is we we effective again, therefore, more tax

Anthony Lebiedzinski

Got right. luck. you thank and Well it. of best All

William E. Shea

you. Thank

Operator

you. Thank

ahead, Research. Your go next question comes Please from Doug. Lane Doug Lane from

Doug Lane

everybody. morning Good hi. Yes,

M&A you a know acquisition you're actively but assessment topic on anything on here. just Just now? are want And properties - can't the to there us something, you give at until qualitative that looking announce you say could give the front? stay I you Can

Christopher G. McCann

in to the move Doug, currently that for we and we be in maybe a spaces making into. categories actively always time want Thank We're lot you, might to sure that space and adjacency in, and looking spend of thank the question. we want the you we're that we're networking

so we're presents challenge. landscape to look you now, that So the that when really a normalized last year, which you would I based looking are see actively sell had they would on companies always certainly looking. right to year the phenomenal say that always be need at valuations,

to I today, platform look. an Berries? looking it's celebrate. in we tuck-ins express, market with what tools active challenges area Shari's an some customers Mall? with like Personalization as and the are And additions just Are to Are connect we there the it, our continue like there for and think, it's mentioned and with did had capabilities, them where So are we to I capabilities, help

William E. Shea

Yes.

it's then bigger operation very product of new us the to think of a That of a profitably buy, where a into placing tuck-in, and of stand-alone as kind a two point. shows I buying that bookends the on assets earlier. platform grow truly Chris it or the Berries, type and acquisition just mentioned PMall that's leverage, our the IP it months, that XX not Shari's last XX and of brings that way kind can and it's we grow having really buying a kind of Chris' we and whether last - any operation, with it acquisitions hard of kind is over can category get stand-alone whether

types shows the of spectrum of So look sides kind the that we for. the companies two of of

Christopher G. McCann

there. then front, capabilities. in well proud We're And we've some front, as the great that integration think on capabilities that, I the we've and teams very put being very judicious building our being that - focused diligence the shows been of as on very the at

So going that a leverage do at forward. that's of how strength ours as we we look and

Doug Lane

labor mentioned sense. is And Thanks. inflation costs, you costs, Okay. rampant. obviously, you shipping mentioned That makes Bill, but

'XX? we pressures are as inflationary else where thinking fiscal So about we model

William E. Shea

drivers. are Well, ones big the cost those big because are the those

we down then in they're investment rates elections are. Throughout gross and where continue to able drive to holiday Those result we've marketing now digital - in have What of our of a where continue the year, to experienced, improvement is automation normalized that's We and normalized as obviously of as offsets to the promotions at we've cost operating costs. during significantly monitor goods, but of as more categories. look increases. labor help drive last labor on major down we during big a these at to see If been this costs kind look and marketing to continual year they costs, the big back are our national be. offset the will costs. of period, big November, whole What the cost marketing and rates expenses. our then that you and They've P&L, the during marketing drop as after surged costs cost margin are kind into shipping despite these well piece rolls we've both the that part, some you as pulled and goods our

Doug Lane

Okay. That's helpful. Thanks guys.

William E. Shea

Doug. Thanks

Operator

remarks. session. you. to question-and-answer over to would concludes Chris conference for I our the Thank McCann like back This closing turn

Christopher G. McCann

all. us and on Thanks Kellie you, today. thank Thank for you, joining the call

may post questions please any with our additional outlook it's And in your lastly, strong the special and call just a corner, to Day, can have email don't your the visit always, moms As or sites you growth. all us around continued life. Mother's important #NoLimitsOnLove about hesitate heartfelt Love for Makes forget you our Family to celebrating and don't video,

engaging a urge really the to do bringing the telling much that and story and customers the and I see are really So, our in deeper teams wonderful with content you market that to fashion.

you'll be I further. with talking see. forward we you pleased to very you look think what Thank and

Operator

The Thank concluded. is attending you. conference for presentation. today's now you Thank

disconnect. now may You

1-800-FLOWERS.COM (FLWS) 2 May 212021 Q3 Earnings call transcript