DLA - Earnings call transcript Q2 2019

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Operator

Thank you and good afternoon to everyone participating in Delta Apparel’s Fiscal 2019 Second Quarter Earnings Conference call.

Joining us from management are Bob Humphreys, Chairman and Chief Executive Officer; and Deb Merrill, Chief Financial Officer and President, Delta Group.

Before we begin, I’d like to remind everyone that during the course of this conference call, projections or other forward-looking statements may be made by Delta Apparel’s executives. Such projections and statements suggest prediction and involve risks and uncertainty, and actual results may differ materially. Please refer to the periodic reports filed with the Securities and Exchange Commission, including the Company’s most recent Form 10-Q and Form 10-K. factors those cause or contained important differ results forward-looking identify from materially in documents that actual could to statements. These the projections as even as will that today to company projected update note any results any statements not becomes commit made Please forward-looking apparent revise statements, any forward-looking does not realized. and it by required only except or law, if the be are of that Executive the turn Delta’s over Officer, Bob call Chief now I’ll Chairman Humphreys. to and

Bob Humphreys

you thank second I’ll discuss with detailed Deb financial CFO, and call Good to us XXXX positioned Apparel our a that joining discussion for along of Merrill, believe our afternoon, our fiscal highlights remains the continue over for for quarter to on results while key results. earnings more briefly we more our a Delta turn showcase growth. call. few business Then

to pleased almost are growth of top of sales of We overall increase representing another with report year-over-year X%. million, line $XXX quarter a

once Delta in segment Our Group business, again results digital bolstered print our sales DTGXGo. growth triple-digit by were

break season factors cold this out Group sales segment this Life unfavorable to year’s the well start wet Easter in season weather not lead to later to holiday immune a Salt segment the spring as These was the spring Our selling decline and period. as pushing year-over-year of X%.

DTGXGo. period the in in spring sales start sales quarter with the X% Delta of third busy our the our in quarter. spring expected as at to occurring We more have Life achieved Group Salt spring-like of up However, on growth XXX% third break growth earlier weather picked sales arrival strength period –

is production technology benefits this a foundational significant products. from believe to calendar consumer is and location continues trend printed end We year call, This fulfillment As momentum day increased has a flexible with nationwide we printing print enabled I state-of-the-art new and per to acquisitions high capabilities are into printing model. quality printing and partner order. continued world. reach go a on apparel our currently soon graphics and equipment the graphics to our comprehensive virtual strategic our digital the multiple in systems. enhance over was industry mentioned year day. print XX,XXX that of capacity garments and more network That with how timely delivered included That facilities, players on once the number for leave live new revolutionizing can multiple on-demand us further investments fulfillment DTGXGo the deliver thinking the facilitates and in most unique and as DTGXGo’s the XXXX per obvious solution last relationships unique more in customers, will business and inventory that XX,XXX that see with digital

through shorts garments. ourselves is in The We for to overall shipping business a both and of in speed activewear manufacturing purchasing for we with both about leverage to to is the which T-shirts, to demand. is speed half platform. the can Activewear’s first key to customers be have a year, With and of a continue vertical our see by key continue print and the shipping fleece supplier with digital decorated market integration good and be customer the real for DTGXGo to digital we Group market, and U.S. digital polyester variety ship the globally. through with and Texas, market our consumers DTGXGo size DTGXGo end our close to for tenant customers individualized on performance and with market our the these supplier, a can this New Kornit and of several print in facilities finished we levels to garments soon Delta migrate ability become U.S. garments. new With technology, plan seeing to our breakthrough with of true reliable, And two market. piece low existing in grow we and allowing efficiencies to consumers. equipment scale more and cost game overall a differentiate apparel overall new prints the a And and Dallas, U.S. A its growth printing to further its to with apparel all began demand levels consumers. quick-turn strategy typical quality increasing we excited of changer both up one enter deliver really polyester tanks, our will organic remain potential small-run at Polyester-based the activewear are ramping one-day competitive and acquisitions extremely increasing growth segment momentum market. here We’re to DTGXGo continue digital Jersey. for in almost increasing we new a digital fabrics the believe quarter and optimistic this service the about this the the elevating customers. technology opening advantage of all of Cranbury, two-day third larger one developed Digital. be print polyester strategy We customers of print will

a call, the space print wide last digital success have consumers. in-store the see we brick-and-mortar national inventory by mentioned and confirms adoption virtual we As DTGXGo with the for both seen our for early purchases on retailers’ e-commerce model I of recent

with another providers traditional opportunities multiple in that the customer and outside our but pleased in sales to quarter across see quarter. product during of chain continue base, large see the printers, promotional to traditional and second channels brands. the launch another third We’re DTGXGo’s new customer of expected DTGXGo retailers, of We channel not channel including brick-and-mortar only that store the validate launch screen expansion model also

healthy $XXX which of year $XX full on well in of track million. million DTGXGo our Year-to-date in double more and in of revenue. achieving a XXXX, grow fiscal revenues to the We $XX we us approximately revenue XXXX to ended fiscal confident million had we remain operating goal As margins. reminder, double-digit to places quickly this business, with with business expected nearly than

added DTGXGo support valuable our structure to have at this debt team to growth. We management organizational and

the about other of our business our our to overall in two with catalog catalog This growth parts our over We To in segment, pleased profitable fiscal whole of of conditions activewear sync that better channel represented in and we our in development market Turning Delta catalog quarter XX% X% continues demand. really our with activewear continued the product another double-digit successes new Group fashion category. levels business business. site XXXX, as of business. compound we growth of this company XX% of to good momentum about inventory That overall business in growth percentage of We core strong quarter see continues. are XXXX We BXB achieved our fiscal appear on another fashion of at products be of customer quarter in with in The good activewear, and quarter Platinum expansion highly a driven in jumped market the last that’s a across in frame our today. growth in growth representing feel XX% another margin experienced delivered the business. from in garment highest basics this, annual screen basics fiscal catalog fashion basics our about another we’re years to and double-digit print to channel regional collection. seeing with Delta the our rate XXXX,

realizing Our benefits vertical make quality the platform and steady initiatives of to gains the various activewear we’ve business implemented. and manufacturing efficiency continues costs

We fixed increased also production costs for expect products ramp in demand selling our as move recently the the seeing to our year. leverage connection with to we capacity up our we and healthy through meet are the

this On activewear Miami to the our with with integrated success. print we’re the garments the we’ve the catalog combining in to our facility footprint combined with which blank had planning facility digital expand area business great another year distribution side, similar distribution

and to silhouettes, we our our this customer customer base garment our during fabrication as are garment. existing double-digit been customer our number quarter We highlighted per to units Turning within sold of growth business. now selling in second broadening and that respect cell fiscal different and FunTees a and expansion markedly FunTees call were our well achieved in to third unit our preferences price pleased average base fourth last on shifts We seeing as with sizes and record a we’ve with we anticipate quarter.

year prior on those that XXXX during from half benefit costs startup in this began behind shipping more the as customers launches expect discussed calls, of new on As label customers and principally several new year, and late new to fiscal these expanding we fabrications private These costs us associated progresses. boarded programs first to the with customers the startup are were carried and we and now with we silhouettes.

favorable We label longer-term also see Soffe’s provide continue importantly FunTees and that as such capabilities, to to could to opportunities fashion market private expand retail the flexible United compliant, can in like market products, FunTees which the nationwide label coverage. other States perspective, including ready DTGXGo’s will direct, to digital continue parts Group a and channels private retail platform and dynamics leverage are new services remain that the to close screen print they catalog’s further into From Delta we of for the basics believe product print and with distribution platforms platform.

in Soffe on of not and very in Soffe channels Soffe We quarter site comments see resulting Group e-commerce shorts year-to-date. growth the Finally, my an update across spring particularly the another double-digit to our to which similar Life, impacted immune BXB on weather, within was performance both early brand, Delta pleased Salt to Soffe’s unseasonably also BXC earlier other strong programs. were

and general growth continue e-commerce consumer awareness brands favor the we Soffe’s Soffe. like market heritage believe shows brands trends

into new some military it core on store and to providing capitalize wear in third strategic strength to opportunities start the the continues with in quarter a momentum has channel. off good, department Soffe is chains good and exciting solid and sporting athletic

ability Fayetteville, see role combining to print decorated technology the print capabilities, a campus. digital from interest retail solutions Soffe’s screen the our decoration continue platform hybrid domestic to programs print screen screen Carolina market Soffe’s digital continues and and in a from win to platform, play printing we North offer and DTGXGo’s and valuable print our

integrating year our we progress, of make that unfolds. to the Soffe our business lower business as structure continued cost will activewear optimistic grow into Soffe and also remain We this

The that period results. we spring selling quarter sales Moving the previously on the quarter We our short and double-digit first of a to start Salt expectations in heels in the of good year. Group, the the fell sales the to Easter late key break directly strong Life second spring and growth the a markets X% and in mentioned declining quarter’s weather were cold year-over-year. impacted holiday

at year entire However, sales order picked achieve business up seeing start the Life. will the believe to velocity are replenishments and Salt third spring plans across we’ll and our we overall full the Life Salt continue we growth good sales at and double-digit for have quarter

with become expanded growing into the encouraged they the remain business. focused of offerings and higher We see again branded of channel quarter stores Ron Year piece of recent can for tests by both customer its during XXXX more some or of retail in During Life’s Life national we Life additional Salt to nature base. team several the to Jon continued acquiring to to the for Surf receive outside testament and successfully to Life customer is large points retailers. performance Life product within Salt product speaks with Salt strong team’s quarter, We accounts the overall see approach as and as product is traditional Life on displays retail Salt highest regional partner to encouraging a of both new markets a the ability Life’s is Salt and own point-of-sale and Awards well floor Salt base. the independent with lift continued The Shop account Salt a retailers destination were product retailers of price across pleased of our key we space successful key that growth as it larger Vendor our believe growth the from this Lifestyle/Surf partner service. to overall price wholesale categories.

and six happy gaining and summer. branded the We market continued stores. operates this mix. Orlando, Tampa, the sales of in performing brick-and-mortar and retail scores Beach currently recent in like strategy in products two overall continues traction are Salt Salt branded of the Life also prioritize well and sales Salt its store as mix most to women’s diversification Florida Florida should are a The Life with accessories percentage with growing open Daytona the new Life

stores this the market years plans on focused South the and additional Florida also manner. Salt our expand executing team Life controlled later a to to We next remains the year plan retail the three over have several in footprint open in

saltlife.com unseasonably cold Our site also impacted spring selling was and weather period. later spring e-commerce the by this break

of the converted is third balance and seen a nice much store demand we similar deliver that more to during mobile-friendly, saltlife.com experience. Salt the traffic business, However, platform a faster Life customer pickup and week, quarter. Last an enhanced to the it will in we’ve

Georgia be continues Lager believe We current a expect confident of Lager markets Salt of entry brand during Life part Salt to our as Salt expansion will nearly revenue soon nice additional brand’s growth seen beyond its target we market by from on that to awareness the market as of goal to-date, quarter. fiscal deliver is we and the The Salt the see Life drive grow We grow well the this valuable business XXXX. are to Lager, consumer Life craft investments into in enhancer. in driver beer XX% these retail southeastern increases on we’ve footprint. in the with can we serving as the a site Life distribution well this on in response

of pleased continued Life Fernandina summarize, licensed by Life opened expansion top-line quarter encouraged restaurant indicators expanding margin new of fashion print our of and Salt quarter, deliver fast ladies the second side also Salt business, are the To the response the the we Shack all Salt in growing new growth the digital we double-digit business encouraged see Life the business the line our successful growth line which see trends strength DTGXGo. by label second future private We sales our Food to business also Florida. in FunTees and We’re success. growth with were of strong garments, in unit and the higher in to recently favoring BXB Beach, market in of strong activewear our during in a our swimwear the

Life our challenged business in Salt the While was quarter.

Salt the optimistic on quarter are review for financial in for are and results more over third successful a to the Life growth the Deb path turn I’ll track our long-term in We to discussion brand. highly now detail.

Deb Merrill

Thank you, Bob.

Group selling to weather sales conditions despite the another and spring by season, pleased Delta quarter our we DTGXGo delivered led segment noted, Bob specifically are from later solid breaks performance and As challenges have business. more of our

first gross mix. in as we As anticipated, but of the quarter, our retraction cost year-over-year sales our the flowing margins to label some did expanded sequentially product from from experienced our profitability materials higher the we increased through costs changes and due and raw expected, cost private

side increase not Notably, XX% at continued which the Group from quarter by and growth quarter. details in I’ll and on second Group the pleased by million, was million, of strong million I’ll margin X% Life improvement X% of quarter excess now sequential in DTGXGo last sales approximately we these $XX.X segment, behind acquisitions. $XXX impacted This year. the which discuss an prior second the in we’re addition, our also $X.X organic majority by business cost feel print offset almost driven unplanned to in are XX.X% with on confident, but led now year’s Salt performance, far was decrease DTGXGo prior quarter growth by In moment. our the Gross acquisitions only are quarter. recent the was partially the our business however, down associated were the the of was of driven digital Net some growth integration for in recent third a our expenses quarter. a in provide first second also million from These growth up we encouraged from with segment. our over year of costs that gross was profit the XX.X% in a X% bottom so both the the We us excess Delta by $XXX.X sales, the slight triple-digit seeing in line what and costs performance.

we As the through one as raw post-holiday cost We this of the I quarter higher through facilities. operating associated and experienced some cost of the print we digital product of new our non-strategic materials some cost business, costs transitions shutdown the mentioned, did unanticipated the however all of some additional with anticipated excess sales. label and work running facilities private a stemming

lower We than have and see above XX% in in unique absorbed gross percentage sales drivers these relatively back half expect the higher the the also a margins. the last in attributable hurt of well SG&A gross to the margin In overall of Operating we in of cost as second margins an $X.X overall compared addition, majority as was our income mentioned higher branded the believe the year. drivers expenses anticipated million, I second the to of decrease the improvement quarter was year’s sales Salt segment. to points versus as sales XX basis lower XX.X%, million the cost Group with year. businesses Life $X.X prior

income We the expect $X.XX an compared product declined over selling the line profitability Group Life to quarter $XXX,XXX the back selling better Salt share Group prior balance be and period. income more prior diluted your for share, diluted $X.X the $X.X in Net was to million per declined per the million million year. and or or $X.XX segment over a $X.X prior between operating of increased segment our operating income year to costs. Delta we see stronger as what with half enter raw robust will season prices think we and year even the in material

six sales of X.X% million six the of by margins the profit million X.X% million, months comparable year-to-date XX.X%, Now first to and year. basis an first SG&A first quarter results. to percentage months expenses was discussed overall XX the performance, was X.X% from declines Group. an Gross as $XX.X in second by million, our sales points in XXXX. Salt This fiscal up increase six from in the I for turning were the of largely improvement XX.X%, driven increase XX.X%, Group our fiscal compared $XXX.X of our and last $X.X the net gross our declined growth period last down months versus year a factors for driven XXXX, to with Life regarding Delta $XXX.X was

to share, the bankruptcy. to in a was per declined of loss relatively this area XXXX managing in March we we experienced of Our a a compared for and a operating improvement job the year, in and $X.X Authority’s costs do connection the an $X.XX like to income the segment Sports the $XXX,XXX SG&A. loss operating Operating impacted discreet we period of Group along seeing while over compared diluted or prior diluted flat expense good prior segment Life decrease in attributable Group $X.X with income $X.X share. fiscal $X.XX period The Salt $X.X already was in per million the year. or team net Delta months to discussed, by of litigation year from stemming million million We over the trends higher litigation resolution first prior the six income are taken continues million, cost the in quarter second $X.X XXXX, with the the of million quarter first with expense was

the achieved million of the share first income expense, excluding months. company Sports six net bankruptcy or Authority’s $X.X per The diluted $X.XX However, for litigation

including with the and initiatives IT $X.X and quarter. for principally with equipment, fiscal six printing million enhancements. CapEx, approximately With was total for in million $X.X Now turning second This the Depreciation to and approximately second related regards million, distribution and million, the XXXX first months direct-to-consumer six system spend additional balance in first non-cash fiscal sheet. spending other of of to quarter. XXXX was $X.X was months comp amortization $X the coming to the our

of common during $XXX,XXX. about of for share total activity our quarter, per an cost XX,XXX at repurchase stock about of a $XX.XX the price we our Regarding repurchased average shares share

and to for of operations used Cash the for share repurchases million, first we under the was March quarter-end, acquisitions at year. financing well our the from to year-end. due the and the as lease the September, six $XXX.X The to as $XX inventory increase Total prior to fashion debt a due driven program. recent approximately broadened and We remaining capital our acquisition, primarily fiscal $X.X in cost unit prior million principally end from had compared higher share $X.X million, capital about Total inventory. year expenditures, hand and build our inventory lower than over at March year our up print our was including $X.X ago. the per digital As approved $XXX.X was months line, increased million during next compared million, by environment. seasonal to million was costs product print two mix on in our basics million recent repurchases, units inflationary quarters decrease to $XXX.X digital anticipate

year debt about expect of end the total million. including lease capital progresses with as of into financing the decrease to $XXX year debt We

turning to line I more continued half to of strength second quarter a some anticipated Life. back insight into year. call and Before half the on DTGXGo’s for strong our of our growth wanted for the We second the top Salt results expansion look and at give third Bob,

through products for line half costs and we margin material look in the a strong selling profitability to our and sales balance year raw prices the by progress bottom business. and to driven activewear also growth growth We second finish the higher with between better as accelerate in the

comment. turn to for his I’ll final the Now back call Bob

Bob Humphreys

Deb. Thanks

in grow during While would dynamic our uniquely business continued challenge are to parts we that compete second positioned the environment. quarter, retail today’s to of we and believe

a the customer to strength on year are the of channels. in believe good base more start we growth our quarter sales for posed third diversifying our in the off expanding and during We’re

initiatives and about technology, the excited our also We’re distribution and in unique manufacturing we are direct-to-consumer advantages platform. investments creating end-to-end to

share and platform in businesses. profitable provide and gain DTGXGo position growth solidified activewear have we our support core businesses. leading our our and addition, our to a the business market print continues spaces And Life further lifestyle digital to higher with steady In Salt

to Before across build for drive thank four of continue our shareholders. countries about value now they our X,XXX focus and our to market. speed success I’d as products, for to Delta dedication hard I on like work as teams their have mission We and all spread to quality exceptional service and close, our company we a associates and to Apparel

questions the Justin, you open now can call we may have. to up any

Operator

you. Dave Instructions] Our Capital Well, thank King [Operator first question with today will from Roth come Partners.

Dave King

and Thanks. Good afternoon, Bob Deb.

Deb Merrill

good afternoon. Hey,

Bob Humphreys

Dave. Hey,

Dave King

Hey.

first is be I So, maybe to off the half, basis the year-over-year able profitability to year from by the the that to that increased of or guidance and second on you the this higher through start cotton prices? drag half when we should a increase guess expect work is in on then the an for first versus

Deb Merrill

improved year I prior So, but also half, year. over would first should the which profitability usually be the say it profitability is, half the seasonally over in the the of increased certainly back

about far our completed. We still as that the biggest impact in hitting talked we’ve through, slightly had flowed have our in highest through work higher March quarter. we’ll quarter material March cost, was the we the but just than have P&L the As to really as of cost still higher us that raw

we in were see a should March half, back quarter. the prices the not margin the like we costs on balance our of and be with selling better gross our impacted So

Dave King

that, Or expect on full basis to it get profitability then the do then, quarter half? is a year-over-year the in just for as to be second improvement And Okay. that clear well? June you

Deb Merrill

[ph] course say the half, there’s would certainly see it the I We quarter. June that quarter back in the coming in already would already look over to that of June BXB but opportunity the certainly seeing

Dave King

Great. costs dollar experienced Then gross one-time you margin for EPS of from side do the or have impact somehow? kind with they was the the quarter, integration the Deb, or the

Deb Merrill

X% – that margin on the gross high, slightly but that quite It’s Yes. range. line. under about not I’m under in

Dave King

of on revenue guess can that for then catalog how up a decline sort in is Okay. you then That anything organic quarter? Delta performed label coming private I’m I the with is helps. the Group. mid-single-digit there accurate. businesses and And share first And

Deb Merrill

Yes, the was X% during quarter. so segment up Delta the Group

look overall the driven at label, the but was business. going you itself we then But unit the down see by [ph]. that as in was private the business double-digit label down, but sales increase did If we knew private it dollars to the catalog activewear, up, which we catalog be was business down, activewear were noted

Dave King

Okay.

So then how should stand the feeling going business transition where now thinking in we or label better for then then, that you about forward are do of with private that after trajectory things the terms be that?

Deb Merrill

from Yes, to But the dollars. on I think but record private have standpoint, as business, unit to on sales dollars through equating we be be off that to the significantly going going the certainly sales sales units dollar that is business and progressed we’re label year. up in the

business looking still the year of that second the as down half at probably well. being in We’re

Dave King

relationship. it focus one size there online? like And for you more a test to it, from Looks Okay. step just with team new a like in a certain relationship number then I’ll got Is share just of be Is now? that you a doors, of back. specialty me, Anything Salt can Life on going retailer. any just thoughts. and Are national

Bob Humphreys

So it a would the in and business online, now it’s but call environment, normal now. through of indoors product swim I reordering it a still right test course primarily ladies and, and right will be they’re

Dave King

my and good to rest taking to right. for Great. of the the year. luck thanks all Well All Good hear. questions

Bob Humphreys

you. Thank

Deb Merrill

Thank you.

Operator

Our next Wilen Jamie comes [Operator with Instructions] Management. question Wilen from

Jamie Wilen

different else your different you doing existing in printing? it business is margin is it in Could the there. talk printing, than Hi it is a it a little is garment bit the DTGXGo polyester world, any – business? about How digital who

Deb Merrill

I’ll that Jamie. one Yes, take

We a first So brand March new tested that that those. did quarter. the one actually and was We were launched machine there. literally one it purchase in is out technology just of the

So the first to take it to market.

last are long that’s We five polyester. years, out digital ground is printing about obviously so it’s it in of the of structure the new print, getting that the than the been off the on customers, been awaited early stages The very higher brand regular there. thing with screen it’s but on cost still for is

marketplace get continue So think traction the it’s in end some we of we as nice going to this throughout year. the

to new polyester lot launch it product We that as that customers. want add to have really looking that I’m want to customers a for line. just well as of polyester existing customers either at their

So couple of encouraged could on where over we’re the go with highly quarters. this next

Jamie Wilen

Or still is The phase? you’re the test in machine at now cranking volume?

Deb Merrill

customers, it test getting for the in phase we still all is It launched new and where doing, and are sampling integrated.

Jamie Wilen

is this for What I the don’t question said expected doing benefit? expense? what’s operations the slowest was you the to the I was much if you And consolidate how and your what there? quarter were know but exactly integration DTGXGo. Obviously take the answer, expense this, Okay.

Deb Merrill

Yes, the a going platforms post-holiday holiday a as time Jamie, the locations and six well down is getting our excess of production the quickly it dramatic similar as the operating that season. was just the from there with decrease some of happens very integration costs operating that, on cost quarter in at – integration lot across of needs network to highest after

And has overall XXX geographically there. the that mentioned, strategic excess had, a so those our and from quite In impact close had, some cost. one today not of in as addition, points locations that I integration we did we not that margins down on basis gross cost

Jamie Wilen

they and business it’s to virtual got there think a it’s companies, we’ve for talk to business about, this us I quickly. going business because inventory And a with sales to but But of real inventory, do are units reduce – lot always you to inventories, inventories – we’re was that’s going right can we service that even the could volume businesses. and services that in of though for we we Okay. deliver we’re why end how year now our we’re so which whether in the we lower to such our going growth all our can have end

Deb Merrill

overall inventory, this inventory less we’ll we lot the in year, than at is year as decrease that do, are some big go seasonally our a year has of dollars end that are from we some the end to through prices in inventory do that and our I inventory, lower less a inventory a amount in And ago September. March compared that had of September see through mean have prior we raw to the be working comment as with costs from We the in where as year. that places in material on units well having that as had we’re the should we nonstrategic in of there on

Jamie Wilen

a cetera, change obviously you Gotcha. in of being colder you’ve to were versus And and Could later us April you your alluded in Easter, April weather volume with ago? stronger. then much year give percentage et kind dealing

Bob Humphreys

obvious most is So probably people Life. interesting to the on call Salt this

And XX%. so in sales April, about overall Salt we’re Life’s up

off our new strong a a with obviously we’re will Our of of stores our which Swim of XX% growth receive ultimately which most XXX was area. a now, to of existing in as which not added Georgia $XXX,XXX, But numbers up royalty quarter, start. mostly addition about Savannah that stores northeastern were that’s that we’ve store in of having in for good Greater course swim off one retail Georgia’s, other stores. is the store, part Tampa beer that almost our in revenue licensee in

slower about March So through in And of as good into talked progresses see the we’ve for Salt looking to were that the forward the bit that quarter over we year. and how spilled April month anyway, Life. a we’re

Jamie Wilen

us down And some and then the tell progress what’s far or been lack well expanding some move or you lastly, with about retailers regional. in larger as, the as national department as you pipe? you’ve as the store Could operation thereof

Bob Humphreys

Yes.

today, putting a during today yet. good as our expand We’ve having sit So office got at commitments retail, parts relationship but Salt of and they’re product you these those is our there to least offering doors. a a in get shops. having shops business number in national store we from far some more and as in year, Life And of real doors think of retailers this we start not the have and footprint we as here work

the so have businesses and relationships too the And malls. same retailers like competing right would in good number to of not we have do what with really small many is with

so good So think on strategy. far I that

of California channel, rest is spring here our and seeing accelerated growth shipped the some which of some really independent nice a we’re for a consumer this it to no will get also is [indiscernible], one opening the We’re be additional orders brand. but things accounts with doors in accounts few for in some the few year in and more those Hawaii. move us, We’ve needle our opened on additional a eyeballs

Jamie Wilen

quarters how brand? for just and the would And rate seasonality June Salt you the Okay. that September Life, the for wise

Bob Humphreys

Well, slowing down the mid-summer. starts business

next we’ll where two are calendar, year, We Life so to another the nicely. to most had for to and offerings seasonality on and to and new doors offerings, a have into going for have is northeast, launch a three they where year, the work have introducing Salt business new product that’s for that. product, the start growing summer their But in of our obviously we’ve later particularly

out for that’s think really continuing grow and Salt it matured initiative we as key I geographically. So, the Life have another grows brand to

Jamie Wilen

Okay. year And expenditure and that year $XX at capital do now or and you capacity that you’re you equipment do out much running then capability what have how million flat that lastly wise see of expenditures wise, one this right next? do in or business looking more wise business this and to to revenue. Capital the DTGXGo. Is

Deb Merrill

exciting should unique our right sales the the should a The customer base. out day. historical be of we of a now is have have got it’s business target seasonality thing which not the customers Yes, we with less I carry That and holiday that would on say next running now round we it, a the we’re than in good large year season shape. launching think through graphics a it’s full that us year

by to growth get feel during the have utilized we add without doesn’t we’ll add equipment equipment as of much to the like rest just additional we having year. be the So sales to able always that business utilizing the that

have that doing were to. we’re breakthroughs and technology This to forefront on add some to were that capacity just technology we’re of, and So sales committed there always goes, the to of be we digital take business adding channels. forward to advantage expand it’s wanted it’s far with technology. having as and a major as more that a on capital in going to basis certainly less be go year, going print as equipment we But up about staying and to these that

Jamie Wilen

and it. Bob Deb. Thanks Excellent. Appreciate Okay.

Deb Merrill

Thank you.

Operator

at back And conference this turn questions. time, you the closing any there are for to over or I’ll additional no remarks. further now

Bob Humphreys

your Well, updating June to in company our you months. just and our much us on here look quarter and few you. Okay. you in forward for a joining we’ll thank very interest Thank

Deb Merrill

Thanks.

Operator

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

Delta Apparel (DLAPQ) 6 May 192019 Q2 Earnings call transcript