ZAGG - Earnings call transcript Q4 2019

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the ZAGG Fourth Quarter 2019 Earnings Conference Call. At this time, all participant lines are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. [Operator Instructions]

to conference like speaker, to now Frey. Brendon would hand over the your I you. Thank sir. ahead, go Please

Brendon Frey

Thank you, XXXX afternoon. to Justin. Good review us for ZAGG’s today joining fourth quarter financial And results. thank you

Taylor today, we Ahern, Officer; Officer. On the Smith, have Financial call Chief Chief Chris Executive and

a Following Chris for comments, open the we and session. will Taylor’s call prepared question-and-answer

fourth earnings press the approximately at closed Eastern quarter release Time. after Our X:XX market was issued p.m. today

Investor supplemental follow-on website. to release, financial the also information this And Relations a furnished SEC our a we As on the we on earnings to published X-K. document Form

find documents tab. website Results Relations of can You the under section all our on our Quarterly in ZAGG.com earnings Investor Financials the at

at tab recording under and We this the one the for a Investor call, conference Relations the of webpage be Events are webcast ZAGG year. archived call will

to, begin, prepared the are may response Before include, These that everyone like and date results estimate as These performance the remarks additional our speak statements contain would do performance the not or to and forward-looking we remind management the statements of forward-looking and statements statements company operations, or limited in future guarantee of statements, questions. make to that we of project future your for not hereof. certain the outlook but Company.

statements be in reports call. and Exchange Commission. obligation report factors or any to contained no factors more statements, risk we on XX-Q Securities that forward-looking annual made any can a of XX-K differ on the cause to those ZAGG on Form ZAGG’s may the the detailed in Form projected release materially that refer For and discussion forward-looking filed actual from results to in you today’s quarterly all assumes with revise

in by both today’s in financial use Company, between explanation will share, the discussing this again in on in GAAP, operating section SEC that financial the these release the reconciliation release. the adjusted and results required derived has GAAP the non-GAAP non-GAAP limitations, non-GAAP found measures. is performance is any which measures which the of note GAAP and Company’s earnings of measures with press Investor use discuss for the Relations EBITDA of The Company’s on per information we website. substitute Regulation ZAGG’s accordance outlook non-GAAP press included not today, diluted An of such non-GAAP G and a for to be and financial and addition detailed ZAGG’s measures call can are the in Please call, measures

Ahern. like I’d now Chris Chris? call to to over turn the

Chris Ahern

for join Good the Brendon. you and to you, afternoon us time taking thank Thank today.

XX% quarterly growth increased revenue line million, which quarter time fourth Our represents year-over-year top and some in the Company. the highest for to record $XXX rate a

full versus adjusted guidance of In projections. fell of expectations, while revenue our low came short terms of range year our the our end below just in performance EBITDA

sales, promotions we It more the continued key and proved experienced partners holiday help lower ran than increased to be selling Thanksgiving overall our part sales. to major with of softness season drive retail Christmas, advertising To in device and due a in challenging accounts. categories between several in our and planned. period spend demand incremental our shorter Many

chose had generate replenishment hoped, levels. didn’t the we of order this inventory impact to While low that many amount on with positive the as a we year retailers sales, end

projection. falling higher the end, expectations had combination of headwinds, the pressure resulted pass greater were an or offset from challenge able to price as fourth the planned. EBITDA short in cost some In of overruns unfavorable not experienced our the acquired tariff and full versus increases on product quarter from the tariffs also we in newly spend, we extent We of brands and along mix fully our

optimistic be XXXX from there the quarter reason fourth in about and our XXXX are that business a number takeaways how of give unfolded, to Despite beyond. us

acquisitions million XXXX late XXXX, approximately revenue and three XXXX, early up and in BRAVEN, respectively, $XX GearX, contributed in XXXX Our in levels. acquired we over which HALO XX% over

During GearX the Verizon successful to number rolled a doors following great September. locations for increasing May of out in in we in the in test distribution significantly U.S., made XXXX, we of progress door all

During we back half the well Sprint, year, others. added of doors AT&T, several the at also as as Target

distribution XX,XXX domestic the XXXX of began We XXXX. start roughly GearX compared with X,XXX approximately for points at of to

has offering past technology also And to and with its are launching Samsung XX from and among involved coming awareness U.S. encouraging. new several very we OEM to DXO year. compatible focused the in new Over designs, we’ve and expanded the brand differentiated case Apple, Google. product continuing build months, been GearX devices response consumers Consumer on

GearX During points and established head to share to brands. continue market expect against XXXX market X fully We head going in XXXX, beyond. gained our share of growing

channel the direct-to-consumer acquisition home QVC, As developed with in strong shopping had HALO network products the portfolio ZAGG we discussed a power this of brought past, in with along the that not prior it to of with transaction. relationship great

the very particularly fourth Bolt quarter, the brand and strong. in featured regularly During lineup HALO for their for of vehicles QVC was sales, starters were

the been business of the with first fourth brand’s of the channel majority historically this this and third quite sales we working quarters, during the year. are seasonal on half presence While events has occurring increasing during

brands headway sales made of our During opportunities other some HSN. XXXX, on we securing for also

example, branded portfolio a performance, the to a HSN. on with launched looking we’re Based wireless IFROGZ during true SKU earbuds and a of relationship successful half forward of For XXXX. we second multi-product

the These in construction, launched it smallest delivering to expect line featuring While we of product durable, results rugged received doors. all-new waterproof contribution our have to we on quality. had overall while three speaker been acquisitions, portable and BRAVEN the a adding QX products to our exceptional sound very continue is an busy go In and new shockproof, BRAVEN well XXXX. X,XXX fall,

margin. InvisibleShield our the of by through product VisionGuard+ your approximately eyes. glass continues wide was In a maximum core XX%, products to protection carry that the protection, screen breakage XXXX’s market launch suite number stabilized while also lead industry terms domestic elite the the health share in highlighted our by of of protecting offers one business, innovation. at

will at and an have this will is newest to the Our drive and in consumers enhance antimicrobial to for At XXXX product feature on integrated bacteria continue harmful is business to announced protection screen pipeline InvisibleShield a points grow us into the as of consumer as screen Innovation maintain product launches experience and forward retail. will will continue future and that technology. as allow the long against price we the further protection great and in January, antimicrobial which remains XX.X% CES protect device. all innovation the solution, that we

seen segmentation level and we product implemented also the success addressing which price good with points, We’ve mid-XXXX. entry strategy or value in

stabilized or we ISOD XX% has our I during strategy Internationally, strategy screen As since which this by enjoying XXXX. share market the screen mentioned, in our success been driven approximately momentum, has business protection invested of implemented. protection great is heavily

XXXX, of a time, XXXX to and we CPR America, growth ZAGG the across ISOD to our here continue doors our XXXX, forward. the in ISOD over end X,XXX the and installed America In Europe, In our across plan and in further current its XX,XXX bringing Demand base global machines we component along we Latin Latin additional wireless our the out locations. to installed success markets, at roughly on retail machines four Asia beyond InvisibleShield Pacific, as units. additional base same North X,XXX to bringing doors XXX of massive roll key in replicating U.S., X,XXX Europe work for accounts we’ve availability planned with by network America, stores carriers to At over going towards had productive of over serve will continue units new overseas XXXX. franchise expanding These with installed and global

charging launch device cables retail was solutions, to pads, charge stores within by ecosystem. highlighted products we of [ph] with the line devices where variety new our new Apple full offering including year X multi and a of designed of Apple with several wireless work Mophie’s expanded a at wireless

we’re We seeing. partners. across pleased wireless solution with new our the most charging also retail of we’re a launched sales And very

and so as one were base resulted with wireless us XX% pad in our XXXX. successful share. category Mophie market forecasts so relevant number across of quarter ended In partner brand supply first months wireless chasing fact, fourth charging the and XXXX the in the the to products which few

XXXX, a series through implemented large, challenges synergies the These starting actions three, stronger some cost include, in to of position response one, profitable in generated operating expense annual headcount acquisitions; and number by Midway gross faced in to XXXX. we in industry of categories. approximately decreasing at XX%; ZAGG by put from long-term and accelerating order $X growth. the approximately global million in initiatives recent and a savings reducing discretionary two, our They drive Company the the

spend in cost investments acquisitions increase to efficiency and opportunities inventory, our better globally, and our ISOD leveraging improved resources, deploy have identified to management. related we’ve recently, invested have XXXX More and marketing forecasting saving XXXX to and

expect in OpEx inventory year-over-year in turns. We improvements a expense decrease and total

the announced was that we rigorous It of parties. interested We and assist shareholder a which last with also Board maximize engaged securities XX in Company strategic and thorough of approximately alternatives exploring strategic Bank the financial America Directors summer to process value. retained to very during

holiday and devices, press from faced demand have for offers season included We than significantly the process summary the the Based was during of through difficult release, which primarily price. provided is XXXX, there for in current the business below expected challenges a the more stock impact the there. on company tariffs, softer the the

event delivering value. long-term welcome strategic to for stockholder driving can the the In the unanimously transaction Board best transaction maximize Board we evaluate stockholder the any the would on that determined interest, value. receive future The that path Company’s is therefore plan opportunity

improved pain In share and the increasing that product continue our capitalize innovation XXXX, by plan on core points, in long-term product of second at XG-enabled improve that categories drive our execute under and operating market categories, expense and to of products the strategies profitability address optimization launching priorities are, through consumer key aimed enhance the in devices, of innovative XXXX inventory rollout our management. structure half protect XG

with on strategy sales years with We they $XX the and current have it said, is on the believe place account prudent taking point to in unfolded guide into right increase how year consistent feel past to million. grow with our We at XXXX revenue external improved the two caused outbreak have being profitability control, challenges by and That headwinds certain this profitability. we uncertainties coronavirus. long-term by beyond based the full the XXXX to and

to on and rollout the the we progress clear as forward you look Our the to the and we exceed of of of year. into become adoption understanding and especially coronavirus of XG get better objective second half in visibility the updating target is this impact

fluid relates very obviously monitor that the we As a situation continue it to coronavirus, to outbreak it’s of closely.

a in from corporate and safety country ban employees have country We top to Europe. no priority. our This and travel resulted within to of travel taken as our partners has Asia,

Within we we the travel situation restricted in and U.S., the will have continue closely. monitor essential only, travel to U.S. to

based China a QX in having biggest will chain has an predominately has partners, to impact job and done cetera. et based impact on currently supply that great team working with logistics we minimizing remotely been in airfreight see our QX. The costs be increase Our in secure manufacturing

we’ll is Our based anything on know and the if provide updates in XXXX changes we outlook what right future. now,

I’ll over who the to more the and now in turn call guidance financials review detail. will Taylor

Taylor Smith

Thanks, Chris.

quarter Since quarterly supplemental additional today, add financial a comments take earlier fourth the like many issued included on our would our I were to in information just performance. some performance of minutes details few to financial financial

HALO growth XX% of to products At and increased was brands management sales power would XX%, BRAVEN to net these of by in compared second estimated XXXX by new acquired great and was low our in The we year. of beginning solid sales with brand XXXX, launches end brands product year-over-year and expect These QX increase protective during over we levels. increased see the by approximately GearX, offset range. million, screen product protection under driven were by of GearX increased lower our sales, driven the the $XXX increases guidance line by sales, half case approximately sales partially and to wireless come. It grow HALO and power future our mophie primarily XXXX. cases newly years last of grow over to XX% the

in cases Gross in in sales were of sales by profit offset flat from percentage products. decrease increase products increased GearX a improvements protection though power and duties a in China, HALO upside manufactured an shift screen saw remained net products mix. as our channel our sales These from and in we of a

and increase attempted negotiating there levers As Those tariffs to in included, pull increases of first we’ve to on the successful in last we the in XXXX. levers mentioned were first manufacturers; price tariff several to efforts on two, advance mitigate manufacturing purchasing movement during China. inventory one, out in largely -- XXXX. have the exploring passing significant quarters or with earnings experienced that of These increases; customers; three, the of of call, are reductions we’ve tariff the three four,

went increases, gross well However, significant given our into effect which that to in fourth quarter. tariff into offset the we the significant year, capitalized as the increases a during the inventory profit, as portion of both, struggled duties impacted late

realized we our fourth achieve late did with into factories, those were Although, price the until quarter. cost not downs of many reductions

In duty in, difficult it nature we increases found compete addition, pass had projected. customers, that we competitive we due of to as the to categories the along the extremely to originally

on wireless that XXXX, administration tariffs number and X.X by of and Bluetooth products cases, the we’re multi-power percentage charging provided stations speakers points reduced waiver our our including further juice film mid-February a into and packs, look on and screen InvisibleShield As BRAVEN we categories, GearX headphones. a protection, Trump in and pleased IFROGZ

Although to has be with XXXX from relief some the cost down tariff margin still into headwind which combined will tariffs with our this XXXX. factories, our in a decreases were We throughout provide expect guidance. the achieved increases XXXX, been incorporated tariff

year last, Demand XX% XXXX. well sell-through HALO quarter to our on expenses of to operating due launches, during executed growing the Chris to of mentioned, $X investment season, of our brands, as as half investments cost and compared InvisibleShield as a last product partially restructuring, that fourth GearX offset increases and the increased channels overruns companywide unanticipated marketing including to support in the products some third portfolio additional was These holiday operating full in drive infrastructure. quarter or during the were QX by increased impact second expenses, million quarter, approximately of and primarily

$XX adjusted million QX in the million EBITDA $XX was versus period. year prior

unmitigated particularly compared product results of that growth drivers and expense Despite saw year to we some the the mix we’re relative in The impacted guidance increases, QX tariff our acquired a expect brands. prior year, to have we overages, improvement. these to margin and in to key with channel adjusted operating profitability, Although expectations. adjusted of EBITDA strategy fell place confident our included short headwinds XXXX and newly EBITDA be

$XXX customers, sheet. to receivable more improved balance Compared a year XX level Turning XX the XXXX increased from during a days ago, from DSOs terms benefited from some to the days. the accounts sales DSOs of of normal to good. X% internationally to and year. of significantly decreased headwinds quarter of million very with and Despite remains receivables prior versus key quality our fourth U.S. the timing The

four, in one, the freight capitalized of at growth $XX was million and to acquisitions; XXXX. duties to the markets of and support that international inventory; were of at Inventory due million linked in million of end current position, $XXX for compared to increased are decrease inventory which demand tariff during some constraints of mitigate in the some has and largely inventory chain the coronavirus. excess the in China some supply to handsets U.S. business; to helped and product, Despite the excess the XXXX two, inventory key the end our three, drivers increase in for The associated the third incremental the impacts with $XXX quarter inventory growing inventory of XXXX the alleviate SKUs

freight was in X year. Consolidated approximate inventory excluding from capitalized X turns duties and prior the times down times,

get X by time approximately exit the We back expect to turns we to XXXX.

million for including our share and acquisition fund $XX to to $XX $XX less XXXX increases. debt is which the compared year. half the was and of consolidated increase with cash to approximately for million associated HALO due remaining second million, repurchase, last ongoing cash, used expenses million brands The operations, debt, $X Net newly to increased tariff acquired

to regard growth support our priorities initiatives. tuck-in outstanding service have consistently debt, stock, to internal With free repurchase cash last, our fund been our and acquisitions, flow,

opportunistically back activities focus in including M&A recent business the for year. to next Given quarters of will give headwinds, flexibility stock on paying ability us our road, our debt down to second the down half be buy the several the and the the our XXXX

$XXX gross our below under million, debt repurchasing we year-end And from was existing million. until stock $XXX credit agreement. Our prohibited are

During future is authorization stock the million $XX XXXX, for the active million buybacks. move repurchase We’ll entire that approved allocation through with our Board the year. a available capital still $XX revisit as we

Last, to spend I our wanted discussing a XXXX. minutes guidance for few

a take we could half, in confident the technology As macro approach uncertainties business, the to uplift XG expect mentioned, decided particularly long-term to strategy to prudent in XXXX. business, our our although a to guidance second that Chris in contribute given of we’re impact some and more the

We uncertainty and coronavirus, The second the perspective with of offset related and acquired the perspective first impact fluid the XXXX both sales XXXX created this challenging which and the key assumptions BRAVEN business core and the in half, situation increased spread are world. XG to HALO XXXX. guidance recently a GearX, the the with net has a in brands forecasting sales China comparisons include outbreak impact of potential some and our technology in into flat from of built supply half retail by combined of rest a in the from

but in expedited Chinese approximately the quarter during customer during million incremental vast some in air line on coming majority We charges have freight incur sight after line delivering good on our factories though demand back quarter. the delay $X New the did experience of quarter, of first the Year, in we’ll Chinese the

provide we on is and now, updates road. the know guidance if down changes anything what will current Our based

duty flat XX%. into updates higher cost to mix roughly and product product we’ll million I we per of This sales, offset currently our year. category approximately protection additional and are and approximately cases including provide estimate as percent to shares a tax by mix to through that of takes be time annual downs the mid-XXs full $X.XX screen in the XX.X of margins And return We year estimated consideration air as the increased XXXX earnings factories, rates improvements, compared to this We of be diluted share freight approximately estimate a Gross mentioned. the be on at progress XXXX. outstanding.

the XXXX, approximately result Adjusted assumes for reduction at overall million, expense other as is cost activities of initiatives. restructuring estimated during EBITDA an This down XXXX, of or revenues. as $XX in operating XXXX during X% as well a

any on would sales current very associated very and with our call flow our model, operating margin meaningful. the business incremental important the incremental to And above little would percentage One through be bottom line guidance come therefore, expense.

you guidance, the we of the million While we last that year. first in through to provide moving sales given to the specific currently number QX understand to million details our year-over-year some to range be wanted to two and more the parts of than share don’t way $XX million in help $XX change We quarterly of performance. a typically XXXX thirds estimate $XX compared we’re quarter,

to the to in adjusted prior to compared period. projecting quarter first single $X EBITDA second million QX to negative quarter with mid the We’re versus range, low improve in further improvement digit negative last year, the year

the questions. we will call open now that, With up for

Operator

from first to Mike question Thank [Operator is And from Instructions] come Malouf Craig-Hallum. you. our going

is now line open. Your

Mike Malouf

and that an helpful. InvisibleShield insight market now. of little share attach taking my just just give It down quarters rates going are rates what’s for be for of of overview Thanks couple would you’ve on market, InvisibleShield of attach with a I sounds question. little going Can maintained you on bit Thanks. Are market what’s Just you a talk like us kind about going? how with If Great. can a bit? go seeing first.

Chris Ahern

Yes. Thanks, Mike.

we’re showing seeing of firstly, QX, actually attach strong terms quite So year-on-year over our year. last rates sense in

there is demand the So, product. for clearly

I from solidify think, we’ve to share. has done a market perspective segmentation helped what really our

InvisibleShield So, but the for MSRPs being to brand. able instance, to attain point with price able the capture higher be the value also

the in very that demand segmentation played reflect is strategy out. as we’re with how seeing well. And happy all-in-all, we’re QX So, the

Mike Malouf

you end of the would had between the of your per would shield? say is ‘XX, ‘XX, the say, to or But, is at ‘XX? price what what end end even unit given average difference of the cost And some you you versus of the average say changes

Taylor Smith

It’s Yes. Mike. A good I’d materially not it’s say slightly, different. gone question, down but

strategy our of some although a has to maintain I us sales think, to portion hit that not the is enabled has of which, price terribly share just we’re the what those us do lower at. overall allowed significant points,

of So, fairly overall, saw total it’s year. still consistent what probably dollars a but last we of couple selling,

Chris Ahern

And our gross as percentage segmentation. margin that we’ve on well maintained

Mike Malouf

continued specific then you just little detail us like if It of on things. wondering list could bit inventories. I’m give pressure duty four there just of some as And sort just sort you have looks on gave you a more surrounding Okay. the of side. the a

Taylor Smith

a It’s good question. Yes.

the So, that freight as your sell, location -- part use inventory. into pay you that capitalized gets any inventory, to to your you duties and or inventory to bring of to prepare and

then if year-over-year, a of inventory increase duties the in capitalize with quarter, also freight million. the fourth tariffs, kind compare a and increased you rate particularly and increase $XX by So, both, combination the little in of is over this some

but were a we’re obviously of if And down we perspective, you in where were ended actually kind the QX so, where because and duty. straight capitalized on up, with QX with inventory out we compare of freight

the definitely as So, increase -- far as meaningfully fourth in contributed the was quarter, inventory goes. it to

Mike Malouf

then, just process. acquisition, And the review final on one strategic well question

perhaps two, the you’ve what maybe could was, you provide any You just potential or or into I feedback? were that said acquisition acquirers the that what One, got the acquirers or right, if some that that get then any you insight process price. And what how had should didn’t it? it -- bids read if stock you I I above think, is read

Chris Ahern

Yes.

say, So, you correctly, should that’s read read how Mike, you it would I it.

obviously in of and were all the time, coronavirus of difficult they of process some around of actual tariff, the potential help of February, more key didn’t go the of mainly In help those the into back we but the terms I combined, this uncertainties at the had the buyers -- then confidence. concerns, would it towards some the we but past, the in differentiator, itself demand, season, And softer didn’t either, and not key within terms holiday around as all say, of end help didn’t concerns. some

Operator

next Forte comes question And from our D.A. from Thomas Davidson.

Thomas Forte

had ‘XX ‘XX China So, more with and supply recently think the it long-term and was we in then role tariffs the how pertains I chain? the your as first coronavirus, the should one of to about

Chris Ahern

Yes.

I products with So, would that outside us, with we’re chain and the tariff forward, new supply looking the tariffs going -- or of way all for say say, in the not web products to designing the That’s CMs alternative mind. China.

to have or doing one it’s CMs some trials. time. we’re We ultimately, two take But already where going

is the tariffs to for to on product, the So, a key in but with mind. product continue down also drive develop cost us,

Thomas Forte

diversify a think to you is there less But on long-term your supply dependent be do you’ll -- that chain China?

Chris Ahern

But Yes, point, some going time. take my to going for sure. that’s just second back to

months of course XX some type of some XX categories. the next we’ll larger to would So, over primarily diversification the our say I and in

So, we’re going to be doing that.

for already wireless pilot it, yes, on be shift we’ve potentially So where Vietnam can production to but we production got diversifying a ongoing we sites. charging, will in instance,

Thomas Forte

-- flat this then, second sales when thinking projecting again, talk about you question And coronavirus and the about so is, my then the for year.

forecasting to there? also -- some stabilize what you supply costs that your freight. have then and air the that also, may And from -- the current been state maybe trying is that chain, how in have geographies potentially as as mean talked hit incremental harder. far thoughts of about of But, that soft for demand some are You does

is chain [multiple speakers] softness? demand So, potentially supply and

Chris Ahern

Yes.

different So, let two me approach it ways. in

supply start actual side. we’ll the with So,

time, got able that the of our whereby demand, team of very So, us ahead majority the to secure we’ve our majority, were vast been QX. in really for we products QX fortunate our

a we’re So, impact in this. not QX, from major seeing

we last we as progressed, over softening demand particular. two the in seen footprint However, in our have weeks, particularly international

instance, as consumers Italy expect retail. less buying on of less for or and is Lot retailers you impact lockdown. going from So would

as in order areas well. We’re seeing softening some

we’ve our that what to but the demand is of in first we line to line we international seeing space, good is a and of going So without half, see softening sight tell coronavirus, whereby from our have said the to coronavirus we of QX, distribution. happen perspective. done cannot ultimately QX we sight sight in footprint got some line we of from QX of are we will to you what’s a from down retail the possibilities tell end good onwards our and it’s I to really how some impacting basically in you, decent But,

unknowns it’s flat. revenue So, that’s the prudent really it we second half, to felt the why keep the and in

Thomas Forte

think for last The question is I InvisibleShield.

Can to that product year last blue we consumers -- like had you antimicrobial timing fortuitous. You ability protecting seems some elements, about think keep was that? this in there’s stock? year, have really about I your from harmful lights. you your talk And which can And about talk

Chris Ahern

Yes.

QX mode I and really seen because to good integrate working we’ve line able able retailers. the screen sight both and of to proving able and that in solution But, with is been to that sure catch-up We’ve IP really of a as being protection. that chain it consumers little with that’s strongly that popular we’ll than we’re into to But, seen and we’re primarily to product we’ve very, able will yes, we bit the of our for and with strong do QX, well. fortuitous, demand very strong product, product. feel in our that was supply we’ve for very demand capture really here, the you, look that and be be better. tell to make So, hard service majority

Thomas Forte

taking question, my Thanks for sir.

Chris Ahern

Tom. Thanks

Operator

Hickman from comes from question last Ladenburg. our And you. Jon Thank

Your line now is open.

Chris Ahern

Hi, Jon.

Jon Hickman

first the have given about that in XX% uncertainties? In your do how still half, fallen year, -- second is you. Thank the the see past, you revenues and half XX% still you

Taylor Smith

great Jon. a It’s question, Yes.

kind would very If half asked were we have told balance the me of the you confidently in front XX-XX weeks would with half have ago, I three you year. second the of

in second based Given from predict on to transpired be we’ve of other and a to And historically. and in world, flat. we’ve the Italy perspective, other probably the our guided is I accurately what of obviously, seeing part in nice going of the think then line certainly a guidance the weeks than with mentioned, QX we all given good able in last first QX that, Chris the in based and revenue, growth regard environment to already long flat very sales, have it’s a And and on what what pretty significant and sight XG, difficult to three uncertainty we we’re shift parts that there’s to kind that the expect over higher on also, why seen half flat just just we guidance. as half revenue things some coronavirus probably which be term macro the is of see

Jon Hickman

And of me then, the air costs? you to are freighting freight again can instead air Why you water? on why Okay. higher explain the

Taylor Smith

Yes.

delays, coronavirus. of because of of our So, at the of Year, of kind with with Chinese been production of they was -- which sent their New our delayed somewhat January, categories. by those return workers of factories, Chinese the the workers factories. the -- all The of end in has typical for delayed home number And because our is a number government Chinese a

freight there, And required air products customer product spend able the to so, time. on here to it’s demand, some some to in more us get be on order to get

Jon Hickman

get you. appreciate Thank it. I it. I Okay,

Taylor Smith

Thanks Jon.

Operator

Chris call remarks. I turn over to Ahern, no showing for questions. back you. Thank And further CEO, like would to now I’m the closing

Chris Ahern

for you Thank We look results. quarter you to our us in forward next call. this all updating for joining

Operator

concludes this Thank Thank you. Ladies conference gentlemen, today’s participating. you and for call.

You may now disconnect.

ZAGG (ZAGG) 11 Mar 202019 Q4 Earnings call transcript