DBI - Earnings call transcript Q1 2018

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, ladies and gentlemen. Thank you for standing by. At this time, all participants are in a listen-only mode.

As a reminder, today's conference call is being recorded.

Now, I would like to turn the conference over to Christina Cheng, Senior Director of Investor Relations. ahead. go Please

Christina Cheng

May morning XX-week statements. Conference Good release the release to First and calculated periods DSW's results XXXX. Results X, in April Thank the note differ future made expectations, no sales company update May ending forward-looking that constitute Comparable Earlier the and prospects and today's May today, public obligation XXXX Please due forward-looking were ending XXXX. from any XX-week the assume Call. operations with about statements. of the may press listed XXXX materially we And to Quarter and of and XX, same you. various plans factors for for we welcome SEC. X, periods to issued comparing filings XXXX remarks various a our press X,

Rawlins, are Officer. Officer; Joining Roger Jared Financial us Chief Poff, Chief Executive today and

to the let over me turn Roger. Now, call

Roger Rawlins

by I’d against Thanks, few our morning. made Christina our and XXXX we’ve highlights good begin priorities. like discussing quarter progress from a first and today to

positive new driving at further greater loyalty on our beginning quarter, momentum. consecutive with report program, by XX-month strategic bottom even XX%. we’ve On ago, to few were rolling proud for payroll DSW launch continued to of positive the initiatives. marketing a second demonstrating X% our intent top and our the and a in inventory, we’re move of line Recent grown basis, success are Inc., investments our This the line and the needle this we comp weeks

a important for capping back-to-school DSW our has market share Kids created the an complete this vehicle will We of which phase successful of execution initiative, last season, growth. multi-year the rollout

a North to weeks grow of few of part ago. Shoes America, Town our in as Finally, the completed acquisition we share market strategy

Officer, complementary years Town as with DSW Jordan, of globally market Our company a one Administrative reinforces successful us the his has DSW’s of and appointed opportunities. has the We've Bill expanded of to a with experience Shoes. largest footwear understanding position new what our guide concepts made keen Chief XX retail the towards will integration. of Bill portfolio retailers President his as over new successful leadership pursue

days, and XX the our strategy comprehensive for long next a revenue review synergies. the of will Town Bill lead develop Over unlocking and cost business term

when We you our QX assessment will results this results. we update of the on report

deliberate the M&A Given challenges we pace. at will of change and a approach integration, management conservative

step the of until price In Shoes assets addition, purchase we completing we are Pending questions any allocate the ask completion this and of our towards under progress acquisition the Town’s fair Town value you as regarding method. we making liabilities, quarter. reserve that next process,

will Let turn who me the financial a call Jared provide over now update. to

Jared Poff

Thanks, good morning, Roger and everyone.

items. discuss a housekeeping I results, address me few our let Before QX

going reference exclude are We on items included to a certain which adjusted GAAP basis. results, primarily

a For non-GAAP to issued refer please reconciliation this results, the release to our in reconciliation morning. adjusted press our GAAP table

This remaining resulted EBuys that appropriate following of adjusted last its home we of leases. distribution charges and reserves related GAAP decision the of office against and in earnings. were exit to liquidation final recorded Second, our completed center our inventory $X.XX exit March, out

recognition this These a our new from $X wind than offset hope XXXX certain sheet XXXX as revenue revenue impact to to that, The increased $X of our by million we revenues primarily to the revenue million of our loss the share of Under recognition me implemented franchise changes results. million XXXX well less net lastly, and and the XXXX have made loyalty than adoption statement. well results reclassification quarter, we However, our visibility to we operating in separately, to new gross of organic $XXX flow this resulted the our adoption other QX in revenue. immaterial $X.XX income and first corresponding chosen a to EBuys revenues. to turn did was revenue XXXX from as within recognition year breakage areas standard, Total the retroactively this gift increase financial results. The quarter first points, company less full And card balance XX out new as that in changes in by quarter them basis With comparative changes and activity expense. for of of increase program to margin quarter restate an standard down including this prior new as results. calling purposes. increased income quarter through residual deferred let from rate results. resulted first X% the by per provide of By standard to adjusted

compared And from the year. EBuys. by to and $X.XX compared X% said sales share earlier, loss to share increase per activity exit Excluding total per adjusted EBuys a Gordmans, of the increased last at X%, revenue as share comparable EPS in $X.XX driven residual year. last Adjusted $X.XX were X.X% earnings includes I per of decrease

in turn a increased momentum by Shoe which our driven where drove marketing comparable year the clearance was me a increased Warehouse, Both online to single activity. with last results X%, new digital categories sale in gains positively. than marketing by Recent increased remarkable segment sales significant lower by Average due clearance in mix low in DSW Let a to Transactions in XX%. the at strong activity. comp largest and Designer investments digits customer sales. X% business, and dollar higher growth at slightly regular demand,

affected posting arrival in encouraged conditions. of Weather regional their strong single positive comps in sandals, driven continued healthy to also quarter sandal women’s Athleisure a The tough category Nevertheless, footwear women's drove digits, snap footwear. while low we sales, despite drive from the start back concentration. fourth positive comparisons. Cooler boot comps, temperatures QX season. low the the row, the were power warmer by For digit given negatively locations, with XX increased single delaying a in a our of comp with

saw look this we growth also forward last business outside equal these return improving seeing to women's for was men's fashion We year in areas. to appetite and an footwear to XXXX. The category

we see added category in Kids were to kids as additional locations excited to full We QX accessories stimulated quarter. the XX during second price quarter, the sales. to edited receipts XXX locations an fresh bring turn to Finally, DSW expect positive assortment and in an by

The strong we response to our ended marketing optimism and merchandising $XX $X Given finding will the quarter, existing quarter. business. our category’s Equally while begun after Elsewhere, momentum four closings. continuing seen, balance our less kids' we other results this with the Comps the higher preserving ways were pleased We're carry will the kids’ addition the season a these of significantly to from net business to presence market million, term this this than business in Mart including kids at assortment. us we quarter and have confidence national kids we've be revenues this position quarter, positioned level. from solid DSW offering. at important footwear, support see and With their our X% is at DSW XXX give EBuys. stock end Kids locations establishing of remains are that a and a to nationwide add penetrated for our Stein business initiatives continue ABG ABG and at million this broaden results the year, to to last prospects. we long increased by under

in DSW of depth higher Turning was effect margin business gross of modestly Gross to we offset the shipping as in to the XX driven and percentage counteract added mix. profit sourcing by segment company digital gross favorable quarter. basis the at profit, cross-channel the unseasonable a this due sales to points, lower to increased fulfillment Improvements costs a related robust incremental demand. conditions markdowns growth the

We profit operational can focus to on continue enhance we ways with improvements. gross

the a quarter by the rate Turning X% of marketing new increased our DSW and XX in transaction to maximum We to to to of impact. for dollars new customer basis continue first awareness new as and VIP SG&A, These of strong drove rewards acquisition for the our customer non-rewards percentage from new spend loyalty members seeing May. in acquisition a accelerated we'll highest few We're digit by the high seen allocate activities last and SG&A activity in from launch single expenses program some we've increased invested sales, this marketing points. levels drive increase customers and quarters.

America. Turning This last QX, to which the will are results new to North year. with penny the we this market below acquisition a of Town Shoes, of Shoes line, month, Town be a excited report similar have a in the last was share loss in DSW’s Town’s to we quarter expand early to vehicle

of completion of specifics we we this following As after our Bill’s later the priorities, financial Roger more formulate expectations strategic said, our year. will assessment provide

due from reform. quarter rate XX.X% first tax income tax our to of the decreased Finally, to implementation XX%

foot store and expand XXX brand’s renovation per $XX We its the the opened We the to to Turning last and inventory open to excludes initiatives design. by foot year funding driven expenditures net the square to DSW needs, declined paid this five connection pilot remaining to CapEx plan this X% quarter a for of new to priorities but total year. subsequent On quarter and and X%. new strengthen working emotional investments, was spent square will basis, DSW’s maintenance a a X cash $XXX last to for brand two our million. XXX expenses of acquisition We in a sheet, locations million warehouses quarter, with per year X DSW stake increase customers. for end. assortment of store this in Town’s ended cash year's cash end our the capital slightly balance Kids IT the to inventory million Quarter on the and of expanded includes million support the capital $XX locations by below related year.

organic expect we in capital year, business. for the For expenditures continue the $XX to million

for our Town the the impact growth. of for update guidance call. our the of Turning EPS Shoes. per let review, turn financial adjusted maintaining we're share to our Roger outlook earnings comp $X.XX during XXXX, digit single our include year our provide our me low $X.XX expectations that, We’ll priorities. call of to outlook strategic not a does to on second strategic consolidation quarter With for Pending and Town completion of an over today for full

Roger Rawlins

Thanks, Jared.

with confident deliberate share. market execute growth line to top in driving as QX with a we're on quarter, track goal our last see we And are grab to you this results, plan. discussed can ability As and

our strides experience these with made pursuing we’ve investment. customer in strategic to great DSW and are evolve key laser We focus the initiatives and of areas engagement

critical to beginning inventory see inventory we're First, And the product, two after right destocking, of position. product the of more driving to sales. is benefit the productive in right place having a years

gross and improvements. mix key item price margin program a Our drove higher regular

inventory the during enabled fourth a Our DSW footwear sourcing categories meaningful categories, cost for posting meaningful space. across at the particularly a vendors. sustained were and with our expand momentum to comps quarter We’ve to and comp account post to depth accessory all turn We for positive us vendor increase improvements presence expect base improve men's to leisure athletic see in and consolidate started pleased quarter. the to the its fewer DSW’s and more as becomes consecutive

capitalize vendors are evolve our continue strategic will These control with journey gain distribution. partnerships points part our healthier hold profitable to DSW will actions of contribute to and goal these accountable the the to destiny of right We and believe we XXXX model our opportunities our brand of to Inc.’s growth shared a changes and of on our to marketplace.

Second, marketing.

results in customer new investing facing last marketing to year, and purchase drive we're acquisition. frequency solid Following customer

in among far, traction are and engagement, we digital all rewards up acquisition the trending are that the customer teens as So retailers Research enrolment favorably. in team one Jaffray’s shows survey. annual with of top moving five DSW gaining Piper also new results ranks

fuel XX% new the aware, our will more and energy of In in our of launch DSW sales. rewards brand of were accounts engagement. the forward, you for DSW improve Looking program customer case over not some program loyalty

simplicity connect enable shoe or rewards, years. Customers file. benefits how changes earned. birthday to to DSW our with we member enhancing mobile through in overstate reason love the our announce to in our repair. rewards the last shipping benefits excited rewards dashboard points can't the system, point of These new earn will we shoe also give to every updated exciting donation customers ten rewards biggest the and are easily ways So We've to single features see us a to

is driving early, launch thank want traffic, it higher our our who to make this and redemption worked activity Although enrolment. campaign to happen. teams rewards hard is all I

people. Third,

associates more model labor house on to as match will these customer our of changes warehouses and in customer back front focus provide a fulfilling of peak as piloted XX% our tasks during we’ve online As coverage of better part engagement, improving house warehouses. new of between activities With XX% well demand, hours. facing our

roll innovation. DSW.com help online. strides out our we're we clarity this better And finally, engagement the customer role tenth made and teams expect we As proud anniversary of improved drive we've year conversion. model, and celebrates this to great in-store its

capabilities for in in omnichannel a retail have cross-channel the second best platform edge leading Our year recognition earned row. the as

We continue class our to mobile platforms, the new digital to loyalty capabilities deliver refine envelope our vast and we push assortment as world around program. experience, for centered our

for that customers this move our we to personalizing our As further regardless channel. even us, shift easier can experience, so to with forward, it focus shop will we make of

digital’s to new warehouses that experiences. merchandising fixture with amplify brings retail life ability new introduce to our transforming We are package and stories a

success additional locations later to this our quarter will the new our out we've of store, and three four lab test year. this roll Following expanded locations

Turning offerings, locations customer been home in to pleased DSW’s our with two market. to to which new now shoe response new expanded we've has service repair,

are where can lounge, return sole customers out. services now or repairs insoles, simply newly orders, drop off hang at and custom up order designed Our a offered pick

year. season, demand Bar With of opening later into our has location the and sandal looking accelerated our this onset at second Nail we're

with As results this are bring meaningful consumers our we facing market, expand we brand hungry we for on customer summary, first innovation our goals inspire connections truly quarter In track to that DSW’s and year. will to self-expression. demonstrate appeal more authentic,

are capitalizing the and chain ahead our our network We and powerful between supply digital consumers' our stay strength financial tap to synergy platforms on of needs.

portfolio the operator growing me the opportunities create are committed leverage we retail term for We to and value will profitable let the that, turn to sustainable to more With our growth. reach with customers drive floor and Q&A. long

Operator

your will be first And of and King from Marotta question Instructions] [Operator C.L. Steven Associates.

Steven Marotta

Roger quarter. Thank you Congratulations on Jared. very great and a morning, much. Good

can additional First, can you be Salons, call would four Is the update repair? format? increased about store you SKU count, to a anything there the that stores shoe of as last You any had accelerate the rollout new comment the the there it donations, offer that a mentioned on can is Nail rollout shoe pertains as that there part little this new there year? additional bit that that of

Roger Rawlins

the should I end fixturing It’s a great through, store the those we we're got new working I question. would place package on say at designer in say or that really the of QX.

are think exceed has the don't those to out I our yet prepared launched you our So our I that we're I really is Polaris call think, in in, continued again which store -- tell how have store Columbus expectations. that first will performing. we to,

in have proceed but year working happy toward. the So with we couple a more I later that seen far, are And think more we've we're we're open going progressing, you everything it's as of how we'll information we so to the give locations year. throughout that

and the it's location. we're again, want be so from Columbus an really it to why behind the there get Bar, we all marketing Right that to it get can a we’ve market. making that's the to another now, we entire into to Nail going take this decided On We progress perspective. market, love in

we figure location think, other where third that other -- getting have today. pretty our how addresses, move running quickly stand in sort much is really out trying all of opening that but we stuff in comments up timing we're when we services, and again, the we'll So had more I then quarter, on I the and think, of do the the to

Steven Marotta

reticent month agree quarter I would comp business, to your date follow address and up the My said, seasonable understand May summer with that question temperatures has more two, one? historically seasonable? And but you to that trends, you've been Okay. more been is like of help that

Roger Rawlins

can a quarter, weather of very This for is just going like Again Septober people pedicures didn't because I which for it that and windows. as boots, to weather pedis when April, tougher sell get really weather talked and about sandals and it you obviously meaning does as do have until they not the same we're was no, to well, way don't and help say, those a end Marpl April. break relates would years first it how us sandals QX. was Steve, and when the we're to warmer, weather Marpl March unique learning talk we necessarily But really about We've have when wear they to they impact on.

think does us. weather I So help

Steven Marotta

May been And you has agree month That's date. helpful. seasonable to more weather that would

Roger Rawlins

but we mean, Yeah. the warmer. get don't – I obviously, been into yeah, Yeah. it’s

Steven Marotta

I triangulate. much. That’s I am Thank you very appreciate helpful. trying to it.

Operator

question Fargo. from Tom will next Nikic be The of Wells

Tom Nikic

my year. everyone. reiterated could give I little EPS. the us guidance morning and you good taking you more comps context I a if wondering for around question. of Hey, Thanks the sort Jared, was the the know for

you some in give almost If line, it in operating about on expenses, and gross particular, sort would the that of interested the doing of I'm the a of is was Is indication of Thanks. new for thinking operating loyalty run little know you X% program? to margin you're how as I us the abnormally should for high sort year? QX. bit remainder sort up consider a expense the were marketing extra we of Or that because rate

Jared Poff

that investment Sure, Tom. marketing, I the to in down would go of year. we rest don't throughout say expect the the

acquired. the go has the to us that that VIP. of with making the expect. the the customers campaign coming very Roger throughout been that tracking on driven happy is basis importantly, and in are as we getting returns a the traffic said that by we've that year relaunch Also sure has that So, new and script, And we're the more we at campaign that

and that pre-hiring to of able with associated scheduling, long us that. up headcounts, There and although traffic match some went with some that, with training give in that's that. So was going more to along term, SG&A some better then things that the and was there model the has flexibility to that rollout our labor leading but like be

up wouldn't year think a but LY should through I you probably be an at, So, bet. level X% increased a say I something is the safe continuing rate is over that that benchmark that

the got are we've when as far calendar some us, against we reg year end the a that, little but mix that of standpoint. moving of year, goes, week, what the of year you've tail the towards expansion margin the opportunities business clearance see and losing or also it the things you calendarize than from out As margin to a end versus middle of part shift of gets seeing the and in the the seen beginning throughout uglier then

Roger Rawlins

as Roger. the just to this relates Tom, would is I margin, want – I it to address.

kids, the I think grow has has in say been impact have would we been as we've impact there's particular athleisure I'm progress couple last to your stronger rate, an women's on I headwinds huge remember margins that not on the years as an grow rate. to here, and dollars in continues margin we're of increase that seeing that kids rate only there have and as in we talking the that as organization the that making are what you penetration, we business that experiencing than but obviously, your an

we that after the not going performed a level and at perform to in a to getting bigger team. wanted Our way much as to be has which private brand we're

underlying and standing they've proud top the so is business, those after the really after things we the all gone of it. buys. that core for our we're when items we how all margin the for consumer. key and business of paid our We're and perspective very the stand as behind from inventory but door talk have I'm they're I team items, how in we're And as the positive of fashion for, getting line both been to about really for our it, perspective we headwinds, putting women's inventory well trend think going investment mean, have three

on progress good really making that we're think I front. So

Operator

B. The Riley FBR. will next from Sinderen be Jeff question of Van

Jeff Van Sinderen

morning. Good

in go the just biggest to share fall, maybe You're stronger are are index of not better being that the capture to to year? other sense or as where back more have for a you inventory categories. market trying you school words, little some inventory or can enough this a you feel might of opportunities Can us of share planning performing last bit year? aggressive after give get you a market had sense retake In to you over get you

Roger Rawlins

best we've have been and which sandals us. We our for consistently are about -- categories, boots talking

life the be into where think we the both as going in early those, left table bets of September. extending we sandals QX, I We so, time of prior think more us you're proceed we through And areas, the completely we those place see we opportunity say, as sandals. out might to in QX, got by on of years

door where the then conservative. efforts so That's us, Athleisure double crazy I trend obviously huge back planning warehouses flat think had market we're all basis, were on any we -- still this in it because in up, you didn't we're having we those well have not stores. in on under just investment So year couple for then because still opportunity penetrated think we a on school, year years share, I we think all and ago, and it focused. back there's of a sandal ago down obviously, have of we kids there. in go would for our to year a we are have a And And really categories, opportunity in it's to ago left table the year, but then I say, think some both last we and two going them the opportunity about talk a did boot planned and we categories digits there both

we're the so efforts. now areas I are those our where right And think, focusing

Jeff Van Sinderen

thinking about the showing this that categories women’s any other improvement but also more as how then and non-sneaker were some you're can how you of maybe mentioned a half said the Athleisure, you're just categories year? in evolving that follow-up, give wondering the And you you second in of about us those thinking and on

Roger Rawlins

our again, and of playing versus a to done We, nice And a team really defense. really good think keep job has talking and buy to women's about this. listen we women's open offense done because job. team us I our aggressive, our being I really, back, that keep I getting really, playing teams emphasizing having embraced has know

is nice end So and across team drive -- we're But, real too at of accessories. at women's category. how really proud men's the our a They've done job day, performed how and that the the to of and DSW. has DSW dictate goes performance is of every going

Operator

The Svezia will next of Christopher question be Wedbush. from

Christopher Svezia

on just I of first, guess want earnings, you. last Difficulty] to, talked more towards about the XX-XX Jared think last for think split I I moving to [Technical go a you call, I

Operator

operator. Pardon me, is Mr. Svezia. the This

line your off. breaking So is

Jared Poff

I'm sorry Chris.

up. you hear broke said. couldn't You what We

Christopher Svezia

So just to go back [Technical Difficulty]

Operator

I'm Mr. to Svezia, to going next questioner. move the on

move take can go could question Bank. we again. Trussell handset, you your We’ll Deutsche just to now to maybe reconnect or your on of If Paul

Unidentified Analyst

is for you Paul. [indiscernible] Hi. discuss could if wondering the I of power performance This on stores. the was just

adopt were but you kind initiatives stores the been these stores your outside that, expectations? they how of You weather, any other to able these performing stores And by have mentioned are in versus impacted of, fleet? in to

Roger Rawlins

I and -- is that we is with a say, weather and have of talking doors to that our some of in about question. great what QX is a this would team. share XX our our We've would Power some That's lot not expectations with you. I self-inflicted been performed

have our opportunity, those I we were this think of stores team with long-term yesterday talking enterprise. we just about the important are how success still to of the

what's But the as those well address have strategies I'm learned getting balance and So lift have which at company. a actually gone a there going of still we going PXX with those as addressing implemented learnings And continue we I result, months to in our team, of what last initiatives marketing is have with team to where the keep as XX with XX some helped do lot strategies satisfied that. think those through team. not implemented and the are after the of Power as were over that stores. and share I assortment Michelle the from we're we've to and with great those we're our that we're through

Operator

The next question of Genuity. will Lyon Canaccord be from Camilo

Pallav Saini

for is behalf Thanks Saini Pallav This on our question. taking of Camilo.

men's was And mix you what improvement this issue and you going quarter? the saw before us business is? If how remind can accessories forward? you And this are planning what of the growing the on

Roger Rawlins

I’ll accessory business. with start So, the

the That's really an accessories, progress has important on have is our the side, a here as really think, board grab but think both and we're and we sneakers continues challenge additional particular, because I to a Nancy an in team casual today, us obviously, side sit in been call, and around. a but I of the Nancy men's key dress, for us, for And some job in space on men's think it we're I a and help business street much coming turning now there driver. assortment of of making casual done have be piece done has I and opportunity team better then a call, job in of in and accessories on job having success from getting it UPT our a as items, really some narrowing that share done have us that nice And consumer. can men's behind our entire a category. nice which improved performance an accessory

Operator

Susquehanna. Sam come will question Poser next of The from

Sam Poser

taking for my morning. Thanks Good questions.

to $X.XX. -- $X.XX. us related that cost mentioned gross that you margin EBuys you you all, the what of quarter give First that EBuys that Can impact in was of

Jared Poff

When flowed you last year-over-year roughly to point Sam, margin. versus improvement XX really quarter. benefit was in year, -- our this it resulted overall a gross Yeah. flowed the through through actually year at earnings what basis our around EBuys a net-net it operating what to look

Sam Poser

in you the And -- merchandise then cost margin, improvement in total? it -- press give can fixed can for is changes us Can release. that give just the the you total the give the this the segment gave you in or just us DSW you us the

Jared Poff

Yeah.

in saw points. DSW a is from not overall XX markdowns little as Ecomm well, just Markdowns were an and basis Inc but up roughly segment. were roughly were so our standpoint, fees it's basis we the basis Inc, XXX points IMU was again, this favorable point, So a favorable by XX favorable,

Sam Poser

So fixed it's that? delevers – then so cost that a

Jared Poff

Yeah.

lever. would sales relatively with Now see as did what digital mean increase DCFC say in though, performance. marketing digital de-leverage we I occupancy shipping and the We the did the I flat. mentioned was

Sam Poser

were most stores And York then where there lastly, improved of There Can power about or of are or of of exist? thereof these may stores not talk saw the you impact in power assume stores. some may the I commentary, markets, power tourism the any stores. City from some anything lack your traffic you talked and New you about

Roger Rawlins

in challenges challenge that we break don't into much to level, out, We market Sam, our I really I tell there would weather QX. think, yet, traffic power versus a QX, but our was how how doors, don't you, a again, I into but was tourism. in challenge think I traffic at in want get some that don’t would but get I of know performance was

Sam Poser

how who sort perspective, success And wins, of how space flexing you other then making the sort who lastly, rolling kids, -- loses other businesses. floor fitting are of categories talked also space are -- you impacting from you're – you're -- the you the or of how for without who kids accessories, a can you the are you about but when out

you there for can some color us? give So

Roger Rawlins

capacity. we the is why has to lose to this, not That's a of chain, as did us pursued great want adult That a this couple years out we get question, it into taken Sam. because

XXX that doors be floor. adult clearance narrowing our putting basis perhaps kind or different reducing choices team of strategize we space, we hard a it to whether an into, the So some has have floor number of door-by-door that from would fixtures have recapture had ultimately to worked it we've adult footwear these on to really roughly aisle, a to accessory in last moved the the remove not fixture, on do

solve. a had would every a learned different a been is and we had and of tell things challenge -- -- a have you we to I has it's So has different mix layout store what

Operator

And difficulties out I worked Wedbush. audio think we've for Svezia Christopher of the

Christopher Svezia

was into any [Technical about how it bias XX-XX more Difficulty] maybe be still would might you color in the it potentially about case year, helpful? Just if bias. or XX-XX? this the last last I just that’s year, Jared, that just potentially XX-XX skewed So wondering fact was play that more in talk versus is Can

Jared Poff

– think the that you breaking little quarter XX-XX make to that XX-XX. before again in asking rolled there half of the and baked gravitating we Chris, that, the you're say, and outs loyalty through this out to timing bit, our or some fully year relaunch prior this a as versus the wanted we drivers worked sure ready of quarter. XX-ish some was year unfolded, versus are but push closer probably so Yeah, we maybe a and and little that would was we were I a the as I the first XX-ish up

to labor that. model, didn't new want the we Additionally, also rush

we’ve So of out that. timing the rolling adjusted

a So we've radar that shifts. timing of on there's done that our things been strategic some were couple

us that's the XX-XX. So XX-XX. right a more back start we're probably more closer getting made little -- like now, a I'd say to

Christopher Svezia

this seeing second their of maybe, cetera, new what bit of buy, buy, in new they my they far, your And average you. they maybe Thank a you're existing out from Okay. customer terms as terms size, so how little just color you what in differ how purchase acquisitions, program? et customers do roll question,

Roger Rawlins

thing trying we Chris, to tell to tough out with XXX are in I’ll and are stores, give it's that specifics already in made. figure to of more and call, store that that the all shoes. donation are are customer weeks us being we're amount in is the it's was There in I the particular you so being how bins we in, walking full that to what now donations do it's excited what three or whether pairs of people is photos results, the being shoe of this skewed handle we're excited and we more a you with millennial much the about sent of XXX than really I like where to So, the cover the think we're a think, but I'm relaunch for on

help how and a program. we're us have impact we VIP a ultimately attract back how communities, more on think can is having us big the consumer millennial historically, I also us big, that think that it for of give but the help our than based to what this I win relaunch

Jared Poff

existing with to like. something we're is in, of that see has they when we're we're Roger non with that involving coming that model traditionally, are we'd in substantial attribution we're that new utilize on continue XX% and the marketing customer with at Obviously, is what's see us driven as increase a we our about. coming mix result and getting new interacting that We non a that us, that's marketing millennial them of to members a And transactions exactly and media have demand with that love Yeah. members, improvement grow digital excited what the mentioned digital add that the – our are call, think digitally digital which as who's very the a I helps digital XX%, would speaking of lot granularity that, happening. a mix see see traction through the invested look transactions to in and to to and we what that's we're medium, them and traction about

so our So far of very marketing. results early we’re with happy very, digital

Roger Rawlins

Yeah.

able we're get non we've one our progress members fact I to where making is, we an declining the we've year new see Chris, been that in think run, materially several really to fact been around actually think getting on the and increase. pretty progress, were That's turn to I three seen is head a and around years. that that important your and first the time two other that we're have

to, also doing that the right we're thing. So points

Operator

we from Patrick MKM [Operator a Partners. of have Instructions] McKeever question And

Patrick McKeever

there store wondering picking and standpoint early landscape the come shift seen some -- of part this had up you're third the overall impact in the the And calendar but with up, of I may is a you're of pricing what the you to stores? closures that overall. the store, then also we've stores have on if second and closed just the I comps that how feel share space. some with department was question impact you're stores but competitive and Wondering competitive like then on department wondering call, department -- from from second the was seeing just if my the I quarters. just the from miss and if And might there retail any was

Jared Poff

I’ll We first take Patrick. no. comp base. a question, the like-for-like The is answer do

So we that adjust are related shift. an our the comp so to calculation it seeing calendar not we ourselves impact in

Roger Rawlins

the the competitive believe is back seen going happening of to a repair, I evolution, create ever a on we offering out our what in to on come challenges, brands we bring private been to that's we've our that it to in is that whether about had we’d unlike to its again we compete really Patrick, assortment, expand we last How not be organization to that anything that thinking why re-launch talked our rewards to you've focused got we're that brand why so price. nail through, on our the to share. to team, for our and face grabbing we disruption just so landscape, experience differentiate mean our figuring experiences how the we is order we've talking and that’s different that’s evolving assortments, differentiate this life program compete that brand how year customer. be create not

the cannot I versus that. approach gain to even being if how We've going yes, on our our inventory that's take around to said, you we for around our look aggressive And investment, data, the side. did us, so around that got again how think the and more what's going do defensive at MPD we're around we disrupt on we share. play But people. get we marketing in offense settle it

Patrick McKeever

the And with just about the on getting shipping loyalty loyalty two then and -- free XX% shipping. loyalty and how, mean, you're are program in some customers day extending to shipping, free all relaunched the expedited I of wondering now sales customers new the

shipping of impact margin So the you the that gross the the my about free question thinking much about just, thinking just of on in how with previously e-commerce shipping? of sales how covered the is were expense program and year, how, for loyalty by relaunch are

Jared Poff

as far of but I would There's that at say multiple our majority already on free basis as digital things sale. vast the our sales happening simple Patrick. a Yeah, there, were demand answer is shipping

a but next are isn't to second to material, our shift So, getting that everyone the the we were they ability it day, also to priority two I layer up say now that there would are back is also moving where is with dramatically open days. created members along

a digital the So pickup price that's the expense the overall, of that's of actually dollars a some there. At of day, business. end having

it to as the And and headwind will to the of continue that on so, growing year, starts shipping year. we it's do keep the believe we're that that, a comping still we and that headwind, headwind while but throughout diminish business be show a materiality for up

Patrick McKeever

in XX-basis point guidance you EPS the last the I guidance I to case? that say about question the margin on guidance, think call the implied or a Is think margin. specific know that previously, then did hadn't given but of the response And -- EBIT sort I in still -- a decrease operating

Jared Poff

Roughly, yeah.

Operator

session. ladies closing would gentlemen, the for And to back to any and conference I like will Roger that hand question-and-answer conclude remarks. our Rawlins

Roger Rawlins

that’s listening great questions Thanks, Thanks today day. your a moving everyone business keep everyone. to again Have in for and for team and being participating, our the let’s forward and disruptive.

Operator

conference you you time, At lines. Thank the presentation. has may this Thank gentlemen, attending you, for sir. and today's concluded. disconnect your Ladies

Designer Brands (DBI) 30 May 182018 Q1 Earnings call transcript