VRA - Earnings call transcript Q1 2021

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Operator

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Vera Bradley First Quarter Conference Call. At this time, all participants are in a listen-only mode.

Following the presentation, we will conduct a question-and-answer session. reminder, is a recorded. As Instructions] today's being conference [Operator call to Mark I like the over would now turn to Dely. Please go ahead.

Mark Dely

Good for call. I for morning would like to everyone. and thank joining Vera us conference Bradley's welcome you

turn in Some of during within unknown of made Act your SEC for Securities discussion discussed made of Vera materially the the any risks at press call. should assume statements, to I operative meaning may as to obligation uncertainties. remain update forward-looking known to amended. safe and now call later response release not statements a Investors no cause forward-looking the and today's harbor could subject the remarks constitute a will on and the provisions the our Wallstrom. Rob? we recent questions pursuant to call the and undertake from prepared statements expect. and during CEO, differ XXXX the Such and Rob statements of both, Form Please are We made that the actual the known refer Litigation over most risks information that to that time. uncertainties of will to Bradley's Reform with company's results to those XX-K filed Private

Rob Wallstrom

our you, also joins and morning us thank Enwright, everyone call. Mark. John CFO Good on me Thank you for today's joining today.

us the this culture COVID-XX with strong company's challenging Undoubtedly, are but been the mind period. start of on innovation disruptive pandemic. history, everyone's and this the and in Let's leading periods what is one has most through our

for us associates, and decision manage they confidence, crisis opportunity. pre-pandemic But and The and through minimize customer to and the our have priorities term. lasting customers to way activity safety I It comes time stronger a the company of shop. and to thrive shopping have traffic consumer us and every consumers our over will taken position shareholders other on and stakeholders. this This associates return to we worked am will emerge well-being actions make. take in challenge long have allow adversity to effect remain the levels. top will our we transform confident, a pandemic's impact We With the on

acquisition Vida XXXX e-commerce will Pura being skills of larger and in in digital total Our of a company of our be resulted has critical new even the environment. companies this both more share revenues

technology. propel the with the were shop, anxious forward, ahead customers were will innovation Many of closed. and our experience as innovation consumer moving are marketing to even product, We us enhance our and that in stores

are our Vera both to e-commerce a Our in Vera the sales Vera performance which company launches to At quarter. masks new about normalized Pura Vida, second Bradley exceed first and continues of the on customers last Pura And at one-third represents our product and year's basis into responding of are was Bradley, and driving total Bradley combined, and Vida strong revenue. businesses also quarter revenues marketing cotton initiatives.

financial our for customers e-commerce, grateful have continued reopening in Beginning operating protect strong several a liquidity actions crisis, to time. for taking position, mid-March, us the smoothly began we position COVID-XX in during this and our future. other navigate who distribution maximize many loyalty customer business keep e-commerce associates, to thankful are worked and to our and their especially service our We for center tirelessly

associates abatement for locations Board program; scale closing suspending compensation possible; temporarily temporarily million previously Bradley graduated ranging reducing took credit orders, and seeking managing from with our delay all concessions unused our charitable receipts our March of XX% inventory extending cancellation certain and marketing cash million store to where from the buyback $XX payment Some new mid-quarter; on our of the store temporarily closures on expenses payment on not compensation reducing approximately revolving working furloughing or XXX(k) and $XX reductions of non-payroll share remaining Vera but limited temporarily operating actions XX% a XX% of terms, to price matches; delaying associate our me; suspending drawing for and levels planned donation agreement; Directors; for of travel; including, base vendor workforce included, actively temporarily openings; rent through the with or we temporarily tightly landlords accelerating canceling store and eliminating XX; addressing XX% terms.

in We the later detail in will actions discuss some more of call. these

Through return the our revenue our growth. business on solid Now, three-year Vision fiscal and brand years on with foundation ago, you company strengthening to I to COVID-XX accelerating to brand and two we our the of want Vida. progress the Over Vision tremendous Bradley on XXXX update restore business a strategy. our aggressive Vera acquisition plan to foundation, Bradley XXXX, to company embarked we XXXX, and how growth growing made is and our earnings Vera impacting Pura total and healthy

XXXX fiscal significantly robust goal. to goal was crisis has but more the that Our growth, COVID-XX affected drive

strategies customer However, Vision innovation, brands despite continued our of on engagement, we XXXX focused the and product long-term navigating through while our COVID-XX crisis. enhancing growth remain the core situation, through heightened

Now, let turn call to the John the review financial to results. me over John?

John Enwright

and Rob Thanks good morning.

in Vida XXX which adjustment million The prior July impairment been will consolidated have our Vida today's have re-platforming quarter systems, first release. over totaled income disclosed the a of in year. transaction first The include Prior acquisition. statement numbers asset not EPS XX.X% expenses outlined exclude been IT have earn-out described measurement previously release. the the numbers, non-GAAP day year related exclude results restated. financial charges, reminder, the discuss the year Pura XXXX intangible non-GAAP to excludes current Pura of of full for income prior first decrease beginning first amortization, the quarter to also adjustments today's Pura XX, net current Non-GAAP Consolidated ASC a following statement the numbers liability period As Vida revenues charges and the quarter, I COVID-XX-related of charges. all $XX.X been

totaled $XX Bradley decrease quarter. Excluding million revenues from first Pura $XX.X net in XX.X% Vida million prior the a year Vera

$XX.X For the Incorporated, share. first or charges, loss per net million totaled $X.XX Vera consolidated diluted quarter excluding Bradley non-GAAP

in For the prior company Vera $XX.X decrease from first prior million the share. from of loss the Direct first decline COVID-XX XX.X% closed $XX.X diluted of non-GAAP quarter. revenues as net of for result excluding million, charges, Bradley a per quarter. first The that million year temporarily totaled or year stores the posted were $X.XX primarily segment company approximately half resulted $X.X quarter a a the

costs liability department COVID-XX revenues. transaction in adjustment net charges, a the loss non-GAAP asset exit Bradley extremely intangible consolidated first first certain the was to Pura a prior of certain well replatforming prior store quarter. totaled in XX.X% sales excluding charges excluding difficult as million purchase charges specialty quarter. or $XX.X in Vida million, to Pura $XX.X orders or as largely The or e-commerce revenues quarter. or a both and a million reduction consolidated year related key costs, net segment non-GAAP $XX.X quarter profit gross operating and specialty million primarily totaled the earn-out from to from fiscal Pura increased On revenues makes current a XXXX SG&A uncertainty segment $XX.X prior The $X.X revenues revenues quarter outlined to million amortization, basis, $XX.X XX.X% as year. reduction basis, accounts. Vida's performance of to the COVID-XX, well charges, non-GAAP quarter. a net other a expenses XX.X% of basis information the XX.X% in XX.X% Vida first previously of SG&A revenues segment cancellation in a revenues excluding $XX.X for non-GAAP charges, million excluding department On and the consolidated the non-GAAP $XX.X On revenues. predict. number or net orders impairment basis prior the excluding On due revenues. included financial totaled resulting first the year totaled technology X.X% quarter expenses totaled million First first net of department basis COVID-XX store of of year XX.X% or $XX.X compared stores, decline as the the operating last Direct for net decrease from year Vera accounts million Indirect totaled the and totaled loss million over in year On surrounding XX.X% of

As providing forward-looking a result guidance. are we now

the turn to me spending for quarter totaled sheet. let Net first the million. balance Now capital $X.X

technology total and $X We logistic expenditures related and million expect new between fiscal primarily year, to to the enhancements. capital stores factory for to million $XX

repurchase we quarter, we repurchased million quarter At million million the remaining $XX our end, had authorization. approximately first approximately stock. of common under During $XX.X share X.X

$XX.X earn-out of the totaled million Cash, Vida plan. temporarily investments first million reduction and year. of As X, $XX.X end the year's at quarter. repurchases at and was a the quarter XXXX fiscal last Board May prior Inventory the Directors million million $XX.X of related million payment compared the reminder, has $XX.X price as facility the the inventory $XX included Quarter suspended the of reflects end year our purchase cash equivalent netted from to $XXX.X of during of inventory drawn under at Pura Pura The revolving which quarter. against credit last million $XXX.X to on first was Vida. -- end million $XX the end million

our The of orders canceled not is inventory apparel. and of situation. seasonal life does winter have have approximately of inventory XX% good is, not We result our a fashion much news a fall of as shelf that a and COVID-XX

we and be. rational Rob? clear inventory try be always we as will to prudent We as

Rob Wallstrom

John. Thanks

both As and on engagement through I forward; that will marketing Vida in noted focused enhancing and remain brands Vera and earlier, innovation we Bradley us propel the products, enhance innovation technology. Pura consumer

with start me Vera Let Bradley.

and products more to is authentic brand, must but innovation true our our to remain becoming and Our critical product assortment. more

relevance, developed have cotton existing alternatives, cotton retain of innovation brand. fabric to market and ensure new an to the updates customers to both customers offering by pipeline ongoing and We attract

launch offerings grow our fabric XX more Re-Active to Twill will over We will continue next months. of and the innovation and XX Performance newest to

and One our bring our is to customers. becoming to all facets it differentiated meet continue focus hands-free, lifestyles. is of the important styles also will We as to market to silhouettes increasingly new customer's

long-term of on in continues our areas youth to everyday. and key dominance Our franchise focus travel be campus, building

a ramped minute. distribution of masks initiatives equipment. in and result environment, current manufacturing these have and our about just more personal we other a talk will I As up the protective of

we'll which excite strategically with strategic that strength and increase are Disney ultimately Target. generate through Bradley distribution enter our year in to alliances And buzz, a in brand. We brand newest and continuing brand the These our We to customers, collaborations second and new product are Vera wide launch collection opportunities engage existing categories. provide And expand are truly for forward partnerships Venus media of continuing test. look of launched reach, awareness, with our and and March, on the collaboration Gillette verabradley.com with our collaboration testament appeal Crocs, August. our our to new

are thrilled that customers World Potter, initiatives, also make create July. and devotees, often new iconic and we and We identifying plus brand. launch Most brands, community positive to collaborations. the continue Consumer product for Wizarding dorm calls working particularly we Vera can to Back charitable our future also we appeal Bradley This Bradley our Products Vera to line collaboration customers Harry other want and Under on children. collaboration with but action. Campus will will to Cares, We about known with with change real VB to where strengthen invite our participate create umbrella women internationally the notably, to attract our will Warner exciting impact, not are areas fans, Bros. are Bradley, to to several in of a a Vera we'll only who support

unprecedented critical need global we to this that in facilities to can our and and all demand to doing chain nationwide. those includes are get time, supplies help utilizing We which supply in

initiative to our and Together taking protective approach doctors responders, is chain have global support of our into of equipment, supply tapped all we variably nurses, including one, the in-demand to of pronged. procure through most medical the three Our Number care us. distribute Taking masks personal first and millions Care

along verabradley.com selling chain thousands And these supply Professional critical masks, verabradley.com. Number on masks, converted surgical Vera which of supply on bags. like are appropriate two, and those to medical-grade support. having and doctors' facilities. time get have retirement Vera of face Number wearables available Healthcare for the we on maintaining our masks who hands companies and to of Fort other a offices facilities and distribution manufacture difficult stores. able Bradley Wayne we scrubs, our available are of regional medical in of ramped been three, have our general These utilized provide includes medical with filters We cotton items the in sell are that up And Collection centers, smaller Bradley public. PPE, hundreds global our

With a spread face these CDC's clothed, response we the recommendation COVID-XX, use huge slow now the of customer for to that coverings everyone help items. are seeing

and supporting the percentage a are nurses sold contributing frontline for by on Response cotton We the of mask crisis, bravely to the working Coronavirus tirelessly of COVID-XX the Fund, each nurses.

people. engagement connecting times. increased and proud of making of know all efforts. by the followers we execution social demonstrate associates' new In helped media these a really social we during the difficult to And working both are about have And team has and are difference. our Bradley strength We that a customer Vera seen, has been always brand our commitment together channels. these that of across in

billion very well content market. favourably X.X both of we doing our during had the has been customers We have and first react associates. impressions. that user-generated quarter and and We strong seen customers masks fabrication, media has coverage Earn are our of the face as to reactive good media the sustainable work with by to amount the shared been bringing also very new customer as

only New worthy annual awareness second Day Autism causes. increased enormous two with for new not our attention, and but media Our with Women's partnership for very Hope financial Girls through support, International Speaks, collaboration generated

Our capsule included collection Johnson Olympian East a the Blessings tie-in charitable with Shawn in in May, mini which Backpack. with launched

do been scaled less. much spend, have back able media we we While with more on to have

lowering real to marketing helped programmatic platform in build speed and brand in products. health us We significant and to beach allowed and while to attributable improvements -- in revenue reach paid away and care washable, media, such data a investments spend. marketing efficiency drive travel as, into Our areas react overall our uncertainty teams science such paid quickly data-driven categories time. prior from to adjusted the and as, hands-free, media This our marketing double-digit

Customer success in Vera the Score. Promoter providing engagement the for of along Voice Net is Engagement program Verint including satisfaction difference. our making a service outstanding enhanced customer and customer Award in Our Customer achieving Bradley won excellence customer with metrics

to me update time table. and our stores give an reopening on Let turn you

to are their open stores restarting and Bradley regulations you where states As many know Vera begun allow. in economies we have locations

of readiness, ability ensuring opened of and and measured health began taking that On in return taken to out safety a sentiment, anticipate Following with of and majority our factory reopening from base March and as Vera XX Xth, and governments work, our guidance Bradley local full-line out the our full stores to we XX June. associates' of XX of opened We of the line a authorities willingness end end will and the we after are and approach associates consumer phased reopening of XX assessing May. our stores to communities. and store stores be approach necessary factory have stores to by customers store protect we and our prudent precautions the health our

precautions procedures keep safe implementing customers associates As stores the several is reopen, to and and company and secure. the

staffing assumptions expected. and stores based aggregate upon prior While data the making sales no more XX% May that the weeks the for operating reduced year better two of hours. of have performance while been we number a revenues at opened than of is limited of days are or have sales future since This of Xth generated approximately we in XX

units is While are traffic up. and per typically down, conversion transaction

We believe to pent-up our is and degree there back demand. excited into welcome are stores some customers of we

believe feel sales more store retailers and open Bradley shopping, more consumers improve. we will Vera comfortable As traffic and

landlords closed. are landlords conversations is Most open but to hope and a been period the deferrals, our in both the abatement to for We periods. quick accept the to period obligations sides to address were period. rent that both are come active to the have malls for for to fair our future not question with in close solution We

the not were have negotiation During period rent for paid period, we the malls that the closed.

permanently bring which our full-line full-line XX of since stores to least beginning closings XXXX. during the at expect the to We year will fiscal close XX total

this year. five far closed have so We

five July. to three one new stores month, We add in open this are one to six open will and this opened May, scheduled in is year; or scheduled factory

We Myrtle our factory South just store. also opened expanded Carolina Beach

e-commerce flexible, should efficient. are platform Novus, and As new Project end by will only and Plus the be not entire company build we quick is systems, new and you enhance our Microsoft know Dynamics it implementing future platform year complete that technology to We our the platform. project customer believe and will but our management, streamlined, the both be be and enterprise our will to order of will be XXX short system, than this fiscal new expenses important POS also will ERP, databased a The and reduce achieve objectives the IT and of further ever make lessen experience. decisions long for informed the our complexity in enable to term. more ongoing Shopify our

Pura excitement talk on about Vida. the let's innovation and at Now, going

more ever led of day the manufacturing the closed growth more Even be facility in e-commerce to Pura revenues Average rates been in lifestyle. values higher, in for would year weeks grow the to Now, due order have conversion and every Vida of pandemic. increase by last our business. closed Pura several XX% to increased Total Mexico facility X% but Pura Salvador customers our the sales. of and a are several days want was we continue over even pandemic, revenue for part and Vida's easy the year-over-year. than was distribution total and confident the potential in midst More Vida fun El

to price bracelets metal, into recent El and Pura style continually jewelry Salvador continued of our introduce string traditional popularity manufacturing the bracelets. packs our styles signature In higher Mexico distribution expansions semiprecious and core and Our in and mood, just are and facility and begun we stone than charms our new Vida in have facility points product, reopened reopen. has has at

spring May Our out and personalize their Customers by special choosing are introductions several like less week. product launches in key combination trend. is off were launched Hair core to bracelet a strong popular can the than successful signature color very selling in to Personalization a our continuing them. open with heart a start. accessories bracelets

engravable January, Our rings are and necklaces, further selling sales looks. add-ons In easy to further bracelets, customize of allow stickers our daily. to hundreds patches, customers pins, and their and engravable launched we and we -- are collection

this out dolphins, the save save that soon. Several are Pura currently expand the charity of and the have that be charity will sold the next tied the and Vida customers. few. charities We been an over to introduced floss, have draw lookout more be our for continue program Pura elephants so will cause-minding to like name signature that the a added butterflies, several be a charm year. of to for popular save quarters. Vida's charms This this the these charm charity back bracelets save important bracelets we Be bracelets lifestyle element year on big replenished they specific to

The increase but donations to cancer our even to not supports style cancer. to our addition and us addition these of offering and charms that enabling increase charity packs water to that price all the our points, benefits awareness cancer great pack packs, popular only for clean awareness Another pack charity ring. charity like the boarding causes. is for water breast breast our We the total component a special have style is charity breast

is launched We Early Pura and Vida this expand will on business. the front. Shopify in the fulfillment second of in continue we the to Candid quarter, signature area distribution capabilities. expanding innovate

in and complement already agreement the and with for many its the to in reach opening wholesale signed established of COVID-XX, to have warehouse team transportation expansion We third-party others. San Pura expand lab Hectic our made only fall. global we around have an store this known for this We logistics and open existing Vida business to Diego and fulfillment Due to have that to Europe us our was those network of but distribution e-commerce products also experienced Europe there. customers, fans the to first the world postpone not scheduled Pura serve decision our will Vida's allow

for customers influencer We for are innovations customer this Pura lifestyle. showcase experiential location help future will store us is existing excited Vida potential at moments enhance and new for on the looking get also us product new as this feedback products, to engaging Vida and into Instagramable expert and customers Pura of is determine provide events. The Pura the backdrop expansion. about the as well Vida new path location engagement ways success always to bring that allow will

Our members continual bracelet a our and clubs Vida. popular connection and monthly Pura value, exclusive great surprises provide and jewelry monthly to products

Shore buying continually should with We our and have for customers of following media and Facebook program loyalty be get can Club. and on -- merchandise. points ask The new called for launched interact products. what gets redeemed Instagram a course, Accumulated we our discounts social We make next. even Customer free us earned points and through for customers

want to mean should everything that's we a it's always brand to our customers product they or think have they to And next idea we whether about say new fun the Our cause for a support. what why hear feedback us.

best-selling feedback. fact, fan thanks have designed of In some been our styles to

a An of part XXX,XXX close to of army Pura active Vida's media of and ambassadors marketing is an strong. On part the engagement micro in strategy. marketing brand brand social the our front, are key influencers

launch growing monthly. the accessory followers the way. engaged most that passionate in these looked number help -- while as over us TikTok pack brands greatest have We These with the the consistently star will Pura Vida million engaged jewelry bracelet was on a programs Pura brands to target style is Vida not of XX signed one for perfect highly Charli's by is that this Vida followers, focusing as Reigning perks we D'Amelio space their Pura the with an Vida of most along Instagram. build movement, impactful With is the at and of very love New she to Instagram brand advocates are number Times. continue million And followers. scoring the Pura the the X most Pura most personality and surpassing with excited most-followed influencer the dancer spread called particularly, brand. TikTok Vida showing the if Queen of upon holiday Charli and the TikTok on on is the on York season. fits agreement those market demographic the one we

I stance mention close, a we -- as associates, to I as a impact our our to sustainable are customers, purpose-driven Before want take and stakeholders, social a and strengthening mention our wanted value corporation, I that company our all that our shareholders delivers meaningful communities. for

purpose-driven working has and which and the this on report, ESG to demonstrated unprecedented Although we our is our Even visibility company tenacity was responded of outlines mailed our proud area. crisis. we to accomplishments flexibility. in responsibility our available website. teams and how materials collaborative in while focused the this In first report our organization our been and sustainability enhancing have corporate published This decision-making comprehensive history, our our and detail. throughout activities and with focus am innovation, our quarter, so and are has that been initiatives proxy remotely I increasing thoughtful

normal. through to and look fully call has the now not forward to We us only returning open we but reopening new the our extraordinary made us prices, will to business has up questions. allowed Our persevere stronger. Operator, culture to

Operator

from first Research. our question Thank go Instructions] now can ahead. Please Beder you. SCC Eric [Operator from we take And

open. is line Your

Eric Beder

morning. Good

Rob Wallstrom

morning, Good Eric.

John Enwright

Eric. Hi,

Eric Beder

opened I to know And customer some was are is before One the that questions. the the goal was you response closed Two of that? Re-Active? that for you what younger out. And seeing had you it

Rob Wallstrom

overall areas. to extremely The Re-Active been couple across of a has and response positive Yeah.

customer First is believe the aspect the I the we of younger that's that it. really is influence strongly very in And all, seeing lifestyle that. of reacting active for kind really of are it too. two One a to sustainability second And reasons. react a of they're

people have first few lot sustainable. a Obviously, impact and there. next more In media that so addition of of coverage that we've will continue up, able actions we environment of the really important we're sustainability products is believe make to on a to the are the to that, because that a And picking had over that lot as true years many we our be it.

Eric Beder

happen stores then of of of design opening or you've that stance on you number full that price stores. And Is outlets just handle significant rollout up and a the how is and of lesser done can what's a it? number by kind

Rob Wallstrom

by consumer a outdoor really of responding more outlet more finding is malls right? They're for to and design the is the reasons. It in feeling couple comfortable stores One we're that, outdoor be outside, seems our are and environment.

as we to that's volume the our believe positive very with well So, for are even we very the important, still higher. they're as open lower levels as in therefore, And stores outlet us. revenue up, begin

– assuming get but where stores health energy open. open continues to would July. best economic our of have to of hopefully regulations, targeting the And line hard to we we beginning expected, our we're have as And all So open how by all thought, go situation the But and to beginning we we upon we're working more the responding by would focus our environment. stores where the of consumer stores expect July, our government have full the depending liens those evolve. is

Eric Beder

going question last is the And flow the to How stores is Harry full-price of outlets or going collection combination out? to or that a in the Potter both? be

John Enwright

well full going So to it's as as be on line doors website our in verabradley.com. on our

Eric Beder

right. All

Rob Wallstrom

it. also our And stores and our channel have too, will too that Indirect partner

Eric Beder

Okay. Thank you.

Operator

Oliver next go question can Cowen. from Please Chen from And our ahead. take now we

Oliver Chen

prepared trend other morning. that opening you labor with demand and were how that are Good inventory pent-up of as the vintages? And you. number about Hi. may XX% Thank your The differences? regional to thought you impressive competition – you productivity. how – What thoughts are relative

John Enwright

first of think... you I question? Could the repeat your part

Rob Wallstrom

we – Yeah. little it. were quite bit Oliver, didn't to you're a hear, because hard get

Oliver Chen

was positive impressive. the number productivity XX% The

would inventories I your how on, and new store with regional trend plan So also just differences? and you love And thoughts openings labor? that other would how

Rob Wallstrom

still we've it our if stores answer up Oliver strongest. we're and bit. try But let Midwestern as please the broke part have overall, to missed is what that and me ones ask, So stores our because Southern it, the finding I that been opened it a little of are

that really have see in The open in the slower, the of Northeast to really those we pushback an areas kind have right really back normal communities bit to certain You it's has in Northeast. We've responded our location Texas really, quickest. pick but of seen momentum. we're little aggressive right beginning to in a that up a openings the now started amount and not of state get that the are

that. watch have very did. anticipate bit much it the they little thought we how felt up return. – have how areas been about very they the as hit see we'll off a We sales open crisis, positively The we've opened. that We that would good might but start they been we'll harder by slower, slow say health So than

the happens the to so – seeing stage real that build And for open, of month-after-month. year. a but does half is the standpoint, that our is stores inventory what go us the week-after-week, did continue did an reduced next in we how getting we rest not now only curve into just and that inventory when of purchases of that the did lot back reduction and we From the crisis ahead entered

where bring that's seasonal, we the the very nature which in good the feel beginning going we reposition able our this is of kind the the year, of next works product, position half get which year as where and product inventory the of It's that next be. the line allowed quicker. of to year. reductions a terms of really our the in very pipeline back well year overall of Due to for Just to as way lot But to our back were happened. in some it back us is later take even the was it of inventory produced less or year in

hard So a had making lot with if a that. we of we would've were stuck seasonality, time really

about each up sure different very with that area, good we're really location feel as managing that. then we inventory by how just and right And So geography opens by we're that the consumers that making it obviously, reflected. just

the ago. technology, putting that tools been data just in than analytics, we the execute we're all in year with been the better luckily, but might a – we've much have a against place to place So

John Enwright

And in demand but of a I labor, the about asked in support is staff performed, so. open kind to of ramped think stores customer also as the staffing to question I would labor. your have our minimum assume only up of levels to that we've We position, the thing add kind regards up we

Rob Wallstrom

we're store the been other in keep mind capacity. because and And reduced happy we've thing, really seeing volume in on reduced the that also hours operating response,

been encouraging. hours So, getting capacity and with these numbers reduced definitely has reduced

Oliver Chen

Yeah, that is. certainly

estate necessary? nature are what real footprint, might we the base be overall state of and post-crisis physical store what now the your really your lease thoughts for On and as renewal, rethink

Rob Wallstrom

we estate, look to things we that store make sure and be have ago. physical very right? might will we locations the and real I location, looking number. that make less number Yes, needed at what have we're of as One, than would tomorrow, we're years very, the right market we happening, two sure different at need are on And that each is hyper-diligent five agree a

being on that that. very making we're focused So sure we're

the though, what's rates few happen I and forcing what re-evaluate have landlords second costs, that's What's happening happening have I with that in real because the brick-and-mortar is happening been years structure. occupancy real last it's to The that that is we think environment highly estate seen making thing this climbing crisis over estate cost been climbing, and highly, challenging. been and think with

make a all reduced of been years. of And rents, what the brick-and-mortar couple some of economics last of in have we those than opportunities the seeing better for sudden

navigating kind presence. we're the us customers as that engage the the find right a well still but get know want the the and economics, sure presence and make where balance we end we exceptional customer, we economics we we the helps having to the as two. day an world And the new our combination the that for it physical of brand. customers Because work. right, brick-and-mortar of digital We is think for provide that can really at of two, strength the can So of believe need in the experience in

Oliver Chen

our retail average mix, you unit margin to ahead. Thank do what with product and Overall, you've you. will been have down making? is, decisions the if And just you're expect last your and agile that there are And innovation prior implications launches you on environment the be you're and year, then you do given roll as versus margin up to seeing? also, what merchandise question

Rob Wallstrom

different of couple A things.

the you talk new all a expect huge about don't as So, product in, come we in difference AUR.

to Twill our remix also at Some product cotton But of Performance the styles. have had. the than we're time, same obviously higher trying like fabrics retail has a the

some pressure that a it is we From a introduce we're movement fabric gets growing as slightly margin up think total, the belt than the are So bags, price. finding what cross might say be pressure we I pretty hands-free to product, of close. same upward the but time, overall. might time At the penetration put would When some standpoint, build thing we which scale. price. margin, downward some it is less But on with better the equilibrium a on as that bodies, innovation putting same be the the

downward of how terms year, expect a to on been haven't the Obviously, we say, we've we bottom seen stores you expect of in up. are to a significant kind pressure in the in the still see. category, margin would shall, retail which category. But pressure In I some the we we the a as seen through we've the the pressure far, good rest so of do Accessory environment apparel more is massive But that say, encouraged seen the we pricing, opening run haven't what go for year. seasonal

Oliver Chen

John. Thanks, regards. Rob. Best Thanks,

Rob Wallstrom

Thanks, Oliver.

John Enwright

Oliver. Thanks,

Operator

call time. to like any remarks. I this at turn now to the questions Rob closing would back further no There for

Rob Wallstrom

today's call. you iconic company is on powerful Well, customers. passionate us thank and two connected Vera an emotionally much Bradley with for brands authentic, Inc. very lifestyle joining

We are focused on continual technology. innovation in engagement product, customer and

We sheet our team and a and balance ESG-focused is liquidity, are socially solid and entrepreneurial conscious have leadership agile. ample and

the interest Thank we second and stronger you September and and will X. your on our come you company. We a support, quarter the on storm hope call weather other out for side can join us for

Operator

ladies conference. your That concludes you. for today's gentlemen. Thank Thank participation, and you

You disconnect. may now

Mark Dely	Chief Administrative Officer
Rob Wallstrom	Chief Executive Officer
John Enwright	Chief Financial Officer
Eric Beder	SCC Research
Oliver Chen	Cowen

Vera Bradley (VRA) 3 Jun 202021 Q1 Earnings call transcript