CHS - Earnings call transcript Q3 2019

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Operator

Good day, and welcome to the Chico's FAS Third Quarter 2019 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions].

I would now like to turn the conference over to Jennifer Ellis, Senior Vice President, Finance. Please go ahead.

Jennifer Ellis

Alyssa. Thanks, everyone. morning, good And to Chico's and earnings call quarter FAS third webcast. XXXX conference Welcome

today our Vogensen, Joining Mary Bonnie are me Brooks, President, Group; van CEO Intimates and Todd CFO. Praag, President; and

today can Investor under Releases. Our earnings Press release be on at Relations, our found www.chicosfas.com website issued

Let you industry, of about projections our comments and our that will statements as forward looking and me our estimates, current date. judgments speak caution which today's only about expectations, today's include assumptions, plans, business

statements. forward-looking on rely unduly not should You

any may Important made actual or differ by by included and this factors cause SEC materially to disclaim from call. issued our information are to the be that law. or this We events revise obligation discussed our except call otherwise that release could results filings in in statements required morning earnings those as implied in in this are on any projected our forward-looking or comments update

of In will discussion addition, financial an our on or results be comments non-GAAP basis. and second quarter adjusted

will included issued with non-GAAP is our reconciliation find schedule available release morning, which this and press the You our on website. GAAP

with the I'll over to that, And call Bonnie. turn

Bonnie Brooks

morning, Jennifer. Thank And everyone. you, good

third As with White XXX strong you delivered for Comparable Market driving over results Black almost House saw, improved sales both sequentially basis the QX we in and points quarter. QX, Chico's improvements. significant

This fifth consecutive Soma's is quarter delivering increases. comp Soma's double-digit continued positive growth. of growth quarter another of

are that results strong we While our demonstrate these on priorities. work three remains, executing strategic

the are to First, product importance across understand obsessed. on of customer and the being organization, align and beginning our teams

areas to comp its FAS and customer September, In through sales driving this in marketing quarter's a XX sales had engagement. all stronger firm performance. progress have We on in months. positive product, stronger focus Action month first contributed and these Chico's improved

basic they an the reflects biggest last on increase for focus Chico's, customer reactivation In fashion inventory more a balanced a improvement items delivered positive position quarter the the month month. Chico's, key of sales and and and had sequential between product. At the September, in comp

marketing and product deliver fashion customers our aesthetic to plans love and the reasserted our We reworked and expect. value

around Additionally, customer making we revisited and adjustments. and quality began fit feedback and our research

As have loyal enthusiastically customer pivot into respond want. we when and we they base they you what an incredibly know,

As House Market quarter. Changes XX-point sales comp third and in affect from a QX the a edit to you a tough course product quarter, had correction. driving may new merchandising adding recall, to the We design in able White Black for and were second meaningful made QX. improvement talent, assortment, enabled quickly cancellations swing product

part that House unit from A significant with improvement the also White in These large of at Black the results stores. average in are in made indicate product customers. and we came traffic visual presentation changes Market resonating retail and

unwavering. the Soma momentum is At

inventory by driven marketing. to be and investments Soma's growth in continues and innovation product

addition, acquisition offered in in the In online. was event customer by and fueled quarter stores anniversary their XXth

industry. Mary of on call van which best, if in Praag are the result, in she detail driving best, not speaking the believe we their will how be on us more today's one is the and joining

digital personalized well optimizing This online product unique horizon driven by is digital is simplifying, our growth and its enable to our and navigation omnichannel the priority customer site. strategic intuitive in and by we customers and marketing extending launch the momentum. platform offer are XXXX, more as our plan the personalized advancements online a second on capability. growth will to service. growth Our new best-in-class and journey, and which More experience, improvements across digitizing continuing in opportunities a our as equivalent user-friendly is channel The as

her. attachment way been On-Line, strong indicate stores. on customer, in a we banners serve sales convenient that with better more completed and In-Store results all capability our BOPIS implementation Buy across As and for an a discussed options initiative of has previously, rate in the October, to important helping Early pickup. In is Pick-up a more establishing us

we Our personal our to call. with major tool impact proprietary QX, connection are tool on customer. our the the discuss clienteling called In a we Style we as in having launching a is deepen more will new Connect phenomenal function which next stores

We continue innovation. ways selling meaningful to to tools explore create and service

in retailers Soma are We Chico's for and category. brick-and mortar in that America's best Newsweek both pleased the recognized were October service customer by

operation. third transforming sourcing Our supply is strategic and priority our chain

low actively and origin be India. our is we will range shift mix the sourcing the group reducing of in of sourcing XX% believe in and diversifying to By Our country China. we manufacturing penetration as our we our end Indonesia XXXX, Vietnam,

continue place provide that seek we quality. and optimizing scale relationships more strategic vendor our on long-term vendor emphasis to product We base of elevated economies as

will impact We we on product and as efficiencies greater quality even cost see XXXX. into move an

and strategic our improve people to a to place the are steps in steps as also On final important support note, business, future goals success. take our to ensure important we we resources taking right and are

I in proven and the with joined customer track in committed making bringing people product obsessed company in When record QX, we and both the to merchandising. company apparel

is where womenswear beginning on all many the private different newly value Black to team successful Market. in organization her of Molly in joined Molly a of created White brand QX, House the of having results Group. the positive label and our included Chico's their and over years and track of brought role XX both the the positive also leading tremendous leading already most aspects At at With has Apparel impact record President Langenstein Macy's

improved quality. structure the became as achieve and as volatility well analysis elevation in apparent of styling careful our could product drive our risk the goals to team, After and product, of our the it be to reduce brand's that

three key senior QX, hired new formerly already track to change to And with design during records we excited have functions, brand role decided to in brands into We members the each three proven driving all structure team and president. these we and the are product. oversee that success to merchandising the which now through reported a VP announce very have new roles

And J.Jill, experience wealth These unprecedented Bowen, Gap, Dusold Chico's from a the – Vanessa a layer and at previously but FAS. relevant not – in driving senior leaders of accelerating designer of efficiencies top and Kelly our to improvement only new Kirsten Anthropology, expertise, Athleta, product, high-end cost Cooper compelling market, and advantages speed they HSN buying also assortments. management, elevation in provide of creating have combined competitive

some structure of expense comments. his the departments, with reductions and product have fewer Aligned recent we strengthening others speak resources. to operate repositioned teams, more to the can will in we believe and Todd consolidated our efficiently

I Chico's progress this by shareholder right will quarter believe overall not with and that making our are deliver our identified is value. financial just as we priorities. short-term, the our but the and performance, FAS on the am profitable, sustainable, to pleased results. I In summary, future evidenced towards we're making changes significant firmly enhanced progress the for on company business course strategic the reposition longer-term

Praag, results over the Molly a on at I'd remarks and like Group, have to to role. additional now she few on the turn next driving for Mary is the how this President we plan morning's apparel And speak brand's Soma. Mary, to to call, of performance call you. to our Intimates significant van over terrific

Mary van Praag

great of Soma. Thanks, delighted speaking happening Bonnie. at things with the about all be you I'm to

growth our As all in comp marks in growth QX Bonnie quarter comp channels, third business. mentioned, coming particularly and of record Positive five strong DCOM sales. the and straight quarters positive

this customers included record event, for XXth Highlights new just successful quarter our a bra which the brands of anniversary in very attracted XX,XXX days. to two

extended XXX are Collections, sizing new in Vanishing the the the style of first quarter, building franchise. we launched largest innovative our our during spring. Also, styles successful and and most More on coming

Cool Our pajama beyond is business driver, Nights growing our Soma expectations.

details desires. match and mix just Our elevated what prints, she and are

study habits differentiation. that benefit leverage on of details innovation sleep. We recently like We'll foundation of Cool to to insights the Nights grow both initiated a and this continue sleep a these business on

focus products are also to innovative that drive on believe our We growth comfortable industry. we in and solution-based through most the the continued

including name year, extensions a bra Lift, the successful Lightest launched the XXX, few. highly Enbliss our several franchise, innovative Vanishing already During mentioned products, the to just Cooking we and to new

engagement in given existing reasons new compelling the resulted brand. customers prospective our have These to enter from improved and customers

improvements delivered We experience. to customer also our

develop our and tool, expertise We enhance bra fit are SOMAINNOFIT. guarantee training, fit invested in our first-of-its-kind a satisfaction

And digital, consumers. the paid our Soma, new helped customers. has which growth public existing in invested successful generate and very brands strategically have of and both efforts at with we awareness been social the in to of marketing minds In finally, the relations particular, we've build in

about We and equally our future. celebrate at we're excited lot have a to Soma

to I'll discuss it Todd to now the pass financials.

Todd Vogensen

Thanks, good morning, Mary. everyone. And

impact of our our to charges accelerated fleet results quarter third the and or on from related depreciation This retail other excludes and be Before structure. optimization begin, related basis. we of and an discussion will organization plan optimization the of the our adjusted the impact of comments non-GAAP charges net severance financial

issued press non-GAAP the GAAP find You'll release this our reconciliation morning. included to schedule with

With consolidated a third that, brands. X.X%, trend but sales down better our the reflecting the outlook, reported we of second our that to quarter across were compared for comparable all quarter above

commerce capabilities to drive in will and ongoing digital digital to continue this customer in continued in We growth our believe and channel. journey fuel investments growth healthy

loss third per reported the $X.XX earnings quarter Moving line, of diluted bottom to share. adjusted we

seasonal includes basis of margin impact basis merchandise. also includes quarter points $X was XX Merchandise a down and million which partial of or clearance points XXX tariff approximately of the

Soma compared to last momentum inventory primarily We in business to support exited the growth. in fuel and total quarter to continued X.X% year, with investments up due the

to Overall, costs, the margin. better primarily better-than-expected that due offsetting quarter basis on we call. in store largely performance meaningful outlook the down occupancy provided gross than only lower margin leverage The merchandise was second points XX was our

Moving third to with year, we cost manage approximately line continue overall last as quarter structure. our flat closely were to to SG&A compared SG&A in expectations, expenses, dollars

This we and ongoing in structure our to savings. realign allocate mentioned, more expect to Bonnie where generate and to third meaningful we the need our As them operate reduces organization efficiently most. we SG&A action quarter costs took resources to

with Our $XXX we strong and remains balance million ended quarter debt. in investments cash and the short-term and million in $XX sheet

technology remodels our focus continued existing investments We refreshes. on and capital expenditures and to store in

of to our in million capital Year-to-date, For XXXX, the our the for million. quarter, third million $XX we've $XX business. expenditures in invested outlook through is $XX range

stores XX in during closed quarter. XX We new and opened stores quarter X year-to-date the and the third we

net track We XX deliver of closures XXXX. in are approximately fiscal to on stores

On outstanding dividends. the of $XX million returned we existing shareholders share $XX a And million the In approximately have million we've quarter, trailing we basis, share repurchases. of authorization. approximately third $XX dividends in form our in four-quarter the shareholders currently under to and form to returned repurchase

other full-year now include plan charges related net costs. excludes our rest related the to and We've our incremental XXXX. fourth-quarter of optimization fleet with and of the the consistent updated to tariffs. costs financial outlook well for Turning the And the outlook script, outlook to as our as severance retail

fiscal we So, for of expect year's improvement in last relative a to in continued first resulting decline comparable the and the quarter total fourth fourth trends quarter, compared XXXX in low-single-digit net consolidated half, sales the sales to sales. company's

margin approximately tariff impact be the to points, XXX Gross net sales expected points. down was a to as million percent which XXX XXX basis points includes basis now basis of of $X or

Our to down to $X SG&A I addition are cost million, reflecting cost range mentioned ongoing million expected be $X of the to that expenses in earlier actions management. in reduction

and line For of a is guidance. last net compared decline in expect which previous sales mid-single comparable year, fiscal the sales, our consolidated in full to year we XXXX total with digit

initiatives the improved second performance in into takes all traction. our half outlook gain reflects across it and also This sales consideration our brands first-half as trends

by Non-GAAP points cost guidance gross result to fourth account of line in XXX net the be XXX the is improved percent quarter. from is down tariffs margin sales in takes points. to the basis with previous This basis and into offset as expected a incremental QX our of

reflecting actions expected is SG&A $XX discussed million, down to earlier. the approximately that we be savings

of And XXXX million non-GAAP $X in the basis. fiscal expense to $X lastly, tax on a range we the expect million

turn I'll Jennifer for the back Now, to call over Q&A.

Jennifer Ellis

take to others, Thank you, yourself one the of to happy I'll would to questions. please over this and your we call question. time, back Todd. In be time consideration At Alyssa. turn limit interest to the

Operator

you. Thank

Instructions]. [Operator session. question-and-answer the begin now will We

Your of B. today from Susan Anderson comes Riley first question FBR.

Susan Anderson

at and improvement morning. job a and in Good White give you the Bonnie, quarter. more House bit some little on if also products and to maybe each that you're Hi. the the the you brand, and you could what are touched feel seeing are could improvement Thanks. at see on then maybe forward. resonating about think if you're areas still we working Chico's, in could customers color what Nice talk going with maybe I the need improvement comps be doing

Bonnie Brooks

it's not better in becoming for quarter. I would thanks ideal, definitely yet, so is And moving right comments. not XXX% Product Susan. but with Thanks, your say each direction. the it's

we our all reasons I others. why have businesses of better hands performing businesses. are our course around that certain of not But correction are our believe firmly businesses than all we for place performing have some that And the and in

major There were process in able was significant for Molly editing changes QX. place beginning for QX. at the that And arriving with QX, QX in some a we QX to took make then of

that of we'll and And continue senior products we significant And have in three vice so, it new place, presidents now to continues. design see changes. the

we're excited we're about So, where pretty headed.

was I thing is QX we Chico's lot that from had the And we've we we a would take them units QX and it of weren't were crowding stores, out really those White And obviously to stock. and we goods. we move some, and House, selling about crowding in rack, old I QX. say right of In goods one Chico's, and stock. say, old did that in cleared talked the haven't really both imperative those that out felt out units had would

those new and off up also stores able that the a moved to present better in So, has included clearly, freed quarter. in that's goods they're have much financials entirely, company lot space our way. been And, be out of the a of written the to And helped. this in that and

Susan Anderson

takes are Todd, helpful. still quarter? gross there and very about puts if to margin similar And maybe third in had quarter in then I margin fourth goods, terms in the one drivers I That's and what can – expecting clear quarter you in ask the Are merch to that you Great. talk occupancy. could clear guess, still to if need you fourth more, for there of you Thanks. and

Todd Vogensen

quarter the entered inventory. really We clean on

set the into holiday from a feeling we're good from So, fourth season. the an even quarter inventory more just we're be and, positioned we've quarter perspective, generally, perspective very in to up about the how presentation going how relevant

of it's actually a fairly a XXX formula to about overall our simple points we margin From points. from is That's for quarter that for tariffs. a the headwind QX, this And XXX be have to perspective, gross in us basis kind outlook into guidance basis basis of the down in new quarter. XXX points

So, is margin other the tariff in not or any drives the movements gross in particularly merchandise the headwinds fourth margin costs. really for what quarter. It's

Susan Anderson

holiday. Thanks Good Great. That's much. helpful. so this luck

Todd Vogensen

Thank you. All right.

Operator

JJK The next question today ahead. Research. comes from Janet Please go Kloppenburg of

Janet Kloppenburg

season, if morning, has everyone. execution could you both merchandising wondering where Good was White positioning you House about I of talk sharpened and the just Chico's maybe for the year-over-year. think holiday

you about, I the that inventory clean. gifting options. And, said think talked was had had well, Todd, you

fresh so seems for much. that lower in quarter. have that does the the improve quarter that comps the in content you comps further mean might to versus as guidance in your is go It the much we Thanks season? year-over-year, improvement So, ageing more third like that look fourth don't through help you imply that

Bonnie Brooks

you. Thank one. that start I'll

of the that will had time the building some product, I say lead job had that the Chico's. fantastic prior there's in terms a holiday done on team holiday we the product of of particularly longer in – and past, In additional some a items team haven't little

kind So, you're one easy, items you one some all inventory depth see for for of around to really me, concepts. going focused, holiday of that key are

we items. So, easy quantified intensely. pretty And have those pickup

Chico's although strongly Soma, holiday not QX White would particularly is season is history it certainly that, is believe do XXXX. more – and we big big degree there for into holiday not But be occasion years believe holiday building far for we we're season, our moved we significant at forward the will what some a stronger would goods a opportunity going of Chico's same a some a we White White it and Black at for is our have So, But, this was the that into significantly holiday of new call the say did themselves a And the year. in for business. And, Moved major year excited course, Soma, the so career holiday House, of polished come, Market. for dollars dressing improvement special about House well and is in in of that House, that the as this that assortments can I We and again, not the plans QX. for be to merchants will holiday. the social year last piece in change from dollars. than and

about up the And, comps Todd, pick do question and inventory? to the on you want the

Todd Vogensen

Sure.

So, Janet, to more more we lot past. than the current we a even into had that the as sure full-price I quarter paid right. we've And attention went on inventory, heading We're goods had the into of think you're making quarter. goods, clean in

us that for So, I quarter. think up sets well the

quarter having terms impact think just fourth time. that quarter the comps, are and a volatile over aware well we're In I of we're is that growing

also of traditionally So, too for what biggest quarter we far is want Chico's has ourselves the don't in House. and to been a just not quarter inherently that ahead get White

meaningful for QX that Interesting and quarter lot for us, it is while certainly thing doing of Soma in on business Chico's a House, necessarily I has Mary been the on the a know QX. isn't impact year the has for Soma. White biggest And

Mary van Praag

a have and patterns, our dressy story to Red so coordinates, sleepwear going all and sets, there added PJ gifting really PJ day. think quarter Yes. destination we we one to ran like our and on Christmas as is and bets big our that first-ever back on. sleepwear a of And our of is predominant number or placed rate just strong bras a we've robes, QX ourselves slippers, we've various holiday coordinated family attachment

to that like traffic. we additional feel all to of we're ready So, primed go capture and

Bonnie Brooks

in Especially days. next the few

Janet Kloppenburg

quarter fiscal we into XXXX should estimates second Todd, for tariff as for first our be incorporating And well? you. and impact Thank

Todd Vogensen

should. really We

able that a to about are cost we lot the things through we've sourcing. talked offset So, tariff on of

more us are So, strategic of we're some partnering well. our at are diversify headwinds we as tariff the to country those origin, looking in around which to offset we sourcing sure can of that how partners enabling make

quality looking less Just that the right a particularly it, call generally the the always from we're those that with getting that that And flipside, need, on in pricing areas parameters. into making perspective, we're sure of things let's there's then, product all are, elastic. at we

the are yes, And And, an can. so, we mitigate tariff It as all of but we to we much will having also looking as certainly next we're try headwinds, as go at offset to those. impact year. not into looking

the on We be haven't but will guidance given quarter. impact we go that through an yet, there as each

Janet Kloppenburg

Thank you, Todd.

Operator

The ahead. next question Morgan from of Kimberly Greenberger Please go today comes Stanley.

Cynthia Campo

of on Cynthia if and bit could your to is for cash you We're out end This you how years? year-to-date you Hey. and do Kimberly. a expect wondering next see flow free couple cash year flow little playing talk the free the with about what

Todd Vogensen

Sure.

free cash flow the things of one that's So, had strength significant years. is company. cash those flow big a many, historically for We've many of been free

inventory We with timing historically. some the in it we've we we're feel year obviously, control the year. lower get in we with been in trended has accounts particularly the in more we've headed That normalized been a we've payable direction where than of We're year, to our continue past. years of and able and going But where next go as and sure good to investments to future, the be this into level that in capital made we through it's that manage inventory, back back to somewhat make the Now, leverage and expected. the was investment.

Cynthia Campo

coming Could a store on it more per And with little little much. then, I the out quarter. one could follow-up that that Thank talk just up if you more please? you so seems bit a is bit inventory your question,

Todd Vogensen

Absolutely.

fair we've So, made in of is Soma. area that amount inventory one investment a

have Soma tends great has but have inventory turn, showing is type that profitable just pipeline its be that products long out. So, Soma intimates to in the a fantastic that And are lives. slower new basics of growth. inventory and They their coming of

get intensive an of So, the nature that It probably more that to stores, inventory way. you a on is other stores, and Chico's the not to of then, your we highly just carry increase more per make on. funding tend the investment inventory low of in breakout store. is which does And White SKU are do relative House. because online, Part we're show those part to may Soma that able relatively those risk

that you at of all what see coming together do level. So, the to top

Cynthia Campo

Great. That's you helpful. very so much. Thank

Todd Vogensen

you. Thank

Operator

(sic) next Bank. question [Paul The Deutsche Please go today Trussell comes of ahead. Jennifer from Trussell]

Gabriella Carbone

is This Carbone for Paul Hi. Trussell. on Gabby

job So, the nice on improvement. comp

on kind promotional seeing of in positioning question environment and the your bigger What Our holiday? overall are picture. and the what your thoughts you're is into mall

so gross rolled impact on margin, just there BOPIS much. is the your now now, then, any ahead? that margin is to there And line out, moving Thanks

Todd Vogensen

Absolutely.

talk margin can and promotional I cover can maybe So, gross environment. Bonnie

that gross of exception don't meaningful more We're right? overall full-price we utilize our exposing that the possible which gross online, help sell-through with terms inventory more margin In we the from a expect on impact rate margin, effectively, should to inventory goods. the on to BOPIS, able customers are

a perspective, costs margin lot a wouldn't from extra necessarily BOPIS. modeling build the in for So, of on gross I

we shipping cost margin are in our from because the initiative, gross amount talking or taking we've up just been stores store that year customers. it in to inventory and a that fair is On our driven of has ship through shipping

we have QX We've really wrapped wrapped on it. completely. go as around initiative on into We around that

leverage level So, should us a field. that of year-over-year, from playing put a more rate back on

Bonnie Brooks

Okay.

being strategic those days specific of is lot asking those a a use and general. promotional the all of successful. which at promotional and you're number versus our very dollars areas promotional QX assortment testing thinking the Yes, promotions all look is heavy in is And – world. total way in in in how our assortments. of exceptionally and market are we in doing terms proving we're There In driving terms more though, the with we're that promotional I time. question levels, promotional about our will we're that of that we is what the no say, that are it

going XXXX days well, are about activity number goals able to our is the on being into our promotion. on that's And promotional one and we to overall of promotion as beyond. So, and of change out not encouraged balance

The that customers, digital, done feel may throughout even Chico's And have year, we to the we not distorted really would are other digital. customers as certainly very this digital some be thing savvy. marketing have that, our is that

So, we are customers for more actually she what us. what expect and stand a we telling about our can from story cohesive

our So, marketing, all say, terms really than last presentation in significantly brands. year, is compelling And stores the holiday message, would only and but more marketing the we're in of not delivering across different the a and aesthetic look I clean really the of online. right

So, also for able driven those and key supported and strongly in to marketing. we season the deeply more stores have online into were with items being buy

much approach direction in So, stronger marketing that and feel our moving we we want. the is

will we're that our see best-in-class. direction say And you them, season the you you emails if would haven't. that a to this I Chico's at look Also, are headed. holiday And urge take I

marketing excited we're So, our for all QX. pretty and about of pumped

Gabriella Carbone

Thank Great. all for much so you the color.

Todd Vogensen

Thank you.

Operator

next Marni today Retail from The ahead. go Shapiro of Tracker. comes Please question

Marni Shapiro

improvements. guys. Congrats all the on Hey,

Todd Vogensen

Thank you.

Bonnie Brooks

Thank you.

Marni Shapiro

there? to quarter what's any Did of because there? same the much talk you the better at bit traffic if at Chico's give assortment insights traffic the White us – And improvements outlets? insights business little about Was stores. did the types that progressed. any about Could the up curious as was you happening you you the can the I'm as at look House a mentioned the see

Bonnie Brooks

your a stores worked We will our we comes And improvement. interiors. House White really scheme you're Marni. and comment life appreciate also window a to lot. in the presentation the changing stores new I the you, We that know at noticing made say changed And the way. significantly that, QX, in on thanks Thank about in that. for

very to results pattern. were are change that our We traffic able excited own actually of about the we because

been setting we windows we they making the Chico's, doing as White things up customers' the the the different and in same significant interiors yet stores is as House. and benefits at positive. of reactions there statements. trying at definitely the the are terms exercise to and The in the stronger But way have are not mood more in are And

business at as outlets, terms of In strong. the not been has outlets

business online is the outlet growing. However,

a a our of have would outlets, been has performer we to also part our strong strong – at business, So, very I very but in but little traditionally say, part the do outlets business. work consistent of

continue we're outlets forward. perform to us going So, very will for that confident

Marni Shapiro

the luck holiday Best of Fantastic. season. for

Bonnie Brooks

you much. very Thank

Operator

question from Telsey [Operator Dana Group. Instructions]. Please Telsey The go next of today comes Advisory ahead.

Dana Telsey

Hi. Good morning, everyone.

think how this the brands? saw quarter you into update you different of real XXXX? than As we September, about the Todd, And on then, did August? Thank rationalization cadence as quarter, each in Was you. head any third the of what for October go the estate plans

Todd Vogensen

Sure.

pretty I had things. in So, was first we One, after think in of that terms of cadence, August, quick two had a lot changes.

in the in presentation as you later So, quarter. would you probably the and did not see of have change product as much

was a So, of month. tougher bit a little August

see a we see. went to on was we were which stronger we quarter, able October, good stronger to product. As pull the promotions through back In did little a and thing bit even

along. quarter, So, were really, as we everything went how with pleased moved we through the

on…? was And, question I'm other your sorry,

Dana Telsey

rationalization. estate Real

Todd Vogensen

Yeah. estate. Real

So, performers. course number of tended to real through optimized a stores be the this stores of estate, clearly were that over the have which we our year, toughest

And we net so, taken this have that closures about XX We're pass. going year. look for first to

mitigate trying right performance store feel like work performance continuing with you, stores. to a see our a improve to decisions. to to we and or want stuck what the the we What we better continuing We are risk, of as look landlord we further the it we to to make stores, in have be opportunity have get into to don't to are at it. the some a rent I'd look in for we If to number those we right at is as answer tell hit. that We're our

we it in of will to will look the sales more stores that then so, those if for, continue and give And great be go along. update things And us will as get we opportunity. looking we're one we progress

Dana Telsey

you. Thank

Todd Vogensen

you. Thank

Operator

to turn like This Bonnie for it I you. concludes would Thank back comments. our closing question-and-answer to over session.

Bonnie Brooks

much. journey Thank look product and remain customer an we for to she each Board right the fourth-quarter exciting, across all place at and and step in In of have long-term and to of in confident our performance shareholders. expects the you plans forward every our transaction The brands. better experience offering a of and our elevated, I believe relevant drive we seamless very channels. our her In our every quality value creation strong people conclusion, path forward and in

behalf Thank at you wish call. today of a happy Chico's you for us joining of all us FAS, QX On for earnings we Thanksgiving. this

Operator

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

You may now disconnect.

Chico's Fas (CHS) 26 Nov 192019 Q3 Earnings call transcript