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| Statement |
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| And when we decide that there's more consistency in the environment out there, we'll be in a good position to accelerate that growth when that time comes |
| Despite what remains a challenging sales environment for us, I am proud of our team's efforts towards protecting product margins, managing inventory and controlling expenses |
| Our third quarter results represent a sequential improvement from our first and second quarter earnings results and exceeded our expectations primarily due to achieving stronger product margins and lowering operating expenses more than we anticipated |
| And then brands that we've carried for a long time, like Nike, we saw improvement in the inventory availability |
| Are you seeing better sales coming out of your own brand versus other brands? Because you're -- especially on the junior side, I think your fashion on your own brands has been pretty good, like really good |
| But certainly, we've made -- and we've seen positive results as a result of that |
| We believe this recent positive turn in our business was driven in part by a more aggressive promotional stance than we have historically taken to this period |
| But it's improved because we've made some very targeted changes to improving how we merchandise online |
| Actually, it's been -- in the women's side, the stores have been consistently better than online for us |
| Product margins were just 50 basis points below last year and improved sequentially this year by 80 basis points compared to the second quarter and by 170 basis points compared to the first quarter |
| So feel good about level of inventory and content of that inventory as we sit here right now |
| So I think one of the things that Laura has been working on is doing a better job of timing of the seasonality of certain goods but also shifting from categories that are underperforming like graphic tees, which has been a very strong category for a long time into more fashion tops |
| And it crosses over in multiple categories, it's good |
| We believe we have identified certain opportunities to improve our performance across departments as we finish fiscal 2023 and look into 2024 |
| However, the trend of our business began to improve during the final two weeks of fiscal November, including 2.6% comp sales growth for Black Friday weekend, the five day period from Thanksgiving Day through Cyber Monday |
| We are encouraged by the overall sequential improvement in our business trends over the last two quarters and are working diligently to attempt to accelerate that improvement going forward |
| And so -- but where we saw the opportunity was really again in tops where we did adjust on the fly and we think we've made a lot of changes that will positively impact the business in the categories where we felt we were maybe underrepresented |
| So we did get feedback from our store teams and district managers that it was well received by customers generally because it is so much easier to think about and manage than BOGOs throughout the assortment |
| So we have very consistent performance between stores and e-com throughout the third quarter |
| Michael Henry Overall, our inventory age is better than it was at this time a year ago |
| From a merchandising perspective, girl's apparel and footwear comped positive, while all other departments comped negative during the third quarter |
| We simplified that and that drive business across -- pretty much across -- positive business across all categories for a couple of days for sure |
| And we didn't -- probably didn't move quick enough to get into some of these fresh categories, because the graphics business has been so positive for us for so long |
| Inventory is in pretty good shape, Jeff |
| And I'm curious if you guys have -- is there a difference in what they're buying? Because I find when I'm on your site, your fashion content on the women's side, even in women's tops, which you had referenced, is really kind of good |
| How are you thinking about that for Q4? Michael Henry If we're at the better end of our outlook, we would actually expect our product margins to be slightly up |
| That was the content actually we have is good, we just didn't have enough |
| Gar Jackson Good afternoon |
| Mitch Kummetz And then on footwear, positive comp in the quarter |
| I thought it was, by the way, really effective in the stores |
| Statement |
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| Graphic tees has been an area of weakness for us within both men's and women's apparel, and we have been lacking sufficient fashion newness in women's overall |
| And there's clearly been a challenge in physical store traffic out there |
| For the quarter, all geographic markets comped negative within a 5 point range with reduced customer traffic across all store formats compared to last year |
| After starting the quarter with a negative 3.7%, comp store sales declined in August amid the peak of the need driven back-to-school period |
| Total comparable net sales, including both physical stores and e-com, decreased by 6.5% through November 28 |
| Comparable net sales, including both physical stores and e-commerce, decreased by 9% |
| While acknowledging that the environment remains challenging for our customer demographic, we believe that we have some product content issues on our part that we are working to fix as quickly as we can |
| The double digit negative comps we saw in the post back-to-school period over the final seven weeks of the third quarter continued into the first two weeks of the fourth quarter |
| Net sales from physical stores decreased by 6.4% and represented 79.6% of total net sales, matching last year, while e-commerce net sales decreased by 6.2% and represented 20.4% of total net sales |
| Our comp sales decelerated sequentially in the post back-to-school period to negative double digits in each of September and October |
| And if we're going to have a negative comp fourth quarter as indicated by our outlook, we'd expect to end the year with inventories down |
| We continue to believe that inflation remains a significant headwind on discretionary spending for our young family, young adult teen and pre-teen demographic |
| Based on recent holiday seasons, we expect that our comp sales may slow down again in the early part of December before improving trend wise in the final days leading into Christmas |
| Based on our quarter-to-date comparable net sales results and current and historical trends, we currently anticipate our total net sales for the fourth quarter of fiscal 2023 to be in the range of approximately $172 million to $178 million, translating to an estimated comparable net sales decrease in the range of approximately 6% to 9% |
| 2023 with store comps down 13.6% while e-com was up 11% relative to last year's comparable period |
| Within accessories, the strong backpack business wasn't enough to overcome declines in other areas |
| Net sales were $166.5 million, a decrease of 6.4% |
| And then suddenly, we get to November and this divergence emerged and it was a little surprising to us, honestly |
| What's driving that? Is there just a better trend in footwear now or is it more about product availability? I know that some of the vendors there had issues, supply chain issues, I know that's been kind of cleared up |
| I think you said it was down 50 bps in the quarter |
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