Q2 2020 Tillys Inc Earnings Call
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Now I'll turn the conference over to yield.
Jackson you may begin.
Good afternoon, and welcome to the till late fiscal 2022nd quarter earnings call I'd, Thomas President and CEO and Michael Henry CFO will discuss the company's results and then how does the Q and a section.
A copy of Phillies earnings press release, please visit the Investor Relations section of the company's website, it's silly stuff.
The same section shortly after the conclusion of the call you will also be able to find a recorded replay of this call for the next 30 days.
Forward looking statements will be made during this call. It looked like at least judgment and analysis only as of today September 3rd 2020, and actual results may differ materially from current expectations based on various factors affecting the at least business, including impacts and the company's actions in response to the current covered 19.
Pandemic Accordingly, you should not place undue reliance on these forward looking statements for a more thorough discussion of the risks and uncertainties associated with any forward looking statements. Please see the disclaimer regarding forward looking statements. It is included in our fiscal 2022nd quarter earnings release, which was furnished to the FCC today on form 8-K, as well I'm sorry.
Other filings with the FCC referenced and that disclaimer today's call will be limited to one hour enrolling cleared acuity session. After our prepared remarks.
I'll now turn the call over to add.
Thanks car.
Good afternoon, everyone and thank you for joining us today.
I want to kick off today's call by thanking our entire tilly's team for their hard work combating that unprecedented unpredictable covered 19 environment.
I'm very proud of everyone's efforts fighting the unexpected challenges.
We have faced together as we approach the six month mark of the pandemic severe impact on our business.
Turning to second quarter it began with.
All 239 about stores close for the first two weeks of the corridor.
Beginning on May 15th and continuing through July early July.
We reopened all but four of us stores and a phased approach with new health protocols.
Customer traffic restrictions and reduced operating hours in place.
Dan.
On July 13th Oh State of California ordered the closure of indoor malls.
For the remainder of the caught up 33 about an idea in California stores.
Which are some of our more productive stores were closed.
Despite these complications of second quarter results.
Were better than we had anticipated.
Total net sales for the second quarter decreased by 16% compared to last year.
Net sales from physical stores, including all periods of store closure.
Net sales from new stores, not yet open up for the year.
Decreased 39.6% compared to last year's second quarter.
Comparable net sales from reopen stores declined 18% collectively during the second quarter following their respective reopening dates compared to last year.
Customer traffic can reopen stores decreased more than 30% collectively.
Ecommerce net sales grew by 128% compared to last years.
Second quarter.
The period of store closures that cross the first and second quarter's a lot of allowed us to focus solely on E com inventory management and operations.
And coupled with our digital first merchandising mindset helped us deliver a thick never gotten E com topline growth.
Improved product margins in operational efficiency and profitability from E com.
We also expanded our ship from store capabilities introduced curbside pickup in select selected stores.
During the quarter.
And I've, just recently identified five or six stores across the country to be utilized as hub stores for additional E commerce fulfillment well in store activity remains significantly reduced.
In terms of merchandising all departments Comped negative as a result of the various period a pandemic related store closures.
This year compared to a normal course of business last year.
Womens mens and <unk>.
Footwear were our best performers.
Girls accessories, and boys where weakest.
I live Tricia leadership, we launched several new brands during the quarter, including BTG Bayer Urban Outfitters Women's Nike free people movement real good sport for Raven.
And several new escape brands.
We're excited about the prospects of the.
For these new brands.
And we continue to win evolve the tilly's merchandise assortment.
Turning to real estate, we continue to negotiate without landlords to reach mutually acceptable solutions for rent we have withheld during periods of store closures.
And we continue to negotiate for reductions in future rent obligations in light of the reduced operating hours and customer traffic restrict friction.
Associated with the ongoing pandemic.
For the most part we have it had thoughtful engagements from Oh landlords.
Today, we have been successful on reaching agreements in principle to address approximately 70% of our total stores.
Do the sensitivity and evolving nature of these discussions we will not share any particular details why those negotiations other than to say we appreciate the spirit of partnership Express taught out company by most about landmark.
In terms of new stores than other capital expenditures. We currently expect to opened two new stores during fiscal 2020 with one opening in.
<unk> early October.
And one opening in mid November.
We sincerely thank those landlords, who are understanding about the uncertainties other current environment and allowed us to defer newstar capital expenditures until 2021.
The seven other new stores, we had originally planned to open during 2020.
We currently expect total capital expenditures for fiscal 2020, including the two new stores and continuing.
Customer facing and other technology investments to be in the range of approximately $8 million to $10 million.
Turning to third quarter back to school season is typically a second most important period behind the holiday season.
We're generating sales.
We started the third quarter going up against our two largest sales weeks of last year's third quarter, which got us off to a very tough start in terms of comp sales.
We also entered into this years third quarter with the 33, California stores close that I referred referenced earlier.
In many other markets in which we operate school districts have announced delayed start dates compared to last year and or.
Have converted to an online only or hybrid format and these plans continue to evolve.
These factors have had a meaningful meaningfully negative impact on our comparable net sales resolved.
When compared to last year, which included a normal healthy back to school season.
Our August total net sales, including the impact of store closures and that.
Sales from stores, not yet opened up full year decreased 35.6% and total with net sales from stores down, 46.3% and E commerce up 40.6%.
The trend of our comp performance, while still negative has been improving from week to week with each passing week. Following the week. One of August we're encouraged to have seen a recent uptick in business in certain markets I'm wherein some schools have reopened.
We cannot be certain if this improving trend from week to week that we saw in August will continue for the remainder of the quarter, nor can we predict whether current expectations for schools.
Going back we'll change whether the stores will remain open for the entirety of the quarter well how consumer behavior has made change as the pandemic continues to evolve. However, we are trying to be proactive.
And in the anticipation of it significantly reduce back to school period this year.
We have planned a third quarter inventory receipts for stores well below last years level.
In closing I want to thank God team again for working so hard to carefully manage our business during this pandemic period.
We are not all the woods, yet so to speak but we are focused on growing and protecting our business for the longer term despite the ongoing pandemic.
Mike will not provide more details on our second quarter operating performance.
And balance sheet Mike.
Thanks, Ed Good afternoon, everyone as Ed noted our fiscal 2022nd quarter operating results were significantly impacted by the ongoing cobot 19 pandemic, including various periods of store closures reduced customer traffic and sales results. Following the phased reopening of our stores throughout the quarter.
And the subsequent re closure of California indoor malls late in the quarter.
Details of our second quarter operating performance compared to last year's second quarter were as follows.
Total net sales for the second quarter were $135.8 million, a decrease of $25.9 million were 16% compared to $161.7 million last year.
Net sales from physical stores were $83.9 million decrease of $55.1 million were 39.6% compared to $138.9 million last year.
Net sales from stores represented 61.7% of total net sales for the quarter compared to 85.9% of total net sales last year.
Ecommerce net sales were $52.0 million, an increase of $29.2 million or 127, 20% compared to $22.8 million last year.
Ecommerce net sales represented 38.3% of total net sales for the quarter compared to 14.1% last year.
We ended the quarter with 230 total stores, including one rescue branded pop up store of which 33, California stores were closed as a result of the cobot 19 Bendeka.
This compares to 229 total stores, including three rescue branded pop up stores, all of which were open to the public last year.
Gross profit, including buying distribution and occupancy expenses was $41.7 million were 30.7% of net sales compared to $51.7 million or 32.0% in that sales last year.
Product margins improved by approximately 360 basis points compared to last year, primarily due to strong regular price selling upon the reopening of our stores.
Buying distribution and occupancy cost do you leverage by approximately 490 basis points collectively against lower total sales.
Occupancy costs, despite being reduced by zero point $4 million on a larger store base compared to last year de leveraged by 270 basis points against lower total net sales.
Distribution expenses Deleveraged by 200 basis points, primarily due to an increase in E com shipping costs of $3 million associated with a significant increase in E Commerce orders.
Buying cost to leverage 20 basis points on lower total sales.
Total US you know expenses were $34.0 million were 25.0% of net sales compared to $39.6 million or 24.5% net sales last year.
Total us DNA was reduced by $5.6 million compared to last year, but deleveraged 50 basis points as a percentage of net sales on lower total sales.
Store payroll and related benefits decreased by $7.5 million, primarily resulting from the various periods of store closures during the quarter and careful management of staffing levels upon reopening.
Most other expenses were also reduced compared to last year.
The primary exception to this was increased income marketing and fulfillment expenses of $3.9 million due to the significant growth in E Commerce orders.
Operating income was $7.7 million were 5.7% of net sales compared to $12.1 million or 7.5% of net sales last year.
This decline in operating results was directly attributable to the impact of the cobot 19 pandemic on our retail stores.
Other income decreased as your point $3 million from zero point $6 million last year, primarily due to having lower total cash and marketable securities, earning lower interest rates on our investments and paying interest on bartered cash compared to last year.
Income tax expense was $2.8 million or 34.3% of our pretax income compared to $3.4 million or 26, 20% of pre tax income last year.
We cannot accurately predict what our effective income tax rate will be going forward as it is depended upon our operating results for the back half the fiscal year, which are also unpredictable in the current environment.
Net income was $5.3 million were 18 cents per diluted share compared to $9.3 million or 31 cents per diluted share last year.
Weighted average shares were 29.7 million for both periods.
Turning to our balance sheet, we ended the second quarter with cash and marketable securities totaling $148.9 million, including $23.7 million borrowed under our revolving credit facility and approximately $13.9 million withheld store lease payments.
Excluding borrowed cash and withheld store lease payments total cash and marketable securities were $111.3 million compared to total cash and marketable securities of $124.8 million and no debt or withheld store lease payments last year.
We ended the quarter with inventories per square foot down 8.9%.
Year to date capital expenditures were $4.6 million compared to $4.8 million last year.
Turning to the third quarter, given the continuing unpredictability surrounding the cobot 19, pandemic, including but not limited to its impacts on consumer behavior, our ability to continue to operate some or all of our stores at any point in time for our ecommerce business.
And the adverse impacts on the back to school season. So far this year, we are unable to reliably predict our future sales earnings at this time, and therefore will not be providing any specific guidance.
However, we thought it was important to share certain facts to help everyone better understand our current environment.
First as we noted earlier, we ended the third quarter with 33 of our California stores closed.
These stores represent 14% of our total store count of 238 and in the aggregate accounted for $22 million were 14% of our total net sales during last year's third quarter.
On Friday last week, the state of California issued new guidelines, which affected the reopening a businesses, including indoor mall.
As a result of these new guidelines the company was able to reopen 15 of these clothes, California stores on Monday of this week six more on Tuesday, one on Wednesday, and one more is expected to open on Friday.
We do not yet know when the remaining 10 of these California stores will be able to reopen most notably in Los Angeles County, which has eight of the 10 remaining close stores.
Next if history is relevant in the current environment fiscal August has represented approximately 50% of third quarter net sales for each of the past four years.
Our fiscal 2020 August net sales were $50.2 million compared to $77.9 million for August last year.
However, there are few reasons to believe that results could be relatively better for the remainder of the quarter.
With a delayed back to school days. This year, we can see some business shift to later in the quarter than in prior years, although still below prior year levels overall record.
Comparable net sales results have been improving trend wise from week to week as we go up against smaller sales weeks from last year.
We have also been encouraged to see an uptick in business following the reopening of certain schools within the markets in which we operate however, we can be certain at this near term uptick will sustain for the remainder of the quarter.
Finally collective comparable net sales from reopen stores since their respective reopening dates and through September one 2020 compared to the respective comparable fiscal dates of last year have declined 25.5%.
Taken together, we believe these factors make it appear more likely than not that our third quarter net sales will be meaningfully below last year's $154.8 million.
We cannot predict with any certainty what our net sales me specifically be for the quarter given all the factors we have discussed.
We continue to carefully manage inventory levels that referenced earlier as well as all expenses in order to protect our cash position, which as of September two was $161.9 million, including foreign cash and withheld store lease payments.
Based on all currently available information, we believe our cash position in credit facility availability, we have been more will be more than sufficient to support our operations for at least the next year.
Operator, we'll now go to Q ne.
At this time, we will be conducting a question and answer session. If you'd like to ask your question. Please press star one on.
It consummation tone would indicate your line is in the question Keith.
You mean fresh start to if you like to remove your question from the Q.
This is using speaker equipment, you may be necessary to be giving your hands it before Christmas Turnkeys.
One moment, please while we pull for questions.
Our first question is from David Buckley.
With Bank of America. Please proceed with your question.
Hi, guys. Thanks, Mike I appreciate all the details just thinking about your gross.
Yes, just your overall out for the holiday season, how are you planning for stores with traffic likely to remain weak.
Yes, so I'd I'd expect our product margins to remain.
Fairly close to last year generally generally speaking absent.
Some additional store closures or things of that nature.
When you look at the year to date first half.
Our product margins are only down a little bit compared to last year, and so I would expect that probably to remain somewhat consistent without knowing specifically where that might fall out depending on how the rest of back to school.
Plays out I think you should expect to see some de leverage from distribution.
And occupancy costs, just as we did in the second quarter.
Given the increase in E com shipping costs, which is likely to continue as we expect become to continue to be strong double digit positive.
During the third quarter.
And you're going to see some occupancy deleverage because sales are likely to be down relative to.
Last year, even though we have reduced those expenses in raw dollars as as we noted during the second quarter. So I think directionally those will probably remain consistent with each other.
As it relates to the holiday season.
For the year at this stage based on what we know as of today.
We noted that for the third quarter, we've planned our store inventory receipts significantly below last year the same remains.
The case in the fourth quarter.
We do think they'll probably will be something to be larger shift towards econ than even we typically see during during the fourth quarter.
Where exactly those things fall out as you know anybody's best guess.
Alright, Thanks, Mike.
And our next question is from Jeff Van Sinderen with B. Riley. Please proceed with your question.
First let me say good work in Q2.
Great to see the metrics better then and everyone expected.
Obviously, a tough compare and we see the I guess metrics, but can you maybe expand on your thinking around back to school and just given the sequential improvement that you've seen so far week to week. What are you seeing in markets, where the kids are actually physically going back to school I think you sort of touched.
On that on your commentary just wondering if there's any more to add to that.
Yeah, we've only had a few markets, Jeff where that have actually gone back to school by where we've seen that app and.
We've seen an uptick in our business as Mike mentioned earlier.
It's hard to predict whether that sustains itself or whether that's going to happen and every market that.
Goes back to school, but certainly we've seen some encouraging signs there are some positive signs in terms of improvement in our overall business within those markets.
So it's hard to predict I mean look at where there's no material differences and I've been a material difference and pro form and speech from off mall to milestone was a traffic has generally been down everywhere and I don't think where along with that and we had traffic has improved.
We've seen a relative improvement to our business do.
Yes, I'm looking at the at the market performance, specifically here, Jeff So, Florida has been very strong for us in the last two to three weeks.
Colorado, Utah has been very strong.
Arizona, Nevada have been positive for two to three four weeks in a row now.
Even though the California stores that we mentioned the the enormous or is it just reopened they've had strong positive comps. These last couple of days.
Couple of days doesn't make a long term trend, but it's at least encouraging and that's part of what we're referencing and seeing an uptick as some of these markets as well is.
The very near term reopening comes from the stores that have been closed for a month and a half.
Okay. So so it's possible we could gained some momentum here over the next month or so I guess, we'll just have to wait and see.
Yes.
Why we that's why we phrased.
Our thoughts about the third quarter in particular.
August as a percentage has been very consistent but this year is not a normal August obviously.
I'd like to think that August was overly depressed because of the push out of back to school dates and then again seeing miss relative improvement from week to week in trend as well as a positive comps we've seen overall blast two days, we've had total comps comp store sales excluding E com positive the last two days that's a good sign too.
Again, we don't know Thats going to sustain we don't know if it's just a temporary blip. It's hard to know anything these days, but at least there are some positive signs that maybe we could recover a little ground in the remainder of the quarters. We go up against much smaller revenue weeks then.
What was in August each of the weeks of August is bigger than any other week for the remainder of the quarter. So.
We've we've taken the hits of going up against the high volume weeks.
That will be interesting to see how much ground, we can recover and if we can recover through the remainder of this cover this quarter sorry.
Right. Okay. That's helpful.
And then add maybe you can just kind of give us a a sense of your longer term thinking at this point.
Around the concentration every business in digital versus brick and mortar I know you talked about you know negotiating rents with the landlords.
Your E Com business I think was approaching 40% of your business in Q2, which.
Certainly wouldn't have expected that if you'd asked me last year, but it's great to see.
And then just maybe thinking around how you might evolve your real estate strategy as E Commerce gross.
Well I know, we've said for quite a while that we think before pandemic.
We thought that was ample room for growth on both with physical stores and E. Com and we thought we were very underdeveloped any calm, which we were so this time and effort that we put in the last few months.
Dedicated to E com and being able to concentrate more on it has shown us how much better it can be but I don't think we've Pete I know we have not peaked at all.
As far as the Ecomm business goes I think we've got a lot lot of runway ahead of a positive runway ahead of us in terms of physical stores I think it's a moving target right now.
We have to I understand I think understanding.
How particular locations, where it's off mall or how what that tenant mix ends up with is a big question Mark for all of us in the industry. So.
We're going to be pretty like we always are we going to be pretty careful and make sure. We understand that co tenancy that we're going to if we're going to go in to.
To a pick a particular location who's going to survive and who wall, but we're going to continue to open stores. There's no question about it and I would say that it's going to be still be a combination or a continuation of our strategy of opening off mall and mall stores both.
Okay, and hopefully those rents will be substantially lower than they would have been.
Recall that.
I'll leave it there and take the rest offline. Thanks very much okay, Jeff. Thank you.
Our next question is from Mitch Kummetz with pivotal research. Please proceed with your question.
Hi, Thanks for taking my question.
Definitely appreciate all the color, particularly around back to school or did you guys give more information than most but on.
That being said I'm still hoping for a little bit more just to make sure I better understand the trajectory. So you gave the kindly August numbers also sort of split it out first two weeks second two weeks I mean first two were down 45, I think I backed into the second to down.
Around 19, but the first two days of of I guess September satellites that are positive was is there anyway. You can give august by weak or can you can you speak to maybe the last week of August or [noise].
Yes, Directionally, you're right Mitch so.
The first week of August we were down over 50% in the second week, we were down almost 40. The third week, we were down 24 in the fourth we grew down 14, so it's been.
Moving meaningfully by weak.
This week, we referenced we referenced the last two days being being positive overall the quirk of this week is that Monday, we are going up against Labor day last year Labor day was almost as early as it could possibly be last year was Monday September 2nd.
Which compare to date was Monday August 31. This year, we'll have the positive side of that compare this year coming up this Monday, which will be this years.
Labor day, which is as late as it could possibly be this year. So.
We did take a significant negative entering this week because of that labor day compare we should get the offset about next week.
Trajectory wise it just looks like things are continuing to improve from week to week and as we referenced.
Where we have seen schools go back we're seeing some nice upticks in business and again, we launch in the early results from the California, We opened stores. So theres no reason to hope a little bit we've seen enough now match, where we have the if we have the schools are.
Going back what we've seen enough of a change in our trends.
To give us a little bit more confidence on how things will precede going full indeed <unk>, okay and do you guys have any metrics that you can speak too.
And like I.
I had a company report earlier this week that said you know by the end of August 65% of schools were back versus 95, a year ago and when they said 65 backed up that combination of in person and virtual versus 35 that had been delayed I don't know if you have any numbers that you can speak to around.
In the markets, where you guys have stores or even yeah.
The top my head no, but you know it it really varies.
Significantly not only by state, but within the state itself Yep. So for example, right in our backyard here.
Like how many is completely different that Orange County.
So it and it really is a moving target to try to figure out okay. What are they really going to go back.
Stuff like that so we don't have enough.
That we could share with you other than okay. That's fair it keeps changing yes, I look at this a couple of weeks ago, and I think I'd counted 75 stores that had a meaningful delay in their back to school timing really relative to last year, but again this keeps changing every single week and sometimes within the week. So.
Got it.
I haven't kept honestly.
And then Mike Us trying to hope to strip out the impact of the close California stores and I think you said 22 million and sales in the third quarter of last year. How did you also made a comment that August typically represents 50% of the quarters. So is it fair to say that you know those stores you know we're about $11 million in August.
Last year or is it less than that because California typically goes back to school later.
I don't have the August breakout of those stores in [laughter] particular, but you know given the relative penetration of August it's going to be pretty close to that plus or minus okay. Okay. And then just a couple of quick ones got it on on the margin source. So store payroll was down seven and a half.
Million year over year in the quarter I would assume but it will be down as well in Q3, but down less than not just given you know how many store opening days you have this this quarter versus last quarter is that the right way to think about yeah, I think thats, a I think thats a fair expectation certainly.
I would expect it to be down year over year, but yes, not nearly as much as it was in Q2 got it was a caveat that stores don't re close [laughter] sure and should shipping de leverage be less less negative in Q3 is ship has as E com penetration.
Probably goes down a little bit again, just because you are going to have more stores open or [laughter]. It just depends what the balance of E com relative to stores. It was and how those play out as hard to say for sure. Okay Fair enough right. Thanks, guys. Good thing as we really expanded our ability we've always had the ability to ship from store, but we have a lot more fun.
Its ability of where we can chip problem. In addition to E com fulfillment center and that might that should help us long term.
Okay. Thanks, again and good luck.
Thank you thanks much.
Our next question is from Sharon Zackfia with William Blair. Please proceed with your question.
Hi, Good afternoon, I guess I had a question on that that had less to do with back to school and just how you're thinking about driving an urgency in the business and I know historically you've used a lot of the that's you know really to drive excitement around tilly's and in this environment I'm. Just curious how you think about driving that acts.
<unk> for consumers, whether it's you know to come into the stores or to go online.
Well I Sharon.
Yeah, the about the days of the events and localized events.
Temporarily suspended until we get to somewhat of a normal.
A pair it out the head at with store traffic and people people shopping patterns, but we haven't only used events to drive traffic to our stores and I think you know well that we don't generally we don't promote much as a company. So it's not going to be price driven.
There's a big.
We continue to work without loyalty base, I loyalty customers and work with them keep in contact with them, which those customer than that being the best multichannel shoppers for us.
And then continuation of and introduction of new categories I know brands.
Has always been part of our Formula we're going to continue to do that.
Going forward so.
Pretty much all we know right now.
Yes, a follow up on how do you have any stats on how much loyalty is comprising of your sales at this point versus kind of pre pandemic.
Ah, we do but we love it sorry.
Yes. Thank you.
And our next question is from Matt Koranda with Roth Capital Partners. Please proceed with your question.
Hi, guys. Thanks, you shared the comp cadence earlier for August which is super helpful. That was wondering it can you just clarify that was all in a year over year comparison, including E. Com is that is that correct.
Yes that did include ecommerce during during that cadence we shared.
Okay, and any material split in terms of the way that performance within the month I mean, I would assume it was relatively steady but.
Any help just on the cadence there.
The week by week cadence.
Yes.
Yes, so we shared that just a few minutes ago win win Mitch asked about that so weak one we're down a little over 50% in than it does though Mike sorry, just to clarify I was talking about E. Com specifically not not just the consolidated I'm just trying to parse out store versus E. Com comparison in the month it.
E comm strengthened as the week as the weeks went on to so you can was up double digits each week.
But it continued to strengthen as as the month went on so it it was up in the teams and week one up over 40% we too.
Then almost 60% week three in more than 60% and before so it's been accelerating.
To the positive just as stores I guess, if you're getting less negative.
Got it now that makes sense. Okay. That's very helpful. And then just curious if you're talking about inventory position and how we feel there. Obviously you guys have done very nice job managing that down.
But are we light anywhere or we have in particular areas in the maybe you could just talk.
Generally about sort of regional differences and sort of merchandise sales made what are you seeing in areas, where you've got physical back to school versus kind of virtual any material differences to point out for us.
Well as far as the every Terry goes I retire is in great shape, its probably never been as clean as that is.
Tricia the merchandise team did an outstanding job managing through.
From the beginning of managing making sure that we were very surgical and our approach to cancellations them and being able to capitalize on things that we saw that were good yeah, that's always going to be some spots on the inventory maybe a product the so that as such as such a great. So that you're not going to have enough, but that's.
Not been caused by anything anything related to the recent environment at all I would say nothing out of the norm inventory is really in good shape.
And what's been difficult this to forecast what I fail store sales I've got to be going forward because of all the volatility in the environment.
Stuff and we you know where were somewhat in that smart more minute chase mode for certain inventory than we normally would be because of that but so far so good.
Okay very helpful and then maybe one for Mike.
Notice the cash balance still up.
And the month of August I guess, it has to come or an imbalance you a shared anything to note. There I would just assume I guess the you guys are still managing inventory very effectively and flushing cash but.
Anything else that we should be aware up there or think about as it pertains to kind of working capital.
Well.
Again any specific numbers are hard to speak to is it just depends on where sales go and weve acknowledge it's impossible to predict anything right now.
That being said, we've run all kinds of different scenarios and trying to protect our business and what we what actions we need to take what we'd need to do to protect.
Inventory positioning protect balance sheet positioning.
We expect to continue to have.
Well more than 100 million, a cash and investments on a go forward basis for the remainder of this year.
I'm not expecting to have any meaningful problems from balance sheet perspective, thankfully. We entered this whole pandemic situation with an extremely strong balance sheet.
We've been very very diligent and serious about managing inventory and expenses in this pandemic period, So I feel as good as I count about our balance sheet.
In this environment and.
Issues.
Okay makes sense, maybe I'll sneak one more on here sorry, guys I'm just curious if you got like can you give a sense for how you're sort of thinking about market share I know back to school and there's a lot of gyrations in August and the year over year comparisons are kind of a little wacky here, but how are you guys thinking about your overall market share going forward. It just.
Seems like maybe you guys have outperformed a couple of specialty retailer peers, but are you losing share to big box them in any general whether you guys are tracking marketshare and how we should be thinking about that going forward.
Thank you I.
Hi, My thought with all the store closure as.
Both specialty and department stores in particular, I think it's an opportunity to gain more market share.
Rather than later.
So I think our merchandise assortment as I'm paralleled out there by most retailers and I think it said, it's an opportunity for us to gain new customer.
As a result of.
Certain store closures are chain closures.
It makes sense. Thank you guys I'll jump back in Q.
Okay. Thanks.
And we have reached Univar question and answer session and I'll now turn the call back over to Thomas for closing remarks.
Thank you all for joining us on the the call today, we look forward to share some business updates with you. Following the conclusion of the third quarter and Black Friday weekend have a good evening everyone.
This concludes today's conference and you may disconnect. Your lines at this time. Thank you for your participation.