Q3 2024 1-800-FLOWERS.COM Inc Earnings Call

Operator: Good day and welcome to the third quarter results conference. All participants will be listened to only momentarily. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star and 1 on your telephone keypad. To withdraw your question, please press star and 2. Please note that this event is being recorded. I would now like to turn the conference over to Andy Milevoj.

Good day and welcome to the third quarter results corporate support.

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After todays presentation, there will be an opportunity to ask questions.

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Speaker Change: Now, let's turn the conference over to what can be done.

Speaker Change: Please go ahead.

Andy Milevoj: Good morning, and welcome to our fiscal 2024 third quarter earnings call. Joining us today are Jim McCann, Chairman and CEO, Tom Hartnett, President, and Bill Shea, CFO.

Speaker Change: Good morning, and welcome to our fiscal 2024 third quarter earnings call joining.

Speaker Change: Joining us today are Jim Mccann, Chairman and CEO, Tom Hartnett, President and Bill Shea CFO.

Andy Milevoj: Before we begin, I'd like to remind you that some of the statements we make on today's call are covered by the safe harbor disclaimer contained in our press release and public document. During this call, we will make forward-looking statements, including predictions, projections, and other statements about future events. These statements are based on current expectations and assumptions that are subject to risks and uncertainties, including those contained in our press release and public filings with the Securities and Exchange Commission. The company disclaims any obligation to update any of the forward-looking statements that may be made or discussed during this call. Additionally, we will discuss certain supplemental financial measures that were not prepared in accordance with GAAP.

Speaker Change: Before we begin I'd like to remind you that some of the statements. We make on today's call are covered by the safe Harbor disclaimer contained in our press release and public documents.

Speaker Change: During this call we will make forward looking statements with predictions projections and other statements about future events.

Speaker Change: These statements are based on current expectations and assumptions that are subject to risks and uncertainties.

Speaker Change: <unk> those contained in our press release and public filings with the Securities and Exchange Commission.

Speaker Change: The company disclaims any obligation to update any of the forward looking statements that may be made or discussed during this call.

Andy Milevoj: Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures can be found in the tables of our earnings. Now, I'll turn the call over to Jim. Thanks, Andy, and good morning, everyone. Thank you for joining us.

Speaker Change: Additionally, we will discuss certain supplemental financial measures that were not prepared in accordance with GAAP.

Speaker Change: <unk> of these non-GAAP financial measures to the most directly comparable GAAP measures can be found in the tables of our earnings release.

Speaker Change: And now I'll turn the call over to Jim.

James Francis McCann: Thanks, Andy and good morning, everyone. Thank you for joining us. This morning, I'll begin with a brief overview of our third quarter performance and then turn it over to Tom who will provide a business update.

James Francis McCann: This morning, I'll begin with a brief overview of our third quarter performance and then turn it over to Tom, who will provide a business update. We will conclude with a financial review from Bill, and then we'll open it up to your questions. Over the last few quarters, we have been providing updates on our Relationship Innovation and Work Smarter initiatives, which are centered on elevating the customer experience and driving efficiencies in all aspects of our business.

James Francis McCann: We will conclude with a financial review from Bill and then we'll open it up to your questions.

Thomas G. Hartnett: Over the last few quarters, we have been providing updates on our relationships innovation and work smarter initiatives.

Thomas G. Hartnett: Centered on elevating the customer experience and driving efficiencies in all aspects of our business.

James Francis McCann: Our organization continues to relentlessly execute on these initiatives, and you'll hear a number of updates today on how we are actively managing our product portfolio and our pricing elasticity. As we look at our third-quarter performance, we continue to see a very complex consumer environment. 1-800-FLOWERS.COM, And although there has been much discussion about the resilient economy, we continue to see a bifurcation between lower versus middle and higher income consumers. It's not surprising that the lower income consumer continues to be most pressured by inflationary forces and higher interest rates, while at the same time, credit card balances and delinquency rates are on the rise. Our total third-quarter revenue declined 9.1%, which includes lower wholesale and blue-net revenue.

William E. Shea: Our organization continues to relentlessly execute on these initiatives and you'll hear a number of updates today on how we are actively managing our product portfolio and our pricing elasticity.

William E. Shea: As we look at our third quarter performance, we continue to see a very complex consumer environment.

William E. Shea: Consumers continue to be deliberate and discerning with their purchases and I'm, making thoughtful decisions.

William E. Shea: Although there has been much discussion about the resilient economy, we continue to see a bifurcation of our lower versus middle and higher income consumers.

William E. Shea: It's not surprising that the lower income consumer continues to be most pressured by inflationary forces and higher interest rates, while at the same time credit card balances into delinquency rates are on the rise of.

William E. Shea: Our total third quarter revenue declined nine, 1%, which includes lower wholesale and bloom that revenue.

James Francis McCann: As Bill will highlight further, our e-commerce revenue trends continue to improve sequentially. Helping offset our top-line softness, fiscal 2024 remains the year of our gross margin recovery. As we updated everyone last quarter, the pace of our March on Recovery is occurring at a faster rate than we had originally anticipated at the beginning of the fiscal year. Our gross margin is benefiting from a combination of our Work Smarter initiatives that are largely centered on operating more efficiently and the reversion to the mean of certain commodity costs.

As Bill will highlight further our e-commerce revenue trends continued to improve sequentially.

William E. Shea: Helping offset our topline softness fiscal 'twenty 'twenty four remains the year of our gross margin recovery.

William E. Shea: As we updated everyone last quarter, the pace of our margin recoveries occurring at a faster rate than we had originally anticipated at the beginning of the fiscal year.

William E. Shea: Our gross margin is benefiting from a combination of all work smart initiatives that are largely centered on operating more efficiently and reversion to the mean of certain commodity costs.

James Francis McCann: As one of the aspects of Work Smarter, we took further action to optimize our workforce during the third quarter. While these decisions are difficult, these changes were made in response to the current environment and to appropriately allocate resources to the growth opportunities in our business. I want to take this opportunity to express our gratitude to every team member who was affected for their personal contributions to our organization's success.

William E. Shea: It's one of the aspects of work smarter, we took further action to optimize our workforce during the third quarter.

William E. Shea: While these decisions are difficult. These changes were made in response to the current environment and to appropriately allocate resources to the growth opportunities in our business.

William E. Shea: Do I take this opportunity to express our gratitude to every team member who was affected for their personal contribution to our organization to success.

James Francis McCann: Beyond our cost optimization efforts, we are executing on our strategic initiatives to offer more solutions for our customers' gift-giving needs. Since the founding of the company, we have been at the forefront of innovation.

William E. Shea: Beyond our cost optimization efforts, we are executing on our strategic initiatives to offer more solutions for our customers' gift giving needs since.

William E. Shea: Since the founding of the company, we have been in the forefront of innovation.

James Francis McCann: We have expanded our gifting options and made it easier for our customers to stay connected and celebrate with all the important people in their lives. We have a portfolio of brands and offer gifting options for every occasion. Most recently, we further expanded our offerings with the acquisition of Cardisle, which enhances our print-on-demand personalized greeting card offerings and enables us to address a wider range of our customers' express needs. The addition of Cardisle gives our customers the ability to pair top quality personalized greeting cards with our extensive variety of gifts across our family of brands or as a stand-alone group.

William E. Shea: We have expanded our gifting options and made it easier for our customers to stay connected and celebrate with all the important people in their lives.

William E. Shea: We have a portfolio of brands offer gifting options for every occasion.

William E. Shea: Most recently, we further expanded our offerings with the acquisition of Carlisle, which enhances our print on demand personalized greeting card offerings and enables us to address a wider range of our customers expressive needs.

William E. Shea: The addition of Carlyle gives our customers the ability to pair top quality personalized greeting cards with our extensive variety of gifts across our family of brands or just standalone grief.

William E. Shea: We are excited for our expansion of greeting card category.

William E. Shea: Further enhances the gifting experience, we can provide our customers.

William E. Shea: Tom will provide additional information on our strategic initiatives.

James Francis McCann: We are excited about our expansion of the Greeting Card Category, which further enhances the gifting experience we can provide our clients. I will provide additional information on our strategic plan. Before we move on to the business update, I did want to take this opportunity to celebrate Harry and David's 90th anniversary. It's a truly remarkable milestone to celebrate 90 years of delivering gifts. From the time of Harry and David's first hand-delivered boxes of pears nearly a century ago, sharing has been at the heart of what we do. While much has changed since 1934, Harry and David have been here all along delivering extraordinary gifts that bring people together for life's meaningful moments. And now, I'll turn the call over to Tom for...

Thomas G. Hartnett: Well, we move on to the business update I didn't want to take this opportunity to celebrate Harry <unk>, David its 90 <unk> anniversary.

It's truly remarkable milestone to celebrate 90 years of delivering gifts.

Thomas G. Hartnett: The time of having David first hand delivered boxes appears nearly a century ago sharing has been at the heart of what we do.

Thomas G. Hartnett: While much has changed since 1930 for Harry <unk>, David has been here all along delivering extraordinary gifts.

Thomas G. Hartnett: Bring people together a light meaningful moments.

Thomas G. Hartnett: And now I'll turn the call over to Tom for a business update.

Thomas G. Hartnett: Thanks, Kim, and good morning, everyone. Today, I'll provide an update on our business performance, as well as an update on our relationship innovation developments, which encompasses new or enhanced product offerings, our merchandising efforts, as well as user interface enhancements. Through these initiatives, we continuously evaluate our offerings, pricing, and bundling opportunities to ensure we have appropriate price points for each of our customer segments and that we are actively managing the pricing elasticity of our product portfolio. Returning to our performance, during the third quarter, we generated an adjusted EBITDA loss of $5.7 million, essentially in line with the prior year despite the 9.1% decline in revenue.

Thomas G. Hartnett: Thanks, Ken and good morning, everyone.

Thomas G. Hartnett: Today I'll provide an update on our business performance as well as an update on our relationship innovation development, which encompasses new or enhanced product offerings, and our merchandising efforts as well as user interface enhancements.

Thomas G. Hartnett: These initiatives, we continuously evaluate our offerings pricing and bundling opportunities to ensure we have appropriate price points for each of our customer segments and that we are actively managing the pricing elasticity of our product portfolio.

Thomas G. Hartnett: Turning to our performance.

Thomas G. Hartnett: During the third quarter, we generated an adjusted EBITDA loss of $5 $7 million essentially in line with prior year. Despite the nine 1% decline in revenue.

Thomas G. Hartnett: Most notably, our e-commerce revenue trends continue to improve sequentially, declining 4.9% for the quarter. As we look at what's driving these trends, we continue to see a bifurcation between our lower income customers, who reduce their purchases the most, as compared to our middle and higher income customers. Proof in point was our Valentine's Day selection of premium gifts that appealed to our luxury buyers and included our Sherry's Berry Select offering, which is priced 25-50% higher than our standard offering, and our 100 long stem roses that retail for $399 and sold out.

Thomas G. Hartnett: Most notably our e-commerce revenue trends continued to improve sequentially declining four 9% for the quarter.

Thomas G. Hartnett: As we look at what's driving these trends we continue to see a bifurcation between our lower income customers reduced their purchases the most as compared to a middle and higher income customers proof.

Thomas G. Hartnett: Proof in point was our Valentines day selection of premium gifts that appeal to our luxury buyers and included our surety is very select offering.

Thomas G. Hartnett: Which are priced 25% to 50% higher than our standard offering and our 100 long stem roses that retailed for $399 and sold out.

Thomas G. Hartnett: This demonstrates our pricing power and our ability to increase ALV. As a result of this ongoing trend, our AOV increased 1.4% as our upper-income customers continue to represent a greater portion of our overall population, and they continue to gravitate toward our higher-priced bundled products that provide a great gift and value. We recognize that our higher income customers have not meaningfully changed their behavior and, in many cases, are trading up in price points, but our lower income customers, who are more affected by the macroeconomic environment, are being much more deliberate with their buying decisions.

Thomas G. Hartnett: This demonstrates our pricing power and ability to increase <unk>.

Thomas G. Hartnett: As a result of this ongoing trend our ALG increased one 4% as our upper income customers continue to represent a greater portion of our overall population and they continued to gravitate towards our higher priced bundled products that provide a great gift and value.

Thomas G. Hartnett: We recognize that our higher income customers have not meaningfully changed their behavior and in many cases are trading up and price points, but our lower income customers were more effected by the macroeconomic environment are being much more deliberate with their buying decisions.

Thomas G. Hartnett: As a result, not only are we expanding our price points higher for luxury-oriented customers, but we have also flexed lower for our lower-income consumers to ensure that we have gifts for every occasion at appropriate price points. Our focus on the customer journey, providing thoughtful gifting options, and having the appropriate price points at each end of the spectrum, from value to luxury, has never been greater. During the quarter, we introduced new product offerings.

As a result, not only are we expanding our price points higher for luxury oriented customers. We also flex lower for our lower income consumers to ensure that we have guests for every occasion at appropriate price points.

Thomas G. Hartnett: Our focus on the customer journey, providing thoughtful gifting options and having the appropriate price points at each end of the spectrum from value to luxury has never been greater.

Thomas G. Hartnett: During the quarter, we introduced new product offerings.

Thomas G. Hartnett: We utilize innovative technology to extend the life of our world-famous pairs, extending their selling season and increasing revenue. We have amplified our marketing efforts to evoke greater emotions with our brand, and we expanded our lineup of gift products available for same-day delivery. Let me take a moment to touch on each of them.

Thomas G. Hartnett: Utilized innovative technology to extend the life of our world famous pairs extending their selling season and increasing revenue, we amplified our marketing efforts to evoke greater motions with our brands and we expanded our lineup with gift products available for same day delivery let.

Speaker Change: Let me take a moment to touch on each of these.

Thomas G. Hartnett: In January, we launched Cheryl's Ice Cream, which can also be paired with Cheryl's Cookies to make a great gift set. We continue to grow our Cheryl's assortment to layer on complementary categories as we did with the introduction of cupcakes a year ago. At Harry & David, we had our longest Royal Riviera selling season on record.

Speaker Change: In January we launched <unk> ice cream, which can also be paired with Charles cookies to make a great gifts that.

Speaker Change: We continue to grow our shareholders assortment to layer on complementary.

Speaker Change: <unk> as we did with the introduction of cupcakes a year ago.

Speaker Change: At Harry <unk>, David we had our longest royal Riviera selling season on record.

Thomas G. Hartnett: We accomplished this by using technology that enabled us to extend the selling season of our pairs and offer them longer than we ever had into the spring. This enabled us to grow pair sales for the quarter as our customers responded to the extended offering period. This technology will yield an even greater benefit in fiscal 2025 as we are anticipating a strong pear crop due to the favorable weather conditions our orchards experienced this past winter.

Speaker Change: We accomplish this by using technology that enabled us to extend the selling season of our Paris and offer them longer than we ever had into this spring.

Speaker Change: This enabled us to grow pay ourselves for the quarter as our customers responded to the extending offering period.

Speaker Change: This technology will yield an even greater benefit in fiscal 2025, as we were anticipating a strong pair crop due to the favorable weather conditions are orchards have experienced this past winter.

Thomas G. Hartnett: And we continue to see our higher-income customers gravitate towards our higher value, higher price gift bundles that combine gifts from our family of brands into a bundled set. For Valentine's Day, we reintroduced our trio bundles that featured 1-800-Flowers, Harry and David Wine, and Sherry's Berries, which exceeded our expectations with great sell-through. To differentiate our offerings from that of our competitors, we're able to leverage our family of brands and the supply chain investments we've made to send these bundles as one extraordinary and elegant gift.

Speaker Change: And we continue to see our higher income customers gravitate towards our higher value higher priced gift bundles that combine guests more family of brands into a bundled set for <unk>.

Valentine's day, we reintroduced our trios bundles that featured 100 flowers, Harry <unk>, David wine, and cherries, berries, which exceeded our expectations with great sell through.

Speaker Change: To differentiate our offerings from that of our competitors were able to leverage our family of brands and the supply chain investments. We've made to send these bundles as one extraordinary and elegant gift.

Thomas G. Hartnett: This not only provides for a much better and more memorable gifting experience, but it also reduces shipping costs by sending all the products in a single delivery. As for our marketing efforts, we are strategically incorporating storytelling to elevate our brands and make a meaningful impact on our customers. Effective storytelling evokes emotions, creates a stronger bond with our customers, and ultimately generates action. A great example of this was within our health and wellness brand with the launch of the Vital Choices Featured Catch on our website, blog, social, and external channels.

Speaker Change: This not only provides for a much better and more memorable gifting experience, but it also reduces shipping costs by sending all the products in a single delivery.

Speaker Change: Turning to our marketing efforts, we are strategically incorporating storytelling to elevate our brands and make a meaningful impact on our customers.

Speaker Change: Effective storytelling evokes emotions creates a stronger bond with our customers and ultimately generate action.

Speaker Change: A great example of this was within our health and wellness brand with the launch of the vital choices featured catch on our website blog, social and external channels.

Thomas G. Hartnett: Vital Choice provides customers with hundreds of healthy or better-for-you options, and we saw an opportunity to foster a stronger relationship with our customers who are interested in food that is healthy, natural, and convenient. Beyond providing customers with useful product information, such as nutrition facts and serving suggestions, we go deeper to share the story of the fishermen who are responsible for the catch. The differences between wild-caught fish and farmed fish, their sustainability efforts, and how they help bring fish from the ocean to our customers' plates.

Speaker Change: Final choice provides customers with hundreds of healthy or better for you options and we saw an opportunity to foster a stronger relationship with our customers who are interested in food that is healthy natural and convenience.

Speaker Change: Beyond providing customers with useful product information, such as nutrition facts and serving suggestions we dive deeper to share the story of the fisherman who are responsible for the cash.

Speaker Change: The differences between wild caught fish and farm fish their sustainability efforts.

Speaker Change: And how they help bring it from the ocean to our customers fleet.

Thomas G. Hartnett: Same-day delivery for gifts has become increasingly important in today's fast-paced world, and customers have come to expect convenience and speed. As a component of our strategic initiatives, our management team has been focused on expanding the number of products available for same-day delivery. By leveraging our BlueNet network, we have expanded the number of products available for same-day delivery to help customers celebrate special occasions, whether it's a last-minute gift or a sudden celebration

Speaker Change: Same day delivery for gifts has become increasingly important today's fast paced world and customers have come to expect convenience and speed.

Speaker Change: As a component of our strategic initiatives. Our management team has been focused on expanding the number of products available for same day delivery.

Speaker Change: By leveraging our balloon that network, we have expanded the number of products available for same day delivery to help customers celebrate special occasions, whether it's a last minute gift or a sudden celebration.

Thomas G. Hartnett: As part of this effort, we recently launched our Cheryl's Same Day Delivery Program that features our best-selling cookies and the option for a cookie add-on to select 1-800-Flowers bouquets. We expect this to build over time, but most importantly, this is a great illustration of how we are differentiating ourselves in the marketplace by leveraging our e-commerce platform, our family of brands, and our fulfillment capabilities to offer customers an expanded array of products, convenience, and speed to be their gifting destination of choice. And now I'll turn it over to Bill to provide the financial review.

Speaker Change: As part of this effort, we recently launched our shareholder same day delivery program that features our best selling cookies and the option for a cookie add on to select one 800 flowers bouquets.

Speaker Change: We expect this to build over time, but most importantly, this is a great illustration of how we are differentiating ourselves in the marketplace by leveraging our E Commerce platform our family of brands in our fulfillment capabilities to offer customers, an expanded array of products convenience and speed to be their gifting destination of choice.

Speaker Change: And now I'll turn it over to bill to provide the financial review.

William E. Shea: Thanks, Tom, and good morning. As Jim and Tom highlighted, we continue to operate in a complex consumer environment where consumers continue to spend on certain categories while curtailing their spend in other categories. We also continue to see divergence in our customer files, where our higher income customers continue to spend and gravitate toward a higher priced offer. As a result, our third quarter revenue declined 9.1% as compared to a year ago.

William E. Shea: Thanks, Tom and good morning.

William E. Shea: Jim and Tom highlighted we continued to operate in a complex consumer environment, which consumers continue to spend on certain categories, while curtailing their spend with us.

William E. Shea: We also continue to see the divergence in our customer file.

William E. Shea: Higher income customers, continuing to spend and gravitate towards our higher priced offerings.

William E. Shea: As a result of third quarter revenue declined nine 1% as compared to a year ago.

William E. Shea: This includes lower wholesale volume with our retail partners for this past Easter, as well as lower bloom net revenue. When we zoom in a little closer and look at our core consumer, our quarter-over-quarter e-commerce revenue trends continue to improve, declining 4.9% in the third quarter as compared to 6.6% in the prior quarter. The improvement was partly due to the shift of ECU.

William E. Shea: This includes lower wholesale volume with our retail partners for this past Easter as.

William E. Shea: As well as well as lower Bloom net revenue.

William E. Shea: Well resume in a little closer and look at our core consumer a quarter over quarter.

William E. Shea: <unk> E Commerce revenue trends continued to improve declining four 9% in the third quarter as compared to six 6% in the prior quarter.

William E. Shea: The improvement was partly due to the shift of Easter.

William E. Shea: Helping to mitigate the revenue decline. Our gross margin is continuing its reversion to the mean, improving 300 basis points to 36.6%. Improvement with lead time due to Lower Freight Costs, our inventory optimization efforts, labor efficiencies, as well as a decline in certain commodity costs. I want to take a moment to discuss a couple of external factors that have captured investors' attention over the past few months, including the Red Sea issues that have impacted supply chains and the extraordinary rise in cocoa prices.

William E. Shea: Helping mitigate the revenue decline.

William E. Shea: Gross margin is continuing its reversion to the mean, improving 300 basis points to 36, 6%.

William E. Shea: The improvement was led by.

William E. Shea: By lower freight costs, our inventory optimization efforts labor efficiencies as well as a decline in certain commodity costs.

I wanted to take a moment to discuss a couple of external factors that had captured investors' attention over the past few months, including the <unk> issues that impacted supply chains and the extraordinary rise in cocoa prices.

William E. Shea: Beginning with the supply chain, we are happy to report that our logistics team recently completed negotiations with our fiscal 2025 inbound freight costs and successfully negotiated lower rates for the fiscal year ahead, despite the geopolitical issues in the Middle East. There's a Cocoa Price.

William E. Shea: Beginning with the supply chain we.

William E. Shea: We are happy to report that our logistics team recently completed negotiations.

William E. Shea: With our fiscal 2025 inbound freight costs and successfully negotiated lower rates for the fiscal year ahead.

William E. Shea: Spite the geopolitical issues in the middle East.

William E. Shea: In terms of cocoa prices.

William E. Shea: We were fortunate to have locked in fiscal 2024 and fiscal 2025 COCO purchases with moderate price increases prior to the recent and much more dramatic increase in prices. We will look to offset these moderate price increases in other areas. As Jim mentioned, we made the decision to initiate a reduction in our full-time workforce in response to the current business environment and to appropriately allocate resources to the growth opportunities within our business. This action is expected to yield annual savings of more than $10 million.

William E. Shea: We were fortunate to have locked in our fiscal 2024 and fiscal 2025 cocoa purchases with moderate price increases prior to the recent and much more dramatic increase in pricing.

We will look to offset.

These moderate price increases in other areas.

William E. Shea: In conjunction with this action, the company incurred a $2.4 million of severance and related charges during the quarter. Third quarter operating expenses were 43.9% of sales, which includes the severance related charges, as compared to 53.9% in the prior year period, which includes a goodwill and intangible assets impairment charge, excluding the impact of the severance-related charges, Non-Qualified Compensation Plan and the impairment charge recorded in the prior year period, for 42.4% of sales as compared with 38.8% in the prior year period.

William E. Shea: As Jim mentioned, we made the decision to initiate a reduction of our full time workforce in response to the current business environment and to appropriately allocate resources to the growth opportunities within our business.

William E. Shea: Operating expenses, excluding the same items just noted, declined $1.2 million as compared to the prior year period to $160.7 million. Net loss for the quarter was $16.9 million, or $0.26 per share, which includes severance and related charges of $2.4 million, or $0.02 per share, as well as a tax benefit of $0.04 per share related to the fiscal second quarter trademark impairment charge. In the prior year, the net loss was $71 million, or $1.10 per share, including non-cash, goodwill, and intangible asset impairment charges of $53.1 million.

William E. Shea: This action is expected to yield annual savings of more than $10 million.

William E. Shea: In conjunction with this action the company incurred a $2 4 million of severance and related charges during the quarter.

William E. Shea: Third quarter operating expenses were 43, 9% of sales, which includes the severance related charges as compared to 53, 9% in the prior year period, which includes a goodwill and intangible assets impairment charge.

William E. Shea: Operating expenses, excluding the impact of the severance related charges, the appreciation or depreciation of investments in our companies.

William E. Shea: Nonqualified compensation plan and the impairment charge recorded in the prior year period with 42, 4% of sales as compared with 38, 8% in the prior year period.

William E. Shea: Operating expenses, excluding the same items, just noted declined $1 2 million as compared to the prior year period to $167 million.

William E. Shea: Net loss for the quarter was $16 9 million or <unk> 26 per share, which includes severance and related charges of $2 4 million or <unk> <unk> per share as well as a tax benefit of <unk> <unk> per share related to the fiscal second quarter trademark impairment charge.

William E. Shea: In the prior year net loss was $71 million or $1 10 per share.

William E. Shea: Which included an after tax noncash goodwill and intangible asset impairment charge of $53 1 million.

William E. Shea: The Adjusted Net Loss was $18 million, or $0.28 per share, compared with an adjusted net loss of $17.8 million, or $0.27 per share, in the prior year period. Our third quarter adjusted EBITDA loss was $5.7 million, essentially flat as compared with an adjusted EBITDA loss of $5.5 million a year ago, as the gross margin recovery and our efforts to operate more efficiently helped mitigate the top line decline. Now, let's review our segment results.

William E. Shea: The adjusted net loss was $18 million or <unk> 28 per share compared with an adjusted net loss of $17 8 million or <unk> 27 per share in the prior year period.

William E. Shea: Our third quarter adjusted EBITDA loss was $5 7 million essentially flat as compared with an adjusted EBITDA loss of $5 5 million a year ago as the gross margin recovery and our effort efforts to operate more efficiently helped mitigate the top line decline.

William E. Shea: Our gourmet foods and gift basket segment revenues declined 11.4% to $131 million compared with $147.9 million in the prior year period. A large contributor to this decline was our wholesale business, which declined approximately $10 million as several retailers had reduced their orders for Easter in light of the consumer environment. This segment's e-commerce revenues declined 4.5%.

William E. Shea: Now, let's review our segment results.

William E. Shea: Our gourmet foods and gift baskets segment revenues declined 11, 4% to $131 million compared with $147 9 million in the prior year period.

William E. Shea: A large contributed to this decline was our wholesale business, which declined approximately $10 million at several retailers have reduced their orders the Easter in light of the consumer environment.

William E. Shea: This segment E Commerce revenues declined four 5%.

William E. Shea: Profit margin expanded 530 basis points to 29.9%, compared with 24.6% in the prior year period, benefiting from lower freight costs, the company's inventory and labor optimization efforts, as well as a decline in certain commodity costs. Including the impact of the severance charge in the current period and the impairment charge a year ago, the adjusted segment contribution margin loss improved $6.3 million to a loss of $7.6 million, compared with an adjusted segment contribution margin loss of $13.9 million in the prior year period. In our consumer flow and gift segments, revenue decreased 5.1% to $221.2 million compared with $233 million a year ago.

Gross profit margin expanded 530 basis points to 29, 9% compared with 24, 6% in the prior year period.

William E. Shea: Benefiting from lower freight costs, the company's inventory and labor optimization efforts as well as a decline in certain commodity costs.

William E. Shea: Excluding the impact of the severance charge in the current period and the impairment charge a year ago. The adjusted segment contribution margin loss improved $6 3 million to a loss of $7 6 million.

William E. Shea: Compared with an adjusted segment contribution margin loss of $13 9 million in the prior year period.

William E. Shea: In our consumer floral and gift segment's revenue decreased five 1% to $221 2 million compared with $233 million a year ago.

William E. Shea: This profit margin expanded 140 basis points to 39.3% compared with 37.9% in the prior year period due to improving lower fulfillment costs and our logistics optimization efforts. Segment contribution margin was $22.8 million, excluding the severance charge compared with segment contribution margin of $26.1 million in the prior year period and our Bluenet segment. Revenues for the quarter decreased 26.1% to $27.3 million. Vermeer's revenues were impacted by lower order volume processed by Blumnet, which included an expected decline in orders by one of our business partners following their merger with a competitor.

William E. Shea: Gross profit margin expanded 140 basis points to 39, 3% compared with 37, 9% in the prior year period.

William E. Shea: Moving on lower fulfillment cost and our logistics optimization efforts.

William E. Shea: Segment contribution margin was $22 8 million, excluding the severance charge compared with segment contribution margin of $26 1 million in the prior year period.

William E. Shea: And our balloon that segment.

William E. Shea: Revenues for the quarter decreased 26, 1% to $27 3 million.

William E. Shea: Revenues were impacted by lower order volume processed by Bloom net which included an expected decline in orders by one of our business partners. Following the merger with a competitor.

William E. Shea: Its profit margin was 45.4% compared with 42.5% in the prior year period, primarily reflecting higher-margin product mix and lower freight costs. Segment contribution margin was $7.6 million, excluding the severance charge, compared with $11 million in the prior year period. Turning to our balance sheet, our cash and investment position was $184 million at the end of the third quarter. Inventory declined to $159.5 million compared with an inventory of $191.9 million at the end of last year's third quarter.

William E. Shea: Gross profit margin was 45, 4% compared with 42, 5% in the prior year period, primarily reflecting higher margin product mix and lower freight costs.

William E. Shea: Segment contribution margin was $7 6 million, excluding the severance charge compared with $11 million in the prior year period.

William E. Shea: In terms of debt, we had $192.5 million in term debt and no borrowings under our revolving credit facility. As a result, our net debt was $8.5 million compared with $98.4 million at the end of last year's third quarter. We continue to execute on our stock buyback program, and we purchased $9.2 million of our stock through the first three quarters of the fiscal year. This amounts to approximately 948,000 shares that we repurchased at an average cost of $9.68 per share.

William E. Shea: Turning to our balance sheet.

William E. Shea: Our cash and investment position was $184 million at the end of the third quarter.

William E. Shea: Inventory declined to $159 5 million compared with the inventory of $191 9 million at the end of last year's third quarter.

William E. Shea: In terms of debt, we had $192 5 million in term debt and no borrowings under our revolving credit facility.

William E. Shea: As a result, our net debt was $8 5 million compared with $98 4 million at the end of last year's third quarter.

William E. Shea: We continued to execute on our stock buyback program and repurchased $9 $2 million of our stock through the first three quarters of the fiscal year.

William E. Shea: This amounts to approximately 948000 shares that we repurchased at an average cost of $9 68 per share.

William E. Shea: Now let's turn to our Fiscal 2024 Guidance. We are reaffirming our guidance and continuing to expect total revenues to decline in the 7-9% range as compared with the prior year. Adjusted EBITDA to be in the range of $95 to $100 million, and our free cash flow to be in the range of $60 to $65 million. I will now turn the call back to Jim for his closing comments.

Speaker Change: Now, let's turn to our fiscal 2020 for guidance.

Speaker Change: We are reaffirming our guidance and continue to expect.

Speaker Change: Total revenues to decline in the 7% to 9% range as compared with the prior year.

Speaker Change: Our adjusted EBITDA to be in the range of $95 million to $100 million.

Speaker Change: And our free cash flow to be in the range of $60 million to $65 million.

Speaker Change: I will now turn the call back to Jim for his closing comments before we open it up for Q&A.

James Francis McCann: Thanks, Bill. Before we open it up for your questions, I want to tell you that I'm incredibly proud to share that 1-800-Flowers.com has been recognized as one of America's most trustworthy companies by Newsday. I want to take this opportunity to congratulate and thank everyone in our organization for the hard work that contributed to this record. It's an honor to have such a strong community of customers who trust us to help them give more, connect more, and build more and better relationships. Trusting a company matters, and we look forward to continuing to build on this momentum. Now, operator, if you would, let's open it up for any questions.

James Francis McCann: Thanks, Bill before we open it up for your questions I want to tell you that I'm incredibly proud to share that one 800 flowers dot com has been recognized as one of America's most trustworthy companies by Newsweek.

James Francis McCann: I want to take this opportunity to congratulate and thank everyone in our organization for their hard work that contributed to this recognition.

James Francis McCann: It's an honor to have such a strong community of customers, who trust us to help them get more collect more and build more and better relationships.

James Francis McCann: Trusting a company matters and we look forward to continuing to build on this momentum.

Speaker Change: Now operator, if you would let's open it up for any questions.

Operator: We will now begin the question and answer session. To ask a question, you may press star and 1 on your telephone keypad. If you are using a speakerphone, please pick up your headset before pressing the keys. If at any time your question has been answered and you would like to withdraw your question, please press star and two.

Speaker Change: We will now begin the question and not substantially.

Speaker Change: Last quick question you May Press Star then one on your telephone keypad.

Speaker Change: So as you can speaker phone please pickup your handset before pressing the keys.

Speaker Change: Anthony Paragon question has been answered.

Speaker Change: To withdraw your question. Please press star two.

Speaker Change: Our first question comes from Mike <unk> with local capital markets. Please go ahead.

Michael A. Kupinski: Thank you for taking the questions and congratulations on managing those costs. I was just wondering if you could talk a little bit about the commodity prices, and they obviously continue to weaken in the quarter. Can you give us a sense of those commodities that were weak that were impactful in the quarter, what commodity prices are looking like and trending, particularly not just cocoa, which you talked about, but maybe some of those commodities that might be a little stubborn and offer future prospects for lower prices going forward?

Mike: Thank you for taking the questions and congratulations on managing those costs.

Mike: Wondering if you can.

Mike: Talk a little bit about the commodity prices.

Mike: You're obviously continuing to weaken in the quarter can you give us a sense of those commodities that were weak that were impactful in the quarter what commodity prices are looking like in training, particularly not just cocoa, which obviously you talk about but.

Mike: And maybe some of those commodities that might be a little stubborn and offer future prospects for lower prices going forward.

James Francis McCann: Michael, thank you for your question. This is Jim.

Mike: Michael Thank you for your question this is Jim.

James Francis McCann: Your commodity prices have been all over the place. And I would tell you, just in the last week, the change in cocoa prices has been extraordinary. We plan for next year to have cocoa prices up quite a bit. And what the impact on us would be, as Bill mentioned, though, we're fortunate that we have locked in our availability and our pricing on cocoa through next year. So we're a little bit protected from those wild swings but still very conscious of them because they're going to impact the overall market and impact our pricing in the future.

James Francis McCann: Commodity prices have been all over the place.

James Francis McCann: I'd tell you just in the last week.

James Francis McCann: The change in cocoa prices has been extraordinary.

James Francis McCann: We are planning for next year to have a.

James Francis McCann: Cocoa prices up quite a bit.

James Francis McCann: What the impact on us would be as Bill mentioned go we're fortunate that we have locked in an hour.

Our availability and our pricing on cocoa through next year, So we're a little bit.

James Francis McCann: Protected from those wild swings, but still very conscious of it because it's going to impact the overall market and impact our pricing in the future, but we're very pleased to see in the last couple of days, it's over 20% decline in cocoa prices, but bill what other commodities I know eggs and butter are two big components, when Europe Baker and <unk>.

James Francis McCann: But we're very pleased to see in the last couple of days an over 20% decline in cocoa prices. But, Bill, what other commodities? I know eggs and butter are two big components. When you're a baker and a chocolate maker, you're very conscious of those prices. And we've seen some wild swings there, giving some color on where we are now and what impacts that might have on our overall course going forward.

James Francis McCann: Rockwood makes it very conscious of those prices.

William E. Shea: You've seen some wild swings a little color on where we are now and what impacts that might have on our overall costs going forward.

William E. Shea: Jim, as you mentioned, eggs and butter are ones that have come down significantly off their highs, and we're getting some benefit this year on those commodities. But other items like fuel, we were getting a benefit for most of this fiscal year, and we're kind of crossing over where fuel has risen. And it's a combination of both on the fuel side, a combination of both what's happening in the markets. But the third point of carry is continuing to – that's a surcharge that they have, and they continue to play with the model. So that's gone from a significant headwind to a tailwind this past year, and right now, it's a slight breeze.

William E. Shea: Jim as you mentioned, the eggs and butter ones that have come down significantly off there.

James Francis McCann: We are getting the benefit.

Jim McCann: Sure.

Jim McCann: On those commodities.

Jim McCann: But other.

Jim McCann: Items like fuel.

Jim McCann: We were getting a benefit for most of this fiscal year client a crossover where fuel is reason.

Jim McCann: It's a combination of both on the fuel side combination of both whats happening.

Jim McCann: In the markets.

Jim McCann: But the third party carriers continue to that's a.

Jim McCann: Surcharge that they had and continue to play with the with the model.

Jim McCann: Exelon a significant headwind.

Jim McCann: Tailwind this past year and right now it's just.

Jim McCann: It's a slight headwind as we head into fiscal 'twenty five in answer to Michael's question overall commodity prices fuel will be the biggest it's still a negative headwind overall on commodity costs because fuel is such a disproportionate.

James Francis McCann: 1-800-Flowers.com

Jim McCann: Part of our commodity mix.

William E. Shea: As we move forward, I think fuel has been a benefit to us in fiscal 24, but as we move forward, fuel will be a headwind again.

Jim McCann: As we move forward I think fuel has been a benefit to us in fiscal in fiscal 'twenty four but as we move forward fuel will be a headwind again.

Michael A. Kupinski: Thank you for that, Collar. Can you give me a sense of the decrease in shipping costs? Surprisingly, you negotiated lower rates going forward. I was just wondering, can you give us a sense of the shipping costs, including ocean freight costs?

Speaker Change: Yes. Thank you for that color and can you give me a sense of the decrease in shipping cost.

Speaker Change: <unk> negotiated.

Speaker Change: Lower rates going forward I was just wondering if you can give us a sense of the shipping costs, including ocean freight costs.

Michael A. Kupinski: Michael, we found that very surprising. I would never have predicted that we'd lock in rates going forward that were lower. Who knew that we'd be talking and thinking about the Red Sea and Houthis six months ago, a year ago? It certainly is a surprise to me. But Bill, you just finished those contract negotiations a week or a week and a half ago. A little color there for my

Speaker Change: Michael we found that very surprising I would never have predicted that we lock in rates going forward that will lower who knew that we'd be talking and thinking about the rates would be.

Speaker Change: Yes.

Speaker Change: Six months ago, a year ago.

Speaker Change: Certainly a surprise to me fulfill.

Speaker Change: Just finished a weaker we got half ago those contract negotiations a little color there for Michael.

William E. Shea: Yes, so several months ago, the spot market for ocean rates jumped dramatically, probably doubled the contractual rates that everybody had. The good news is that the carriers did honor the contractual rates, so we didn't feel the impact of those spot market spikes. As we entered into negotiations, several We were concerned about where rates would go for Fiscal 25, but we were able to successfully negotiate across the four carriers that we used a slight decrease in our ocean rates as we head into Fiscal 25.

Michael: Yeah, so several months ago, the spot market for ocean rates jumped dramatically probably doubled the contractual rates that.

Michael: That everybody had the good news is that the carriers did honored the contractual rates. So we didn't feel the impact of those spot market.

Michael: Spikes.

Michael: As we entered into negotiation several.

Michael: Backing back in March we will concerned where where rates would go for fiscal 'twenty five, but we were able to successfully negotiate a crosstalk the.

Michael: For carriers that we use a slight decrease in our ocean rates as we head into <unk>.

For fiscal 'twenty five so those actually rates went into effect, yes yesterday may one and a one through May may 31.

William E. Shea: So those rates actually went into effect yesterday, May 1st, and they run through May 31st of next year. On the FedEx side, on the outbound shipping side, we always have modest contractual rates. We talked a little bit about fuel, and there are other surcharges that are outside of those rates. But we've been, under our Work Smarter initiative with inventory optimization logistics initiatives, we've been able to offset those rate increases this past year.

Michael: Yes.

Michael: Next year.

Michael: On the Fedex side on the outbound shipping side, we always have modest contractual rates, we talked a little bit about about fuel.

Michael: All of the surcharges that are outside of those rates, but we've been in between we've talked under a mock work smarter initiative with inventory optimization logistics.

Michael: The initiatives, we have been able to offset those rate increases this past GSO through the nine months ended.

Michael: At the end of the third quarter, our actual cost per packages.

Michael: Flat to slightly lower on a year over year basis.

James Francis McCann: And we've done, Michael, to mitigate those inbound freight costs. I'll ask Tom to comment on this, is that where we purchase, where we manufacture. Yes, so Michael, as we have shifted some of our volume to the states, etc., from a supply chain. So just the raw number of containers we're bringing in is less than it was, even without where we've been in sales.

Michael: Great.

Michael: Done Michael to mitigate those inbound freight costs and I'll ask Tom to comment on this.

Thomas G. Hartnett: Where we purchase where we manufacture.

Thomas G. Hartnett: As Michael as we over time and still feeling this thing from the pandemic, we have shifted some of our volume.

Thomas G. Hartnett: To the states et cetera from a supply chain.

Thomas G. Hartnett: So just a raw number of containers, we are bringing in is less than it was even sands, where we've been in sales. So.

Michael A. Kupinski: Gotcha, thanks for that color. And just one final question, if I may. You implemented cost-cutting actions in your workforce during the quarter. How much of those actions could be viewed as permanent?

Michael: Gotcha, Thanks for that color and just a final question. If I may you implemented cost cutting actions in your workforce in the quarter, how much of those actions could be viewed as permanent.

James Francis McCann: Michael, this is Jim. Yes, we reduced our workforce, our salaried workforce, this quarter. Painful thing to do, but appropriate under our ongoing work squatter initiative, where we'll continue to look to say how can we operate more efficiently, how can we be more productive, and that's going to result in us having a constant eye on our costs, and part of our cost structure is obviously our talent. So it didn't have any impact on last quarter because in the same quarter, we also have the related severance costs that go along So it didn't have any benefit in the last quarter. On an ongoing basis, we're estimating about $10 million in reduced operating costs at the payroll level, and that is all permanent.

Michael: Michael This is Jim yes.

Michael: Yes.

James Francis McCann: Reduced our workforce salaried workforce.

James Francis McCann: This quarter painful thing to do but appropriate under our ongoing works water initiatives, where we will continue to look and say how can we operate more efficiently how can we be more productive and thats going to result in us having a constant.

James Francis McCann: <unk> on our cost and part of our cost structure is obviously a talent.

James Francis McCann: Sure.

James Francis McCann: Sure.

James Francis McCann: It didn't have any impact on last quarter because.

James Francis McCann: In the same quarter, we also have the <unk>.

James Francis McCann: Related severance costs that go along with that so we didn't have.

James Francis McCann: Any benefit in the last quarter on an ongoing basis, we're estimating about $10 million and reduced operating cost with the payroll level and that is all permanent.

Michael A. Kupinski: Gotcha. That's all I have.

Speaker Change: Got you that's all I have thank you.

Speaker Change: Sure.

Speaker Change: Yes.

Operator: Our next question comes from Alex Fuhrman with Gregg Hall. Please go ahead.

Operator: Thank you. Our next question comes from Alex Fuhrman with Gregg Hall. Please go ahead. Hi guys, thanks very much for taking my question.

Speaker Change: Our next question comes from Alex Fuhrman, Craig Hallum. Please go ahead.

Alex Joseph Fuhrman: Hi, guys. Thanks, very much for taking my question.

Alex Joseph Fuhrman: Wanted to ask about same day delivery.

Alex Joseph Fuhrman: It seems like in many ways, that's where the industry is heading.

Alex Joseph Fuhrman: The economics on your orders look like compared to the rest of your business and what do you think happens to your cost structure, if it become table stakes over time.

Alex Joseph Fuhrman: Thanks, Alex. I think the last thing you said is absolutely true. That is, it is going to be table stakes, and we've been saying that in these forums for a couple of years now. So it's something we're working toward, and we're looking forward to more of that. Tom will give you a little color on what the impact of the costs is for us, but the unique model that we've become gives us a real leg up there.

Speaker Change: Thanks, Alex I think the last thing you said is absolutely the case.

Speaker Change: Is going to be table Stakes and we've been saying that in these in these forums for a couple of years now so it's something we're working toward and we're looking forward to more of that Tom will give you a little color on what the impact of the cost for us but.

Speaker Change: Unique model.

Thomas G. Hartnett: The comp.

Thomas G. Hartnett: It gives us a real leg up.

Alex Joseph Fuhrman: And in particular, Tom, if you would, talk about what we're doing now with other products across our portfolio and putting them in the Same Day program, what we're seeing in its very early stages. But Same Day is, as you say, Alex, increasingly table stakes, and we think we're particularly well-positioned to serve our customers better and benefit our community, particularly our last mile fulfillment, which is anchored by our BloomNet network. Tom? Good morning, Alex. You know, so on this, obviously, the same day as...

Thomas G. Hartnett: And in particular, Tom if you would talk about what we're doing now with other products across our portfolio and putting them into same day program. What we're seeing in its very early stages, but at the same day is as you say Alex increasingly table Stakes.

Thomas G. Hartnett: We are particularly well positioned.

Thomas G. Hartnett: To serve our customer better and.

Thomas G. Hartnett: The benefit of our community, particularly our last mile fulfillment, which is anchored by our Bloom that network Tom.

Thomas G. Hartnett: Good morning, Alex. You know, so on this, obviously, same day is something we've been working on for a long time, and we are very involved. 1-800-FLOWERS.COM So, we've seen success, you know, early success with Cheryl's Cookies. We've had confection products with the Sherry's Berries brand where we've been able to bundle those products, or, obviously, our Sherry's Berries products, our fruit bouquet products. So we have a pretty wide swath of products. But there will always be different economics based upon the speed at which a customer chooses to get delivery.

Thomas G. Hartnett: Hey, good morning, Alex.

Thomas G. Hartnett: So on this obviously same day is something we've been at a long time and we are very involved.

Thomas G. Hartnett: Just in our floral with our floral partners and helping them manage delivery costs. So that's something we're all the time for same day. So we're leveraging a lot of that learning as we move further and further into other gifting items.

Thomas G. Hartnett: That we can push into the local markets.

Thomas G. Hartnett: So we've seen success early success with shareholders cookies, we've had confection products with the <unk> berries brand, where we've been able to bundle those products are our obviously, our sherry's berries products, our <unk> products.

Thomas G. Hartnett: So we have a pretty wide swath of products.

Thomas G. Hartnett: There will always be different economics based upon the speed in which a customer chooses to.

Thomas G. Hartnett: To get delivery, obviously, if somebody wants something in two weeks, we probably can be more economical and the way we provide that item to the customer and how we ship. It then our same day.

Thomas G. Hartnett: Obviously, if somebody wants something in two weeks, we probably can be more economical in the way we provide that item to the customer and how we ship it than the same day. We think that as we continue to grow our volume and we learn about, you know, the better ways of forward-deploying product, and really about those rings of fulfillment, et cetera, we can leverage our... are doing that network that much greater.

Thomas G. Hartnett: We think that as we continue to grow our volume and we learn into the better ways of for deploying product.

Thomas G. Hartnett: And.

Thomas G. Hartnett: Really about those those rings of fulfillment.

Thomas G. Hartnett: Et cetera, we can leverage our.

Thomas G. Hartnett: Our our.

Thomas G. Hartnett: Net network that much greater.

Speaker Change: Okay. Thank you so much both do really appreciate the thorough answer there.

Operator: Our next question comes from Linda Bolton-Weiser with DA Davidson. Please go ahead.

Speaker Change: Our next question comes from Linda Bolton Weiser with D. A Davidson. Please go ahead.

Linda Ann Bolton: Yes, hi. So I was wondering about, well, you mentioned on the wholesale side that some retailers, you know, pulled back a little bit on ordering for Easter. I'm just curious if you're getting any early reads about what retailers are thinking for Christmas. And going along with that, I know that the club programs are kind of an important part of things. Do you anticipate a decline in your sales for those club programs this Christmas? Thanks. Hi Linda, how are you?

Speaker Change: Yes, hi.

Speaker Change: So I was wondering about well you mentioned the on the wholesale side, that's a retailer.

Speaker Change: Pulled back a little bit on ordering.

Speaker Change: For Easter I I'm, just curious if youre getting any early read about what retailers are thinking for Christmas.

Speaker Change: And going along with that I know that the club programs or kind of an important part of things.

Speaker Change: Do you anticipate.

Speaker Change: Klein and sort of your sales now.

Speaker Change: Club program this Christmas thanks.

James Francis McCann: Hi Linda, how are you? Wholesale is a piece of our business that gives us an excuse and coverage for infrastructure. So it's not something we want to do well and do better, but it's not something we're going to be very reliant on other than to help us offset the operating expenses that we'd have with or without it. So it's only important in that respect.

Speaker Change: Linda.

Speaker Change: And answer to your question.

Speaker Change: <unk>.

Speaker Change:

Speaker Change: The wholesale is.

Speaker Change: A piece of our business it gives us an excuse and coverage for infrastructure. So it's not something we wanted to do well and do better, but it's not something we're going to be very reliant on other than the.

Speaker Change: Help us offset the operating expenses that we would have with or without it. So it's only important in that respect what we saw last year is itself. The Christmas holiday in calendar 'twenty two weren't as strong as the big boxes were hoping for so they cut back dramatically on their on their buy.

James Francis McCann: What we saw last year is that sell-throughs during the Christmas holiday and calendar 22 weren't as strong as the big boxes were hoping for, so they cut back dramatically on their buys for the calendar 23 holiday period. So that was something we had as a headwind going into this that we knew about because, as you indicated in your question, we had a good line of sight as to what that would look like several months out before the holiday season.

Speaker Change: For calendar 2003 holiday period, so that was something we had as a headwind going into this that we knew about because as you indicated in your question. We have a good line of sight as to what that would look like.

Speaker Change: Several months out before the holiday season.

James Francis McCann: Then Easter was a complication because we had a good Easter a year ago and then this Easter, the big box guys, I think because Easter moved up and that always has a depressing impact on sales for Easter when it's early and it tends to sneak up on people, they cut way back on their Easter orders. So we knew that came up. In answer to the important underlying question of what you asked, I'll ask Bill to talk about what line of sight we have for this year and will it continue, as Linda asked in our question, to be a headwind for us?

Speaker Change: Then Easter was a complication because we had a good Easter a year ago and then this Easter the big box guys I think because Easter moved up and that always has a depressing impact on sales where Easter was earlier.

Speaker Change: Thanks to sneak up on people they cut way back on the eastern orders, So we knew that coming in and answer to the.

Speaker Change: Important underlying question about you ask I'll ask bill to talk about what line of sight that we have for this year.

Speaker Change: We continue as Linda asking a question to be a headwind for us.

William E. Shea: Linda, as we talked about at the end of the second quarter, we took about a $20 million reduction in those big box wholesale orders back in Q2, and about a $10 million hit this year because of the reduction in Easter. We do have some line of sight into holiday next year, and orders will be up next year, so it will not be a headwind; it will be a tailwind. Those orders have not been finalized yet, so to the extent of the increase that we'll get next year, we don't have that locked in yet, but it will be a tailwind, not a headwind. But we don't anticipate it getting back to its pandemic high. No, we expect it to be up, but not to recapture, maybe to fully recover from the high.

Speaker Change: Yes.

William E. Shea: Talked about at the end of the second quarter, we took about a $20 million reduction in those big box wholesale orders back into Q2 and about $10 million hit this year because of the reduction in reduction in Easter. We do have some line of sight into holiday.

William E. Shea: Next year in orders will be up next year. So it will not be a headwind it will be a tailwind.

William E. Shea: Those.

William E. Shea: It has not been finalized yet so to the extent.

William E. Shea: The increase that we will get next year, we don't have that locked in yet, but it will be a tailwind not a headwind, but we don't anticipate getting back towards <unk>.

William E. Shea: Hi.

William E. Shea: Pandemic client.

William E. Shea: No.

William E. Shea: We expect it to be up but not to not to recapture maybe Italy fully will cover from the high <unk>.

Speaker Change: Oh, okay.

Speaker Change: Thanks, and then.

Linda Ann Bolton: Okay. Thanks. On the personalization side, I was wondering, given your commentary about the bifurcated consumer, high versus low, has there been a big difference between PMAL and... I think it's the other line, I think it's called Things Remembered or something like that. Has there been a big difference in the performance of those two lines? And can you kind of comment on how that area is doing in general? Thanks.

Speaker Change: Oh on the personalization side I was wondering given your commentary about the bifurcated consumer high versus low.

Speaker Change: Is there been a big difference between Tmall and.

Speaker Change: Yes.

Speaker Change: The other line I think it's called things remembered or something like that is there has there been a big difference in the performance of those two lines.

Speaker Change: Can you kind of comment on how that area is doing in general thanks.

Thomas G. Hartnett: Good insights there, Linda, of course, but I'll ask Tom to give you some color. I think I think the answer is yes, but Tom Yeah, that is true, Linda, as the personalization of the mall business tends to have a We have seen a little bit more of the impact there on that personalization business. But on, say, right now, because things remembered are still so new, if you remember, we acquired that a year back, and it was just the IP, and we're just starting to get our sea legs under us.

Speaker Change: Good insights there lender of course, but I'll ask Tom to give you a color I think.

Thomas G. Hartnett: The answer is yes.

Thomas G. Hartnett: That is that is true Linda is the personalization.

Thomas G. Hartnett: Small business that tends to have a.

Thomas G. Hartnett: Consumer with a lower household income we have seen a little bit more of the impact there on that personalization business.

Thomas G. Hartnett: But on St.

Thomas G. Hartnett: Say right now because things remembered is still so new if you remember we acquired that a year back and it was just the IP and we're just starting to get our sea legs under us.

Thomas G. Hartnett: We have seen growth that we're very pleased with there, and that appeals to a different demographic, and we see a pretty big delta in average revenue per user, or AOV, for things remembered. So we're very pleased with how things remembered is getting started. It takes a couple of years to get your legs under you, as Tom said, in that business, because you have to select inventory, manufacture it, import it, and get it into stock.

Thomas G. Hartnett: We have but we have seen growth in that we're very pleased with their in.

Thomas G. Hartnett: And that is appealing to us.

Thomas G. Hartnett: A different a different demographic and we see a pretty big Delta in average.

Thomas G. Hartnett: Our.

Thomas G. Hartnett: Four things remember, we're very very pleased with how things remembered as getting started it takes couple of years to get legs under it as Tom said on that business, because you have to select inventory manufactured or imported get it into stock. So it will take us through next holiday season to really get a feel of how it's going but we're really pleased with how it's doing coming out.

Thomas G. Hartnett: So it'll take us through next holiday season to really get a feel for how it's going. But we're really pleased with how it's doing, coming out of the gate. Tom, what is the big selling item we have at Things Remembered?

Thomas G. Hartnett: Tom what does that what does the year the big selling item, we have with things remembered.

Thomas G. Hartnett: is a year-long base that sells very well. It's $180. It's a beautiful item, but it's a strong, strong seller for us and continues to gain strength. And that's a $180 ticket, so I think that goes to the heart of your question.

Thomas G. Hartnett: As of year, along ways that sells very well it's $180.

Thomas G. Hartnett: Beautiful item, but that's a strong strong celebration and continues to gain strength and thats a $180.

Thomas G. Hartnett: Ticket. So I think that goes to the heart of your question Linda.

Linda Ann Bolton: And would the contribution margin for Things Remembered be higher than for PMAL?

Thomas G. Hartnett: And when the contribution margin for things remembered would be higher than for PMO.

Thomas G. Hartnett: The contribution margin is about the same. The labor component of some of the items that we make on Things Remembered can be higher with a little bit less automation, so we're still working through those things. There's opportunity there in the future, but even though we have a higher ticket on the Things Remembered product. 1-800-FLOWERS-COM

Thomas G. Hartnett: Oh.

Thomas G. Hartnett: The contribution margin is about is about the same.

Thomas G. Hartnett: The labor component of some of the items that we make on things remembered.

Thomas G. Hartnett: Can be higher with a little bit less automation. So we're still working through those things theres opportunity there in the future.

Thomas G. Hartnett: But even though we have a higher ticket on the things remember product.

Thomas G. Hartnett: It is less about and the things remembered brand, it's more about the product and the personalization.

Thomas G. Hartnett: And vice versa on the personalization mall side.

Thomas G. Hartnett: Okay.

Linda Ann Bolton: And then, I'm just curious about your workforce reduction. I applaud you for taking action on that front, but I don't recall you taking a lot of workforce reductions just historically. So I'm just wondering how that's sitting, like, is that affecting morale within the company? Maybe you could comment on that.

Thomas G. Hartnett: And then.

Speaker Change: I'm just curious about.

Thomas G. Hartnett: Your workforce reduction I mean, I applaud you for taking action on that front, but I don't recall you taking a lot of work force reductions just historically, so I'm just wondering how that fits.

Thomas G. Hartnett: Like is that affecting morale within the company, maybe maybe you could comment on that.

James Francis McCann: The answer is it's always tough to do. And yes, you're right. We haven't done it that often historically. I think this is only the second time in my memory that we've had to do a significant RIF. I think what you'll see from us going forward is that we have a new sense of talent management. And I think, frankly, it's not unique to us.

Thomas G. Hartnett: Linda It's Jim I'll start there the answer is it's always tough to do.

James Francis McCann: And yes, Youre right, we havent historically, we havent done that often I think this is only the second time in my memory that we've had to do a significant growth I think what youll see from US going forward is that we have a new sense of talent management and I think frankly, it's not unique to US I think you see.

James Francis McCann: I think you're seeing, you know, when a company like Google, which has really never had large layoffs or layoffs of any kind in their history, is now telling their people that talent management is going to be a regular part of how they think about their costs and how they manage their company going forward. So, too, us. That is, you're going to have growth areas in your company where you're going to be staffing up.

Thomas G. Hartnett: When a company like Google, we've really never had large layoffs or layoffs of any kind in the history and now telling their people that talent management is going to be a regular part of how they think about the cost and how they manage the company going forward. So to us that is youre going to have growth areas of the company, where you are going to be stepping up and <unk>.

James Francis McCann: And even in the last couple of weeks, we've had a couple of really significant hires in our management ranks that we've just initiated to continue to staff up areas where there's growth, where there's opportunity, and sometimes an area that you're not emphasizing as much as you used to will require us to move people or, in some cases, remove some folks. So I think we have a different ongoing attitude about talent management.

Thomas G. Hartnett: Even in the last couple of weeks, we've had a couple of really significant hires in our management ranks that we've just just initiated.

Thomas G. Hartnett: Two two.

Thomas G. Hartnett: We continue to step up the areas, where there is growth where this opportunity and sometimes an area that you're not emphasizing as much as used tool requires a move people or in some cases.

Thomas G. Hartnett: Removes some folks so I think we have a different ongoing attitude about talent management I don't anticipate that we'd have to do other risks.

James Francis McCann: I don't anticipate that we'd have to do other rifts of any size going forward, but we will always, from a work smarter point of view, be managing our talent in a very proactive way to make sure we're staffing growth opportunities and minimizing our exposure and our expenses on the areas that aren't growing or don't have the same promise going forward.

Thomas G. Hartnett: Any size going forward, but we will always from our work smarter point of view the managing our talent in a very proactive way to make sure we're staffing the growth opportunities and minimizing our exposure in our expenses on the areas that aren't growing or don't have the same promise going forward.

William E. Shea: And Linda, Work Smarter, and we've talked about this for several years now, is really much broader than just labor management. It is all about operating more efficiently and driving costs out of the business. We've talked a lot about technology and automation and how that's driven down our costs in our production areas; we've talked about logistics, inventory management to drive down our cost per cost of the package, incorporating spending negotiations, and marketing efficiency, moving from some bottom of the funnel where the digital rates have continued to rise to more efficient marketing spend. So it is a much broader area of ultimately continuing to look at how we can operate this business more efficiently and drive costs out of the business.

Thomas G. Hartnett: Inland work smarter and we've talked about this for <unk>.

Thomas G. Hartnett: For several years now is really a much broader than just labor management or it is all about operating more efficiently and driving cost out of the business. We've talked a lot about technology and automation and how that has driven.

Thomas G. Hartnett: Driven down our costs in our production area.

Thomas G. Hartnett: In our production areas.

Thomas G. Hartnett: We've talked about logistics inventory.

Thomas G. Hartnett: Management to drive down our cost per.

Thomas G. Hartnett: Package.

Thomas G. Hartnett: Incorporate expanded negotiations marketing efficiency moving from some bottom of the funnel.

Thomas G. Hartnett: For digital right.

Thomas G. Hartnett: We have continued to.

Thomas G. Hartnett: To rise to more efficient marketing spend so it is a much broader area of ultimately continuing to look at how we can operate this business more efficiently and drive costs out.

Speaker Change: Okay, well, thanks for everything and good luck. Thank.

Speaker Change: Thank you Linda.

Thomas G. Hartnett: Okay.

Linda Ann Bolton: Okay. Well, thanks for everything, and good luck. Thank you, Linda. Our next question comes from Anthony Lebiedzinski with CIDOT.

Operator: Our next question comes from Anthony Lebiedzinski with TDOT. Please go ahead.

Thomas G. Hartnett: Our next question comes from Anthony the bids.

Anthony Chester Lebiedzinski: Please go ahead.

Thomas G. Hartnett: Yes.

Anthony Chester Lebiedzinski: Hi, Good morning, guys can you hear me.

Thomas G. Hartnett: Yes.

Thomas G. Hartnett: Alright, this is different year one for Anthony.

Thomas G. Hartnett: How much was average order value during the quarter and are you seeing success with doing more multi branded bundles.

Anthony Chester Lebiedzinski: Well, there's a short question, but there are a couple of pieces to it. Bill will touch on what the average order was. I'll tell you the average order is increasing, and we're not thrilled with that. It evidences and supports the theory that our higher income customers are weathering this period better than our lower income customers, number one. Number two, when I say we're not thrilled with the rise in average order value, it causes Bill to have heart palpitations.

Thomas G. Hartnett: Okay.

Speaker Change: A short question, but a couple of pieces to it.

Speaker Change: Bill will touch on what the average order was I'll tell you. The average order is increasing and we're not thrilled with that as evidence that supports the theory.

Speaker Change: Net.

William E. Shea: With that.

William E. Shea: <unk> better or higher income customers are as well.

William E. Shea: Weathering this period better than a lower income customers.

William E. Shea: Number one number two when I say, we're not thrilled with the rise in average order value that causes builds that have harp applications, but that's the reason I would say, we're not thrilled with that is because I'd, rather see us have a broader range of price points. Many more accessible price points and you see you will see and have seen our efforts to do that and then the third.

Anthony Chester Lebiedzinski: But the reason I say we're not thrilled with that is because I'd rather see us have a broader range of price points, many more accessible price points. And you'll see and have seen our efforts to do that. And then the third piece of your question is around bundles. So I ask Bill to start with the average order value, and then Tom to talk about the success we've seen with bundles, which goes back to a question that Alex asked earlier about what we're seeing with our last mile delivery capabilities and how that's benefiting our bundles, which are a collection of more than one of our brands.

William E. Shea: Third piece of your.

William E. Shea: Question is.

William E. Shea: It was around bundles, so I'll ask bill to start with the average order value and then Tom to talk about the success, we've seen with bundles, which goes back to a question that Alex asked earlier about.

William E. Shea: What we're seeing with our last mile delivery capabilities, how that's benefiting our bundles, which is a collection of more than one of our brands. Yes. So the average ticket during the quarter was $79, it's up about one 5%.

William E. Shea: So the average ticket during the quarter was $79. It's up about 1.5% year-over-year. To Jim's point, a lot of that is driven by these bundles and ultimately the pricing elasticity that we have. So we have been introducing more higher-priced items that appeal to the affluent consumer that's continuing to buy. Part of that is the bundles that Tom will describe, but we've also introduced a number of lower-priced point items.

William E. Shea: Year over year to Jim's point, a lot of that is driven by.

William E. Shea: By these by these bundles and ultimately the pricing elasticity that with that we have so we have been introducing more higher price items.

William E. Shea: Feed that the affluent consumers continuing to buy part of that is the bundles that Tom will describe.

William E. Shea: We've also introduced a number of lower price point items as well to generate interest in.

William E. Shea: Orders from.

William E. Shea: Less affluent consumer.

Thomas G. Hartnett: Yes, it's a highlight again on the... Part of this is, I don't think we answered your specific question. We rose, AOV was $79, we didn't, I apologize, so our bundles continue to do great, we're exceeding our expectations, and we recently, for the holiday season, we launched a new bundle series between our personalization mall business and our Harry and David business. And to give you a good example of our charcuterie board, where we have a personalized cutting board that is delivered together as one discrete gift.

William E. Shea: Some of you were slightly again on the.

William E. Shea: Yes.

Speaker Change: This is so I don't think so to your specific question.

William E. Shea: Rose.

William E. Shea: <unk> was $79 at Rosemont.

Speaker Change: I apologize.

Speaker Change: Our our bundles continue to too.

Speaker Change: Great we're exceeding our expectations we recently.

Speaker Change: For the holiday season, we're continuing this with.

Speaker Change: Launched a new bundle series between our personalization mall business and our Harry <unk>, David business and to give you a good example of our Charcuterie Board, where we have a.

Thomas G. Hartnett: And the board is personalized with the family name on it. The board is personalized, an example. So just like we were talking about with Cheryl's Cookies, we have bundles that are doing great. Some of the others we talked about is a wine gift that we're bundling with a whole assortment of different products from different brands. We have this wonderful gift for Mother's Day, which is a Harry and David prepared mirror, which is prime rib, but we're also bundling it with Sherry's Berries in a floral arrangement.

Speaker Change: Personalized cutting board that has delivered together as one as one discrete gift.

Speaker Change: And the board is personalized broken the board laminate borders Personalizing example, so just like we were talking about with the.

Speaker Change: Shareholders cookies, we have bundles.

Speaker Change: That are doing great with now and bundling those with floral gifts.

Speaker Change: <unk>.

Speaker Change: Some of the others, we talked about it.

Speaker Change: Wind gifts that we're bundling with a whole assortment of different products throughout the different brands. We have this wonderful gift for mother's day.

Speaker Change: Which is.

Bill Shea: Harry <unk> David.

Speaker Change: Paired mirror, which is prime rib, but we're also bundling with sherry's berries.

Thomas G. Hartnett: Floral arrangement, we think thats going to be.

Thomas G. Hartnett: We think that's going to have great appeal. It's selling for $699, so I think that's going to have great appeal for some of our affluent customers. We continue to push heavily into the bundles model, and our merchants have done a great job of being very creative and coming up with great ideas that our consumers are gravitating towards. I'm so happy to see.

Speaker Change: Great appeal selling for $699.

Thomas G. Hartnett: And have a greater appeal for some of our affluent customers. So we'll continue to push heavily into.

Thomas G. Hartnett: The bundles model.

Thomas G. Hartnett: Our merchant team has done a great job of being very creative in coming up with great ideas that our consumers are gravitating towards so happy to see.

Speaker Change: Thank you for the color there.

Operator: As a reminder, if you wish to write a photo question, you must press star and 1. Our next question comes from Doug Lane with Watertower Research. Please go ahead.

Michael Kupinski: As a reminder, if you wish to wait for the question Lucas.

Operator: Yes.

Jim McCann: Our next question comes from Doug Lane with Walter Publishers. Please go ahead.

Doug Lane: Yes, hi, good morning, everybody. I just have a couple things here.

Speaker Change: Yes, hi, good morning, everybody.

Doug Lane: I just have a couple of things here.

Doug Lane: I look at the third quarter EBITDA loss of $5 7 million and Thats, not really too far from where that quarter was pre COVID-19 and through nine months. Your gross margin is 40%, 41% and again not too far from where you were pre COVID-19. So I guess my question is how close are you with regards to reverting to the mean on your cost structure.

Doug Lane: You know, I look at the third-quarter EBIT loss of $5.7 million, and that's not really too far from where that quarter was pre-COVID. And through nine months, your gross margin is 40%, 41%. Again, not too far from where you were pre-COVID. So I guess my question is, how close are we with regard to reverting to the mean on your cost structure?

Doug Lane: Okay.

Doug Lane: Yeah. So from a margin perspective, if you look at Doug If you look at our kind.

William E. Shea: So from a margin perspective, you know, if you look at, you know, Doug, if you look at a, you know, kind of 10-year history from 2012 to 2021, you see us in that, you know, 42% range, give or take, you know, 50 basis points. You know, we had a low point of 37.2 a few years ago, and we've been climbing back, and this year, we've obviously made great progress on that.

Doug Lane: 10 year history from 2012 to 2021, you're sourcing that that 42% range give or take 50 50 basis points.

William E. Shea: We had a low point of 37 two.

William E. Shea: A few years ago, and we've been climbing back an issue.

William E. Shea: <unk> made great progress on that.

William E. Shea: At the beginning of the year, you know, we had guided that we'd be in the low 39%, you know, percent for the year, and we upped that after the second quarter and now anticipate that, you know, our margins will exceed 40% this year and be in the low 40s, 40, you know, 40.1%. So we're climbing back, but we're not all the way there yet, and, you know, we do think there's still opportunity for us and that we're going to kind of revert back to our historical mean of 42% over the next couple of years.

William E. Shea: Beginning of the year, we had guided that we'd be in the low 39.

William E. Shea: <unk> for the year and we upped that.

William E. Shea: After the second quarter and now anticipate.

William E. Shea: <unk> debt.

William E. Shea: <unk> will exceed 40% this year and be in the low 40%, 40%, 41%. So we're climbing back but we're not we're not all the way there yet.

William E. Shea: And we do think there's still opportunity for us and that we're going to kind of revert back to historical mean of 42% over the next couple of years.

Speaker Change: No you're getting pretty close any way im looking at the balance sheet here and I have to ask what's the what's the.

Doug Lane: Well, you're getting pretty close. Anyway, I'm looking at the balance sheet here, and I have to ask, what's the...

Speaker Change: The acquisition front look like.

Speaker Change: Are you still prioritizing acquisitions and your growth strategy and what's the environment like these days.

James Francis McCann: Well, I think, Doug, this, Jim, the overall environment, I'd say, was that a lot of smaller companies, particularly 1-800-FLOWERS.COM, So we announced an acquisition, we talked about an acquisition just a few weeks ago. But we don't even really look at that as an acquisition. We see that as a talent acquisition. We see that as a capabilities acquisition. It comes with very little revenue but a very talented technology team that fits in very nicely with our existing team.

Doug Lane: Well I think Doug this is Jim.

James Francis McCann: The overall.

James Francis McCann: Overall environment I'd say is that a lot of smaller companies, particularly.

James Francis McCann: Earlier stage companies are really having a hard time finding capital if they don't have profitability are clear.

James Francis McCann: Short term path to profitability, so it's a target rich environment.

James Francis McCann: We're being very judicious about what things we can bring consideration too so we announced an acquisition.

James Francis McCann: Just to talk.

James Francis McCann: <unk> talked about an acquisition just to.

James Francis McCann: A few weeks ago.

James Francis McCann: We don't even really look at that as an acquisition, we see that as a talent acquisition, we see that as a capabilities acquisition. They come from very little revenue, but very talented technology team fit.

James Francis McCann: Fit in very nicely with our existing team, we're using that to improve our capabilities.

James Francis McCann: We're using that to improve our capabilities. We're making a lot of effort in terms of our portfolio of products that we have. So I don't think we need to do any acquisitions to achieve our near-term objectives. We will be opportunistic if we find something that really does fit our portfolio well, and we'll continue to do these tuck-in kind of talent acquisitions that really buttress our capabilities of providing a full experience for our product. Helping them to have more and better relationships and providing them with a different blend of services. So I think it's a good environment, but we're

James Francis McCann: Spending a lot of effort in terms of our portfolio of products that we have so I don't think we need to do any acquisitions to achieve our near term objectives. We will be opportunistic if we find something that really does fit our portfolio well.

James Francis McCann: And we'll continue to do these tuck in kind of talent acquisitions that really buttress our capabilities of providing a full experience for our consumers, helping them to have more and better relationships and.

James Francis McCann: Provide them with a different blend of services so.

James Francis McCann: I think it's a good environment, but we're being very judicious about what kind of a company that we want to be what capabilities do we need to really serve our customers. We already have an enormous database how else can we serve those customers in that database is our primary objective bill or Tom any color, Yeah, I was going to say I mean.

William E. Shea: Yeah, I was going to say, you've seen us do big acquisitions over the years with Harry & David and Personalization Mall. You've seen us do tuck-in acquisitions with the Sherry's Berries and Things Remembered type of items, and you've seen us almost like acqui-hires, you know, over the last year or so with, you know, Smart Gift and now Cardisle to kind of bring capabilities to the company that will, you know, help, you know, enhance the offerings that we have for our customers.

William E. Shea: <unk> seen us do big acquisitions over the years with Harry <unk>, David and personalization mall, you've seen us do tuck in acquisitions with the cherries berries and things remembered type of items and you've seen us almost like aqua hires over the over the last year or so with.

William E. Shea: Smart gift and now at call it I'll keep going.

William E. Shea: Bring capabilities to the company that will help enhance the offerings that we have for for our customers and with <unk>. It does give us an offering the greeting cards that are at the low price points that consumers can interact with us and we want our customers to come and visit us and interact with us more frequently.

William E. Shea: And with Cardisle, it does give us an offering to come up with greeting cards that are at low price points that our consumers can interact with us. And we want our customers to come and visit us and interact with us more frequently.

Doug Lane: Great. That's very helpful. Thanks, guys.

Speaker Change: Great. That's very helpful. Thanks, guys. Thanks, a lot.

Speaker Change: Ladies and gentlemen, this was our last question.

James Francis McCann: Well, thank you all. Thanks for your interest and for your good questions. Any other follow-up questions you have, we'll be happy to chat with you one-on-one. We'll be happy to do that today, tomorrow, or any time during the day. Reminder, we're at the beginning of the Mother's Day push here, so all the wonderful moms in your life, we're here with a beautiful selection of gifts from all of our portfolio brands to help you express yourself in just the right way to the women in your life who are moms or have had a very mom-like influence on you and the people around you. So enjoy the upcoming Mother's Day holiday, and thanks for your interest and

Speaker Change: Well. Thank you all thanks for your interest and your good questions.

James Francis McCann: The other follow up you have will be happy to chat with you one on one.

James Francis McCann: We will be happy to do that today tomorrow anytime.

James Francis McCann: Future reminder.

James Francis McCann: At the beginning of the mother's day push here so all of the wonderful moms in your life.

James Francis McCann: Beautiful selection of gifts from all of our portfolio brands to help you Express yourself in just the right way to the women and Youll LIFO, our moms or had a very modern like influence on you and the people around.

James Francis McCann: Enjoy the upcoming mothers day holiday, thanks for your interest and time today.

Operator: Ladies and gentlemen, the conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Speaker Change: Ladies and gentlemen, the gold price has now concluded. Thank you for attending today's presentation you may now disconnect.

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