Good afternoon, and thank you for standing by. Welcome to the Deckers Brands’ Fourth Quarter Fiscal 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct the question-and-answer session. Instructions will be provided at that time for you to queue up for questions [Operator Instructions]. I would like to remind everyone that this conference call is being recorded. I will now turn the call over to Erinn Kohler, VP of Investor Relations and Corporate Planning. Please go ahead.

Hello, and thank you everyone for joining us today. On the call is Dave Powers, President and Chief Executive Officer and Steve Fasching, Chief Financial Officer. Before we begin, I would like to remind everyone of the company’s Safe Harbor policy. Please note that certain statements made on this call are forward-looking statements within the meaning of the federal securities laws, which are subject to considerable risks and uncertainties. These forward-looking statements are intended to qualify for the Safe Harbor from liability established by the Private Securities Litigation Reform Act of 1995. All statements made on this call today, other than statements of historical facts, are forward-looking statements and include statements regarding the impact of COVID-19 on our business and industry, changes in consumer behavior and the retail environment, strength of our brands and demand for our products, changes to our distribution and inventory management strategies and our anticipated financial performance, cost savings and liquidity position. Forward-looking statements made on this call represent management’s current expectations, and are based on information available at the time such statements are made. Forward-looking statements involve numerous known and unknown risks, uncertainties and other factors that may cause our actual results to differ materially from any results predicted, assumed or implied by the forward-looking statements. The company has explained some of these risks and uncertainties in its SEC filings, including in the Risk Factors section of its annual report on Form 10-K and quarterly report on Form 10-Q. Except as required by law or the listing rules of the New York Stock Exchange, the company expressly disclaims any intent or obligation to update any forward-looking statements. Please note that throughout the discussion, there maybe references to certain non-GAAP financial measures for comparable prior year results. These non-GAAP financial measures refer to results before taking into account non-recurring charges that are not believed to be core to our ongoing operating results. Our non-GAAP financial measures are not adjusted for constant currency. While we are not reporting any non-GAAP financial adjustments for the fourth quarter of fiscal 2020, a reconciliation between our reported GAAP and non-GAAP results for the prior year can be found in our earnings release that is posted on our Web site under the Investors tab. With that, I will now turn it over to Dave.

Thanks, Erinn. Good afternoon, everyone. As our fiscal year 2020 came to an end, communities around the world were experiencing impacts from the spread of the COVID-19 pandemic. On behalf of the Deckers organization, I'd like to extend our thoughts to everyone affected by the virus and share our deepest gratitude to all the individuals on the frontlines of this crisis, especially the healthcare workers and first responders. I'd also like to thank all of our employees for their efforts during this unprecedented time. The entire Deckers organization understands that this is a very difficult time for many people. I'm proud of how our employees and brands have risen to the occasion to serve communities in need through programs such as our better together initiative that we launched to support COVID-19 pandemic relief efforts. Through monetary contributions, we're working to support small businesses in our communities and the individuals they employ. In addition, our brands are contributing in kind donations of product. To-date we've donated over 10,000 pairs of shoes to first responders and essential workers. At Deckers, we believe doing good is essential to the success of our employees, brands and organization as a whole. We'll continue to do our part and supporting those in need through these trying times. We're all in this together. Given the extraordinary circumstances, today's dialog is going to follow different structure than our past earnings calls. To outline, I'll begin with a discussion on how we're responding to and navigating through the crisis. Then give an update on the status of our operations, as well as walk through some of the trends we're seeing in the business through the first half of our first quarter. And finish with a condensed overview of our fourth quarter and fiscal year 2020 performance, which will include…

Thanks Dave and good afternoon, everyone. Before we jump into our fourth quarter and fiscal year 2020 results, as well as an overview of our approach to managing the business in this unprecedented environment, I'd like to take a moment to highlight the strategies we've implemented over the past few years. The actions we've taken have built a more efficient business and created a strong framework and solid footing to navigate the current uncertainty. More specifically, we've implemented the UGG domestic wholesale marketplace management strategy; reducing the risk of excess inventory in the wholesale marketplace and lowering the risk of default with a smaller and healthier account base; built a strong partnership for the HOKA brand in the run specialty channel, driving awareness and customer affinity, while also capturing accelerated demand through direct-to-consumer; invested in digital infrastructure and marketing for all our brands to deliver a compelling consumer experience; shifted cost structure by reducing fixed costs and investing in variable categories; consolidated our factory base to work with financially strong partners with diversified operations outside of China; and made a targeted improvement to Teva and Sanuk profitability. The flexibility of our operating model is serving us well during these challenging times, allowing us to effectively navigate the current environment. We believe that our past and ongoing efforts provide the foundation to proactively manage through the COVID-19 disruption. We're working from a relative position of strength as compared to our peers due to the significant operating enhancements we've made over the past few years. Our actions drove improvements of over 600 basis points to our non-GAAP operating margin as compared to fiscal 2017, and more than doubled cash and equivalents to $649 million at the end of our year fiscal 2020. Now moving to our results. While we ended the year…

Thank you, Steve. As I reflect on the year's performance, my key takeaway is recognizing the strength of our brand, along with an appreciation for their commitment to staying purpose driven. The power of each brand lies within the authentic connections they forge with their respective consumer base. Each of our brands remains open for business and are here to serve consumers during this uncertain time. Special thanks to our employees in the frontline, including our warehouse teams, retail associates and customer service agents, who continue to deliver and serve our customers in these extraordinary circumstances. As we look towards adapting operations to endure the near-term challenges, we're doing so with our sights on the future. We are evaluating our business strategically and intend to emerge from this pandemic with new opportunities and additional strength in the Deckers portfolio. As we navigate forward, I am confident that the Deckers organization will embrace challenges, adopting new ways to collaborate, thrive and inspire each other, as we build in our foundation to become stronger. Through it all, we will develop ways to improve our business, including innovations within our planning, production and the delivery of compelling product to the market. As we evolve these operations, we’ll be mindful to preserve the progress we've made and we’ll stay true to their underlying strategy. The Deckers organization will overcome near-term hurdles, while setting our sights on the goal of emerging stronger. With that in mind, we will continue to fuel the HOKA brand with digital marketing campaigns and virtual touchpoints to engage with consumers; focus on what matters in UGG, leaning into key styles and protecting marketplace management progress; enhance our e-commerce capabilities and digital presence in the omni-channel atmosphere, as we look to accelerate even faster during and beyond this crisis; and stay true to the Deckers spirit becoming better together as we evolve and innovate in the face of challenge, looking to continually develop and improve our operations and community. Overall, in the current environment, our company, brand and balance sheet are well positioned. We will manage the business with a high level of flexibility throughout the rest of the year. Thank you to all of our stakeholders. On behalf of the entire organization, I hope everyone is staying healthy and safe during these times. With that, I'll turn the call over to the operator for Q&A. Operator?

Thank you. We will now begin the question-and-answer session [Operator Instructions]. Our first question today comes from Jonathan Komp with Robert Baird.

I wanted to maybe just start off, broader question on the wholesale environment and you shared some detail there. I just want to get a sense of your handle on the state of things, inventory and even some of the discussion about orders, trends that you're expecting. Just any way to frame up the range of variants or any other color that you can give as you think about the balance of the year on the wholesale side?

First of all, I also want to say, hope everybody on the call is safe and healthy with their families, and appreciate everybody listening in. We are and we have since over the last few years built very, very strong relationships with our key wholesale partners. And I will say the teams on a weekly if not daily basis are having conversations with these partners to navigate through this what’s happening in the business now. As you heard on the call, the script, the wholesale business right now is actually performing very well from a sell through perspective, and the order book is holding pretty well for the back half of the year. And what we're hearing from our wholesale partners from an UGG perspective is they're still confident that UGG is going to be a key brand for them in the back half of the year. We’ve heard that they need to be successful in the holiday timeframe as we all know. And the current trend is happening with Fluff Yeah program, Flipper and Neumel things are progressing well. So certainly there's challenges with store opening, but we are seeing in our business and also some of our key partners, very strong uptick in e-commerce, which is making up some of that loss in stores. And I think with stores opening hopefully here and key partners over the coming months, we'll see some improvements there. So the outlook right now seems very, very good confident about it. We're hearing from our partners that UGG is going to be a key brand in their portfolio for the rest of the year. They are making cuts and so we are just being mindful of that and monitoring it. But so far the first five or six weeks into the quarter, I think they’re [indiscernible] nicely for UGG and then same with HOKA. I think what we're finding is both HOKA and UGG are proving to be really important brand for consumers right now. UGG on the work from home comfort, lifestyle perspective, it's nice to know that when people think of comfort and home and casual, they do think of UGG first and foremost. And then a lot of consumers, as you all know, are doing home workouts and trying to exercise more. And so that trend is also continuing to keep HOKA as a critical brand. And I think you’ve seen that in the Google Trends data that came out that we referenced in the script. The brands are demand. We’re challenged with wholesale store openings at our own store openings. But we think the outlook where we stand today looks good.

And just to add on to that a little bit, because I think you were referencing, where we gave the quarter-to-date update and talked about wholesale being down kind of mid-30%, that's really because stores are still close. So with wholesalers that have a strong online presence, they are doing well and sell through is doing well and that's what we're seeing, that's where we're also seeing a strong e-commerce business on our side. So more so what we're seeing is the result of the wholesale being down is still stores being close with our wholesale accounts, but those that are doing business online are actually doing very well and sell through as well.

Yes, and I think it’s key to understand this is a smaller portion of our total year. And so while the trends right now look good, especially in the context of the situation we're all in, it’s promising we have a long way to go. We don't know yet of reward we were going to get as wholesale is continuing to manage tightly over there.

And then just a follow-up on HOKA and the kind of directional color around the growth you're expecting this year. Could you just expand a little bit more on the drivers that you see? I know you talked about pulling back on some of the launches, but maybe maintaining flexibility on marketing. And I know you have some new apparel product, limited portion in the marketplace. So maybe just comment a little bit more on the drivers you see there?

Yes, I think it’s a couple of things that are happening for HOKA. One of the things we wanted to do, first and foremost, we want to protect the positioning and the strength and the distribution that Erinn has built over the last three or four years. That is first and foremost. We see HOKA being around for a long time, being very important brand in the industry for a long time. And we're taking a long range approach to this. So what the team did is pushed out some of the launches of products where that has allowed for our partners and our sales to sell through inventory products that’s already in the pipeline at full price. If you've been paying attention to the HOKA brand that are on the marketplace you will see there’s little to no discounting on the brand, that's because we managed inventory tightly. There's no reason to just kind of because it’s selling through well the margins are high and our partners are benefiting from that high average retail and margin. And then staggering some of the lunches throughout the year to be in line with where the demand is and the inventory level. The whole ecosystem, which is what we like to call, the combination of strategic partners in our online business is performing very well. And we're driving more business to our e-commerce site which is great because we're acquiring more consumers and that's driving up margins a little bit in short-term right now as well. So still optimistic, we know this is going to be a headwind for the brands. But right now full price selling is strong. We still see this as a growth brand, even though this year will be challenging and getting back to high level of growth coming from '22 and beyond. So the goal is protect the brands, maintain tight distribution, maintain full price selling, more of a pull model from consumers and continue to do that with powerful launches. And we have some great innovative launches coming through in the next eight to 10 months.

The next question comes from Jim Duffy with Stifel.

To start Dave, I wanted to ask, a few times in your prepared remarks, you mentioned planning for a new normal and future state of the business. Can you share in the post pandemic world and maybe how you're thinking about the new normal and future state of the business, specifically for the UGG brands and some of the things you're doing to prepare for that?

Yes, you know we had a lot of conversations just around that what is the new normal. I think they're just trying to figure that out. And for us, there's a couple things. From a employee standpoint, we are seeing some positive results from the work from home scenario or situation, both in the ability to stay connected and make decisions faster, which I think is great and then beneficial to the team and also allows us to be more efficient in our spend and reduce travel. So there has been from an operation and employee workforce perspective that we will probably continue in the long-term, leveraging technology to reduce travel, using 3D and imaging for our failed samples and reducing cost there. There's a lot of good benefits. The things that we knew and we're working on but we've had the opportunity right now through technology to accelerate some of those things. From a business standpoint, like we've been saying for the last two years now, we see a handful of really strong strategic wholesale partners, leveraging them to access to consumer and across the different demographics of our consumer base and that's emerging, and then really continuing to fill our DTC business. And so we've shifted pretty dramatically the marketing efforts to be much more in tuned with what's happening in the consumer now. We're using a lot more user generated content, leveraging in TR and we're getting fantastic response to that. So I think you're going to see a shift to faster product to market, faster adjustments in digital marketing, continuing to fuel our DTC business overtime and continuing with the strength of franchise style where the real upside to the brand long-term is. And I think this is the first time we've seen this kind of reaction to the UGG brand in spring and summer. And I truly believe that even without this situation, the UGG plus sandal franchise would have been an exciting product in this environment. And so those are the kinds of things that we're going to continue doing. I would say, bigger and more powerful, closely related to the brand DNA launches, leveraging our partners to reach consumers with new products and really filling DTC from a long range plan perspective.

Can I ask you to elaborate some on the merchandising strategies for this fiscal year with the UGG brand? Can you talk more about balancing newness with concentrating the merchandising assortment and known high velocity styles?

So there's two keys to that. One is, we wanted to reduce the inventory in styles that were seasonally light with seasonal liability. So styles that were in and out one time styles that really in the scheme of things weren't generating a lot of volume. So the teams went back in the first week of the shutdown that in March, this is across all of our brands. We went through and adjusted buy really reduced SKU count anywhere from 20% to 30% going into the back half of the year to protect our level of margin liability and inventory in the channel. But more importantly really focusing on the big drivers of the business. And so I think you're going to see continued newness and things like our Fluff franchise. We have another launch coming out in June, the pride launch that just hit. There’s another launch from that product in September and we have a lot of these planned. But what we've realized is the combination of UGG DNA and comfort and fashion is our formula to success. And we want to continue that with fewer styles but bigger volume, bigger impacts on us going forward. And then we also have our apparel launch this year that we talked about we're doing a pretty aggressive launch that was originally planned, it was something to do with DTC and some of the key wholesale stores with Nordstrom. So we’re staying close but we're just getting more focused and disciplined and focus on speed along the way.

Next question comes from Camilo Lyon with BTIG.

So a couple questions. So you talked about your backlog through mid maybe flattish. And you also said that you are contemplating or expecting more cancellations to happen but you haven't seen those yet to a large degree. So couple of questions on that. Can you tell us at what point in the year will you stop accepting cancellations? We're getting other than that window where we're a couple months away from shipments of fall starting to unfold. And it seems -- and it’s early days, but it does seem that as stores start to reopen, the trends are less bad than initially feared, generally speaking. So I'm just curious to know how you're thinking about that?

It's a good question. I think if that goes through kind of our scenario planning. So at this stage as wholesale accounts are still opening up, we want to see outdoors open up in terms of what the demand is, it goes back a little bit to the first question where we're seeing, I think initially and it's still early on and it’s kind of the high proportion of e-commerce sales in the first part of this quarter, then it shifts to wholesale. But with the strength of e-commerce, it’s giving us confidence in product sell through and wholesale accounts that are selling online or having strong sell through. So at this stage, we think it's still a little early to kind of call it in terms of when we call the line in terms of cancellations. We are working with accounts to understand where their product is, what the product is selling through. We have wholesale accounts. We have both online and physical presence. They're trying to use what they're learning from their online sales to help formulate an opinion kind of on physical store. So it's still ongoing. I think we've learned more in the last couple of weeks. We continue to see strong sell through. And I think it's giving some of our wholesalers confidence in how UGG is performing. So, again -- not providing guidance. But as we were thinking about the year and being cautious about what potentially could happen, recognizing we're still in the smallest part of our year, so first quarter representing less than 12% of our business, is just being a little bit cautious. We do have inventories. So we can fulfill orders but we want to be a little bit cautious in terms of what we're ordering. And we'll use what we're seeing to kind of educate us on how to think about kind of backlog from cancellations. But at this point, we just felt that it's prudent to be a little bit cautious and we expect that we'll see some more cancellations. But as we indicated in the change in the backlog, we have some cancellations. And we probably think it's a good part of the cancellations and then we'll see what happens as stores reopen.

Yes, and we just initiated our last buy for the holiday season over the last week or so, had a lot of conversations with the wholesale team validating assumption from some of our wholesale partners. And where we decided to land is we're going to buy for reorders and in the past, we would buy a little bit more cushion on the upside. We have some good core inventory we're carrying over. We’ll buy to the orders but we are expecting to see some cancellations as things progress. But the order book is also shifting between partners as people with more online presence are doing better than people with more store relevant, physical store reliance business. But it sits within the mix and then as the order book as we said still looks good and we’re buying for that order book, and then we put ourselves in the chase position things are better than planned.

And then my follow-up is, if you take -- so you've given great color on the wholesale order book and how you're planning and how you'll build to orders inventory. Are you taking a comparable approach to the DTC business? It's now almost 40% of the business. So, are you taking a little bit more of a proactive approach in allocating more or better inventory to your DTC channel?

We made some shifts obviously between what the expectations were have been for stores and e-commerce. So no surprise we're seeing a better business in e-commerce right now, obviously, because the stores are closed. We think that trend will continue. One of the big benefits of having a good e-commerce business right now is we're acquiring a lot of new consumers, and a lot of new young consumers in both HOKA and UGG that we can go back to in the holiday time frame. So we're optimistic that we're going to continue to have a strong online presence and online business. Shipping inventory but we can share easily between online and retail and then we are planning for more potential closeouts, if there are cancellations that we can funnel through those DTC channels as well with higher margin. So little bit more conservative there, but we do think in key styles of franchises that there is upside to e-commerce and we put that into our expectations.

So is it safe to say that your DTC plan is a little bit less conservative than what your wholesale plan is?

Yes, I think that's fair.

The next question comes from Sam Poser with Susquehanna.

I guess just to follow up. On the wholesale side of things, especially with HOKA on your partner's direct-to-consumer business -- on your partner's e-commerce businesses. Are you utilizing a good deal of drop ship right now? So you're basically reacting directly to the customers demands through their Web site, so you're doing a bit of that at the moment?

We're doing small portion because a lot of those are smaller independent, so we're doing some of that but it's not a big part of our overall business at this time. We’re available and we’re offering it for sure.

And then in the near-term, Steve, are you seeing sort of -- because of the way the business is going and such a shift to e-commerce and so on? Are there any structural gross margin headwinds in the near-term? Just because of the state of the market, not necessarily because you have -- it would be more on the fixed costs kind of situation rather than merch margin?

What I would say on the near-term is and again, what we've seen in kind of the quarter to date is with a higher proportion of e-commerce, gross margins are contributing to an improvement in margins on the higher gross margins associated with that. Some of that will shift this as the bulk of remaining quarters shift to kind of wholesale. And then I think we'll have to see as we emerge from this kind of economic pressure. But in terms of kind of some margins as a higher proportion of our business in the first few weeks of the quarter have been more heavily on e-commerce, we're seeing some margin improvement there. We'll see a little bit of a shift as we see more wholesale being fulfilled in the back half of the first quarter. And then again, not provided guidance. But as we look at the balance for the year, we'll see how things develop in terms of promotions. And then in terms of how we're thinking about the organization as we talked about, it is shifting some resources to e-commerce to help drive the increased traffic that we're seeing there. So where we're finding efficiencies in the organization and I think some of that in our e-commerce infrastructure to facilitate the increased traffic and demand that we're seeing.

And right now, as I mentioned earlier, we're still seeing full price selling very healthy rate for our brands and we want to maintain that through as long as we can. We are predicting there will be more suitable promotional environment in the back half of the year. But right now, full price sell through is strong. We opened the closet for UGG today on the Memorial Day weekend time frame to liquidate some of the spring product that we want to go to out, so we go into the back half the year clean. And so you might see a little bit of that in the marketplace but those are seasonal styles that aren't really important to the core business and we'll manage through that with what we have. But as Steve said, e-commerce has the strength right now a little bit more higher margins to date, but we have a lot of wholesale in order to do in the back half.

And then the other thing that we've talked about like which was demonstrated last year is using marketing. So, we’ve increased our marketing spend around that and we'll continue to use that as a lever as we evaluate kind of how sales continue to come in.

And then just two more things, you alluded to sort of new channels of distribution. And I've been hearing that some of the sort of more athletic reach, you're starting to maybe build up assortments with some of the more athletic retailers that happened to generally have a decent digital platform as well. Can you give us some color on what's going on there? And then one of your major accounts earlier in the season decided to get promotional for a little bit of time. How are you reacting if people -- if your wholesale partners do something that hurt the brand?

And as we've been seeing for a while how the sanctity of our brand and positioning in the market is first and foremost for us. So, we've been firm on pricing and we've had conversations with some of our partners. I think you saw some of that early in the quarter and that’s the way we're going to approach this. This is, we see this as a shorter term headwind for the economy and our brands. But we're in this for the long haul and we want our brands to weather through this in a quality way. We're not going to chase revenue just chasing revenue and discounting brands to get there and that's the approach. For HOKA, generally speaking, we said the distribution and is the right distribution today, I think our access points to the consumer give us a good footprint, as well as driving business or e-commerce business. We did open Dick’s recently for the first time, we did a test with them like three or four years ago. They were in and out quickly and that was before people really understood what hope was all about but the test so far has been going very well. We're very pleased with that. And we're going to continue to do business with Dick’s with HOKA. Really primarily seeing online and probably 10 stores and expanding the assortment a little bit right now approching Bondi, we are going to be expanding into Rincon as well. But very pleased to see the reaction from the consumer, which tells us that awareness is growing dramatically for the HOKA brand. And in an environment like that, we're competing head-to-head with some of the best brands out there and to see the response is very encouraging for us.

The next question comes from Tom Nikic with Wells Fargo.

First, I want to ask about the European resets. The list, the pandemic and what’s going on the last couple of months. So does that change anything as far as the European reset goes? Does it accelerate it, slow it down? Any color you can give on that would be helpful?

As you know, we've talked about this on our last earnings call. We're going into this year with a focus on resetting UGG in the European marketplace, there's been some brand heat issues, inventory and the channel cleanup that we need to do. So the plan is still to do that We are looking at allocating resources this year from a marketing perspective where we want to focus. We made some adjustments between the EMEA business and the China business to show most of those up but really staying on course. And like I just said, we've instructed the teams over there not to chase revenue. They’ll try not to discount the product, still focus on cleaning it up. It will be a challenge this year, obviously, they're getting pretty heavily affected across the region. And we're going to manage that tightly, but still reset is the goal and reigniting the brand and the classic franchise in the European consumer. Some good news though is we are seeing more adoption of the Fluff franchise and the slippers in that marketplace as we haven't seen in the past. And a lot of the PR and social and celebrity posts that we're getting for UGG right now, which has just phenomenal is starting to resonate nicely with the younger consumer over in that marketplace as well. So hopefully that will help with brand heat positioning. But from an inventory and marketplace perspective, we’re going to manage it tightly with a goal of creating more of a scarcity model and resetting brand through the year.

And then just a follow up on HOKA. Right now, the wholesale distribution there’s a lot of independent smaller retailers. Is there any concern about some of those retailers maybe not surviving the current lockdown, and what that would potentially do for the gross trajectory of HOKA?

It's interesting, we had a call with the HOKA sales team and some of the marketing folks yesterday. And they're using some of the new analytical capabilities that we've created in the company to really take an assessment of each individual account based on their geographic location or where their states are within the closings or [Technical Difficulty]. But I think overall, it won't be significant to the trajectory that the HOKA brand is on. We still continue to fuel that with a big players and our online business, and their potential growth with Dick’s and maybe offset some of that. So still optimistic. It all depends when they're able to reopen and the velocity of sales don’t get at that time.

And Tom, just to add to that. In my prepared remarks, I made the comment about kind a HOKA we're planning a little bit slower growth this year. So clearly, we will see some disruption as a result of COVID-19. But it's a short-term kind of disruption to the brand. So as Dave said, we're going to manage closely. We're going to work with the accounts. We’re going to try to help accounts, where we can. And some won't make it that business will transfer to some somewhere else hopefully online.

I think the demand is there certainly and I think this is not going to have an impact on the trajectory over the business overall. Just to further update, we are doing a little few more drops ships with our HOKA brand at this time to get an update from David, our COO. So that is happening which is we’re happy to deal with the situation.

Last question today will come from Paul Lejuez with Citi Research.

But did you give an e-comm growth rate for quarter-to-date by brand? For second, just curious what percent of your SKUs sold to a wholesale partner ultimately sells through a store versus online? And then last, just curious what you've seen in China? I think you said those stores are all open. I'm curious how business has come back?

I think the first part of the question was, what is we mentioned on kind of brand growth quarter-to-date. So what we’ve said with was UGG was down, we didn't put -- we don't break out e-comm, but UGG is down, which is all channels down mid single-digit. HOKA up low 30% range, Teva down low 40%, Sanuk down mid 30%, but we don't necessarily break down out by channel. And DTC is, which is sales, is up 40%. stores and e-commerce combined and e-com is up triple digit

And then you talked about SKU, what percent of SKUs is sold in wholesale, online versus store, did I get that right?

You're selling -- you've got big wholesale business. Curious if you have a sense of what percent of those units that you sell through one of your partners ultimately get sold through a store versus online?

Yes, I think generally speaking, probably in the 30%, 40% range in a normal environment, certainly in this environment, assuming 95% to 100% with store closures in our wholesale partners.

And then just China experience?

China, they've been through this. And we're learning a lot from our China team and the management over there. They were shut down obviously early in the year for about three months stores working from home, obviously a lot more serious and the shutdown is being here. They are back to work in the offices, not fully back there's still some work from home situations happening there, which is fine. They’re managing the business right. They're working closely with our wholesale partners who are also having some serious headwind, because they don't have e-commerce with the stores. And then the stores that were opening, they’re back online, they're not to the level that they were. We’d expect them to be to keep in mind retail stores for UGG at this time of year in China is very low volume, but the e-commerce business has pick-up nicely in the marketplace. So there will still be some headwinds through the year, but I think we do some cleanup and help our partners through some of their inventory challenges. But all in all we're seeing good reaction to the products that’s in the marketplace now, both in the slippers category but also some of our sneaker, such as the LA class style that just launched. And then continuing to manage tightly the HOKA business in that marketplace as well. So back on track, back up and operating but the consumers’ responds to opened stores is still slowly coming back and I think it's going to be that way for a little while.

Can I just go back to the 30% to 40% that you mentioned selling online through your wholesale partners? Does that defer much by brand?

It will be, HOKA will have a higher percentage of what they're selling online in terms of the line of products…

Across the board, that will be independent or not. Those will be heavily weighted more on store versus e-commerce, the small independents. So generally speaking, I think it all depends on the account, department stores, anywhere from 30% to 40%, some cases maybe a little bit higher. And then the smaller independents is less online business. So, it averages out I would say across all brands, from 30% to 40%. The other thing just real quick is I don't know how the industry has really thought about this, but it is something that we're thinking about with the lack of Chinese tourists travel, presumably through the rest of the year and beyond that's going to have impact on global outlet businesses, European businesses, but it’s been a positive impact to the China business. So we don’t know what that looks like, it's something that we're monitoring closely. But I think it is going to be a factor in the industry that we're going to have to pay attention to.

This concludes our question-and-answer session, and also concludes our conference. Thank you for attending today's presentation. You may now disconnect.