1-800-FLOWERS.COM, Inc. (FLWS) Q1 2019 Earnings Report, Transcript and Summary

Good morning and welcome to the 1-800 Flowers Fiscal 2019 First Quarter Results Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Joe Pititto, Senior Vice President of Investor Relations and Corporate Communications. Please go ahead.

Thank you, Carrie. Good morning and thank you all for joining us today to discuss 1-800 Flowers.COM Inc.’s financial results for our fiscal 2019 first quarter. For those of you who have not received a copy of our press release issued earlier this morning, the release can be accessed at the Investor Relations section of our corporate website at 1800flowersinc.com. In terms of structure, our call today will begin with brief formal remarks and then we will open the call to your questions. Presenting today will be Chris McCann, CEO and Bill Shea, CFO. Before we begin, I need to remind everyone that some of the statements that we will make today maybe forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the applicable statements. For a detailed description of these risks and uncertainties, please refer to our press release issued this morning as well as our SEC filings, including the company’s annual report on Form 10-K and quarterly reports on Form 10-Q. In addition, this morning, we will discuss certain supplemental financial measures that were not prepared in accordance with generally accepted accounting principles. Reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures can be found in the tables accompanying the company’s press release issued this morning. The company expressly disclaims any intent or obligation to update any of the forward-looking statements made in today’s call. Any recordings of today’s call, the press release issued earlier today or any of its SEC filings except as maybe otherwise stated by the company. I will now turn the call over to Chris McCann.

Good morning, everyone. As you saw in this morning’s press release, we had a very good start to fiscal ‘19. The strong revenue growth of 7.7% for the period was driven by double-digit increases in our 1-800 Flowers and BloomNet businesses. The accelerated growth in these areas both top and bottom line reflected continuation of the positive trends we saw during the second half of fiscal ‘18. These trends reflecting investments we have been making since the second half of last year and now we are stepping up this year to take advantage of market conditions and further extend the market leading position for the 1-800 Flowers brand, while accelerating market share gains for our BloomNet business. In addition to strong revenue growth, the results of these initiatives can be seen in several key areas. In our 1-800 Flowers brand, during the first quarter, we achieved double-digit growth in our customer file with both new customers and returning customers up substantially, another positive trend that we expect to continue. Both new and existing customers continue to be attracted to the strength of the brand because of our focus on truly original products designed for a broad range of everyday and holiday occasions, such as our expanded succulents line that’s getting lots of play in social media, especially among millennial customers and our new wild beauty line of free-spirited bouquets that include floral varieties growing on eco-friendly sustainable farms and on continually enhancing the customer experience with innovations, such as our digital self-service portal and the rollout of our new PWA technology on our category leading mobile platform. PWA allows us to significantly ramp up speed and functionality for the increasing number of customers who are coming to us on their mobile devices. In BloomNet, the investments we are making are enabling us to capture a significant increase in orders from local flower shops and third-party online floral companies. Combined with the increasing order volumes from the 1-800 Flowers brand, BloomNet is seeing accelerating top line and bottom line growth as well as expansion of its market position. In addition, BloomNet continues to focus on leveraging its growing order volumes through its expanded suite of products and services for florists, including new digital directory features designed to help florists highlight their unique product designs and drive incoming orders from sending flowers, digital marketing programs in SEO and SEM to help our florists improve their website performance, and expanded hard good offerings from glassware and ceramics to balloons in baskets that leverage BloomNet’s scale to provide competitive pricing and help our florists improve their profitability. As a result, we expect BloomNet to drive sustainable accelerated growth both top and bottom line throughout the fiscal year. Regarding Gourmet Food and Gift Baskets, as we noted in this morning’s release, the results in this segment were in line with our expectations. The flat revenues primarily reflected the timing of certain shipments during the quarter, including gift baskets to some wholesale customers that shifted into our fiscal second quarter and Harry & David’s Fruit of the Month Club Cherries program, which we shipped in June this year at the end of the fiscal ‘18 fourth quarter compared with last year when they shipped in July during our first quarter. Adjusted for the timing of these shipments, revenue in this segment would have increased more than 5% compared with the first quarter of last year. Importantly, during the first quarter, Harry & David e-commerce demand was up 10% and its customer file also grew at double-digit pace. This bodes well for the upcoming holiday season. In addition, during the first quarter, our Cheryl’s Cookies business showed strong operational performance. Cheryl’s has addressed last year’s second quarter operational issues and we expect to see a nice bounce back for the brand in terms of both revenue and enhanced gross margin during the key holiday season. Overall, as we enter the holiday shopping period, the positive trends we are seeing across all three of our business segments positioned us well for a solid fiscal second quarter and full year. Now, I would like to turn the call over to Bill to cover some of the first quarter metrics in more detail. Bill?

Thank you, Chris. As Chris indicated, we are pleased with the strong start we have had for fiscal 2019. Our results for the fiscal first quarter across all three of our business segments were on or ahead of our plan highlighted by the accelerated growth in both our consumer floral and BloomNet businesses. Before I jump into some of the metrics for the quarter, I would like to hit on two specific areas to provide some additional clarity. First, in terms of gross profit margin percentage, the decline of 240 basis points in consolidated gross profit margin percent for the quarter compared to the prior year was essentially in line with our expectations and primarily reflected several factors, including a strategic investment in BloomNet to drive significantly increased order volumes, which we discussed back in our August conference call. While these investments impacted gross margin percent during the quarter, they helped drive double-digit revenue growth and solid increases in gross margin dollars as well as higher contribution margin dollars in BloomNet. Going forward, we expect BloomNet to continue to show strong top and bottom line growth albeit with a lower year-over-year gross profit margin percent compared with the prior year. In our Consumer Floral segment, gross margin declined 100 basis points during the quarter primarily related to increased shipping costs and strong growth in our Passport loyalty program. As we have noted in past calls, while growth in our Passport program impacts gross profit margin percent in the near-term, it provides significant benefits in terms of frequency and customer lifetime value. As a result of the higher shipping costs and our expectation for continued growth in Passport, we expect gross margin percent in this segment to be down slightly for the remainder of the fiscal year. With that said, we expect to continue to drive strong growth in both revenue and gross margin dollars in this segment. In our Gourmet Food and Gift Baskets segment, gross margin percent in the first quarter was impacted by the combination of product mix and increased labor and transportation costs. This was in line with our expectations and in terms of product mix was primarily related to the timing of certain wholesale gift baskets and the Food of the Month Club shipment that Chris mentioned in his remarks. These impacts were primarily timing issues. Looking ahead, we expect consolidated gross profit margin in this segment to be roughly flat to slightly up for the remainder of fiscal 2019. The second area I would like to touch on is the impact of tax and accounting changes on first quarter net loss and EPS and its comparability with Q1 of the prior year. The increased loss in the quarter primarily reflects the combination of a lower tax benefit compared with the prior year and the required adoption of accounting standard ASC 606. The combination of these factors represented a several million dollar impact on the quarter. The lower tax benefit reflected the lower effective tax rate of 27.1% in the quarter compared with the prior year period’s effective tax rate of 35.1%. As you will remember, the lower effective tax rates went into effect during our fiscal second quarter last year when the Tax Cuts and Jobs Act was passed. As a result, we recorded a higher tax benefit in Q1 a year ago, which was subsequently adjusted to the lower rate in the second quarter. Regarding ASC 606, the adoption of this accounting standard required us to expense the cost of catalogs upon mailing. Previously, these costs were amortized over the life of the catalogs, which for Q1 mailings would have extended into our fiscal second quarter. Going forward, we will benefit from the fact that these expenses were recorded in Q1 this year compared with the prior year when they were recorded primarily in Q2. Now, breaking down the highlights of our fiscal first quarter, first, in terms of revenue, total consolidated revenues increased 7.7% to $169.5 million compared with $157.3 million in the prior year period. This was driven by double-digit growth in our Consumer Floral and BloomNet segments, which more than offset the flat revenue growth in our Gourmet Food and Gift Baskets segment, which as Chris noted was primarily related to timing. As we head into the key holiday period, our largest in terms of revenue, we expect to achieve solid revenue growth in our Gourmet Food and Gift Baskets business. This is based on several positive factors, including the strong growth in Harry & David’s e-commerce demand and its customer file during our first quarter, the operational enhancements at our Cheryl’s Cookies business and solid growth in our 1-800 Baskets direct-to-consumer and wholesale businesses. Regarding operating expenses during the first quarter, in dollar terms, operating expenses increased 5.3%, reflecting marketing related expenses to support the 7.7% revenue growth we achieved as well as the impact of ASC 606. However, as a percent of total revenue, our operating expense ratio improved by 120 basis points reflecting our focus on leveraging our operating platform. Like my earlier comments regarding net loss and EPS, our EBITDA loss for the quarter of $13.9 million was better than our plan. The increase in our EBITDA loss compared with the prior year period primarily reflected the impact of ASC 606 as well as the aforementioned timing shipments within our Gourmet Food and Gift Baskets segment. Turning to our balance sheet, our cash and investment position was $27 million at the end of the first quarter. Inventory was $160.7 million compared with inventory of $148.4 million at the end of last year’s first quarter. The increase in inventory supports our expected growth and includes the strategic pre-building of some inventory for the holiday season that we discussed back in our August call. This allows us to use core workforce during the slower summer months to somewhat mitigate the headwinds associated with the very tight labor market and rising hourly wages. In terms of debt, we had $100.4 million in debt outstanding, including current maturities on our long-term credit facility compared with $107.4 million at the end of last year’s fiscal first quarter and we had zero borrowings under our revolving credit facility. Now regarding guidance, we are reiterating the guidance we provided at the beginning of the current fiscal year, which includes our plans to increase investments to take advantage of market conditions and build on the revenue growth momentum we are seeing across all of our business segments. Additionally, our guidance for fiscal 2019 bottom line metrics assumes the restoration of 100% bonus payout compared with the minimum payout in fiscal 2018. As a result, our guidance is as follows: consolidated revenue growth accelerating to a range of 5% to 7% compared with the prior year; EPS in the range of $0.38 to $0.42; adjusted EBITDA in the range of $77 million to $80 million; and free cash flow for the year in the range of $30 million to $40 million. It is important to note that absent the one-time catch-up in bonuses, we expect to significantly improve our bottom line metrics. And in fiscal 2020 and ‘21, we anticipate adjusted EBITDA and EPS will grow at a double-digit pace as we approach $100 million in EBITDA. I will now turn the call back to Chris.

Thanks, Bill. So summing up, we had a good start to fiscal ‘19. We accelerated our revenue growth to nearly 8% driven by double-digit growth in our Consumer Floral and BloomNet businesses, where we are expanding our market positions. And in our Gourmet Food and Gift Baskets segment, we have positioned ourselves well for a strong performance in the key holiday period with double-digit growth in Harry & David’s e-commerce demand and customer file, strong operational performance at Cheryl’s and solid growth in our 1-800 Baskets direct-to-consumer and wholesale businesses. We are excited by the opportunities we see to deliver accelerated growth by focusing on providing our customers with truly original gifts to help them connect and express and by continually enhancing our customers’ experience. In terms of product development, we launched the new 1-800 Flowers wild beauty line, an exclusive collection of free-spirited bouquets designed specifically for customers who appreciate a fresh, natural and youthful aesthetic. Harry & David Gourmet, an inspired collection, featuring fully prepared gourmet meals, desserts, wine and more, all perfect for gifting, self-consumption and entertaining for everyday and holiday occasions. The Harry & David sentiments line, featuring uniquely crafted gifts for everyday occasions, from birthdays to anniversaries, sympathy, get well and more, the new special edition flavors to love collection from the Popcorn Factory, including Caramel Apple, Cookies & Crème, Salted Caramel Bourbon, and sure to be a new holiday favorite, Peppermint Bark Drizzle. The Popcorn Factory also expanded its line of single-serve packaging for self consumption, which is gaining good traction in wholesale channels. At Cheryl’s, we introduced our new Chocolate Chip Brookie, a combination of brownie and chocolate chip cookie that is already becoming a customer favorite. And in terms of technology innovation, we rolled out enhancements to our platform, including improved navigation, faster checkout, expanded functionality for our new self-service portal. We enhanced our mobile platforms with improved page speed, touch-friendly visual navigation and we continue to make shopping easier on our conversational commerce platforms, where we are seeing increasing use of tools like Apple Business Chat and Apple Pay. We rolled out new full worth department in category shopping pages for Harry & David, complementing the look and feel of its homepage and enabling more comprehensive storytelling to customers and we revamped checkout for Harry & David, adding multi-gift ordering capabilities that allow customers to send multiple gifts to multiple recipients in one order and in one checkout. On the customer data front, we launched new technology initiatives to enhance personalization in our e-mails allowing for dynamic content to be inserted based on customer segmentation and onsite behavior and enhanced customer targeting technology to refine our targeting programs across our digital marketing channels. Last and most important for both near and long-term growth objectives, during the first quarter, we saw accelerated double-digit growth in our Passport loyalty program as well as in the creation of new multi-brand customers. In this area, in addition to increasing numbers, we also continue to see strong growth in key customer behavior metrics including frequency, average annual spend and retention, all leading to increased customer lifetime value. As you can see, we have a lot going on from our focus on truly original new product development to our adoption of new technology innovations that just help us enhance the customer experience. We believe all these initiatives and many more that we have underway position us well to drive strong performance in the upcoming holiday season and deliver on our growth guidance for fiscal ‘19 and the years ahead. With that, I would like to open the call for your questions. And I’d ask Carrie to please repeat the instructions for Q&A.

[Operator Instructions] The first question will come from Anthony Lebiedzinski of Sidoti & Company. Please go ahead.

Okay, good morning and thank you for taking the questions. So, BloomNet revenue growth was very impressive here in the quarter. You talked about gross margin being down was that really all driven by rebates or was there anything else there as far as the gross margin percentage decline?

Well, I think really when you first take a look at BloomNet, Anthony and thank you for the question we are really pleased with what we see with BloomNet. Again, the turn of growth in BloomNet really began in the second half of last year. That reflects a couple of things. The investments we have been making to increase the order volume of orders running through the platform do really great work the team is doing to expand our suite of products and services and that continual focus on the customer and making sure that we are giving the BloomNet customer what they are looking for.

Yes, Anthony, BloomNet is well-positioned to grow its top line at a double-digit pace for the remainder of the year. Gross margin percentage will be down in part due to rebates also the accelerated growth of wholesale, but again, the margin being down as a lot of the investments that we have been making to drive that significant order volume growth, so gross margin dollars and contribution margins will be up very nicely.

And those are the key factors for BloomNet is that the revenue growth and the contribution margin.

Got it. Okay. Thanks for that explanation. And Bill, can you quantify the exact impact of the catalog expense shift because of 606?

Yes, it’s about $2 million.

Got it. Okay. And Chris, I know you talked about the double-digit growth in your Passport program. So, as a percentage of your overall sales, so what is that at this point?

So it’s an increasing percentage of our sales and we really look at it first and foremost as a multi-brand customer and what that is as a percentage of our sales and that’s clearly in the double-digits now as a percent of sales for us. Passport is a component of that and really we continue to see that growing nicely. And to see that kind of growth in Q1, which is a slow quarter really reinforces the decisions that we made to invest behind that growth this year by feeding – by going out and focusing on more new customer activity – customer acquisition, I am sorry to bring into that funnel, where we are seeing the benefits of cross brand marketing, cross merchandising initiatives.

Got it. Okay. And then you guys talked about like a lot of other companies increased their transportation costs. Is there anything else aside from that and labor to think about? And I guess the tariffs are non-issue I guess at this point, so I just wanted to get a better clarification on that?

Lot there, Anthony. First, with regard to transportation costs, they are all up again this year, albeit in the mid to upper single-digit range versus the prior year where we saw this 30% to 40% increases, but they were kind of in line with what we had planned for the year and what we had guided. I think we had mentioned that we had changed some of the strategies that we had with regard to kind of trucking costs where historically we had used the spot market for that and now where we have used and started to move some of our trucking costs to larger firms and we have contracted with larger firms and then tactically, we used the spot market. From the standpoint of tariffs, probably not a big impact – certainly not on Q2. We brought in most of our inventory prior to the Round 3 of the tariffs and we are accelerating the receipt of certain inventory from China before January 1 when the higher tariffs are impacted by us. But it is an area that we are looking at Chris, there is – it will present a headwind for us in 2020 if trade talks do not improve with China. And we are looking at various strategic ways of addressing that from looking at sourcing that product – looking at sourcing the product outside of China going back to the Chinese manufacturers to absorb some of those costs to reconfiguring some of our products to remove some of the products that are subject to the tariffs and we always have strategic pricing initiatives in place.

Got it, okay. Well, there was a tweet from the President that he had some talks with the President Xi, so we will see how that shakes out. So thanks for the time.

We don’t necessarily react to all of his tweets, but yes.

The next question will come from Michael Kupinski of Noble Capital. Please go ahead.

Thank you. Congratulations on your quarter. Can you talk about the seasonal employee hiring and how that has gone and were you – I know last year, you were talking about being affected by some immigration related issues, I was wondering is that settled down now? So, how did your seasonal hiring go and thoughts on labor rates?

So, I will take that to start Michael and then Bill will give a little more color. Seasonal labor is a daunting challenge for us every year and this year it gets to be even – it’s one of the tighter years, even Anthony just referenced, it’s what you hear everybody talk about, labor and trucking. We really went into this year, I think with one of the best plans we have ever had developed on recruiting seasonal labor. And the early stages, we are in good positions to where our hiring is keeping in mind that a lot of hiring is still in front of us, but we are in a very good position right now. Bill, you want to talk a little bit more?

Yes, Michael, there certainly has been an impact on our cost, our hourly wages. We have had to increase our hourly wages, but we have lots of programs in place to kind of attract and to retain our seasonal workforce and that’s everything from offering them product discounts, specials sweepstakes, retention bonuses, bus passes and many more. This is an area that we know was going to continue to be a challenge as labor rates are going to continue to rise in a very tight labor market, but this is why as we discussed in our August call, we made the investments in pre-building inventory for the holiday – for this holiday season using our existing workforce during the slower seasonal periods. We continue to invest in automation in both our warehouse and distribution facilities as well as our manufacturing processes and we always look at the potential for strategic pricing initiatives to help offset that.

And then on I know that you guys were looking at the prospect of expanding your number of affiliated stores on your consumer floral side of the business and I was wondering has that initiative begun yet or is this really what we are seeing right now is just increased order volumes in or have you begun kind of starting to increase your affiliated stores?

Yes. As we look at BloomNet, the BloomNet growth we are seeing I think, first and foremost, comes from tracking more orders into BloomNet. Then that once we are doing that, then you are starting to see where we are seeing some growth in some of our other products and services and then growth you get some slight growth in membership. That kind of comes third in the process. So I would say you are not really seeing that yet. We are seeing some good signs in the marketplace, where there is good opportunities because shops want orders and when we have good order flow coming through BloomNet, they look to join BloomNet more and more.

Got it. Okay, those are most of my questions. Thank you.

Thank you, Michael.

The next question will come from Linda Bolton-Weiser of D.A. Davidson. Please go ahead.

Hi, congratulations. So can you remind us what the impact of the Cheryl’s Cookies situation was last second quarter both on revenue and EBITDA? I remember you quantified it last year can you remind us what that was?

Yes, Linda. There was about a $4 million hit to contribution margin or EBITDA during the quarter and about $0.04 a share.

And revenue?

And revenue was a little above that, but about $4 million to $5 million in revenue.

So that factor combined with the shifting of the expense relating to the accounting change should make the EBITDA growth in the second quarter quite robust year-over-year, I would think. Am I thinking along the right lines?

Yes, that is correct. And what you do have though with ASC 606 is you have certainly the Q1 switch into Q2 meaning we expensed in Q1 catalogs that we normally would expense in Q2. There is some impact of Q2 into Q3 and that some of the holiday catalogs that still generate revenue post holiday would have been the past, would have been expensed in Q3. And therefore – and now it will all be expensed in Q2. So it really – we recapture that, the impact of that give or take $2 million over Q2 and Q3.

Got it. And then so sorry if I didn’t catch this, but is your EBITDA range, guidance range for the year remaining unchanged or did you adjust that?

It is remaining unchanged.

So given the exceedance, I guess relative to some estimates for this quarter, what would be like the reason that one would think you would have to lower the EBITDA in the remaining quarters in order to just keep it unchanged for the year, what would be the downward factors for the remaining quarters?

Linda, I think we are very pleased with the results of the first quarter. Our first quarter is about 14% of our overall year. It’s really setting ourselves up for the key holiday quarter for our GFGB brands and then for the floral holidays subsequent to that. So I think right now we are just taking the cautionary approach.

Yes. It’s hard to make adjustments on Q1.

So just trying to be conservative for the year, I guess?

Yes.

Okay. And then do you actually ever I forgot, do you actually ever say – can you say how much the florists membership of BloomNet was up year-over-year in the quarter or at the end of the quarter?

No, we generally don’t report on that. So it’s similar to the question, we saw this season growth in membership, but again that comes slower. What we are seeing now really is growth in order volume, growth in products and services and that’s what’s really driving the growth of BloomNet.

So you are saying the acceleration, if there were to be one in the number of florist members would actually come later, it’s like a lag effect?

Yes, that would be correct.

And how long would that take, like a year or just a couple of quarters or 2 years, like can you just describe how that works a little bit more?

Yes. It’s really hard to determine. There is a lot of factors to go into working with these florists, who is small businesses in change, when that change comes, doesn’t want – do they want to make changes during the – in between the Christmas and Valentine season, the Valentine’s and Mother’s Day season. Very often you see changes like that happen in the summer time when it’s a slower period of time for them, but we see opportunities. We are seeing some opportunity in the marketplace now and we will continue to go after it of course.

And did most of your service agreements with you, are they like 1 year type agreements, 2 years, 3 years or do they just vary in timeframe, the agreements that are longer term service?

Yes. Generally short-term agreements and that’s the way we want it. We want to be –making sure that we are earning the business every day. So as they retain with us, it’s because they are earning and they are seeing the value from it.

Okay, thanks very much.

Thank you and good luck.

[Operator Instructions] The next question will come from Mark Rosenkranz of Craig-Hallum Capital Group. Please go ahead.

Hey, good morning everyone. I will add my congrats on the quarter.

Thank you.

Thank you.

Yes. I wanted to discuss the increased marketing spend, would you say are you seeing that more in older avenues of investment that you have used in previous quarters or some of the increased investment we are starting to see in the holiday season open up to some potential new channels for marketing and just general comments on the overall promotional environment going into the holidays?

Sure, Craig – Mark. As we look at the increased investments in marketing, it varies quite frankly. I think if we look on the Harry & David side, one of the areas where we are seeing is some good catalog marketing and getting some good return there. But really on the 1-800 Flowers side of the things – of the business and those are the two brands we are really investing behind. It’s more on the digital marketing side. And it’s across the Board, its areas where we have seen good progress, but certainly during Q1 we are going to do some testing of new channels. And as we always are, expanding new channels whether it would be video or new forms of display, etcetera. Really, what we are looking for as we are doing this is which channels are giving us a higher percentage of new customer acquisition above and beyond our regular investment space. So that’s what we are looking for the new customers. As we look at the promotional environment, we are going to the holiday season. It’s always going to be a promotional environment and while this past quarter was great from the floral brands and we continue to see our floral trends very positive, clearly the quarter shifts over now to the food brands. We are very encouraged by all the trend that we saw in the Harry & David demand from the first quarter, what we are seeing from the Cheryl’s business from an operational performance, the 1-800 Baskets business we talked about. So we see some really good trends as we move into the holiday season, which is driven by our gourmet food businesses.

And Mark just to remind you that part of the increase that we saw in marketing spending in the first quarter was the change in accounting and the expensing, the immediate expensing of catalogs in the first quarter.

Okay, great. That’s helpful. And then on the multi-brand side, you have mentioned that it’s now a double digit percentage of sales, which is some really strong traction, I am just wondering if you can discuss the behavior of those customers in relation to the growth in past quarter, are you seeing maybe initial entry from a holiday season than they are moving into an everyday gifting for their multi-brand or is it just kind of a get them initial holiday as the next holiday approaches they come back in a different way?

What we are seeing in general is that there is a high propensity for one stage, well, two questions I was going to answer and mainly first on Passport. Once they join Passport, we see a high propensity for them to interact and engage with another brand, which is nice. When we see customers engaged with another brand, what we are seeing is that they are finding that product to resonate for a different occasion for a different recipient, so whether that be for a different holiday or a different everyday holiday, everyday occasion, that’s what’s driving that increase of frequency as our customers then begin to see us as the total everyday gifting solution exactly the type of behavior we are looking for.

Okay, great. Thanks for taking my questions.

Thank you.

And this concludes our question-and-answer session. I would now like to turn the conference back over to Chris McCann for any closing remarks.

Well, thank you. Thank you, all for joining us today and thank you for your call and then joining us on the call for your questions. If you have additional questions, certainly don’t hesitate to follow-up with us. And with the holiday season rolling into full swing, I would like to wish everyone a happy and healthy holiday and a happy Thanksgiving and encourage everyone to visit our all-star family of brands to help you connect, express and celebrate with all of the important people in your lives. Thank you very much.

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect your lines. Have a great day.