Financial Data and Key Metrics Changes - The company experienced a challenging environment in 2025, with mixed performance across its portfolio, particularly softness in Tommy Bahama and Johnny Was, while Lilly Pulitzer and emerging brands performed strongly [12][13] - Capital expenditures were significantly high due to the construction of a new distribution center in Lyons, Georgia, which is expected to enhance the omnichannel business [11][12] - The company reported a customer retention rate of 62% over a 12-month period, indicating strong customer loyalty [11] Business Line Data and Key Metrics Changes - Tommy Bahama accounts for over half of the total business, while Lilly Pulitzer represents about a quarter, with smaller brands making up the remainder [5] - Emerging brands grew by 17% in the third quarter, although they still represent less than 10% of total revenue [10] - Johnny Was has not performed well since its acquisition, but a turnaround plan is in place, focusing on artisanal details and storytelling in marketing [9][27] Market Data and Key Metrics Changes - The company has shifted its sourcing structure significantly, reducing reliance on China from 40% to about 10% in response to tariff challenges [19][20] - The macroeconomic environment is showing signs of improvement, with positive indicators such as GDP growth and a favorable unemployment rate, which could benefit the business in 2026 [18] Company Strategy and Development Direction - The company is focusing on cost reduction initiatives, including indirect spending and SG&A expense reductions, to improve profitability [14][17] - There is a strategic emphasis on leveraging successful practices from Lilly Pulitzer across other brands, particularly in merchandising and customer engagement [23][25] - The company plans to stabilize Johnny Was by refining its product line and closing underperforming stores while enhancing the brand's unique artisanal appeal [27] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, citing internal initiatives and a potentially more favorable macroeconomic environment [14][18] - The company acknowledged the challenges faced in 2025, particularly due to tariffs and consumer behavior, but is confident in its plans to address these issues moving forward [12][19] Other Important Information - The company has a balanced omnichannel distribution model, with retail and e-commerce being nearly equal contributors to revenue [5][6] - The new distribution center is expected to go live in early 2026, which will be a significant driver for the company's omnichannel strategy [11][12] Q&A Session Summary Question: How is the business positioned for recovery after challenging years? - Management highlighted strong performances from Lilly Pulitzer and emerging brands as a foundation for recovery, with plans to extend successful strategies across the portfolio [16][17] Question: What are the impacts of tariffs on sourcing and product assortment? - The company faced significant tariff challenges in 2025 but successfully navigated these by diversifying its sourcing strategy and reducing reliance on China [19][20][21] Question: What drove the success of Lilly Pulitzer, and how can those learnings be applied to other brands? - The focus on the top 20% of customers, who drive a significant portion of sales and profits, was key to Lilly's success, and similar strategies will be applied to Tommy Bahama and Johnny Was [23][25]