Financial Data and Key Metrics Changes - Total company net sales for Q1 2025 decreased by 2.1% to $57.9 million compared to $59.2 million in Q1 2024 [12] - Gross profit was $29.2 million, representing 50.3% of net sales, down from 50.6% in the prior year [13] - Operating loss for Q1 was $4.4 million, compared to an operating income of $5.6 million in the same period last year [14] - Net loss for Q1 was $4.8 million, or a loss per share of $0.37, compared to net income of $4.4 million, or income per share of $0.35 in the prior year [15] - Adjusted EBITDA was negative $3 million for Q1, compared to negative $1.5 million in the prior year [16] Business Line Data and Key Metrics Changes - The wholesale segment was relatively flat compared to the prior year, while the direct-to-consumer segment declined by 4.4% due to planned store activity and softer traffic trends [12] - Improved product margins were noted, excluding freight and distribution costs, indicating a healthier margin business [6] Market Data and Key Metrics Changes - The company has significantly reduced its exposure to China, with expectations that by spring 2026, exposure will be approximately 25% of the cost of goods [17][18] - The company is navigating increased freight and tariff costs, with expectations of higher costs in Q2 due to ongoing trade policy issues [24][17] Company Strategy and Development Direction - The company is focusing on diversifying its sourcing base outside of China while maintaining product quality [18] - Plans to open new stores in Nashville and Sacramento later this year, alongside the recent opening in Marlebone, London, indicate a commitment to expanding international presence [8][9] - The company is investing in store remodels to enhance customer experience and align with brand positioning [9] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding the macroeconomic environment and the ongoing tariff situation, opting not to provide full-year guidance at this time [5][16] - There is optimism about the trends seen in the business, particularly in the direct-to-consumer segment driven by e-commerce [5][10] Other Important Information - Selling, general, and administrative expenses increased to $33.6 million, or 58% of net sales, compared to 54% in the prior year, attributed to increased marketing and store-related expenses [14] - The company is committed to disciplined expense management amid ongoing volatility and uncertainty [16] Q&A Session Summary Question: Trends in freight costs and distribution methods - Management confirmed that air shipping was utilized more in Q1 due to timing issues, and they expect to see increases in freight costs in Q2 [22][24] Question: Impact of trade policy issues in future quarters - Management indicated that the back half of the year may see more impact from tariffs, but they are working on mitigating these costs through supplier discounts and sourcing adjustments [26] Question: Plans for price increases - Management stated that price increases are being implemented strategically and should not be significantly noticeable to consumers [27] Question: Factors driving positive consumer trends - Management highlighted the success of new product lines, particularly linen, and the ability to extend the spring assortment despite delays in pre-fall shipments [30][31]

Financial Data and Key Metrics Changes - For the full year 2024, total sales were approximately $611 million, with comparable sales growth of 1.5% and a gross margin of 70.4% [18][26] - Adjusted EBITDA for the year was $107 million, while adjusted net income per diluted share was $3.47, reflecting a 4% increase [26][27] - Free cash flow for the year was $47 million, with a cash position of $35.4 million at the end of Q4 [27][28] Business Line Data and Key Metrics Changes - In Q4, total company sales were $143 million, down approximately 5% compared to the previous year [21] - Direct sales accounted for 50.5% of total sales in Q4, down 6.8% year-over-year due to a shift into markdown selling [24] - The company saw strength in bottoms, outerwear, knit tops, and sleepwear during the quarter, supported by marketing campaigns [9][10] Market Data and Key Metrics Changes - The retail channel drove a 1.9% increase in comparable sales for Q4, while store sales were down 3% due to calendar impacts [22] - The best customer cohort continued to show consistent growth, contributing to overall performance despite traffic headwinds [10][11] - The company experienced challenges in traffic, particularly in Q4 and early Q1, attributed to broader macroeconomic conditions and consumer sentiment [40][72] Company Strategy and Development Direction - The company plans to continue investing in new store growth, with a target of opening 20 to 25 net new stores by the end of 2026 [34] - The implementation of a new order management system (OMS) is expected to enhance omnichannel capabilities and improve customer experience [31][32] - Marketing efforts are being diversified, including geo-targeted campaigns to drive store traffic and customer engagement [12][55] Management's Comments on Operating Environment and Future Outlook - Management noted that fiscal 2025 has started slowly, with consumer sentiment and adverse weather impacting performance [14][15] - The company is taking a prudent approach to its outlook for Q1 and the remainder of the year, considering the ongoing macroeconomic uncertainties [15][19] - Despite challenges, management remains confident in the brand's potential for growth and the effectiveness of its operating model [16][35] Other Important Information - The company ended the year with a healthy cash position and announced a quarterly dividend increase [10][28] - Inventory levels were reported to be elevated due to strategic shipping decisions, but are expected to normalize in the coming quarters [29][82] - The company has initiated a share buyback program, with $24.5 million remaining under the authorization as of the end of Q4 [28][74] Q&A Session Summary Question: Can you elaborate on the Q1 headwinds? - Management identified three main headwinds: adverse weather, consumer sentiment concerns, and the OMS implementation [40][41] Question: What benefits do you expect from the OMS implementation? - The OMS is expected to provide operational efficiencies and enhance sales through new omnichannel capabilities, starting in the back half of the year [43][45] Question: How do you view gross margin trends for the year? - Management expects gross margins to be flat, with Q1 facing the most difficult comparisons due to prior strong performance [50][52] Question: What are the trends in store versus digital sales? - Stores are performing better in full-price sales compared to digital, which has shifted more towards markdowns [72] Question: How are you managing promotions in the current environment? - The company is focused on maintaining a disciplined promotional strategy while responding to consumer price sensitivity [65][68]

Financial Data and Key Metrics Changes - Net income for Q4 2024 was $77.2 million or $1.53 per share, down from $79.6 million or $1.59 per share in Q4 2023 [10] - For the fiscal year, net income decreased to $195.5 million or $3.89 per share from $219.9 million or $4.40 per share in the previous year [10] - Net sales for Q4 decreased by 0.8% to $379.2 million compared to $382.4 million in Q4 2023 [10] - Comparable store sales increased by 3.9% in Q4 compared to the same period last year [10] - Gross margin for Q4 was 52.6%, up from 52.3% in Q4 2023, while the full year gross margin decreased to 48.7% from 49.1% [13] Business Line Data and Key Metrics Changes - Women's merchandise sales for Q4 increased by 4.5% compared to the prior year, representing approximately 43% of total sales [19] - Men's merchandise sales decreased by about 4% in Q4, representing approximately 57% of total sales [21] - Accessory sales increased by approximately 7.5%, while footwear sales decreased by about 7% [23] - Youth sales increased approximately 10% in Q4, with denim accounting for about 45% of sales [24] Market Data and Key Metrics Changes - Total e-commerce sales grew by 12% in Q4 compared to the same period last year [8] - Online sales for the fiscal year decreased by 4.3% to $197.7 million compared to $206.5 million in the previous year [11] Company Strategy and Development Direction - The company is focusing on relocating stores to higher traffic outdoor centers, with 51 out of 74 remodels being relocations [7] - Investments in digital experience have been made to enhance economic performance [8] - Plans for fiscal 2025 include opening seven new stores and completing 18 to 22 remodel projects, with at least half being relocations [17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about managing through economic challenges due to strong vendor relationships [9] - The company is monitoring the impact of tariffs and believes it can manage costs effectively [30] Other Important Information - Inventory was reported at $120.8 million, down 4.4% from the previous year [16] - The company ended the year with 441 retail stores, down from 444 stores at the end of fiscal 2023 [18] Q&A Session Summary Question: Could you elaborate on merchandise margin gains? - Management attributed the increase in merchandise margins to a higher percentage of private label sales and better regular price selling [29] Question: How do you see store traffic in light of recession concerns? - Management noted that they do not track traffic counters but estimated flat traffic based on February sales being down 1% [40] Question: What is the current sourcing strategy for inventory? - The company primarily sources from China, with some from Vietnam and Bangladesh, and is open to relocating production if necessary [43] Question: Are there plans for new initiatives in online sales? - Management highlighted strong online performance and ongoing improvements to the website and marketing strategies [47][50]