1-800-FLOWERS.COM(US:FLWS)2020-01-30 19:46Financial Data and Key Metrics Changes - The company reported a revenue growth of 6% for the second quarter and 7% for the first half of the fiscal year, driven by solid growth across all three business segments [18][21] - Adjusted EBITDA grew by 7.4% to $110.7 million, net income increased by 8.1% to $74.2 million, and EPS rose by 7.7% to $1.12 per diluted share [22] - Gross profit margin slightly decreased to 44.4%, while operating expenses as a percentage of total revenues improved by 50 basis points compared to the prior year [21][22] Business Segment Data and Key Metrics Changes - In the Gourmet Food and Gift Baskets segment, which accounts for over 75% of total revenues, revenue increased by 5.6% to $464.6 million, primarily driven by Harry & David and strong growth in the wholesale baskets business [23][24] - The Consumer Floral segment saw revenues increase by 7% to $115.7 million, with a contribution margin growth of 11% to $10.9 million [25] - BloomNet's revenues increased by 9.8% to $25.7 million, reflecting the ability to drive sales of expanded product offerings [27][28] Market Data and Key Metrics Changes - The company continues to gain market share across all three business segments, with a focus on improving customer experience and leveraging digital marketing initiatives [16][17] - The company anticipates a revenue growth of approximately 10% during the second half of the fiscal year, reaffirming its guidance for total consolidated revenue growth of 8% to 9% for the year [20][32] Company Strategy and Development Direction - The company is focused on building sustainable growth while driving higher margins and expanding operational leverage [15][16] - Investments in innovative technologies and marketing initiatives are aimed at attracting new customers and deepening relationships with existing customers [16][38] - The company is well-positioned for the upcoming Valentine's Day holiday, with a strong product lineup and marketing strategies [37][40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate headwinds such as rising labor costs and tariffs, while maintaining strong operational execution [19][21] - The management team is optimistic about the future, citing strong customer acquisition and retention metrics, as well as a favorable economic environment [62][63] Other Important Information - The company has a strong cash position of $295.6 million and zero outstanding borrowings under its working capital line, providing flexibility for future investments [30] - The company is actively engaged in share buybacks to offset share dilution from stock-based compensation [54][74] Q&A Session Summary Question: Outlook for Valentine's Day - Management noted that while it is early to gauge the competitive landscape, they feel well-positioned due to the momentum built over the past quarters [40] Question: Performance of Shari's Berries - Management indicated that Shari's Berries is performing well and is expected to contribute modestly to the bottom line in the second half of the year [41][43] Question: Impact of Calendar Changes on Revenue - Management acknowledged that the six fewer shopping days during the holiday season impacted revenue but expressed satisfaction with the overall growth achieved [48][49] Question: Marketing Spend and Customer Acquisition - Management confirmed that marketing expenses are aligned with sales growth, focusing on new customer acquisition while deepening existing customer relationships [78][84] Question: M&A Environment and Future Acquisitions - Management remains active in seeking acquisition opportunities that can leverage their operating platform and enhance growth [63][64]