Bassett Furniture Industries Inc (BSET) 2024 Q3 法說會逐字稿

Good day, and thank you for standing by, and welcome to Bassett Furniture Industries Q3 2024 earnings conference call. (Operator Instructions) I would now like to hand the conference over to your speaker today, Mike Daniel, CFO. Please go ahead.

美好的一天，感謝您的支持，歡迎參加巴塞特家具工業 2024 年第三季財報電話會議。 （操作員指示）我現在想將會議交給今天的發言人，財務長 Mike Daniel。請繼續。

Thank you, Gigi, for the introduction. Welcome to Bassett Furniture's earnings call for the third quarter ending August 31, 2024. Joining me today is our Chairman and CEO, Rob Spilman.

謝謝吉吉的介紹。歡迎參加巴塞特家具 (Bassett Furniture) 截至 2024 年 8 月 31 日的第三季財報電話會議。

We issued our news release yesterday after the market closed, and it's available on our website. After today's remarks about our quarter, we will open the call up for a Q&A session. We will post the transcript of the call on our investor site within 48 hours of this call. In addition, we filed the 10-Q this morning, and that's available on our website under SEC filings on the Investor Relations tab.

我們昨天在市場收盤後發布了新聞稿，可在我們的網站上查看。在今天關於我們季度的評論之後，我們將開始問答環節。我們將在本次電話會議後 48 小時內將電話會議記錄發佈在我們的投資者網站上。此外，我們今天早上提交了 10-Q，您可以在我們網站的「投資者關係」標籤上的 SEC 文件下找到該資訊。

During today's call, certain statements we make may be considered forward-looking and inherently involve risks and uncertainties that cause actual results to differ materially from management's present view. These statements are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. The company cannot guarantee the accuracy of any forecast or estimate, nor does it undertake any obligation to update such forward-looking statements.

在今天的電話會議中，我們所做的某些陳述可能被認為是前瞻性的，並且本質上涉及風險和不確定性，導致實際結果與管理層目前的觀點有重大差異。這些陳述是根據 1995 年《私人證券訴訟改革法案》的安全港條款作出的。

For more information, including important cautionary notes, please see the company's annual report on Form 10-K for the fiscal year ended November 25, 2023. Other filings with the SEC describing risks related to our business are available on our corporate website.

如需了解更多信息，包括重要的警示說明，請參閱公司截至2023 年11 月25 日的財年10-K 表格年度報告。的公司網站上找到。

Now I'll turn the call over to Rob for comments about our third quarter. Rob?

現在我將把電話轉給 Rob，徵求對我們第三季的評論。搶？

Thank you, Mike. Good morning, everyone, and thank you for joining us for today's call. The integration of our industry with the weak US housing market continued to pressure sales during our third quarter. Although mortgage rates have started to ease since the Fed's 50 basis point rate cut three weeks ago, overall housing affordability and inventory availability remain impediments in the short term. Our industry is ready for a transformational shift in the next several quarters and Bassett plans to benefit as it happens.

謝謝你，麥克。大家早安，感謝您參加我們今天的電話會議。我們的行業與疲軟的美國房地產市場的整合繼續給我們第三季的銷售帶來壓力。儘管自三週前聯準會降息 50 個基點以來抵押貸款利率已開始下降，但整體住房負擔能力和庫存供應在短期內仍然是障礙。我們的產業已準備好在未來幾季進行轉型，巴塞特計劃從中受益。

I also want to mention two events that have occurred subsequent to the third quarter that will potentially have a bearing on our fourth quarter, Hurricane Helene and the East Coast dock strike. Many customers and employees were deeply affected by the devastating effects of Hurricane Helene. Our thoughts are with them. Hurricane Helene impacted our distribution center in Kitabu County, North Carolina, and it was shut down due to damage and power outages for two days during the first week of October.

我還想提及第三季之後發生的兩件可能對我們第四季產生影響的事件，即颶風海倫和東海岸碼頭罷工。許多客戶和員工深受颶風海倫的破壞性影響。我們的想法與他們同在。颶風海倫影響了我們位於北卡羅來納州基塔布縣的配送中心，該中心因損壞和停電而在 10 月第一周關閉了兩天。

We've recovered as quickly as possible to get shipments back on track. The larger longer-term impact on our logistics and distribution systems are related to the damage to the I-40 infrastructure, which is our main route to the west. And while the East Coast dock strike was just three days, the impact on our business has put shipments back one to two weeks.

我們已盡快恢復正常，將出貨重回正軌。對我們的物流和配送系統更大的長期影響與 I-40 基礎設施的損壞有關，這是我們向西的主要路線。雖然東海岸碼頭罷工僅持續了三天，但對我們業務的影響卻使發貨時間推遲了一到兩週。

Now let's move on to the discussion of our third-quarter results. Like last quarter, revenue in both our wholesale and retail segments was down with greater pressure on our retail business due to the higher level of associated fixed costs.

現在讓我們繼續討論第三季業績。與上季一樣，我們的批發和零售業務收入均下降，由於相關固定成本水平較高，零售業務面臨更大壓力。

Heading into the quarter, our Memorial Day event and our subsequent fourth of July event, both produced increases compared to last year. But the in-between weeks were especially difficult as consumers stayed on the sidelines.

進入本季度，我們的陣亡將士紀念日活動和隨後的 7 月 4 日活動均比去年有所增長。但中間幾週尤其困難，因為消費者保持觀望。

The third quarter is always our weakest reporting period. This year's combination of the annual July fourth weekly operational shutdown, followed by the cyber attack that we suffered meant that our manufacturing facilities were shut down for over 16% of the quarter's workdays.

第三季始終是我們報告最疲軟的時期。今年，每年 7 月第四週的營運關閉加上隨後遭受的網路攻擊意味著我們的製造設施在該季度超過 16% 的工作日被關閉。

Consolidated gross margin was 53%, up 1.4% from last year, though slightly lower on a sequential basis. Wholesale gross margins improved by 50 basis points despite lower volume, largely driven by improvement in club level margins. Inventories were down more than $10 million year over year and slightly down sequentially, reinforcing our belief that we can run with leaner inventory.

綜合毛利率為 53%，比去年增長 1.4%，但環比略有下降。儘管銷量較低，但批發毛利率仍提高了 50 個基點，這主要是由於俱樂部層級利潤率的提高。庫存比去年同期下降超過 1000 萬美元，並且環比略有下降，這增強了我們可以以更精簡的庫存運行的信念。

Retail gross margins improved by 210 basis points to 53.7% attributable to higher home delivery income and better margin on clearance inventory. Our average ticket was $3,900, up 5%, while total retail written sales were down 5%. 41% of retail sales were design makeovers also down slightly from last year.

由於送貨上門收入增加和清倉庫存利潤提高，零售毛利率提高了 210 個基點，達到 53.7%。我們的平均票價為 3,900 美元，上漲 5%，而零售總銷售額下降 5%。 41% 的零售額來自設計改造，也較去年略為下降。

We remain focused on top line enhancements in both retail and open market efforts. Initial sell-through of our fall upholstery introduction was very strong heading into Labor Day. The reception of a leather option to our true custom program produced strong sales in the quarter and should be an important feature going forward.

我們仍然專注於零售和公開市場努力的營收提升。在進入勞動節之前，我們推出的秋季室內裝飾產品的最初銷售量非常強勁。我們真正的定制計劃中的皮革選項的接受在本季度產生了強勁的銷售，應該是未來的一個重要特徵。

Since the end of the third quarter, we have added nine new Bassett custom studio dealers to the program. We have made the custom studio a centerpiece of our showroom at the upcoming Fall High Point furniture market. We also plan to support the outreach with trade advertising, something we have not done in several years.

自第三季末以來，我們在該計劃中新增了九家巴塞特定制工作室經銷商。在即將到來的秋季高點家具市場上，我們將訂製工作室作為陳列室的核心。我們還計劃透過貿易廣告來支持外展活動，這是我們幾年來沒有做過的事情。

Last quarter, we initiated a five-point restructuring plan to set asset up for improved long-term operational and financial performance. We made good progress during the quarter on executing this plan, and we believe that we are better positioned as a result. Point one of our strategic plan was to drive organic growth through Bassett branded retail locations, omnichannel capabilities and enhanced customization positioning to expand our dedicated distribution footprints.

上季度，我們啟動了一項五點重組計劃，以建立資產以改善長期營運和財務表現。本季我們在執行該計劃方面取得了良好進展，我們相信我們因此處於更好的位置。我們的策略計劃之一是透過巴塞特品牌零售店、全通路能力和增強的客製化定位來推動有機成長，以擴大我們的專門分銷足跡。

We are remaking a significant portion of the product line in the upcoming quarters to address new styling and price point opportunities. In case goods, we will launch three major collections beginning this fall and culminating in the spring of 2025. The three imported collections are comprehensive bedroom, dining and occasional and entertainment product offerings.

我們將在未來幾季重新打造產品線的很大一部分，以應對新的款式和價格點機會。就商品而言，我們將從今年秋季開始推出三個主要係列，並於 2025 年春季推出。

On the domestic front, we are expanding our successful origins dining program this fall. Our solid Wood BenchMade program will also undergo a makeover over the next 10 seasons. In upholstery, strong sales in our domestic motion assortment, warrant expansion of the category, especially in our recliner line. We have a targeted outreach to the interior design community underway as well, recognizing the growing importance of this channel throughout the industry.

在國內方面，我們將在今年秋天擴大我們成功的起源餐飲計劃。我們的實木 BenchMade 計畫也將在接下來的 10 個季節進行改造。在室內裝潢方面，我們國內運動產品系列的強勁銷售保證了該類別的擴張，尤其是我們的躺椅系列。我們也正在對室內設計界進行有針對性的推廣，認識到這個管道在整個行業中日益增長的重要性。

For the consecutive year, we will operate a designer showroom an inter hall and high point at the fall market in two weeks. We contacted more than 400 designers and design firms at the spring market and are encouraged by their recognition of our strength for the designed trade.

我們將連續一年在兩週內經營一個設計師展廳、內部大廳和秋季市場的高點。我們在春季市場聯繫了400多家設計師和設計公司，他們對我們在設計行業實力的認可讓我們深受鼓舞。

We have continued to invest and our multiyear cross-functional digital transformation this year even in these challenging times. E-commerce sales are still a small portion of retail revenue. We are optimistic about the potential of our omnichannel capabilities, and we're excited to see double-digit e-commerce growth this quarter. With these investments, we expect stronger asset brand and design presentations to complement our in-home makeover proficiency.

即使在這個充滿挑戰的時期，我們今年仍繼續投資和進行多年的跨職能數位轉型。電子商務銷售額仍只佔零售收入的一小部分。我們對全通路能力的潛力感到樂觀，很高興看到本季電子商務實現兩位數成長。透過這些投資，我們期望更強大的資產品牌和設計展示能補充我們的家庭改造能力。

Point two of our plan was to rationalize US wood manufacturing from two sites into one primary locations supported by a small satellite operation. As expected with any rationalization, there was some disruption in August during the transition, which impacted margins. This consolidation is now complete and we are seeing improved overhead absorption with operating one location.

我們計畫的第二點是將美國木材製造從兩個地點合理化為一個由小型衛星業務支持的主要地點。正如對任何合理化的預期一樣，8 月的過渡期間出現了一些中斷，這影響了利潤率。這項整合現已完成，我們看到營運一個地點的管理費用吸收有所改善。

Point three was to optimize inventory and drop on productive lines. We are continuing on this path as part of the domestic wood plant consolidation strategy. As expected, this reduction of clearance and slow-moving products affected margin in the third quarter that is designed to strengthen the overall productivity of our line and of our stores.

第三點是優化庫存和生產線上的下降。作為國內木材廠整合戰略的一部分，我們將繼續沿著這條道路前進。正如預期的那樣，清倉和滯銷產品的減少影響了第三季的利潤率，該利潤率旨在增強我們的產品線和商店的整體生產力。

Point four was to improve overall cost structure of both wholesale and retail businesses. In retail, we are consolidating warehouse operations after the closure of three warehouses during the second quarter. In today's reported quarter, we moved facilities in East Texas and Oklahoma into our North Texas home delivery center and also consolidated two Virginia facilities into one. This process will continue until we realize the completion of our new footprint.

四是改善批發零售業整體成本結構。在零售方面，我們在第二季關閉三個倉庫後正在整合倉庫業務。在今天報告的季度中，我們將東德克薩斯州和俄克拉荷馬州的設施搬到了北德克薩斯州的送貨中心，並將弗吉尼亞州的兩個設施合併為一個。這個過程將持續下去，直到我們實現新足跡的完成。

In wholesale, in addition to the aforementioned wood plant consolidation, we have completed our plan to move out of a major West Coast wholesale distribution center, which resulted in a $1.2 million charge this quarter. We continue to thoroughly review the SG&A structure of both retail and wholesale to further identify opportunities to pair operating expenses. On the capital side, we are beginning a program to refurbish certain stores within the repo fleet with the recently completed Greensburg, North Carolina store being the first.

在批發方面，除了上述木材廠整合外，我們還完成了搬出西海岸主要批發配送中心的計劃，這導致本季度產生了 120 萬美元的費用。我們繼續徹底審查零售和批發的SG&A結構，以進一步尋找配對營運費用的機會。在首都方面，我們正在啟動一項翻新回購車隊內某些商店的計劃，最近完工的北卡羅來納州格林斯堡商店是第一個。

Our last point and the restructuring plan was to close Noah home. The mid-price e-commerce furniture retailer headquartered in Canada with operations in Canada, Singapore, the US and the United Kingdom. This work is still in progress as we planned. No operations and remaining inventory will wind down by the end of this current fiscal year.

我們的最後一點和重組計劃是關閉諾亞之家。這家中價電子商務家具零售商總部位於加拿大，在加拿大、新加坡、美國和英國開展業務。這項工作仍在按照我們的計劃進行。到本財年末，任何業務和剩餘庫存都不會減少。

Our capital spending plans for the fiscal year are primarily complete. We will continue to purchase shares opportunistically and drive returns to shareholders through dividends, including the regular quarterly dividend that our Board of Directors approved this week.

我們本財年的資本支出計畫已基本完成。我們將繼續機會主義地購買股票，並透過股息推動股東回報，包括董事會本週批准的定期季度股息。

We continue to have a strong balance sheet, but it's imperative for us to improve profitability. That means that we continue to evaluate the efficient use of our resources so that we can align Basset's operating expense structure with projected revenue. Getting these pieces in place, along with the launching of new products and services I mentioned earlier, are expected to better position ourselves for the eventual turnaround and consumer demand.

我們持續擁有強勁的資產負債表，但提高獲利能力勢在必行。這意味著我們將繼續評估資源的有效利用，以便我們能夠使 Basset 的營運費用結構與預期收入保持一致。將這些部分落實到位，再加上我之前提到的新產品和服務的推出，預計將更能滿足最終的轉變和消費者需求。

Now I'll turn it over to Mike for more details on our financials. Mike?

現在我將把它轉給麥克以獲取有關我們財務狀況的更多詳細資訊。麥克風？

Thanks, Rob. In my commentary, the comparisons I will discuss will be the third quarter of fiscal 2024 compared to the third quarter of fiscal 2023, unless otherwise noted. But before I get into the results, I want to provide more context on our cyber incident that occurred in July.

謝謝，羅布。在我的評論中，除非另有說明，我將討論 2024 財年第三季與 2023 財年第三季的比較。但在了解結果之前，我想提供有關 7 月發生的網路事件的更多背景資訊。

As we reported in our SEC filings, our IT team detected unauthorized occurrences on a portion of our systems. The team immediately took steps to contain the issue by shutting down those systems. We activated our incident response plan and quickly began working with external cybersecurity consultants to assess and monitor the activity by an unknown threat actor.

正如我們在 SEC 文件中報告的那樣，我們的 IT 團隊在我們的部分系統上發現了未經授權的情況。該團隊立即採取措施透過關閉這些系統來控制問題。我們啟動了事件回應計劃，並迅速開始與外部網路安全顧問合作，評估和監控未知威脅參與者的活動。

The system shutdown interrupted Bassett's manufacturing plants for one week, which resulted in delays on some wholesale and retail orders. By July 17, we essentially had all systems up and running, we were able to recover all data from backups and began full operating -- fully operating as normal within two weeks. We do not believe that any consumer personal information was compromised.

系統關閉導致 Bassett 的製造工廠中斷一周，導致部分批發和零售訂單延遲。到 7 月 17 日，我們基本上已經啟動並運行了所有系統，我們能夠從備份中恢復所有資料並開始全面運行——在兩週內完全正常運行。我們認為沒有任何消費者個人資訊外洩。

This issue resulted in an estimated loss of between $1 million to $2 million for the third quarter, and we're in the process of filing a claim with our insurance provider and expect to receive the proceeds in the fourth quarter. So for the third quarter, consolidated revenues declined $11.6 million or 13%, primarily due to a 16% decrease in wholesale sales and a 10% decrease in retail sales through our company-owned stores.

此問題預計導致第三季損失 100 萬至 200 萬美元，我們正在向保險公司提出索賠，預計將在第四季收到收益。因此，第三季的綜合收入下降了 1,160 萬美元，即 13%，主要是由於我們公司自營商店的批發銷售額下降了 16%，零售額下降了 10%。

Consolidated gross margins increased 140 basis points to 53.0% due to improved margins in both the retail and wholesale segments. This was partially offset by $609,000 of unproductive labor costs incurred during the temporary shutdown resulting from the cybersecurity incident. Excluding these unproductive labor costs, our consolidated gross margin would have been 53.8% and as compared to 52.7% in the prior year, which included $900,000 of additional inventory valuation charges.

由於零售和批發部門的利潤率提高，綜合毛利率增長了 140 個基點，達到 53.0%。這部分被網路安全事件導致的臨時關閉期間產生的 609,000 美元非生產性勞動力成本所抵消。排除這些非生產性勞動成本，我們的綜合毛利率將為 53.8%，而上一年為 52.7%，其中包括 90 萬美元的額外庫存估價費用。

We reported a consolidated operating loss of $6.4 million compared to a loss of $3.2 million for the third quarter of 2023. And nonrecurring factors impacting the operating loss was the estimated loss from the cyber incident and a $1.2 million loss on the logistical services contract that Rob mentioned earlier. Based on the progress Rob discussed in the restructuring plan, we are on target to realize our projected annual cost savings of between $5.5 million and $6.5 million, starting with fiscal 2025.

我們報告的綜合營運虧損為640 萬美元，而2023 年第三季的虧損為320 萬美元。損失。根據 Rob 在重整計畫中討論的進展，我們的目標是從 2025 財年開始，實現預計每年節省 550 萬至 650 萬美元的成本。

Now I'll provide information regarding our wholesale operations. Net sales decreased $8.8 million or 16% from the prior year period due primarily to a 22% decrease in shipments to the open market, a 13% decrease in shipments to our retail store network, and a 6% decrease in lane venture shipments.

現在我將提供有關我們批發業務的資訊。淨銷售額較上年同期減少880 萬美元，即16%，主要是由於公開市場的發貨量減少22%、零售店網絡的發貨量減少13%，以及Lane Venture 的發貨量減少6% 。

Gross margins for the three months ended August 31, 2024, increased 50 basis points over the prior year, primarily due to the expected improvement in the club level leather business that Rob previously highlighted. This improvement was partially offset by lower margins in the Bassett custom upholstery business due to deleverage of fixed costs from lower sales volumes and $609,000 of unproductive labor costs were 1.3% of sales incurred during the temporary shutdown from the cybersecurity incident.

截至 2024 年 8 月 31 日止三個月的毛利率比前一年增加了 50 個基點，這主要是由於 Rob 之前強調的俱樂部級皮革業務的預期改善。這項改善被Bassett 客製化內裝業務的利潤率下降部分抵消，這是由於銷售下降導致固定成本去槓桿化，以及609,000 美元的非生產性勞動力成本，佔網路安全事件暫時關閉期間銷售額的1.3% 。

While SG&A expenses decreased $500,000, SG&A expenses as a percentage of sales increased 240 basis points due to reduced leverage of fixed costs on lower sales volumes. Wholesale backlog at quarter end was $18.5 million as compared to $19.4 million at the end of the second quarter.

雖然 SG&A 費用減少了 50 萬美元，但由於固定成本對銷售下降的影響減少，SG&A 費用佔銷售額的百分比增加了 240 個基點。季度末批發積壓訂單為 1,850 萬美元，而第二季末為 1,940 萬美元。

Now moving on to retail store operations. Net sales decreased $5 million or 9.6% from the prior year periods. Written sales, the value of sales orders taken but not delivered declined 4.8% compared to the prior year period. Gross margin for the quarter improved 120 basis points over the prior year period due to higher margins in both in line and clearance goods and higher delivery income.

現在轉向零售店營運。淨銷售額較去年同期減少 500 萬美元，成長 9.6%。書面銷售，即已接受但未交付的銷售訂單價值與去年同期相比下降了 4.8%。由於排隊商品和清關商品的利潤率提高以及交付收入增加，本季的毛利率比去年同期提高了 120 個基點。

While SG&A expenses decreased $2.2 million, SG&A expenses as a percentage of sales for the quarter increased 150 basis points, again, primarily due to decreased leverage of fixed costs from lower sales volumes partially offset by reduced advertising and fixed delivery costs.

雖然 SG&A 費用減少了 220 萬美元，但 SG&A 費用佔本季銷售額的百分比再次增加了 150 個基點，這主要是由於銷售下降導致固定成本槓桿率下降，部分被廣告和固定交付成本減少所抵消。

In our goal to increase efficiency at the store level, we have redirected our customer service functions at our centrally located call center to each individual store. This transition eliminated 30 positions responsibility now for customer engagement on scheduling deliveries, taking payments, and handling issues is now at the store level, which enhances local relationship building and engagement. We kept a small staff at our central call center to handle product claims. Retail backlog at the end of the third quarter was $33.3 million, up from $31.5 million at the end of the second quarter.

為了提高商店層面的效率，我們將位於中心的呼叫中心的客戶服務功能重新導向到每個單獨的商店。這項轉變消除了 30 個職位，現在負責安排送貨、接受付款和處理問題的客戶參與責任現在由商店層級承擔，從而增強了本地關係的建立和參與度。我們在中央呼叫中心保留了一小部分員工來處理產品索賠。第三季末零售積壓訂單為 3,330 萬美元，高於第二季末的 3,150 萬美元。

Finally, let's turn to the balance sheet and capital allocation. We ended the quarter with $56.2 million in cash and short-term investments. We limited our operating cash flow deficit for the quarter to $400,000. In addition to the estimated $1 million to $2 million loss related to the cyber incident, we historically have increased cash outflows during the third quarter as we pay our annual premiums on company-owned life insurance, fund a significant portion of our annual property and casualty insurance renewal and give our manufacturing workers vacation pay for the week of July 4 when the plants are shut down.

最後，我們來看看資產負債表和資本配置。本季結束時，我們擁有 5,620 萬美元的現金和短期投資。我們將本季的營運現金流赤字限制在 40 萬美元。除了與網路事件相關的估計100 萬至200 萬美元損失外，從歷史上看，我們在第三季度的現金流出增加，因為我們支付公司擁有的人壽保險的年度保費，為我們年度財產和傷亡的很大一部分提供資金續保，並為我們的製造工人提供 7 月 4 日工廠關閉當週的假期工資。

Last quarter, we mentioned our plans to spend an additional $4 million to $5 million of capital investments in our business over the back half of the year. with the majority of that spending on limited retail store remodels. As the pace of business continued to be weak during the quarter instead of the $10 million we had planned to spend for fiscal 2024 at the end of Q2, we now expect the annual total to range between $6 million to $8 million or $1.5 million to $2.5 million for the fourth quarter.

上個季度，我們提到計劃在今年下半年對我們的業務追加 400 萬至 500 萬美元的資本投資。其中大部分支出用於有限的零售店改造。由於本季業務節奏持續疲軟，而不是我們計劃在第二季末為 2024 財年支出 1,000 萬美元，因此我們現在預計年度總額將在 600 萬至 800 萬美元或 150 萬至 2.5 美元之間第四季度為100 萬元。

Our financial condition remains solid and provides us with a platform to weather the current economic storm while executing our plans for the future. As Rob previously said, we will complete the planned restructuring activities during the fourth quarter, while continuing to challenge our cost structure so that we can align operating expenses to our revenue. It's imperative for us to improve profitability so that asset provides our shareholders a reasonable return.

我們的財務狀況依然穩健，為我們提供了一個平台來應對當前的經濟風暴，同時執行我們的未來計劃。正如羅布之前所說，我們將在第四季度完成計劃的重組活動，同時繼續挑戰我們的成本結構，以便我們能夠使營運費用與收入保持一致。我們必須提高獲利能力，讓資產為股東提供合理的回報。

Now we will open up the line for questions. Gigi, please provide instructions to do so.

現在我們將開放提問熱線。 Gigi，請提供這樣做的說明。

(Operator Instructions) Anthony Lebedzinski, Sidoti.

（操作員說明）Anthony Lebedzinski，Sidoti。

So first, just a quick comment for me. I mean, certainly, despite the difficult environment, it's nice to see the company maintaining a strong balance sheet. So I guess as far as my first question, so obviously, Q3 was -- you had the normals shutdown during fourth of July, you had the cyber attack issue. So you were really only operational for 10 or 11 out of the 13 weeks.

首先，我簡單說一下。我的意思是，當然，儘管環境困難，但很高興看到公司保持強勁的資產負債表。所以我想就我的第一個問題而言，很明顯，第三季是——7 月 4 日期間正常關閉，但遇到了網路攻擊問題。因此，在這 13 週中，您實際上只運行了 10 或 11 週。

So it looks like the weekly revenue on an adjusted basis improved actually from the second fiscal quarter. Your customer deposits also were up sequentially as well. So how should we think about in that context as far as the results and kind of your near-term outlook. I know you mentioned the hurricane and the port strike issue. But just wondering also if you could just comment as to what you've seen so far as far as the Labor Day. I know it's a multiple part question, but hopefully, you can address all that.

因此，看起來調整後的每週收入實際上比第二財季有所改善。您的客戶存款也持續增加。那麼，在這種情況下，我們應該如何考慮結果和近期前景的類型。我知道你提到了颶風和港口罷工問題。但我想知道您是否可以評論一下截至勞動節為止您所看到的情況。我知道這是一個由多個部分組成的問題，但希望您能夠解決所有這些問題。

Anthony, this is Rob. There's a lot to unpack there. I would say July was really tough because we only have operated a week and a half or so in the month. Our fourth of July was good, as I said in my remarks, and the -- so is Memorial Day, in between was very soft. We have historically, things start getting better at the back half of August, leading into Labor Day. This was no exception this year. And September is one of the stronger months for us in the stores and in general for the year. And it has -- it's definitely better slightly better during that time period. But I'd still say if you just overlay this with past years, we're still in a tough environment. That's the way I would describe it.

安東尼，這是羅布。那裡有很多東西需要解壓。我想說七月真的很難，因為這個月我們只運作了一周半左右。正如我在演講中所說，我們的七月四日是美好的，而陣亡將士紀念日也是如此，其間的氣氛非常柔和。從歷史上看，情況在八月下半月開始好轉，直到勞動節。今年也不例外。九月是我們商店和全年整體表現最好的月份之一。在那段時間裡，它確實稍微好一點。但我仍然想說，如果你將這一點與過去幾年相疊加，我們仍然處於一個艱難的環境。我就是這樣描述它的。

Understood. Understood. Okay. Your average ticket was up. What's driving that? And how sustainable do you think that is?

明白了。明白了。好的。你的平均票價上漲了。是什麼推動了這一點？您認為這有多可持續？

Our average ticket is about where it's been. It will be down one quarter to be up. We're right around that $4,000 mark. And so that's -- it's kind of lumpy depending on the size of the design projects that we have. So I would not say that, of course, everybody would like to have a bigger average ticket all the time. But we're as interested as we are in that, we're also interested in store traffic and transactions and all of the above. So I think our average ticket is basically been in this high $3,000 right at $4,000 range for the last couple of years. And it's -- I expect it to stay in that range.

我們的平均票價大約是它去過的地方。它將下降四分之一。我們的價格就在 4,000 美元左右。所以，這有點不穩定，取決於我們設計專案的規模。當然，我不會說每個人都希望一直擁有更高的平均票價。但我們對此很感興趣，我們也對商店客流量和交易以及上述所有內容感興趣。所以我認為過去幾年我們的平均票價基本上一直在 3,000 美元到 4,000 美元之間。我預計它會保持在這個範圍內。

Okay. And then in terms of the gross margin improvement, so even with the headwind of paying your workers that $600,000, you had a nice improvement from last year. So I'm just curious, when business recovers and given the improvement that you're making to the business with the restructuring efforts, what kind of gross margin could we see in a better environment. I'm not -- I would love to hear your thoughts on that.

好的。然後就毛利率的改善而言，即使面臨向員工支付 60 萬美元的不利因素，您也比去年有了很大的進步。所以我很好奇，當業務復甦時，考慮到透過重組努力對業務所做的改進，在更好的環境下我們能看到什麼樣的毛利率。我不是——我很想聽聽你對此的想法。

I think we could improve -- further improve the gross margin. There are challenges, of course, with absorption. We put two factories together this quarter, which is a tough thing to do. We had to really embark upon a new model on [the line], that hurt our margins. We did not -- in addition, we did this right in July and early August. So not only did we have the cyber event, we had that going on.

我認為我們可以改進——進一步提高毛利率。當然，吸收方面也存在挑戰。我們本季將兩家工廠合併在一起，這是一件艱難的事情。我們必須真正開始在[生產線]上採用一種新模式，這損害了我們的利潤。我們沒有——此外，我們在七月和八月初就這樣做了。因此，我們不僅舉辦了網路活動，而且還舉辦了其他活動。

And so the first couple of weeks of that consolidation of those plants was lumpy as often is, unfortunately, over the years, we've had to do some of this. And -- but it got better as the month of August in (inaudible). So it's hard for me to quantify exactly where this could be, but I do think we still can move some -- see some progress in gross margins over -- on the wholesale side in the future. And frankly, we expect it.

因此，這些工廠整合的前幾周是不穩定的，不幸的是，多年來，我們不得不做一些這樣的事情。而且 - 但到了八月（聽不清楚），情況有所改善。因此，我很難準確地量化這可能發生在哪裡，但我確實認為我們仍然可以在未來的批發方面做出一些改變——看到毛利率方面的一些進展。坦白說，我們對此充滿期待。

Now the flip side of that is we want to offer value, and this is a very competitive market at the moment. So as we price our goods and settlement retail, we definitely want to -- at least on the opening price point side, for sure, have some recognizable value. But overall, I feel pretty good about the trajectory of our gross margin and the ability to further improve it.

另一方面，我們希望提供價值，目前這是一個競爭非常激烈的市場。因此，當我們為商品和結算零售定價時，我們肯定希望至少在開盤價方面具有一些可識別的價值。但總體而言，我對我們的毛利率軌跡以及進一步提高毛利率的能力感到非常滿意。

That sounds good. And my last question. As far as the basket design studio concept deal, how many stores is that in right now and what is your expectation for the end of the fiscal year?

聽起來很好。我的最後一個問題。就籃子設計工作室概念交易而言，目前有多少家商店？

Well, we now have 40 of these out in the field. They're not all set up yet because we've -- we got seven of them in the month of September. So we just made the deal. But -- so the -- we haven't shipped all the goods and the fixtures and all that yet.

嗯，我們現在有 40 個這樣的設備在現場。它們還沒有全部設置好，因為我們在 9 月就已經準備好了其中的 7 個。所以我們就達成了協議。但是——所以——我們還沒有運送所有的貨物和固定裝置等等。

We had said earlier in the year, we want to have 50 of these signed and we've got the upcoming market at High Point, and we have reconfigured our showroom to make this a major focal point of the effort down there and look forward to seeing you and showing it to you. So I think we could still get that 50 we talked about earlier. The bigger question is the long-term potential of this.

我們在今年稍早說過，我們希望簽署50 個這樣的產品，並且我們已經在High Point 即將推出的市場，我們已經重新配置了我們的陳列室，使其成為那裡工作的主要焦點，並期待著看到你並向你展示它。所以我認為我們仍然可以獲得我們之前談到的 50 個。更大的問題是其長期潛力。

Now we do not sell entry-level goods. We sell better goods and there are certain markets where you just don't have the demographics to support this, but we are very encouraged and slightly surprise a little bit, frankly, that with the reception that we're getting to this thing with some of the markets that we didn't really necessarily count on.

現在我們不銷售入門商品。我們銷售更好的商品，在某些市場上，你只是沒有足夠的人口統計數據來支持這一點，但坦率地說，我們感到非常鼓舞，並且有點驚訝，因為我們正在與一些人一起做這件事。

So over time, we think between this and then our next iteration of our dedicated distribution footprint, of course, is our Bassett design center, which is the full blooded with the case goods and everything around it, what we used to call a gallery back in the day and then stores.

因此，隨著時間的推移，我們認為，在這之間，我們的專用分銷足蹟的下一個迭代當然是我們的巴塞特設計中心，這是充滿了箱子貨物及其周圍一切的血統，我們過去稱之為畫廊回來白天然後商店。

So this is a great way to get into the Bassett program and extensively for the dealer and it's a proven piece of our line that we do every day. So very excited about the potential and the enthusiasm around it so far.

因此，這是進入巴塞特計劃的好方法，並且對經銷商來說是廣泛的，而且這是我們每天都在做的行之有效的部分。到目前為止，我們對它的潛力和熱情感到非常興奮。

Well, that sounds great. I look forward to seeing that at a high point, and I'll pass it onto others. Thank you very much, gentlemen, and again.

嗯，聽起來不錯。我期待看到這一點，並將其傳遞給其他人。非常感謝你們，先生們，再次感謝你們。

Brian Gordon, Water Tower Research.

布萊恩‧戈登，水塔研究中心。

Good morning, Rob. Good morning, Mike. I want to dig in a little bit on an earlier question. I think if I got this right in your remarks that you said that orders at retail were down something like 4.8%. And given the cyber event, that would come to something like 11% of production days by itself. I know that you had mentioned something like 15% of production days were missed. But part of that, I assume was the planned July 4 shutdowns. If we back out that cyber, would it be fair to say that shipments might have been down something closer to 5% from wholesale.

早安，羅布。早上好，麥克。我想深入探討一下之前的問題。我想，如果我在您的言論中理解正確的話，您所說的零售訂單下降了 4.8% 左右。考慮到網路事件，這本身就佔了生產天數的 11%。我知道您提到 15% 的生產天數被錯過了。但我認為其中一部分是計劃於 7 月 4 日關閉。如果我們取消網絡，可以公平地說，批發出貨量可能會下降近 5%。

Thinking about that question, keep in mind that we do catch up, we're still taking orders on the wholesale side during that shutdown time and --

思考這個問題，請記住，我們確實趕上了，在停工期間我們仍在接受批發方面的訂單，而且——

Talking about the holiday.

談假期。

Yes. Yes. Yes. And we were taking orders during the cyber event...

是的。是的。是的。我們在網路活動期間接受訂單......

Getting interim.

得到臨時的。

We just got an interim. So -- and I'm not sure I follow your math on 5%. Give me that a little bit more context on that.

我們剛剛有一個臨時的。所以——我不確定我是否遵循了你關於 5% 的數學計算。請給我更多一點背景資訊。

Yeah. I mean, so I was just trying to do some back of the envelope. So I mean we have 13 weeks and 5 days of production a week I was assuming. So if you're down to something like 58 days versus 65 that gets to 11%?

是的。我的意思是，所以我只是想做一些簡單的事情。所以我的意思是，我假設我們每週有 13 週 5 天的生產時間。那如果你把時間減少到 58 天與 65 天之類的話，那麼這個比例會達到 11% 嗎？

Yes. And we were down -- keep in mind, we were also down that same amount last year because we're closed for that week of July 4.

是的。我們的業績下降了——請記住，去年我們也下降了同樣的數額，因為我們在 7 月 4 日那一周關閉。

Right. I'm talking about the 7 days specifically for the cyber.

正確的。我說的是專門針對網路的 7 天。

Okay. So Well, it certainly did not help our shipments. But we were essentially able to catch up on the majority of the shipments that we missed the -- I think the real issue when you kind of peel back the onion is on the retail side, where although we were open and theoretically taking orders we had several customers that would come in and not right in order because we were doing it on paper.

好的。那麼，這肯定對我們的出貨沒有幫助。但我們基本上能夠趕上我們錯過的大部分發貨——我認為真正的問題是在零售方面，儘管我們是開放的並且理論上接受訂單，但我們一些顧客會進來，但順序不正確，因為我們是在紙上做的。

So I think when you really think about what you -- the sales you lost, it was really during that time period on the retail side where people were coming in, but essentially turning around and leaving because we didn't have our systems up and running. So that's really the main thing that affected our sales and our shipments for the quarter.

所以我認為，當你真正思考你所損失的銷售額時，實際上是在零售方面的那個時期，人們進來了，但基本上轉身離開了，因為我們沒有建立我們的系統，跑步。所以這確實是影響我們本季銷售和出貨量的主要因素。

I'll add one other comment to that, Brian. And that is as we -- I mean we've shut down a week for the fourth of July for my lifetime around here and in North Carolina is kind of a traditional -- most furniture companies, I know do the same thing. And -- but it takes a little bit of time to get the wheels turning again when you come back from that week off.

我將對此添加另一條評論，布萊恩。這就是我們——我的意思是，我們已經在七月四日關閉了一周，這是我一生中在這裡和北卡羅來納州的一種傳統——我知道大多數家具公司都會做同樣的事情。而且——但當你從那週休假回來時，需要一點時間才能讓一切重新運作。

And also in our case, where we have really captive distribution system, we don't have a lot of different freight lines coming in here and doing this. But so in other words, the loads are depleted. You have to build the loads up again. And so when you have that factor and then immediately after a day, you shut down again for over a week like we just -- Mike said, then it just exacerbated all that.

而且在我們的例子中，我們擁有真正的自營配送系統，我們沒有很多不同的貨運線路來到這裡並執行此操作。但換句話說，負載已經耗盡。你必須再次增加負載。因此，當你有這個因素時，一天后，你會像我們一樣再次關閉一個多星期——麥克說，然後它只會加劇這一切。

So the efficiency in the pipeline and getting these loads built back and filling the trucks and getting them out there, definitely affected our July and into August. We did catch up. Some of that is -- it was just an inefficient really -- and in the factories, too, all this stuff didn't affect us and back to Anthony's question on the gross margins, that's definitely played there. But I would say that it's slightly affected us, but we called up a good part of it is what I would say.

因此，管道的效率、恢復這些負載、裝滿卡車並將它們運出那裡，肯定會影響我們的七月和八月。我們確實趕上了。其中一些是——這確實效率低下——而且在工廠裡，所有這些東西都沒有影響我們，回到安東尼關於毛利率的問題，這肯定是在那裡發生的。但我想說的是，這對我們造成了輕微影響，但我們召喚了很大一部分，這就是我想說的。

That definitely helps kind of understand the impact of that I mean, the reason why I'm asking is, is it does seem like when we take a look at the retail orders and if we were to back out the inefficiencies and then the cyber event that we may be close to a bottom that we might be seeing something like a bottom being put in from a demand perspective? Would you agree with something like that?

這肯定有助於理解其影響，我的意思是，我問的原因是，當我們查看零售訂單時，如果我們要取消效率低下，然後取消網絡事件，這似乎確實如此我們可能已經接近底部，從需求角度來看，我們可能會看到類似底部的情況？你同意這樣的事情嗎？

Well, that, of course, is a great observation and question and the one we ask ourselves all the time and in all calendar, we were asking ourselves this time last year. in the post-covid meltdown, I guess, of retail business around the whole industry. And we had the consecutive months last year of pretty much the same business, and we came into this year saying, hey, -- but I think this is a trend.

嗯，這當然是一個很好的觀察和問題，我們在所有日曆中一直問自己，去年的這個時候我們就問自己。我猜想，在後疫情時代整個產業零售業務的崩盤中。去年我們連續幾個月的業務幾乎相同，今年我們說，嘿，但我認為這是一種趨勢。

We've kind of -- we're bumping along the bottom, and this thing is going to come back at some point. Well, it went down again this year. So that really surprised the heck out of us, to be honest with you. But it does feel in the last -- if I take the third quarter we just reported kind of the back part of that, the last several weeks of that and then into September that we're -- I think we've reached the bottom of this thing.

我們有點——我們正在觸底，而這個事情會在某個時候捲土重來。嗯，今年又跌了。老實說，這真的讓我們感到驚訝。但確實感覺在最後 - 如果我以第三季度為例，我們剛剛報告了其中的後半部分，最後幾週，然後到 9 月，我們 - 我認為我們已經觸底這件事的。

Now the question is, how long do you stay on the bottom? And because we're not seeing, in our case, even though we'll have a very good week, but then we'll get a couple of tough weeks. So we're not seeing the momentum that we want to see. And of course, we're doing everything in our power to try to make that happen. So -- but if you can't come up until you reach the bottom. So from that perspective, I do feel like we're there.

現在的問題是，你還能在谷底待多久？因為我們沒有看到，就我們的情況而言，儘管我們將度過美好的一周，但隨後我們將經歷艱難的幾週。所以我們沒有看到我們想要看到的勢頭。當然，我們正在盡我們所能實現這一目標。所以——但是如果你不能上來直到你到達底部。所以從這個角度來看，我確實覺得我們在那裡。

And let me add, Brian, if you look at the retail written last quarter, it was down 2.5%. Retail written this quarter down 4.8% and as you point out on the cyber -- the effects of the cyber, I think you could come to that assumption that we are sort of bumping along on the bottom.

讓我補充一下，Brian，如果你看看上個季度的零售數據，你會發現它下降了 2.5%。本季零售業虧損下降了 4.8%，正如您在網路上指出的那樣——網路的影響，我認為您可能會得出這樣的假設：我們正在觸底。

Yes, that's all very encouraging. I mean -- so kind of shifting a little bit to thinking about growth for next year, you kind of put that number something like 50 designed studios by the end of the year. Do you have any kind of thoughts on how big that could be as we look to fiscal year '25. And then kind of the follow-on question to that would be, I know there's been no store openings planned for the end of the year. but how many new stores might potentially be in the works? I know you said on the last call that you were actually traveling in July to look at some sites. How many of those might be in the works.

是的，這一切都非常令人鼓舞。我的意思是——稍微轉變一下角度來考慮明年的成長，你可以把這個數字設定為到年底大約有 50 個設計工作室。當我們展望 25 財年時，您對這個規模有什麼想法嗎？隨之而來的問題是，我知道今年年底沒有計劃開設新店。但有多少家新店可能正在興建中呢？我知道您在上次通話中說過，您實際上是在 7 月旅行去參觀一些網站的。其中有多少可能正在進行中。

Well, honestly, I would say at the moment, we've got one market that we're looking at. We're still working on the economics of that. And so -- but that's -- at the moment, all we have planned is one new market, one new store. And we should recent kind of conclusion on that decision in the next few weeks. And so honestly, what we're really doing is looking inward on our current fleet to refurb that. I also alluded to the increase in e-commerce that we're seeing, again, on small basis base, but nevertheless, encouraging, and some good things are happening there.

好吧，老實說，我現在想說的是，我們正在尋找一個市場。我們仍在研究其經濟學。因此，目前我們所計劃的只是一個新市場、一家新商店。我們應該在接下來的幾週內就該決定得出最近的結論。老實說，我們真正要做的是對我們現有的機隊進行內部改造。我還提到了電子商務的成長，我們再次看到，雖然基礎很小，但仍然令人鼓舞，並且那裡正在發生一些好事。

In terms of the custom studio, it's so new. It's six months in, and it's really difficult to say. But I think we're going to see steady growth in that program. Now will we sign another 50 next year. Honestly, I don't know. But I do think that, that will provide growth for us. And again, the ones that have opened already are doing well. we report on that every Monday in our market review, and that's encouraging to see. So those are the kind of things we're counting on for next year.

就定制工作室而言，它非常新。已經六個月了，真的很難說。但我認為我們將看到該計劃的穩定成長。明年我們會再簽下 50 名球員嗎？老實說，我不知道。但我確實認為，這將為我們帶來成長。再說一遍，那些已經開業的企業都表現得很好。我們每週一都會在市場回顧中對此進行報告，這是令人鼓舞的。這些就是我們明年所期待的事。

Great. And really excited to see the new product at High Point when we come visit.

偉大的。當我們來訪時，很高興能在 High Point 看到新產品。

Brian, listen, thank you, and I can't have the call in without a recognition of Budd. We miss him. And he was -- and you were encouraging us to do conference calls, which we hadn't done in the past. This is our second one. And we miss him but you're doing a great job. I know he'd be proud of what's going on with the your organization and looking ahead.

布萊恩，聽著，謝謝你，如果沒有巴德的認可，我就無法接電話。我們想念他。他是——你鼓勵我們召開電話會議，這是我們過去沒有做過的。這是我們的第二個。我們想念他，但你做得很好。我知道他會對貴組織的現狀和未來的發展感到自豪。

Thank you. I would now like to turn the conference back over to Rob Spellman for closing remarks.

謝謝。現在我想將會議轉回羅布·斯佩爾曼 (Rob Spellman) 致閉幕詞。

Okay. Thank you, Gigi. And I just want to thank everyone for your interest today in Bassett and for the questions we did receive. As we said, our restructuring plan is well underway and is designed to align our cost structure with our current revenue and it's something we're focusing on every day around here. We look forward to losing the new collections I talked about growing the Bassett Custom Studio, further connecting with the interior design community and advancing our omnichannel presence as we head into the upcoming High Point market and all into 2025. Thank you very much.

好的。謝謝你，吉吉。我只想感謝大家今天對巴塞特的興趣以及我們收到的問題。正如我們所說，我們的重組計劃正在順利進行，旨在使我們的成本結構與當前收入保持一致，這是我們每天關注的事情。我們期待著失去我談到的新系列，發展 Bassett Custom Studio，進一步與室內設計社區建立聯繫，並在我們進入即將到來的 High Point 市場和 2025 年時推進我們的全渠道業務。

This concludes today's conference call. Thank you for participating. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。