Express Inc (EXPR) 2022 Q4 法說會逐字稿

Ladies and gentlemen, good morning. My name is Abby, and I will be your conference operator today. I would like to welcome everyone to the Express Incorporated conference call to discuss our fourth quarter and full year 2022 earnings. (Operator Instructions)

女士們，先生們，早上好。我叫艾比，今天我將擔任你們的會議接線員。歡迎大家參加 Express Incorporated 電話會議，討論我們第四季度和 2022 年全年的收益。 （操作員說明）

And I would now like to hand the call over to Greg Johnson, Vice President of Investor Relations. Please go ahead, sir.

我現在想把電話轉交給投資者關係副總裁格雷格約翰遜。請繼續，先生。

Thank you, operator. Good morning, and welcome to the Express earnings conference call and webcast to discuss the announcement of our fourth quarter and full year 2022 results. Express' fourth quarter and full year 2022 earnings release and presentation can be found in the Investor Relations section of express.com. These items will be archived, and our call will be available for replay.

謝謝你，運營商。早上好，歡迎參加 Express 收益電話會議和網絡廣播，討論我們第四季度和 2022 年全年業績的公佈。 Express 的第四季度和 2022 年全年收益發布和演示可在 express.com 的投資者關係部分找到。這些項目將被存檔，我們的電話將可以重播。

I'd like to open by reminding you of the company's safe harbor provisions. Today's call may contain forward-looking statements. Any statements made during this conference call, except those containing historical facts, may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual future results may differ materially from those suggested in forward-looking statements due to a number of risks and uncertainties.

我想通過提醒您公司的安全港條款作為開場白。今天的電話會議可能包含前瞻性陳述。在本次電話會議期間作出的任何陳述，除包含歷史事實的陳述外，均可被視為構成 1995 年《私人證券訴訟改革法案》含義內的前瞻性陳述。未來的實際結果可能與前瞻性陳述中建議的結果存在重大差異由於一些風險和不確定性。

For a description of the risks that could cause our results to differ materially from those described in forward-looking statements, please refer to our 2021 Form 10-K and other filings with the SEC. These risks and uncertainties are further detailed in our earnings press release that was issued this morning. These statements represent our current judgment and are subject to risks, assumptions and uncertainties. Express assumes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

有關可能導致我們的結果與前瞻性陳述中描述的結果存在重大差異的風險的描述，請參閱我們的 2021 年 10-K 表格和提交給美國證券交易委員會的其他文件。我們今天上午發布的收益新聞稿中進一步詳述了這些風險和不確定性。這些陳述代表我們目前的判斷，並受風險、假設和不確定因素的影響。除非法律要求，否則 Express 不承擔更新任何前瞻性陳述的義務，無論是由於新信息、未來事件或其他原因。

In addition, we may refer to certain non-GAAP measures. You can locate a reconciliation of any non-GAAP measures discussed in our comments to amounts reported under GAAP in our earnings release. We will also be providing financial comparisons to prior fiscal periods. In our prepared remarks today refer to comparisons to the corresponding periods in 2021, unless otherwise noted. Please see the explanatory notes in the earnings release for additional details regarding the definition of certain items.

此外，我們可能會參考某些非 GAAP 指標。您可以找到我們評論中討論的任何非 GAAP 措施與我們的收益發布中根據 GAAP 報告的金額的對賬。我們還將提供與以前財政期間的財務比較。在我們今天準備好的評論中，除非另有說明，否則指的是與 2021 年同期的比較。有關某些項目定義的更多詳細信息，請參閱收益發布中的解釋性說明。

With me today are Tim Baxter, Chief Executive Officer; Matt Moellering, President and Chief Operating Officer; and Jason Judd, Chief Financial Officer. I will now turn the call over to Tim.

今天和我在一起的是首席執行官蒂姆·巴克斯特 (Tim Baxter)； Matt Moellering，總裁兼首席運營官；和首席財務官 Jason Judd。我現在將把電話轉給蒂姆。

Thank you, Greg, and good morning, everyone. We delivered full year 2022 diluted earnings per share of $4.25, after completing the transaction with WHP Global. This transformative strategic partnership begins a bold new chapter for our company. As a part of the transaction and reflecting the intellectual property of the Express brand that we contributed to the joint venture, and the private sale of a pipe investment, which WHP Global used to acquire 5.4 million newly issued shares of our common stock, we received proceeds of $260 million, which repositioned our company financially and we are now beginning to reposition our company strategically.

謝謝你，格雷格，大家早上好。在完成與 WHP Global 的交易後，我們實現了 2022 年全年攤薄後每股收益 4.25 美元。這種變革性的戰略合作夥伴關係為我們公司開啟了大膽的新篇章。作為交易的一部分，反映了我們為合資企業貢獻的 Express 品牌的知識產權，以及 WHP Global 用於收購我們新發行的 540 萬股普通股的管道投資的私人出售，我們收到2.6 億美元的收益，這使我們的公司在財務上重新定位，我們現在開始在戰略上重新定位我們的公司。

We intend to first achieve profitable growth in our core Express business. Second, to optimize our fully integrated omnichannel platform to create synergies and drive efficiencies across the portfolio of brands; and third, to accelerate our growth and profitability in partnership with WHP Global by scaling the Express brands through category and international licensing and by acquiring and operating other fashion brands. We will accomplish these objectives by operating with consistent, rigorous, sustainable financial discipline, and we are fully committed to creating shareholder value.

我們打算首先在我們的核心快遞業務中實現盈利增長。其次，優化我們完全集成的全渠道平台，以創造協同效應並提高品牌組合的效率；第三，與 WHP Global 合作，通過品類和國際許可擴大 Express 品牌規模，以及收購和運營其他時尚品牌，以加速我們的增長和盈利能力。我們將通過始終如一、嚴格、可持續的財務紀律來實現這些目標，並且我們完全致力於創造股東價值。

Our comparable sales were flat for the year, with negative comps in the back half, offsetting gains in the first half. Our strategy to elevate our brand with higher average unit retails and reduced storewide and site-wide promotions, which had driven steady growth for 5 consecutive quarters through Q2 bumped up against reduced consumer spending, increased price sensitivity in discretionary categories and aggressive promotional activity across the industry.

我們今年的可比銷售額持平，下半年的銷售額為負，抵消了上半年的收益。我們通過提高平均單位零售量和減少全店和全店促銷來提升品牌的戰略，這在第二季度連續 5 個季度穩步增長，抵消了消費者支出的減少、非必需品類別的價格敏感度提高以及整個市場的積極促銷活動行業。

In addition to these external headwinds, we had some self-inflicted misses in our women's assortment architecture. We lacked depth and breadth across certain categories and products, we were out of balance and dressy versus casual in core versus fashion and in good, better, best pricing.

除了這些外部不利因素外，我們在女裝分類架構中也有一些自找的失誤。我們在某些類別和產品上缺乏深度和廣度，我們在核心與時尚以及良好、更好、最好的定價方面失去了平衡，正裝與休閒。

Over the last 3 years, our ability to react quickly has been inhibited by the industry supply chain challenges. Now that we have effectively mitigated most of those challenges, our receipts are arriving on time or in some cases, earlier than expected, and we are responding to consumer trends and behavior with greater speed. We recalibrated with urgency to address the imbalances in our assortment architecture late in the third quarter.

在過去的 3 年裡，我們的快速反應能力受到了行業供應鏈挑戰的抑制。既然我們已經有效地緩解了其中的大部分挑戰，我們的收據會按時或在某些情況下比預期更早到達，並且我們正在以更快的速度響應消費者趨勢和行為。我們緊急重新調整，以解決第三季度末分類架構中的不平衡問題。

We have chased, restructured and corrected our core assortments. And these categories are already generating a significantly higher portion of our sales. These recalibrations will accelerate as we move through the spring and be fully realized in Q3. Our outlook for 2023 reflects improved sales trends as we move through the year.

我們追逐、重組和糾正了我們的核心品種。這些類別已經在我們的銷售額中產生了更高的比例。這些重新校準將隨著我們度過春天而加速，並在第三季度完全實現。我們對 2023 年的展望反映了我們在這一年中不斷改善的銷售趨勢。

In 2022, we continued to advance the Express Way Forward strategy. And while our women's business was challenged, our men's business delivered a record year. We drove positive comps of 12% and growth in all major categories. Our brand purpose is resonating, and our styling community is growing. We are operating with the highest number of loyalty members in our company's history and see strong spend per customer that fell short of our customer acquisition targets and are adjusting our marketing strategies to address this.

2022年，我們繼續推進“高速前行”戰略。雖然我們的女性業務受到挑戰，但我們的男性業務創造了創紀錄的一年。我們在所有主要類別中實現了 12% 的積極增長和增長。我們的品牌宗旨引起共鳴，我們的造型社區也在不斷壯大。我們擁有公司歷史上最多的忠誠會員，並且看到每個客戶的強勁支出沒有達到我們的客戶獲取目標，並且正在調整我們的營銷策略以解決這個問題。

Turning to performance by sales channel. Our retail and outlet stores outpaced e-commerce throughout the year. Express Factory Outlets performed well with a positive 4% comp and record sales and profit in 2022. These results further underscore the current consumer expectation around value. Retail stores delivered a 5% comp for the year, with our in real-life pilot stores outperforming the balance of our fleet.

轉向銷售渠道的績效。我們的零售店和直銷店全年都超過了電子商務。 Express Factory Outlets 表現良好，2022 年銷售額和利潤達到 4% 的正增長。這些結果進一步凸顯了當前消費者對價值的預期。零售店全年交付了 5% 的利潤，我們在現實生活中的試點商店的表現優於我們車隊的平衡。

We opened 6 new Express Edit concept stores in New York, Miami, Boston and Philadelphia. Our Express Edit stores are acquiring new customers and loyalty members and outperforming the balance of our fleet on these metrics as well as boosting digital sales in surrounding ZIP codes.

我們在紐約、邁阿密、波士頓和費城開設了 6 家新的 Express Edit 概念店。我們的 Express Edit 商店正在獲得新客戶和忠誠會員，並且在這些指標上表現優於我們車隊的平衡，並促進了周邊郵政編碼的數字銷售。

Our e-commerce business slowed significantly as the year progressed as customers return to shopping in our stores. E-commerce sales were also impacted by the challenges in our women's business, which is highly penetrated online. As the women's business has improved, we've seen a corresponding lift in this channel. We remain committed to delivering $1 billion in e-commerce demand. But given the industry-wide slowdown in online sales, this may take more time than we originally anticipated.

隨著客戶返回我們的商店購物，我們的電子商務業務隨著這一年的進展而顯著放緩。電子商務銷售也受到我們女性業務挑戰的影響，該業務在線滲透率很高。隨著女性業務的改善，我們看到了該渠道的相應提升。我們仍然致力於滿足 10 億美元的電子商務需求。但鑑於整個行業的在線銷售放緩，這可能需要比我們原先預期更多的時間。

The macro conditions in the back half of 2022 were challenging. And because we expect these conditions to continue, we have identified $40 million of annualized expense savings. $30 million will come from reductions in our SG&A cost structure. The remaining $10 million comes from interest savings due to the elimination of our high-interest term loan, which we paid off in January.

2022 年下半年的宏觀環境充滿挑戰。由於我們預計這些情況會持續下去，因此我們確定每年可節省 4000 萬美元的費用。 3000 萬美元將來自我們 SG&A 成本結構的減少。剩餘的 1000 萬美元來自於取消我們在 1 月份還清的高息定期貸款而節省的利息。

We expect inflationary headwinds as well. So this is just the first phase of aggressive, productive cost savings and expense reductions in order to safeguard our commitment to achieve a mid-single-digit operating margin. At an upcoming investor event, we will share more detail about our expected cost savings and expense reductions, including how and when they will be realized. We are fully committed to the Express Way Forward strategy and our teams remain focused on the initiatives advancing our objectives.

我們預計也會出現通脹逆風。因此，這只是積極、高效的成本節約和開支削減的第一階段，以維護我們實現中個位數營業利潤率的承諾。在即將舉行的投資者活動中，我們將分享更多關於我們預期的成本節約和費用減少的細節，包括它們將如何以及何時實現。我們完全致力於 Express Way Forward 戰略，我們的團隊仍然專注於推進我們目標的舉措。

We have been agile in our approach and continue to both respond to and navigate the macroeconomic consumer and competitive environments. We remain confident in our stated goal of long-term profitable growth in the Express brand.

我們的方法一直很敏捷，並將繼續響應和駕馭宏觀經濟消費者和競爭環境。我們對 Express 品牌長期盈利增長的既定目標充滿信心。

Now let me turn to the other aspects of our transformation beyond our core Express business. We intend to fully optimize our integrated omnichannel platform to operate and grow a portfolio of fashion brands. We will leverage our streamlined flexible go-to-market model and apply our capabilities in sourcing and production, logistics, real estate, technology, finance and human resources to create synergies and drive efficiencies across the portfolio.

現在讓我談談我們轉型的核心快遞業務以外的其他方面。我們打算全面優化我們的綜合全渠道平台，以運營和發展時尚品牌組合。我們將利用我們精簡靈活的上市模式，並運用我們在採購和生產、物流、房地產、技術、財務和人力資源方面的能力，在整個產品組合中創造協同效應並提高效率。

We also intend to accelerate our growth and profitability in partnership with WHP Global by scaling the Express brands through category expansion and international licensing and by acquiring and operating other fashion brands. We will be disciplined in our approach to acquisitions with a focus on generating compelling returns on our investments and delivering against a clear set of strategic criteria, including profitable growth potential synergies through our operating platform and new capabilities. Already a part of the Express brand portfolio, UpWest will also accelerate our growth. While still small, UpWest had a great year with sales growth of 43%.

我們還打算與 WHP Global 合作，通過類別擴張和國際許可以及收購和運營其他時尚品牌來擴大 Express 品牌，從而加快我們的增長和盈利能力。我們將嚴格遵守收購方式，重點是為我們的投資創造可觀的回報，並根據一套明確的戰略標準交付，包括通過我們的運營平台和新能力實現盈利增長的潛在協同效應。作為 Express 品牌組合的一部分，UpWest 也將加速我們的發展。雖然規模仍然很小，但 UpWest 的銷售額增長了 43%。

Digital sales continue to grow rapidly and we have expanded the brick-and-mortar fleet to a total of 13 stores. UpWest also successfully launched its first wholesale relationship with Nordstrom in 2022.

數字銷售繼續快速增長，我們已將實體店數量擴大到 13 家。 UpWest 還於 2022 年成功與 Nordstrom 建立了首個批發關係。

Now let me turn the call over to Jason, who will take you through additional aspects of the WHP Global partnership as well as the details of our fourth quarter and full year results and provide our outlook for 2023.

現在讓我把電話轉給傑森，他將帶您了解 WHP 全球合作夥伴關係的其他方面以及我們第四季度和全年業績的詳細信息，並提供我們對 2023 年的展望。

Thank you, Tim, and good morning, everyone. Before I review our core Express business results for Q4 and the full year, let me speak briefly about the transaction we closed in January with WHP Global. As Tim said, this is a transformative partnership which repositioned our company financially. Upon closing, we received $235 million in gross proceeds in exchange for contributing intellectual property assets to the joint venture.

謝謝蒂姆，大家早上好。在回顧我們第四季度和全年的核心快遞業務業績之前，讓我簡要談談我們在 1 月份與 WHP Global 完成的交易。正如蒂姆所說，這是一種變革性的合作夥伴關係，它在財務上重新定位了我們公司。關閉後，我們收到了 2.35 億美元的總收益，以換取向合資企業提供知識產權資產。

We also received $25 million in proceeds from the private sale of a pipe investment which WHP Global used to acquire 5.4 million newly issued shares of our common stock, representing an approximate pro forma ownership of 7.4%.

我們還從一項管道投資的私人出售中獲得了 2500 萬美元的收益，WHP Global 用來購買我們新發行的 540 萬股普通股，相當於 7.4% 的近似所有權。

The $260 million in proceeds immediately strengthened our balance sheet and provided us with capital to repay our $90 million term loan eliminating $10 million in annual interest expense and fund the first year guaranteed minimum royalties of $60 million to the IP joint venture. We will use the balance of the proceeds to invest in the EXPR platform and in future M&A opportunities.

2.6 億美元的收益立即加強了我們的資產負債表，並為我們提供了償還 9000 萬美元定期貸款的資金，消除了每年 1000 萬美元的利息支出，並為 IP 合資企業提供第一年保證的最低 6000 萬美元特許權使用費。我們將使用所得款項的餘額投資於 EXPR 平台和未來的併購機會。

We are beginning the next phase of our company's transformation to create shareholder value. And the most important way we will do this is by achieving sustainable, profitable growth in the Express brand. In order to realize this objective, we plan to reimagine our financial architecture in some significant ways: growing the top line, operating with financial discipline and realizing expense savings.

我們正在開始公司轉型的下一階段，以創造股東價值。我們要做到這一點，最重要的方法是實現 Express 品牌的可持續盈利增長。為了實現這一目標，我們計劃以一些重要的方式重新構想我們的財務架構：增加收入、遵守財務紀律並實現費用節約。

In 2023, we intend to deliver $40 million of expense reductions to offset the $40 million of net royalty paid to the IP joint venture. $10 million will come from the interest expense savings I just mentioned, and the remaining $30 million will come from reductions to our SG&A expenses.

2023 年，我們打算減少 4000 萬美元的費用，以抵消支付給知識產權合資企業的 4000 萬美元淨專利使用費。 1000 萬美元將來自我剛才提到的利息費用節省，其餘 3000 萬美元將來自我們 SG&A 費用的減少。

Moving to our results. We delivered full year 2022 comparable sales, gross margin rate, SG&A expenses as a percent of sales and adjusted diluted loss per share, all within the ranges of our previous outlook. We expected and drove flat comparable sales in 2022 despite negative 13% comp in Q4. We expected and realized a 150 basis point decline in our full year gross margin rate. including our Q4 gross margin rate of 23.9%. We expected our 2022 SG&A expenses as a percent of sales to delever approximately 200 basis points and we actualized at 220 basis points.

轉到我們的結果。我們交付了 2022 年全年可比銷售額、毛利率、SG&A 費用佔銷售額的百分比以及調整後的攤薄每股虧損，所有這些都在我們先前展望的範圍內。儘管第四季度為負 13%，但我們預計並推動 2022 年的可比銷售額持平。我們預計並實現了全年毛利率下降 150 個基點。包括我們 23.9% 的第四季度毛利率。我們預計我們 2022 年的 SG&A 費用佔銷售額的百分比將減少約 200 個基點，我們實際為 220 個基點。

Our full year GAAP diluted earnings per share was $4.25. This includes the after-tax impact of the $409 million gain on the transaction with WHP Global. We expected an adjusted diluted loss per share of $1.18 to $1.22 in 2022. And after adjustments, we actualized at a loss of $1.21 per share. Moving on to the balance sheet. We expected our inventory to decline sequentially and move closer to parity with quarterly sales changes. Our inventory was up 2%, which was a meaningful improvement from the 10% increase in Q3. As we move through the month of January, our inventory levels were down 6%.

我們全年的 GAAP 攤薄後每股收益為 4.25 美元。這包括與 WHP Global 交易的 4.09 億美元收益的稅後影響。我們預計 2022 年調整後的攤薄每股虧損為 1.18 美元至 1.22 美元。調整後，我們的實際每股虧損為 1.21 美元。轉到資產負債表。我們預計我們的庫存將連續下降，並接近與季度銷售變化持平。我們的庫存增長了 2%，與第三季度 10% 的增幅相比有了顯著改善。在我們度過 1 月份時，我們的庫存水平下降了 6%。

However, we received $26 million of fresh product in the back half of January, which was earlier than expected due to improved supply chain conditions and we began to see improved results immediately upon receipt of that product, particularly in women.

然而，我們在 1 月下半月收到了 2600 萬美元的新鮮產品，由於供應鏈條件的改善，這早於預期，我們在收到該產品後立即開始看到改善的結果，尤其是女性。

Our balance sheet at the end of the year includes the $52 million CARES Act receivable we have mentioned before. And which we expect to receive in 2023. Borrowings against our asset-based lending facility at year-end were $122 million. and we had $66 million of cash and cash equivalents on hand and $148 million available on the revolver.

我們年底的資產負債表包括我們之前提到的 5200 萬美元 CARES 法案應收賬款。我們預計將在 2023 年收到。年末我們基於資產的貸款機制的借款為 1.22 億美元。我們手頭有 6600 萬美元的現金和現金等價物，手槍有 1.48 億美元可用。

Turning to our outlook for 2023. We considered our 2022 performance as well as the advancements we have made in our 4 foundational pillars and balance those factors against the persistent challenges of the macroeconomic and retail apparel environment.

談到我們對 2023 年的展望。我們考慮了我們 2022 年的表現以及我們在 4 個基本支柱方面取得的進步，並在這些因素與宏觀經濟和零售服裝環境的持續挑戰之間取得平衡。

Our outlook includes expectations for the first quarter and the full year of 2023. Let me start with Q1. Compared to the first quarter of 2022, we expect the following: comparable sales of negative low double digits, gross margin rate to decline approximately 850 basis points. SG&A expenses as a percent of sales to deleverage approximately 500 basis points.

我們的展望包括對 2023 年第一季度和全年的預期。讓我從第一季度開始。與 2022 年第一季度相比，我們預計如下：可比銷售額為負低兩位數，毛利率下降約 850 個基點。 SG&A 費用佔銷售額的百分比，以去槓桿化約 500 個基點。

Diluted loss per share of $0.70 to $0.80, inventory to move closer to parity with sales trends as the year progresses. Compared to full year 2022, we expect the following: comparable sales of positive low single digits, diluted loss per share of $0.85 to $1.05, capital expenditures of approximately $55 million.

每股攤薄虧損為 0.70 美元至 0.80 美元，隨著時間的推移，庫存將接近與銷售趨勢持平。與 2022 年全年相比，我們預計如下：可比銷售額為正低個位數，每股攤薄虧損 0.85 美元至 1.05 美元，資本支出約為 5500 萬美元。

At an upcoming investor event, I will share more about our expected growth trajectory over the next several years. And will explain how we expect the combination of a compelling strategy, exceptional execution and a comprehensive and achievable financial road map will create long-term shareholder value.

在即將舉行的投資者活動中，我將更多地分享我們未來幾年的預期增長軌跡。並將解釋我們如何期望將引人注目的戰略、出色的執行力和全面且可實現的財務路線圖相結合，從而創造長期的股東價值。

And now let me turn the call back to Tim.

現在讓我把電話轉回蒂姆。

Thank you, Jason. We are beginning a bold new chapter of our transformation and have a clear strategic road map. We intend to first achieve profitable growth in our core Express business. Second, to optimize our fully integrated omnichannel platform to create synergies and drive efficiencies across the portfolio of brands, and third, to accelerate our growth and profitability in partnership with WHP Global by scaling the Express brand through category and international licensing and through the acquisition and operation of other fashion brands. We will accomplish all of this by operating with consistent, rigorous and sustainable financial discipline to create shareholder value.

謝謝你，傑森。我們正在開啟轉型的大膽新篇章，並製定了清晰的戰略路線圖。我們打算首先在我們的核心快遞業務中實現盈利增長。其次，優化我們完全集成的全渠道平台，以創造協同效應並提高品牌組合的效率，第三，通過與 WHP Global 合作，通過類別和國際許可以及通過收購和經營其他時裝品牌。我們將通過始終如一、嚴格和可持續的財務紀律來創造股東價值，從而實現所有這些目標。

This will be our President and Chief Operating Officer, Matt Moellering's last earnings call. As we announced earlier this month, he will be retiring in May. For the past 20 years, Matt has been a driving force behind each stage of the company's evolution. He played an instrumental role in taking the company private and taking the company public.

這將是我們的總裁兼首席運營官 Matt Moellering 的最後一次財報電話會議。正如我們本月早些時候宣布的那樣，他將於 5 月退休。在過去的 20 年裡，馬特一直是公司發展各個階段的推動力。他在將公司私有化和上市方面發揮了重要作用。

His tremendous institutional knowledge and steady hands have provided continuity for our organization over a very long period of time. In the last 3.5 years since I joined the company, Matt has been an extraordinary thought partner, someone who's experienced in perspective, I have valued a great deal. He helped to launch and advance our EXPRESSway Forward strategy, helped steer our organization through the pandemic and played an integral role in the formation of our new partnership with WHP Global.

他豐富的機構知識和穩健的雙手為我們的組織提供了很長一段時間的連續性。在我加入公司的過去 3.5 年裡，馬特一直是一位非凡的思想夥伴，他在遠見方面經驗豐富，我非常看重。他幫助啟動和推進了我們的 EXPRESSway Forward 戰略，幫助引導我們的組織度過了大流行病，並在我們與 WHP Global 建立新的合作夥伴關係方面發揮了不可或缺的作用。

I want to thank Matt for his leadership, his guidance and his many contributions but most of all, for his support in positioning our company for the next chapter of our transformation. I know I speak for our entire organization when I say, thank you, Matt.

我要感謝 Matt 的領導、他的指導和他的許多貢獻，但最重要的是，感謝他支持我們公司為轉型的下一章做好準備。我知道當我說謝謝你時，我代表我們整個組織，馬特。

And now I'll turn the call back over to the operator so we can take your questions.

現在我會將電話轉回接線員，以便我們回答您的問題。

(Operator Instructions) We will take our first question from Eric Beder with SCC Research.

（操作員說明）我們將從 SCC Research 的 Eric Beder 那裡回答我們的第一個問題。

In terms of the joint venture with WHP, what are you assuming from that in your 2023 guidance? And what should we be thinking about in terms of the acquisition criteria is in terms of potentially -- are you looking for immediately -- these acquisitions to be immediately accretive?

關於與 WHP 的合資企業，您在 2023 年的指導中對此有何假設？就收購標準而言，我們應該考慮的是潛在的——你是否正在立即尋找——這些收購會立即增加？

Eric, thanks for the question. I'll answer the first half on the -- what's included in our outlook and then turn it over to Matt to talk through the decision criteria. So within the outlook, within gross margin, we will be impacted by the $60 million of guaranteed minimum royalty and then within operating income, there will be our share of distributions from the joint venture back of roughly $20 million. So the net impact associated in the P&L outlook is $40 million on the year.

埃里克，謝謝你的提問。我將回答前半部分——我們的展望中包含的內容，然後將其交給馬特討論決策標準。因此，在展望中，在毛利率範圍內，我們將受到 6000 萬美元保證最低特許權使用費的影響，然後在營業收入中，我們將從合資企業獲得的分配份額約為 2000 萬美元。因此，與 P&L 前景相關的淨影響為 4000 萬美元。

And then on the second piece, what we're looking for are acquisitions that do a couple of things. One, provide profitable growth opportunity going forward opportunities that provide significant synergy opportunities for us, acquisitions that provide new capabilities and that are complementary to our Express fashion business as well.

然後在第二部分，我們正在尋找的是做幾件事的收購。第一，提供有利可圖的增長機會，為我們提供重大協同機會的機會，提供新功能的收購以及對我們的快速時尚業務的補充。

All 4 criteria don't have to be met, but we are looking for opportunities that meet one or more of those requirements in that or significant return on investment opportunities for Express. Will they all be accretive in the first year? I wouldn't say all of them will, but they all will drive significant economic profit over a very short period of time, and that's what we're looking for in opportunities.

不必滿足所有 4 個標準，但我們正在尋找滿足其中一項或多項要求的機會，或者 Express 的顯著投資回報機會。它們在第一年都會增值嗎？我不會說所有這些都會，但它們都會在很短的時間內帶來可觀的經濟利潤，而這正是我們正在尋找的機會。

Okay. And in terms of what we're seeing in the product, we've seen a number of items come in, in terms of fashion basics for both men and women. What should we be seeing in terms of penetration going forward? And how -- what should we be thinking about in terms of the margin opportunities for those items versus the regular items or the fashion items?

好的。就我們在產品中看到的內容而言，我們已經看到了很多項目，在男性和女性的時尚基礎方面。在未來的滲透率方面，我們應該看到什麼？以及如何——我們應該如何考慮這些項目與常規項目或時尚項目的利潤率機會？

Well, obviously, our core assortments generate higher margins than our fashion deliveries. And as I said during my prepared remarks, Eric, we had imbalances, particularly in our women's business between core and fashion. The reality is that the fashion that we delivered in women's sold very well. We just did not have the appropriate depth and breadth in our core categories. to drive the volume that we needed to drive.

好吧，很明顯，我們的核心分類比我們的時裝交付產生更高的利潤。正如我在準備好的發言中所說的那樣，埃里克，我們存在不平衡，尤其是在核心業務和時尚業務之間。現實情況是，我們提供的女裝時裝賣得很好。我們只是在核心類別中沒有適當的深度和廣度。驅動我們需要驅動的音量。

And so we have, as I said, reacted with great urgency to correct all of those imbalances in the women's assortment. And we're seeing improvement, as you said, as we see our core categories and the depth and breadth of our core categories, coming back to life in our stores and online. So our outlook that we've shared for the year indicates sequential improvement as we move through the year in both sales and profit. So we are obviously expecting that the corrections that we've made to the imbalances in the assortment, particularly in women, are going to really reverse the sales trend that we saw in the fourth quarter.

因此，正如我所說，我們已經非常緊迫地做出反應，以糾正女性產品分類中的所有這些不平衡。正如您所說，我們看到了改進，因為我們看到我們的核心類別以及核心類別的深度和廣度，在我們的商店和網上恢復生機。因此，我們對今年的展望表明，隨著我們在今年的銷售和利潤方面取得連續改善。因此，我們顯然預計，我們對產品種類（尤其是女性）的不平衡所做的糾正將真正扭轉我們在第四季度看到的銷售趨勢。

Great. And one quickly. You mentioned about the licensing. I understand what's going in there. So if you sign agreements for more international territories or for categories, the joint venture side that, that would be incremental to your guidance? Is that how we should be thinking about that?

偉大的。並且很快。你提到了許可。我明白裡面發生了什麼。因此，如果您簽署更多國際領土或類別的協議，合資企業方面，這將增加您的指導？那是我們應該考慮的方式嗎？

That is how you should be thinking about that, Yes.

這就是你應該考慮的方式，是的。

Our current guidance includes no impact from our relationship with WHP Global other than the royalty payment, which Jason described earlier.

我們目前的指導意見不包括我們與 WHP Global 的關係的影響，但 Jason 之前描述的特許權使用費支付除外。

Great. Thank you and good luck for the year of [2023.]

偉大的。謝謝你，祝你 [2023 年好運。]

(Operator Instructions) We will take our next question from Dana Telsey with Telsey Group.

（操作員說明）我們將與 Telsey Group 一起接受 Dana Telsey 的下一個問題。

And Matt best of luck in your next chapter. As you're looking at -- as we're looking at the results today, Tim and where you are and obviously, identifying the issue with the women's business, as you look through the cadence of the year for improvement, what should we be seeing in that women's business? And how are you thinking about maintaining the momentum of the men's business? And then I have a follow-up.

Matt 祝你下一章好運。正如你所看到的——當我們看到今天的結果時，蒂姆和你所處的位置，很明顯，確定女性業務的問題，當你回顧一年的節奏以尋求改進時，我們應該怎麼做看到那個女人的事了嗎？您如何考慮保持男裝業務的發展勢頭？然後我有一個後續行動。

Sure. So what we should be seeing in the women's business or what you should be seeing in the women's business is improved balance in the assortments. So improved balance between dressy and casual, improved balance, particularly in tops, and that is across silhouette and across price points. So you'll see -- you should see improved balance in good, better and best pricing across our tops assortment.

當然。因此，我們應該在女裝業務中看到的，或者您應該在女裝業務中看到的是，產品組合的平衡得到改善。因此改善了正裝和休閒之間的平衡，改善了平衡，尤其是在上衣中，這是跨款式和跨價格點的。所以你會看到——你應該看到我們的頂級產品在良好、更好和最好的定價之間取得了更好的平衡。

And you should begin to see great iterations of all of our iconic styles. And I want to be sure, Marni asked on the last call, she doesn't want to see Portofino walls. And the Portofino is one of our iconic styles and the team has done a phenomenal job of iterating against all of our icons. So as we move through the year, you'll begin to see better balance in the assortments. You'll continue to see great fashion deliveries, which have continued to perform well for us.

你應該會開始看到我們所有標誌性風格的偉大迭代。我想確定，Marni 在最後一次通話中問道，她不想看到 Portofino 的牆壁。 Portofino 是我們的標誌性款式之一，團隊在迭代我們所有的標誌性方面做得非常出色。因此，隨著我們度過這一年，您將開始看到分類更加平衡。您將繼續看到出色的時裝交付，這些時裝交付對我們來說一直表現良好。

And you'll see the reimagining of all of our icons across all of the categories and a reintroduction of many of those icons across the categories in the women's business. In the men's business, it's really all about, to your point, sustaining the momentum that we have seen over the past several years. And that strategy is not different than women's, except that it is about sustaining not turning around.

您會看到我們對所有類別的所有圖標進行重新構想，並在女性業務的各個類別中重新引入許多這些圖標。在男性業務中，就您的觀點而言，這實際上就是保持我們在過去幾年中看到的勢頭。這種策略與女性的策略沒有什麼不同，只是它是關於維持而不是回頭。

We've had great balance in our men's assortments. We have grabbed market share in categories that were previously not core categories for us like denim, like knits like men's chinos. And so you'll see us continuing to take market share across all categories in men's and continuing to drive the businesses that were very well known for like men's suits. We had a fantastic year in men's suits and men's dress shirts, another fantastic year in men's dress shirts.

我們在男裝系列中取得了很好的平衡。我們已經在以前不是我們核心類別的類別中搶占了市場份額，例如牛仔布，例如男式斜紋棉布褲等針織品。因此，您會看到我們繼續在男裝的所有類別中佔據市場份額，並繼續推動以男裝等著稱的業務。我們在男士西裝和男士正裝襯衫方面度過了美妙的一年，在男士正裝襯衫方面又是精彩紛呈的一年。

And the same thing that I talked about in women's where we are sort of reinventing and reintroducing our icons will also be happening in men's. We've recently introduced several iterations of our iconic 1MX shirt in men's and each one of those has performed extraordinarily well. So you'll continue to see us doing that throughout the year, too.

我在女裝中談到的同樣的事情，我們正在重塑和重新引入我們的偶像，也將在男裝中發生。我們最近推出了多款男款標誌性 1MX 襯衫，每一款都表現出色。所以你會繼續看到我們全年都這樣做。

Got it. When I look at channels, it looks like the e-commerce business declined more than the stores channel and outlet performed better than some of the regular retail stores, how you're planning the different channels? What did you see in the components of the comps, whether it's traffic conversion? And then on the merch margin, which was, I think, impacted by 280 basis points which is a little bit better than the 360 in the prior quarter. How do you see that moving forward?

知道了。當我看渠道時，電子商務業務似乎比商店渠道下降得更多，奧特萊斯比一些常規零售店表現更好，您如何規劃不同的渠道？您在comp的組成部分中看到了什麼，是否是流量轉換？然後是商品利潤率，我認為它受到 280 個基點的影響，比上一季度的 360 好一點。您如何看待這方面的進展？

So from a channel perspective, Dana, certainly, we did experience a slowdown in our e-commerce business as the year progressed as we moved through the year, culminating in that more significant drop in the fourth quarter. I think 2 things are happening in e-commerce.

因此，從渠道的角度來看，達納，當然，我們的電子商務業務確實經歷了一年的放緩，隨著我們今年的發展，最終在第四季度出現了更顯著的下降。我認為電子商務正在發生兩件事。

Number one, we've seen and heard from many of our competitors a similar story about pretty aggressive slowdowns in the e-commerce business in 2022, as consumers return to shopping in stores, something that hadn't happened for a couple of years while we were living under the influence of the pandemic. So I think that was part 1 of our e-commerce challenge.

第一，我們已經看到並從我們的許多競爭對手那裡聽到了一個類似的故事，即隨著消費者重返商店購物，電子商務業務在 2022 年將大幅放緩，而這種情況已經有幾年沒有發生了我們生活在大流行病的影響下。所以我認為這是我們電子商務挑戰的第 1 部分。

The second part was the challenges that we faced in our women's business, which is very highly penetrated online. So as we make the corrections that we have made and continue to recalibrate our assortments in women's, we anticipate our e-commerce business improving, and we have already seen a corresponding lift in that channel as we've corrected our assortments in women's. I would expect that to continue as we move through the year.

第二部分是我們在女性業務中面臨的挑戰，該業務在線滲透率非常高。因此，當我們進行我們所做的更正並繼續重新調整我們在女性產品中的分類時，我們預計我們的電子商務業務會有所改善，並且我們已經看到該渠道的相應提升，因為我們已經糾正了我們在女性產品中的分類。我希望隨著我們度過這一年，這種情況會繼續下去。

And I would expect our e-commerce business to improve sequentially, just as we have outlined in our outlook. I also expect our stores to continue to perform well. You mentioned the outlet stores, that channel. I think it's very clear that the consumer demanded value in the fourth quarter, that channel was performed better than our other channels in the fourth quarter.

正如我們在展望中所概述的那樣，我希望我們的電子商務業務能夠連續改善。我也希望我們的商店繼續表現良好。你提到了直銷店，那個渠道。我認為很明顯消費者在第四季度需要價值，該渠道在第四季度的表現優於我們的其他渠道。

And I think that's clearly because we offered really exceptional value in that channel. In our retail stores, we bumped up against a consumer who was demanding really aggressive promotion, particularly since our average unit retails were substantially higher than they have been in the past. So as a part of recalibrating the assortments, we're also addressing those things. So I expect our stores performance to continue to improve as we move through the year as well.

我認為這顯然是因為我們在該渠道中提供了真正卓越的價值。在我們的零售店裡，我們遇到了一位要求真正積極促銷的消費者，特別是因為我們的平均單位零售量大大高於過去。因此，作為重新校準分類的一部分，我們也在解決這些問題。因此，我希望我們的門店業績在今年也能繼續改善。

We've also got some exciting things happening in stores. Our in real life pilot. I mentioned that, that is a pilot that we put in place a bit over a year ago so that we could learn about how we could create a much, much better experience in our stores for our consumers to drive conversion to higher levels. We're seeing better results in those stores than in other stores.

我們還在商店裡發生了一些令人興奮的事情。我們在現實生活中的飛行員。我提到過，這是我們一年多前進行的試點，這樣我們就可以了解如何在我們的商店中為消費者創造更好的體驗，從而將轉化率提高到更高水平。我們在這些商店看到比其他商店更好的結果。

And we are -- so we are tweaking that model and considering rolling that out to additional stores when we are confident that we've got the financial model correct. And I'll let Jason speak to the gross margin part of that question.

而且我們 - 所以我們正在調整該模型並考慮在我們確信我們的財務模型正確時將其推廣到其他商店。我會讓傑森談談這個問題的毛利率部分。

Yes. With regard to merchandise margin, as we look through the year, it's really a story of increasing balance to steal Tim's word. So we will be seeing in the back half of this year, costing improvement on a like-for-like product basis year-over-year. We are seeing that in the POs we are writing right now. And I think that, that is very aligned with what we're hearing in the market.

是的。關於商品利潤率，當我們回顧這一年時，這確實是一個增加平衡以竊取蒂姆的話的故事。因此，我們將在今年下半年看到，在同類產品的基礎上同比成本有所改善。我們在我們現在正在編寫的 PO 中看到了這一點。我認為，這與我們在市場上聽到的非常一致。

On the other side of the story, is the fact that this value customer, we expect to stay with the market for what I'll call the near term, so over the next number of quarters. And definitely need to see a set of price points attractive to them that would offset some of the costing benefit. Now it's not a full offset because typically this is handled through a markdown.

另一方面，事實上，這個有價值的客戶，我們希望在我稱之為短期內留在市場上，因此在接下來的幾個季度內。並且肯定需要看到一組對他們有吸引力的價格點，以抵消一些成本效益。現在它不是完全抵消，因為通常這是通過降價處理的。

But to Tim's point on balance, this is also handled by giving that broader balanced assortment into our core, not just the fashion that they're looking for. And so I do expect to have, as indicated with our EPS guidance on the year attrition in the merch margin rate. A lot of that is driven in Q1, which we talked about and then balance achieved by the end of the year.

但就蒂姆的平衡點而言，這也可以通過將更廣泛的平衡分類納入我們的核心來解決，而不僅僅是他們正在尋找的時尚。所以我確實希望有，正如我們關於商品利潤率年度損耗的 EPS 指導所表明的那樣。其中很多是在第一季度推動的，我們談到了這一點，然後在年底實現了平衡。

And that is all the time we have for questions today. I will now turn the call back to Mr. Baxter for his closing remarks.

這就是我們今天所有的提問時間。我現在將把電話轉回給巴克斯特先生，聽取他的結束語。

Thank you all for joining us this morning and for your continued interest in our company.

感謝大家今天早上加入我們，感謝您對我們公司的持續關注。

And ladies and gentlemen, this concludes today's conference call. We thank you for your participation. You may now disconnect.

女士們，先生們，今天的電話會議到此結束。我們感謝您的參與。您現在可以斷開連接。