Steven Madden Ltd (SHOO) 2011 Q1 法說會逐字稿

Good day, everyone, and welcome to the Steve Madden first quarter 2011 earnings conference call.

Today's call is being recorded.

For opening remarks and introductions, I will turn the call over to Ms.

Jean Fontana.

Please go ahead, ma'am.

Thank you, good morning, everyone .

Thank you for joining us for the discussion of Steve Madden's first quarter 2011 earnings results.

Before we begin, I would like to remind you that statements in this conference call that are not statements of historical or current facts constitute Forward-looking statements with the meaning of the Private Securities Litigation Reform Act of 1995.

Such Forward-looking statements involve risks and uncertainties and other unknown facts that could cause actual results of the Company to be materially different from the historical results or any future results expressed or implied by such Forward-looking statements.

The statements contained herein are also subject generally to other risks and uncertainties as described from time to time the Company's reports and registration statements filed with the SEC.

Also, please refer to their earnings release for more information on risk factors that could cause actual results to differ.

Finally, please note that any Forward looking statements used in this call cannot be relied upon as current after this date.

I would now like to turn the call over to Ed Rosenfeld, Chairman and CEO of Steve

Thanks, Jean.

Good morning everyone, and thank you for joining us.

I'll begin today's call with a review of our first quarter financial results.

I'll then highlight some recent developments at the Company and finally update you on our guidance for 2011.

Overall, we are pleased with our first quarter performance as we delivered strong top and bottom line gains in both wholesale and retail.

Validated net sales for the quarter grew 26% over the prior year to $165.8 million.

Wholesale net sales increased 30% to $134.3 million compared to $103.1 million in the first quarter of last year with solid increases in both our footwear and accessories wholesale businesses.

Wholesale footwear net sales were $108.5 million, a 31% gain versus Q1 2010.

Of course, the increase was partially a result of the transition of our Target private-label and Olsenboye footwear businesses to the wholesale model from the buying agency model.

Excluding the impact of these transitions, wholesale footwear net sales increased 12% compared to the prior year driven by strong gains in international, Madden Girl, and Madden.

Wholesale accessories net sales were $25.8 million, a 27% increase driven by strong growth in our private-label business as well as the continued momentum of Big Buddha.

Turning to retail, we are very pleased with the results in our retail division with net sales rising 10% to $31.5 million in the quarter.

Comparable store sales increased 12% which is on top of a 13.6% increase in the first quarter of last year.

Comp was driven by both higher AURs and improved conversion.

Our assortment was spot on in terms of trends with strong performance across a number of categories, including boots and booties, pumps, and wedges.

Doors opened for the 12 months ended March 31, 2011 generated $766 in sales per square foot, up from $672 in sales per square foot a year ago.

Closed four full price store and opened three outlets, ending the first quarter with a eighty three Company-owned retail locations, including the Steve Madden Internet store.

Turning to other income, our commission and licensing income net of expenses was $4.6 million in Q1 versus $6.2 million last year.

First cost commission income net of expenses was $2.7 million in the quarter, down from $4.9 million in last year's first quarter.

Decline was due entirely to the transition of the Target private label and Olsenboye footwear businesses with wholesale model and into the top line.

Licensing royalty income net of expenses was $1.9 million in the quarter, up 53% from the first quarter of 2010.

Driven by the inclusion of royalty income from the Betsey Johnson brand, which we acquired in October 2010.

Consolidated gross margin for the quarter was 41.7%, as compared to 45.5% in the first quarter of last year.

Decline was due to a decrease in the wholesale gross margin to 37.9%, from 42.5% in the same period last year.

As expected, wholesale gross margin was diluted by three shifts in sales mix.

One, the transition of the Target private-label and Olsenboye footwear businesses to the top line, two, the strong growth of the private-label accessories business and three, the strong growth of the international business.

Combined , these factors accounted for 410 of the 460 basis point decline in wholesale gross margin.

Gross margin in the retail division expanded in the quarter to 58.1% this year compared to 56.7% in the first quarter of 2010 due to reduced discounting.

Operating expenses were $46.2 million in the first quarter, or 27.9% of net sales compared to $41.3 million, or 31.4% of net sales a year ago, 350 basis point year-over-year improvement was due mainly to leverage on increased sales.

Operating income for the first quarter of 2011 increased to $27.5 million, or 16.6% of net sales compared to $24.9 million, or 18.9% of net sales in last year's first quarter.

And income increased 16% to $17.9 million, or $0.63 per diluted share compared to $15.4 million, or $0.55 per diluted share in the prior year's first quarter.

Turning to our balance sheet, as of March 31, 2011, we had $188.8 million in cash and marketable securities and no debt.

We ended the first quarter with inventory of $33.8 million versus $23.9 million in the first quarter of last year.

We're comfortable with our inventory levels and in fact believe that this is a better level of inventory than what we had a year ago in terms of enabling us to maximize gross profit dollars.

As the end of the quarter, we had approximately three weeks of supply in wholesale and approximately 13 weeks of supply in retail.

Our consolidated inventory turn over the last 12 months was 9.5 times and CapEx for the quarter was $3.7 million.

Now I'd like to update you on some new developments at the Company over the last couple of months.

In February, we signed an agreement to become the exclusive distributor of Superga in North America beginning in June of this year.

Superga is an Italian heritage sneaker brand that we will distribute in high end department and specialty stores.

The brand is strong in many international markets, particularly in Western Europe, but is largely unknown in the United States.

Given its strong product line, including its iconic 2750 Classic Style, as well as its authentic 100-year-old brand heritage, we believe that with the proper marketing, Superga has the potential to really take off in the United States.

Also in February, we signed a new international license agreement for distribution of Steve Madden in India with Reliance brands.

India is clearly an attractive and rapidly growing market, and in Reliance, we believe we have found the ideal partner, one that understands brand building and has the real estate clout and financial wherewithal to execute on an aggressive growth plan for Steve Madden.

We expect to have the first flagship stores opening in key markets in India by the end of this year.

And finally, in March, we continued our test of the outlet model by opening three more outlets, bringing us to four outlet stores in total.

New stores are in Las Vegas, Orlando and Philadelphia.

While it's still early, these stores are running ahead of expectation in both sales and gross margin.

We continue to be encouraged by the potential outlet store rollout.

We have two more outlet openings planned for this year.

And now, I'd like to provide you with our latest thoughts on the rising costs in China and the associated gross margin impact.

We're still seeing approximately 5% to 8% increases in our cost of goods from southern China.

Continue to work to mitigate these increases by moving more production to the northern China where costs remain lower and to a lesser extent, by shifting some production to other countries, such as Mexico.

We've also raised prices on select items with fresh materials or styling, so far have not experienced price resistance.

The net impact to gross margin from all these changes was negligible in Q1.

We continue to target a net neutral impact to gross margin from all these changes for the full year 2011, although I must note that achievement of this goal requires continued customer acceptance of price increases.

As discussed on last call, we do expect overall 2000 gross margin to be down due to mix shifts caused by one, inclusion of the Target private-label and Olsenboye footwear businesses in the top line, two, the growth of the international business and three, the growth of the private-label accessories business.

Overall, these mix shifts are expected to dilute gross margin by approximately 240 basis points this year.

Excluding these mix shifts, however, we now believe we can be flat to modestly up compared to last year, and so we currently expect consolidated gross margin for 2011 to be approximately 140 to 240 basis points lower than 2010, an improvement over our previous guidance of a gross margin decrease of 200 to 300 basis points for the year.

Finally, we announced today that our board of directors has declared a three for two stock split.

Stock split will entitle stockholders of record at the close of business on May 20 to receive one additional share for every two shares of common stock held on that day.

Additional shares are expected to be distributed on or about May 31.

Now, onto sales and earnings guidance.

For fiscal 2011, we continue to expect net sales will increase 20% to 22% compared to fiscal 2010.

Diluted EPS for 2011 is now expected to be in the range of $2.03 to $2.10.

Compared to previous guidance of diluted EPS in the range of $2 to $2.07 on an adjusted basis to address the three for two stock splits.

And now I'd like turn it over for any questions you may

Thank you.

The question-and-answer session will be conducted electronically.

(Operator Instructions).

With that our first question from Jeff Van Sinderen with B.

Riley.

Good morning, and congratulations.

I wonder if you can give us any more color on Madden Girl, what you're seeing there in terms of trends and order rates and sell throughs.

Yes.

Madden Girl continues to perform.

We had another nice double-digit top line gain in the quarter, and it just continues to grow.

It's doing well really in a bunch of different tiers.

It's doing well, of course, in the TJ Maxx , Marshalls, those guys where it's historically been, but as you know, we've been really growing it in Macy's over the last year or two, and it continues to pick up steam there.

We're now all door in Macy's with Madden Girl and we're getting some very strong selling there, which we're really pleased

Okay, good.

And then any update you can give us on Betsey Johnson and the progress there?

Yes.

That's perhaps the most exciting thing happening for us right now is Betsey Johnson footwear is just -- we're so pleased with the performance there.

As you know, we start off selling -- our first shipments went to Nordstrom.

We initially shipped about 36 doors .

The sell throughs were extremely strong there.

Nordstrom was thrilled with them, and in fact, Nordstrom has now taken -- signed-on for a couple styles to go all door for fall.

So we're really excited about that, and in addition, we've got Dillards signed up for about 28 doors, Lord and Taylor is doing about 47 doors, and we're also shipping is Zappos and Amazon and Victoria's Secret and Macys.com and a number of other accounts, so we're really, really pleased with the initial reads

Okay, good.

And it sounds like you're accessories business is doing pretty well.

Any more color you can give us on that?

Yes.

We had big increases in first quarter .

The biggest increase really came from the private-label accessories, the private-label piece of the accessories business.

We had a big gain with our handbag business with Wal-Mart, so we were pleased with that.

We've also continue to have really nice momentum in Big Buddha.

Steve Madden is performing well, we're doing well in belts.

The Betsey Johnson business, as you know, has been a little tough, although we're having a great market week this week.

We think we've done a lot to improve the product there, and we're optimistic that we're going to get that turned

Okay, good.

And then I know it's still early, but anything you can share on your plans for Superga and how you're going to approach that in the US?

Yes.

Well, I think in terms of distribution, it's going to be focused on the high end department stores and specialty stores.

But the key will really be bringing the -- to do some interesting things with marketing and to -- I think there's going to be a big PR aspect here.

We're going to want to try to get it on the right feet in the right magazines and the right editorial pieces, et cetera.

And I can't announce anything yet, but we're working on developing some kind of collaboration or co-branding concept with a designer brand which we think could be very exciting.

Oh good, okay.

Great to hear.

Thanks very much, and good luck this quarter.

Thanks, Jeff.

We'll move on to Scott Krasik with BB&T Capital Markets.

Thanks.

Good morning, Ed.

Good morning, Scott.

So, question on gross margin.

I guess first, outside of the three items you pulled out, the decline in gross margin, can you just sort of talk through that?

Of the overall gross margin was down about 380 basis points, and those three items accounted for 360, so we were quite close.

We were off 20 basis points.

There were a few little things in there, we had to fly some more goods because sandals took off much earlier this year.

Sandals really started selling it January, which has not happened the last few years, so we flew in some goods for that reason.

But we were awfully -- we were essentially close to flat without those three mix shifts.

On wholesale, there were some other -- maybe it was a little bit more than that.

Yes, it was 410 out of 460 basis points in wholesale.

That other 50 basis points is essentially the freight and some of those other factors.

Okay, and mix was a play there.

Will mix turn more favorable as you sell more wedges and sandals -- wedges and heels and things like that?

I don't think it -- I don't think that impacts the gross margin percentage, no.

I don't see that being impactful.

Okay.

And then just in terms of seasonality --

I just want to finish on a point though.

But the impact on from those three items that we've called out does less in the back three quarters.

In these next three quarters, we anticipate it's going to be somewhere between 180 to 230 basis points in each quarter whereas it was 360 basis points for the overall gross margin first.

You read my mind.

That was my question.

So, in the last three quarters, is there a specific quarter where you expect the impact be greater?

Based on our current projections, fourth-quarter would be the greatest, but again, that would be 230 basis points, still considerably less than what we had in first.

Okay, that's --

And those numbers are on the overall gross margin, not the wholesale.

Okay, great.

And then just in terms of your efforts to , I don't know to elevate is the right word, but the Steve Madden brand to really make the distribution there as clean as possible and utilizing your other brands in doors that are more appropriate for those, where are you in those

Yes.

Well, we've -- I think that we've really done that over the last couple of years, and that's one of the things that's been great about Madden Girl is it's allowed us to do business and that second tier.

DSW, TJ's et cetera, and we can sort of pull Steve Madden or lessen Steve Madden's presence in the stores and really build Madden Girl, and now we're doing the same thing on the men's side with our Madden brand which is allowing us to keep Steve Madden men's elevated and still do the business at that $50, $60 price point and we know a lot of men are looking for.

And even within Macy's, as you know, we've pulled Steve Madden out of some of the bottom doors and are building the Madden Girl and Material Girl business in those bottom doors.

And then the top doors, we've increased the number of our shops where our goods are presented as a vendor statement on a couple tables, and we're seeing real nice benefits from that so far.

We went from 44 shops to about 161 shops and so far, in addition to that, just booking better and being a better brand presentation, we've also seen about a 20% increase in those doors since we've made that transition.

Well, that's -- yes, that's was what I was getting at.

So, the net-net effect of pulling Madden out of the bottom doors, you've gotten a positive overall?

Yes.

It' s a little too early to say what the impact is going to be on overall profitability, because we need to get through a mark down money negotiation, et cetera.

But so far, we're very pleased with how that's working out.

All right.

Great .

Thanks, Ed.

Keep it

Thank you.

We'll move on to Camilo Lyon with Wedbush Securities.

Hey, Ed.

Nice quarter.

Thanks, Camilo.

I was hoping you could talk about -- you mentioned that you had strength in boots and booties in the first quarter, and I would assume that that was a little bit of carryover from -- with the weather here in the Northeast being a little bit cooler.

So, I was wondering if you could talk about how you're thinking about the boot business in the back half and how that compares with some of the trends, the shipping trends that we're seeing from a skinny leg jean to a wider leg bottom.

Yes.

Well, I think the change in the jean silhouette definitely will impact the kinds of boots that we're selling, so I think you're going to see more -- the shaft tights are going to come down, you're going to see -- it's going to be more focused on the short booties whereas late in season here we were -- this year we were selling a lot of tall shaft booties, but we're expecting to sell more of the short booties, and also, they're going to come off the ground.

So, whereas a year ago when we were selling booties, the military bootie that was so successful for us, it was a lot of flat booties.

With the wide leg jeans, we're expecting that they're going to be more wedge booties and more sort of thick heels, chunky heels.

But that's some good reads on those things, feel quite good about that.

And as I said on the last call, that for conservatism's sake, we've assumed that the boot business is not quite as strong this year as it was a year ago, but so far, our boot orders are actually up versus a year ago.

So, our early 625 boot deliveries, right now we have -- we're up in the boot business from where we were a year ago.

That's great to hear.

And would the pricing dynamics on the change in the boot type be similar?

Yes.

I don't think it's going to be much different.

So, the shaft tight is a little bit lower, but -- which might indicate that they would be a little bit less expensive, but due to the -- taking them off the ground, that tends to command a higher price, having the wedge or the heel.

So I think net-net, it's going to be similar.

Great.

So, just to be clear, so you were planning the boot business down low singles or down low singles and now it's looking to be maybe up low singles?

It that kind of magnitude change?

Well, I think it's too early to say what it's looking to be.

We have still assumed in our guidance that it's a smaller percentage of the mix than it was a year ago, but if current -- if the very early reads continue, then there will be upside to the guidance that much.

Great.

And then just moving on, is there any update you can give us on the acquisition front, whether it's how some of the brands that you might be speaking to, how they're thinking about price or just even the availability of potential brands out there, and any update on that would be great.

Sure.

We continue to be very proactively looking for acquisitions, and we are constantly evaluating things and working on things.

There's not too much I can say, but we're working -- were looking at a couple things right now.

We hope to be able to get at least one of them done, but there are no guarantees in this game, so we'll keep plugging away and hopefully we'll have something to talk about in the next call.

Great.

And then just finally on inventory, and maybe if you could just shed a little bit of light onto what the composition of the inventory?

Is it t a function of having higher costing goods in your retail inventory that's given that rise, or is it just a function of how low you were last year in Q1?

Yes.

Some of it is because the cost of the goods is higher this year.

But I think the most significant factor is just that we were so conservative or so light a year ago.

And as in a couple of the past quarters, we sort of would encourage you to look at it as a two-year stacked basis, and -- because last year we had this huge decline despite a growing sales, a huge decline of inventory despite sales that were growing.

If you look at the inventory growth over a two-year period, we were up about 21% over that two years.

Our sales are up 54% over that two-year period, so I think in that context, we still feel very couple with the inventory level.

It sounds like there is continued opportunity to meet increasing demand, and this is just a way of getting that and in being in a better in stock position to fill that demand?

Is that right?

That's right.

Yes, absolutely .

Perfect.

Good luck.

Talk to you soon.

Thanks.

Moving on to Clair Gallacher with CapStone Investments.

Good morning, Ed.

Good morning.

Just wanted to touch base on the outlet stores for a minute.

I know that these are new for you and it's still early, but I was just curious what you've learned of from these openings.

I know you did have an outlet opened in the fourth quarter, so that's been around for a little bit longer, but maybe what you've learned and if this is going to -- if you're more excited about that strategy today than maybe you were a couple months ago.

Yes.

Well, I think we've learned that what we offer translates to the outlet world.

We've been very pleased, particularly with these most recent three openings in Vegas, Orlando and Philly, where we get put in our store design and the merchandise assortment as we planned it.

As you recall, we opened Riverhead in November.

We took that store over from Betsey Johnson when we did that transaction, so it's a little bit of a rush job.

And in fact, we're going to remodel that store now to make it look like the most recent three.

But we've been really pleased with the initial results there, and we've also been somewhat pleasantly surprised on the gross margin.

We were expecting it was going to run about 10 points lower than our full price stores, and so far, we are doing considerably better than that.

We're pretty encouraged with what we're seeing so far.

Okay, great.

And then, and I apologize if you already mentioned this, but with the 12% comp that you reported for the quarter, how did your traffic -- how was your traffic in and out of your stores?

Traffic was essentially flat.

We had better conversion, and we had higher AURs from a year ago.

And as we head now into the second quarter, are you seeing any major shifts in the AUR in the conversion, or does it look at it's holding up?

No, it's holding up.

In fact, obviously, April was a very nice month.

We were all benefiting from the Easter shift in April.

In fact, traffic was a little bit better in April than what we saw in the first quarter, and the AUR continues to be up year over year.

Okay, great.

And then my last question is on international .

How did international fair during the quarter, and what were the drivers

Yes.

International continues to be our fastest growing segment.

We were up -- we had another, I think it was either our third or fourth consecutive quarter over 50% year-over-year sales growth there, and we've got a lot of the existing businesses are really driving growth.

Obviously, we've talked a lot about China, but we're also getting big growth of Australia, Mexico, South America.

And as you know, we continue to introduce new territories as well.

Just in first quarter, we launched in Dubai, or the United Arab Emirates, with a group called the Landmark Group, which is the largest retailer in the Middle East.

They have about 1,600 stores.

And we also entered Benelux, which was an exciting deal for us because long-term, we really think Europe is of course the biggest opportunity, and this really provides us an entry there.

And we have a partner there called Macintosh Group and have had a successful launch there so far as well.

We're supposed to have nine stores in the Benelux territory by the end of this year.

International continues to plug away, and as we've talked about in the prepared remarks, we also signed a new deal with India, and we're expecting to have three to five stores open there by the end of the 2011, so we continue to feel really good about this business.

You finished 2010, I believe international was about 5% of your business.

Do you think it'll be substantially higher as a percent of sales by the end of 2011?

Well, it's going to continue to increase because it's definitely growing faster than the overall.

I don't expect us getting much past 7% or 8% this year.

But over time, we expect that percentage to get -- to go considerably higher.

Okay, great.

Well , best of luck.

Thanks,

Thank you.

We'll take our next question from Sam Poser with Sterne Agee.

Good morning, Ed.

Can you just go back to the gross margin for a second?

Of the 460 basis points, 410 of that was from those three items that you mentioned.

The other 50 was air freight, and what was the balance?

It's a bunch of little things.

When you get to 10 and 20 basis points, I can't -- it's hard to parse it, but keep in mind we had very tough comparisons from a year ago.

That was our highest gross margin performance ever by a large margin.

It was just tough comparisons and a little more air freight, I would say.

Okay.

And then as we look ahead in total, you said that the range would be from what to what again?

I just missed that when you were going through it.

Somewhat -- based on our current forecast for those sort of three businesses that are causing the negative mix shifts, it's somewhere between 180 and 230 basis points per quarter.

And that could be -- but that's just that, so that could be offset by -- that could be offset the other way.

Yes, and in fact, we think we are going to do -- we think we are going to be able to offset it in some ways because the total impact of those three factors for the year, we are currently expecting to be 240 basis points, but we do not expect -- we've said that we think our overall gross margin should be somewhere between 140 and 240 balance, so we're expected some improvement from the remainder of the business.

And if you hit -- at the low end -- and then how do we look at your expenses then?

You did a nice job controlling the expenses this quarter.

Yes.

So, how do we look at the expenses in that case, because if you low end it at 140 for the balance of the year, it sounds like you'd beat your guidance.

That would certainly be towards the up -- that would be towards the top end of our range, yes.

But we still think that the SG&A, I think on the last call I believe you asked the question actually, and you said it's $200 million in the range, and that continues to be in the range for SG&A.

Okay.

And then the Macy's transition, you spoke briefly about this, what -- where would you -- where are you in that -- in the first quarter, how much progress did you make in transitioning all of the plans to get shoes out of this, to get the shops set up, the 163 and the 300 -- all the different brands that you --

Yes, the shops are all now set up.

I think that if you really want to see the full impact of this, you have to wait until fall though.

Because you still have shoes that were shipped in for the bigger number of doors under Steve Madden et cetera, so it really is going to, I think in fall is when you're going to see the real impact to both sales and profitability.

Okay, great.

And then --

If you go into the stores, you'll see the shops now.

But as you said, those shops will fill up with more of the correct product really starting in the back half of the year?

Yes.

And then lastly, other license deals, you talked about acquisitions.

Are there other licensing deals floating around right now?

And also, I wondered if you could deconstruct your businesses for us, except for the men's business for the quarter.

In terms of other licenses, we're always looking at things.

There's nothing imminent there, but we continue to evaluate additional licenses, or we continue to look at things that are sort of exclusive brand opportunities.

So, for a license that we could be exclusive to one retailer, a Kohl's, a Penny's, a Wal-Mart, et cetera.

We also continue to look at some things on the very high end, more on the Elizabeth and James kind of customer base.

That's certainly a possibility that would do another license this year, and I know you're joking about deconstructing the businesses since we have this conversation on every call that we don't do that anymore.

Just -- darn.

Anyway, well thank you and continued success.

Thanks, Sam.

(Operator Instructions).

We'll move on to Steve Marotta with CL King & Associates.

Good morning, Ed.

Couple of quick questions.

Regarding accounts receivable, it's up about 50%.

Is that wholly due to the shift at Target, and can you parse that out a little bit?

Yes, sure.

Obviously, the sales in the quarter, I think our wholesale sales were up 30%, I don't have numbers front of me, but 31 -- 30%, yes, in the quarter.

So, that obviously drives a lot of it.

And the balance of it is that a lot of the growth came from Target and Wal-Mart.

And those are relatively slower pairs, so that target -- the Target shift was very meaningful there, and the growth of the Wal-Mart handbag was very meaningful there because those guys pay us lower than our average customer.

Okay.

Can you quantify the impact of Betsey Johnson in the first quarter on sales and earnings?

We did a -- in shoes, we did a couple million dollars in Betsey Johnson.

Actually, no, I'm sorry, less than that.

1.

2 million in Betsey in the quarter.

In earnings, I don't have all the different pieces because you've got bags and shoes and licensing.

I know that the licensing revenue, it contributed about $11 million in the quarter of licensing and royalty income, which is the most significant piece of the profitability from that business.

Sure, of course.

And you've spoken in the past, if I'm not mistaken, the impact would be about $0.10 to $0.15 on the current year?

Yes.

Maybe you -- have you just to that based on the trends in the first quarter?

No, I would say that's still a good range.

Maybe we're moving towards the higher end of that range.

Again, I want to remind people though that we got about $0.03 of accretion last year, so it's not all incremental in 2011.

Right, right.

And lastly, you mentioned that April has been pretty good due to the Easter shift.

Yes.

Can you comment at all about weather patterns and whether that -- I guess it didn't affect you if you said it was good, how your results were, either versus plan or at your wholesalers, if there's been any slowdown in potential reorders because of wet weather patterns in the Northeast and Midwest?

No.

We really haven't seen anything meaningful from that.

And in fact, it's easiest for me to speak about our own retail stores.

We have -- we're certainly ahead of plan there, in April and continue to be very pleased with our momentum.

But it's similar and the wholesale sell throughs continue to be very good as well.

Do you see -- have we been a little bit better in the South than in some other places, yes.

But overall, we are still performing in all regions.

That's great.

Thanks much.

Thank you.

We'll take a follow-up question from Sam Poser from Sterne Agee.

All right.

Just real quick, you kept the sales the same, but you said that the initial -- that the reads on the boots are starting to improve.

Yes.

What else -- what precluded you given that, because you really had thought the boots were going to be down on the last call,?

What precluded you from actually raising the top line range?

I think it's just too early.

We've got some reads of boots yet, but as you know, at the beginning of May, we really don't know what the boot season is going to look like.

Hopefully on the next call will have more insight into that, and if it continues to be strong, then obviously that would enable us to move towards the higher end of the range or potentially raise the guidance.

Okay.

Thank you again.

Thanks, Sam.

We have no further questions at this time.

Mr.

Rosenfeld, I'll turn the conference over to you to any closing and additional remarks.

Okay, well thanks so much for joining us on the call, and we look forward to talking to you in three months.

Goodbye.

Ladies and gentlemen, that does conclude today's conference.

We thank you for your participation.

Have a great day.