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Edited Transcript of HIBB earnings conference call or presentation 22-Mar-19 2:00pm GMT

Q4 2019 Hibbett Sports Inc Earnings Call

BIRMINGHAM Mar 29, 2019 (Thomson StreetEvents) -- Edited Transcript of Hibbett Sports Inc earnings conference call or presentation Friday, March 22, 2019 at 2:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Jared S. Briskin

Hibbett Sports, Inc. - Senior VP & Chief Merchant

* Jeffry O. Rosenthal

Hibbett Sports, Inc. - President, CEO & Director

* Patrick J. Watson

Corporate Communications, Inc. - SVP and Principal

* Scott Justin Bowman

Hibbett Sports, Inc. - Senior VP & CFO

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Conference Call Participants

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* Camilo R. Lyon

Canaccord Genuity Limited, Research Division - MD & Head of US Consumer Research

* Peter Sloan Benedict

Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst

* Samuel Marc Poser

Susquehanna Financial Group, LLLP, Research Division - Senior Analyst

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Presentation

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Operator [1]

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Ladies and gentlemen, thank you for standing by, and welcome to the Hibbett Sports Fourth Quarter and Year-end 2019 Earnings Conference Call. (Operator Instructions) As a reminder, this conference is being recorded on Friday, March 22, 2019.

I would now like to turn the conference over to Mr. Pat Watson with Corporate Communications. Please go ahead, sir.

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Patrick J. Watson, Corporate Communications, Inc. - SVP and Principal [2]

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Thank you, everyone, for joining Hibbett Sports to review the company's financial and operating results for the fourth quarter and fiscal year 2019, which ended on February 2, 2019.

Before we begin, I would like to remind everyone that management's comments during this conference call not based on historical facts, including those in response to your questions, are forward-looking statements. These statements, which reflect the company's current views with respect to future events and financial performance, are made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are subject to uncertainties and risks.

It should be noted that the company's future results may differ materially from those anticipated and discussed in the forward-looking statements. Some of the factors that could cause or contribute to such differences have been described in the news release issued earlier this morning, in the company's annual report on Form 10-K and in other filings with the Securities and Exchange Commission. We refer you to these sources for more information.

Lastly, I would like to point out that management's remarks during this conference call are based on information and understandings believed accurate as of today's date, March 22, 2019. Because of the time-sensitive nature of this information, it is the policy of Hibbett Sports to limit the archived replay of this conference call webcast to a period of 30 days.

I'd now like to turn the call over to Scott Bowman, Chief Financial Officer. Please go ahead, Scott.

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Scott Justin Bowman, Hibbett Sports, Inc. - Senior VP & CFO [3]

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Thank you, and good morning. Welcome to the Hibbett Sports fourth quarter and full year earnings call. Today, we have with us Jeff Rosenthal, President and CEO; Jared Briskin, Senior VP and Chief Merchant; and Cathy Pryor, Senior VP of Store Operations. I will start today's call with prepared remarks on the fourth quarter and full year financials, followed by Jared with a review of merchandising and then Jeff with highlights from the fourth quarter, along with the general business update.

Keep in mind that fourth quarter results included 13 weeks versus 14 weeks last year and full year results included 52 weeks versus 53 weeks in the prior year. As a reminder, the extra week last year accounted for $13.5 million in additional sales and an additional $0.08 per share in last year's fourth quarter. The benefit to the full year last year was slightly lower at $0.07 per share due to a lower average share count.

For the fourth quarter, total sales increased 14.7% to $306 million, which included $49.1 million for the City Gear business. Comp sales increased 3.8%, which did not include City Gear sales. City Gear will be included in comp sales starting in the fourth quarter of fiscal 2020. By month, comp sales were negative 5.5% in November, positive 6.2% in December and positive 11.2% in January. E-commerce sales increased 60% and represented 10.6% of total sales in the quarter.

Gross profit rate decreased 40 basis points in the quarter. This was mainly due to a $1.9 million expense incurred to amortize an inventory step-up value related to the City Gear acquisition. Gross profit rate was also negatively impacted by the liquidation of each inventory related to the integration of City Gear.

In last year's fourth quarter, the reserve of about $866,000 was taken against inventory due to the sale of our Team Division. SG&A expenses increased 225 basis points in the quarter, mainly due to $2.8 million of nonrecurring expense related to the City Gear acquisition and $300,000 of nonrecurring severance costs related to the reduction of 30 positions in the field organization and corporate office. In last year's fourth quarter, we recognized a $3.1 million gain due to the sale of our Team Division. Depreciation and amortization increased 38 basis points as a percent of sales, mainly due to the acceleration of depreciation related to store closures. The income tax rate for the quarter was 22.8%, which compared to last year's rate of 38.5%.

Operating income of $9 million was 2.9% of sales versus 6% last year. Excluding nonrecurring costs, operating income was $13.9 million. Diluted earnings per share was $0.36 per share and $0.57 per share, excluding nonrecurring costs. I would also like to report that our e-commerce business was profitable in the fourth quarter, and we expect it to continue into fiscal 2020. The team has done a great job managing gross margin and expenses, while driving top line growth and adding exciting new capabilities to serve the omnichannel customer.

For the full year, earnings per share was $1.51 and $1.77, excluding nonrecurring costs. From a balance sheet perspective, the company ended the quarter with $62 million in cash versus $74 million last year with $35 million in borrowings outstanding on our revolving credit facilities. Inventory increased 10.7% from last year, mainly due to the acquisition of City Gear and was 2.7% higher on a per-store basis.

We spent $3.7 million in CapEx for the quarter, as we made further progress on our major initiatives and finished the year at $16.7 million. Also, the company repurchased 776,000 shares for $16.5 million for the year and have approximately $188 million remaining under the existing purchase authorization.

As we turn our focus to fiscal 2020, I would like to provide some highlights related to our guidance. First of all, I would like to provide some details on the effect of City Gear in fiscal 2020. As we move forward, we will treat City Gear as an extension of the Hibbett business and results will be reported on a combined basis. This means that it is not our intent to provide specific gross margin, expense or other profitability metrics for the City Gear business in the future. However, I will provide actual revenue for the City Gear business until it is incorporated into consolidated comp sales starting in the fourth quarter of fiscal 2020. For modeling purposes, I'll also provide the following details at this time for fiscal 2020.

For sale seasonality, City Gear is expected to index somewhat higher in the first quarter and somewhat lower in the fourth quarter compared to Hibbett. For gross margin, City Gear's rate is expected to be lower than Hibbett due to a lower product margin and a somewhat higher percent of sales related to logistics and store occupancy expense. We see opportunity for improvement in this area as we work through the integration process, but expect the rate to be lower for fiscal 2020.

For SG&A expense, City Gear is expected to be lower as a percent of sales compared to Hibbett. For depreciation, City Gear is expected to be similar to Hibbett as a percent of sale. And for operating margin, City Gear is expected to be similar to Hibbett as a percent of sales.

Turning to the full year consolidated guidance. We expect comparable store sales to be in the range of negative 1% to positive 1%. Additionally, we will continue our plan to improve the productivity of our store base and estimate we will close approximately 95 underperforming stores and open 10 to 15 new stores. For gross margin, we expect our overall rate to decrease in the range of 25 to 45 basis points. Excluding non-recurring costs for both years, non-GAAP gross margin is expected to decline in the 35 to 55 basis point range. With respect to SG&A, we expect an increase in the range of 15 to 25 basis points. Excluding nonrecurring cost for both years, we expect SG&A to be approximately flat as a percent of sales.

Depreciation expected to decline in the range of 10 to 20 basis points, and we expect our tax rate to be approximately 24.5%, which compared to last year's rate of 24.3%.

Finally, we expect earnings per share to be in the range of $1.50 to $1.70, which includes $0.25 to $0.35 per share for nonrecurring costs associated with the integration of City Gear and costs associated with store closures. Excluding nonrecurring cost, non-GAAP earnings per share is expected to be in the range of $1.80 to $2.

Turning to capital allocation, we expect to continue our share buyback program in fiscal 2020 and expect to repurchase $10 million to $15 million in stock for the year. For capital expenditures, we expect to spend $18 million to $22 million. Finally, we plan on the full repayment of our $35 million in debt outstanding by the end of the fiscal year.

With that review, I will now turn over the call to Jared.

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Jared S. Briskin, Hibbett Sports, Inc. - Senior VP & Chief Merchant [4]

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Thank you, Scott. Good morning. As a reminder in my prepared remarks, reflective of comparable sales trends, this will not include City Gear stores until the fourth quarter. During the fourth quarter, our footwear business increased double digits posting our 6 consecutive quarter of comp sales gains. Both men's and women's footwear were up double digits and kids was up mid-single digits.

Growth drivers were Max Air (sic) [Air Max] and Air Force franchises for Nike, retro and retro-inspired products from Jordan, and Yeezy and Goose platforms from adidas. Significant growth was also seen across other brand partners, including New Balance, Brooks, PUMA, Vans and Champion.

Our apparel business was down low single digits for the quarter. Apparel with strong connectivity to our footwear business performed exceptionally well, along with our investment in plus sizes and big and tall. Our trend in performance products that have been improving turned significantly negative during the gift-giving peak between Thanksgiving and Christmas. The declines in performance products, socks and licensed products turned the category as a whole negative.

Team sports business was down mid-single digits. Cleated business was slightly negative for the quarter with gains in baseball, soccer and volleyball offset by football. Equipment was weak overall with significant declines coming from inflatables, which historically has a strongest gift category. We exited the quarter clean with inventory position to take advantage of growth categories, and we are limiting our exposure to weak categories.

I'll now turn the call over to Jeff Rosenthal.

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Jeffry O. Rosenthal, Hibbett Sports, Inc. - President, CEO & Director [5]

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Thanks, Jared. Our e-commerce business continues to grow, achieving a 60% comp in the fourth quarter. This growth was driven by healthy increases in traffic, conversion and average order value. Footwear sales were particularly strong online in Q4. Increased scale, a healthy product mix and operating efficiencies have led to the profitability of our e-commerce business, which now contributes positively to company EBIT.

In Q4, we saw the impact of the omnichannel initiatives we have been working on throughout the year. There were 4 larger initiatives that helped increase our store traffic and sales. Our BOPIS-ROPIS program, replatforming and redesigning our e-mail program, our new mobile apps, the growth of our digital marketing programs, these 4 things were either not available in the prior year or in the infancy versus the full maturity in Q4 this year.

I also would like to add, our BOPIS program is highly featured and gives customers the flexibility to either buy online and pick up in store or reserve online and buy in store. During the holidays, we saw increased usage of this program, which drove store traffic and sales. Earlier this year, we moved our e-mail program to a new platform and focused on segmenting our e-mails. About 90% of purchases from e-mails are made in store, and we saw e-mail traffic increase substantially year-over-year because of the improvements we made.

In May, we launched our new mobile apps. Besides e-commerce, the primary purpose of these apps was digitize our legacy and store raffle process, buckets no less. The convenience and ease of a new process resulted in increased participation, which drove store traffic and sales. Lastly, our focus on digital marketing drove significant growth in online traffic. Most notably, the store locator sections of our websites saw the largest increases. Because of our omnichannel initiatives, more customers than ever are aware of what we sell as well as where and how they can shop with us.

On a personal note, I would like to let all of you know that I have made incredibly difficult decision to move from my position as CEO of Hibbett. When I first came to Hibbett 20 years ago, we had 110 stores and about 1,000 employees, doing approximately $100 million in sales. And believe it or not, using dial-up for credit card transactions. Today, thanks to the efforts and leadership of our incredible team, I am proud to say we are over $1 billion company. We have with over 1,100 stores and a digital presence equal or greater than any in retail today. It has been an awesome ride, and I'm proud to be part of it. There are so many people who helped me -- who helped make this portion of my professional life meaningful. I want to thank all of the Hibbett employees, who have worked tirelessly to grow the business and each of our vendor partners who have supported us tremendously through the years. We would not be where we are today without all of you.

Finally, I'd like to remind you all of a lesson I learned as a 21-year old when I got my first job in the industry making $5 an hour, that it can be very simple if you always remember at the end of the day, it's just t-shirts and tennis shoes.

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Patrick J. Watson, Corporate Communications, Inc. - SVP and Principal [6]

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Thank you very much, Jeff. That idea we will live on. Frank, we are now ready for questions.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from the line of Camilo Lyon with Canaccord Genuity.

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Camilo R. Lyon, Canaccord Genuity Limited, Research Division - MD & Head of US Consumer Research [2]

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Jeff, all the best to you and your retirement. I wanted to ask you guys -- you guys had a great performance in the quarter. I wanted to ask about your apparel initiatives. Some interesting comments there on the performance piece that Jared made, but if you can just give a little bit more detail on that, that would be great. And also as you think about the stronger part of the apparel assortment -- the branded assortment, if you can give us a little bit more color on how that unfolded in the quarter? And if you feel that there were any pockets or brands, inventory shortage issue that you had to overcome? And if you did, when do you expect to get back into stocking those particular brands?

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Jared S. Briskin, Hibbett Sports, Inc. - Senior VP & Chief Merchant [3]

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This is Jared. Really, from an apparel perspective, our business prior to Thanksgiving and our business post-Christmas was actually very solid. The peak week in that 6-week period that's typically very promotional, I mean, usually very driven by a lot of commodity products. It was very difficult for us. We made a significant investment and continue to make investments in our branded apparel business that closely aligns with our sneaker business, where we've been able to provide that connectivity from an apparel perspective, we've been very successful. Our men's business was actually very strong for the quarter. We did have some of those connectivity issues in women's and kids, which historically were a little bit more driven by some of that promotional commodity business that we continue to look for other opportunities.

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Camilo R. Lyon, Canaccord Genuity Limited, Research Division - MD & Head of US Consumer Research [4]

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And so if I'm understanding correctly, so the performance piece that you had been talking about that before in a year had seemed to have stabilized, that took another leg down. Is that...?

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Jared S. Briskin, Hibbett Sports, Inc. - Senior VP & Chief Merchant [5]

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It is. Yes, you are understanding that correctly.

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Camilo R. Lyon, Canaccord Genuity Limited, Research Division - MD & Head of US Consumer Research [6]

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And if that's the case, do you -- did that alter how you are viewing your plans for '19 for that type of products?

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Jared S. Briskin, Hibbett Sports, Inc. - Senior VP & Chief Merchant [7]

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We are. We have been, and we continue to transition more towards the sportswear and connectivity pieces of our business. Again, that 6-week period was a little bit of a surprise just based off the trend that we had been seeing prior to that, but we continue to believe that we need to continue to evolve our apparel business and have it as closely aligned to our sneaker business as possible.

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Camilo R. Lyon, Canaccord Genuity Limited, Research Division - MD & Head of US Consumer Research [8]

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Got it. And then moving on to footwear, would you give some highlights in terms of what you're seeing from the innovation pipeline, not only as it pertains to the quarter but also what's coming forward? And what are the things that you're excited about? And within that context, now that you've got City Gear under the umbrella, are you able to leverage the buying power such that Hibbett stores are also benefiting from an increased allocation assortment?

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Jared S. Briskin, Hibbett Sports, Inc. - Senior VP & Chief Merchant [9]

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Yes. I think, obviously, our footwear business, we've been strong for a long time. Fourth quarter was a significantly improved trend. The team worked really tirelessly to ensure that we were positioned well for the fourth quarter and going forward. Our brand partners have been absolutely fantastic and working with us really providing opportunities to scale our footwear business to more of our locations. So we will continue that trend. We absolutely see City Gear as an extension of our fashion and stores and believe certainly that the combined entity does have some additional leverage and buying power working closely together.

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Camilo R. Lyon, Canaccord Genuity Limited, Research Division - MD & Head of US Consumer Research [10]

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Got it. Great. And then my final question, Jeff, if I could ask, somewhat of a surprising announcement. You've done a lot to reposition the business with this omnichannel initiative that you've been tasked to undertake for the last 3 or 4 years. I guess, within that context, as the process unfolds with searching out a new CEO, any sense of timing, any sense of the candidates that you would be looking for? And how that process will unfold, just trying to get a sense of what kind of urgency is there to find a replacement and when we would see that's happening?

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Jeffry O. Rosenthal, Hibbett Sports, Inc. - President, CEO & Director [11]

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Yes, I mean, this could take 6 to 8 months or even possibly longer. And at the end of the day, I'm a sneaker dude, and I'm going to continue to be that. And I'm going to be on the Board of Hibbett. And I pulled a lot into Hibbett, and I want this business to succeed. And I feel really awesome that over the last 3 or 4 years, it's difficult as it may have been, and we've got so much accomplished and so much to be proud of. We have really transitioned this company from being way behind to be now a leader, and I have felt the last 3 or 4 years, I've been playing defense. I got this team and this team got me, to be able to play offense. And we should be very proud of what we've been able to do. And you know what, at the end of the day, I own this business, and we're going to continue to make Hibbett own it.

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Operator [12]

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Our next question comes from Peter Benedict with Robert W. Baird.

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Peter Sloan Benedict, Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst [13]

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Jeff, well, best of luck. I'm sure we're going to still be in touch with you here, it sounds like, which is good. My first question is around e-commerce profitability, you mentioned that in the fourth quarter. Scott, maybe help walk us through the P&L build up as we think about e-commerce on an annual basis? What's kind of the latest view here in terms of what's required to be profitable on an annual basis? And how kind of the gross margin and EBIT margins compare to what you see in the stores or just to a consolidated number?

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Scott Justin Bowman, Hibbett Sports, Inc. - Senior VP & CFO [14]

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Sure. Yes, first off, a credit to the team. They have just done a phenomenal job of growing the e-comm business and striking a balance between investing for growth and the profitability side. And so we're pretty much on track. As I said on previous calls, we did overspend a little bit on advertising, trying out some things, and it turns out that, that has paid some dividends; and it did in fourth quarter, as we were able to use those dollars more efficiently. So that along with a little bit better margin as we're selling little bit less clearance and some other things really spells a pretty good picture for the e-commerce business this year from a profitability standpoint. As you kind of look at the business, I've said all along that it is a business that you have some fixed cost or semi-fixed cost where the volume does drop to the bottom line pretty nicely. And so we finished this year close to $90 million in sales. The run rate in fourth quarter was positive, so obviously, we'll have an increase next year as well. So $90 million to $100 million business will prove to be profitable for us. And that does include all the investments we've been making on the capability and functionality side. So as those expenses and costs drop down a bit, that will fall to the bottom line as well.

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Peter Sloan Benedict, Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst [15]

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Okay. That's helpful. And then as we think about the stores in 2019 and trying to improve the performance there, obviously it got better in the fourth quarter, what would you call out as maybe the biggest drivers that you guys see to kind of moderating the decline in comps, in stores, in 2019? Are there any specific initiatives we could -- we should be focused on?

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Jeffry O. Rosenthal, Hibbett Sports, Inc. - President, CEO & Director [16]

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No. It's kind of what we talked about. It's really the connectivity of making it a full omnichannel. We continue to work on that in the connectivity, the amount of people that we're adding to our loyalty program, the amount of connectivity through our digital presence, the connectivity through social media. I mean, just yesterday, we were on Sneaker News. We were getting lots of customers really liking the new assortments that we've been able to get down throughout our chain and now people actually know where and how to get it. So it's really, just really, enhancing that even to a higher level that than we did this year. And I think part of the increased better sales in the fourth quarter really have to do with all of that. It's all coming together. For example, BOPIS and ROPIS, 3 days before Christmas and people can't get things, what a great way to drive traffic to your stores because they know exactly what store to go and when to get it. That will be able to use that -- all that and really continue to work on customer experience and store service. And for example also like on BOPIS, we average less than 15 minutes on getting back to a customer. That's pretty unheard of. I know, personally, I've gone out shopping many times and tried to use BOPIS and ROPIS and sometimes it's 4 and 5 hours, but we're averaging less than 50 minutes. And those type of things, we've executed very well. We've built over $100 million e-commerce business. And I know even from the investment community and others, they had doubts that we are 17 years late to this and to build over $100 million business in 18 months should give this team some credit.

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Peter Sloan Benedict, Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst [17]

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No, that's great. And then I guess my last question, kind of, back to Jared. Just a little more on footwear, as we think about 2019, obviously, the momentum is terrific right now, but what guidepost should we be thinking about or initiatives or product or what have you that can help you guys sustain this momentum in 2019? How are you thinking about footwear, in particular? And what are the drivers going to be in '19? That's my last question.

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Jared S. Briskin, Hibbett Sports, Inc. - Senior VP & Chief Merchant [18]

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Yes, I think, first of all, without getting terribly specific about brands, I mean, we absolutely believe that the pipeline is very full. We're really excited about what's coming out for the balance of the year and where we've been positioned with regard to those products that are coming out. One of our largest initiatives is really to scale a lot of those franchises and products to more of our stores. We believe that's a significant differentiator for our store business. So that from an initiative perspective, that's our biggest initiative. We have, without question, garnered better access, without question garnered better allocations. And now we're looking to really attack the sneaker business in more of our locations.

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Operator [19]

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(Operator Instructions) Our next question comes from the line of Sam Poser with SIG.

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Samuel Marc Poser, Susquehanna Financial Group, LLLP, Research Division - Senior Analyst [20]

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I have a few questions. Number one, with your digital -- of the digital revenue, how much of that is coming from mobile now?

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Scott Justin Bowman, Hibbett Sports, Inc. - Senior VP & CFO [21]

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From mobile, I think, it's 15% to 20%, Sam.

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Samuel Marc Poser, Susquehanna Financial Group, LLLP, Research Division - Senior Analyst [22]

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And I mean, have you -- how has that accelerated or not accelerated since you launched the mobile app?

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Scott Justin Bowman, Hibbett Sports, Inc. - Senior VP & CFO [23]

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Yes, so it's increased a bit. And I think looking forward, it will get even better. The raffle functionality continues to attract a lot of new members. And I think some people are just finding out about that functionality. So I think that will help and then just continued enhancements. So Bill Quinn and his team has done a great job of improving just the functionality of the app and will continue to do so.

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Samuel Marc Poser, Susquehanna Financial Group, LLLP, Research Division - Senior Analyst [24]

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And then secondly, I would like to know about the store closures. And can you walk through the store types and what you're closing and sort of how this decision structured? And how it will help the overall business? Or what it will do to the overall business?

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Scott Justin Bowman, Hibbett Sports, Inc. - Senior VP & CFO [25]

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Yes, the vast majority of the stores that we're closing are those stores that are more sporting goods oriented in smaller towns. And it's a case where a lot of that is commodity-type items. And sometimes, those stores, in these small markets, they are just too small for those stores anymore. And so it's kind of taking a hard look at those stores and pulling off those stores. And then on the other end, where we're having really good momentum on more of the fashion doors, we will fuel those stores, and with City Gear, that will make that side of the business even stronger. So -- all in kind of the mindset of improving the productivity of our store base, but I would say that going forward that, that will probably hold true where a lot of the stores we're closing are more in smaller towns and more sporting goods oriented.

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Samuel Marc Poser, Susquehanna Financial Group, LLLP, Research Division - Senior Analyst [26]

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And those small -- those sporting goods oriented stores, by definition, margin structure is different than -- the mix structure make the margins different than it would at a fashion store or a specialty store?

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Scott Justin Bowman, Hibbett Sports, Inc. - Senior VP & CFO [27]

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Yes, it's not going to really cause a big difference, and there is not a big enough difference to really move the needle. And if you think about the stores that we're closing, they typically run about half the volume of an average store. So from a volume standpoint, it's a smaller impact.

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Samuel Marc Poser, Susquehanna Financial Group, LLLP, Research Division - Senior Analyst [28]

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Got you. And then Jared, you didn't want to be brand-specific, but I'll try to force the issue. With Nike, you are one of the 5-or-so key Nike accounts in The United States, is that correct?

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Jared S. Briskin, Hibbett Sports, Inc. - Senior VP & Chief Merchant [29]

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That is correct.

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Samuel Marc Poser, Susquehanna Financial Group, LLLP, Research Division - Senior Analyst [30]

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And what is that giving you? And with the addition of City Gear, what are you anticipating there?

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Jared S. Briskin, Hibbett Sports, Inc. - Senior VP & Chief Merchant [31]

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Well, I think, obviously, our companies have always had a great relationship. Being included in their focus group has certainly helped us. The relationship is stronger. Our access points are better. Our allocations are certainly improving, and we believe we can certainly do more to leverage the Nike brand in more of our locations through sneakers. Without question, we know we've got a sneaker-obsessed kid in a lot of our markets, and we are certainly partnering with them to really get after that kid.

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Samuel Marc Poser, Susquehanna Financial Group, LLLP, Research Division - Senior Analyst [32]

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And then lastly, on the apparel side of things, the more fashion apparels are performing performance apparel, I believe, as you said -- and on men's, it's better. How are you evolving the more fashion apparel on the women's side? Or do you sell that more opportunities on the men's side there?

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Jared S. Briskin, Hibbett Sports, Inc. - Senior VP & Chief Merchant [33]

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No, there's a big opportunity on the women's side. We're very focused. And as I mentioned in the fourth quarter, we were double-digit in sneakers. Our apparel business that connects with sneakers was a lower percentage of our mix during the year last year. We believe, as we go through this year, that connectivity within women's apparel to our current sneaker business will be very significant and very enhanced. I think if you reference some of the imagery that we have through our social channels and through the digital platforms, we're telling a great story, but it's also a story we haven't told in stores in a long time. So we do think it's going to take some time, but where we've had a really strong connectivity, really premium-driven sportswear products, our women's business has excelled.

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Samuel Marc Poser, Susquehanna Financial Group, LLLP, Research Division - Senior Analyst [34]

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I mean, so can we assume that brands have focused on more fashion, be it Fila, Champion, Nike, I guess, adidas, to some degree would be more first top of mind than when I'm leaving out?

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Jared S. Briskin, Hibbett Sports, Inc. - Senior VP & Chief Merchant [35]

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They absolutely are.

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Samuel Marc Poser, Susquehanna Financial Group, LLLP, Research Division - Senior Analyst [36]

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And Jeff, we're going to miss you.

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Jeffry O. Rosenthal, Hibbett Sports, Inc. - President, CEO & Director [37]

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I'll miss you guys, too.

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Operator [38]

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Mr. Rosenthal, there are no further questions at this time. Please continue with the presentation or closing remarks.

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Jeffry O. Rosenthal, Hibbett Sports, Inc. - President, CEO & Director [39]

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Thank you very much for being on the call, and we look forward to talking to you, not very much longer, in May, and look forward to talking with you then. Thank you for listening today.

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Operator [40]

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Ladies and gentlemen, that does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your line. Have a great day, everyone.