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1-800-Flowers CEO on record earnings and Valentine’s Day initiatives

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1-800-FLOWERS.COM CEO Chris McCann joins Yahoo Finance Live to discuss the company’s most recent quarterly results — which were the highest revenue and profit in the company’s history — how the company has navigated and kept up with demand amid the pandemic, and its #NoLimitsOnLove initiative across its multiple brands ahead of Valentine’s Day.

Video Transcript

MYLES UDLAND: Let's turn our attention now to another industry that saw a huge 2020, perhaps one that flew a bit underneath the radar. And that is the gifts and flower business. Joining us now to talk more about it, coming off a blockbuster quarter, is Chris McCann. He's the president and CEO over at 1-800-Flowers.com.

Chris, great to speak with you once again. I'd love to just start by maybe taking us through what you guys saw in the holiday quarter and how your business evolved through 2020. I think we spoke around Mother's Day, and still kind of COVID period. Weren't really sure how to get the shops open, how to keep the supply going. But looking at these results, clearly, things were firing on all cylinders in the end of the year.

CHRIS MCCANN: Sure, Myles. And it's great to be back. Thank you.

As we really looked at our business this past year, it's been a challenging year for all of us, right? And it's been a challenging year for the consumer as well. But we look at the momentum that we had going in from really accelerating our revenue starting in 2018 through '19 and into 20, accelerated further by the pandemic.

And we've been very fortunate as a company that consumers are turning to us for what they need most, to connect with each other, to express themselves to the important people in their lives. And as a company, we're so well positioned for that.

As you referenced, the last quarter was a record quarter for us in terms of revenue growth and profit, record history in our company. So just tremendous opportunity for us. We grew our e-commerce business 60% last quarter. And those trends just continue. And here we are at Valentine's Day and looking forward to a really strong Valentine's Day season as well.

JULIE HYMAN: Hi, Chris. It's Julie here. We have been talking a lot about, as you probably would guess, the whole short squeeze phenomenon that we've been watching in the market. 1-800-Flowers shares are pretty heavily shorted. At last check, it was about 20% of the float was shorted. And you guys moved up a lot this year, more than 25% the last time I checked.

How do you think about that when something like that happens to your stock or when it looks like something like that is happening to your stock? I did see there were some insider sales that were revealed in filings. But do you take the opportunity to sell shares, for example?

CHRIS MCCANN: Well, I think as we look at the stock price, we're up significantly in the last 12 months, I think over 100% in the last 12 months. What you see with shorts generally is companies that have that kind of rise, people start to place some bets one way or the other. We look at the stock price and whether it's being shorted by people, whether it's being bought long by certain funds, which in most of the cases, most of the time is the case.

We disassociate ourselves from the stock price and keep our head down and focus on building this business for the long term. As you know, Julie, we've been in this business. My brother and I created this business. We've been in this business a long time, plan on being in it for a long time. So fortunately, we're able to put that kind of volatility aside and focus on what's best for our customers, day in and day out.

BRIAN SOZZI: Chris, given that focus on the fundamentals, how tough is it right now to find new employees?

CHRIS MCCANN: It's challenging. The employment market has been challenging. As we went into the holiday season, we said one of the headwinds we were facing was both labor rates and labor availability, surprisingly. With such a high unemployment rate, it's been difficult to get the seasonal labor that we needed to get.

Fortunately, we have a great operations team in place, a great HR team. And we were able to manage through that very successfully, as evidenced by the results of the quarter, 45% overall growth, 48% growth in our EBITDA, so showing some leverage there. But we've been able to overcome those challenges. But it is surprising to many. That is a challenge in the marketplace today.

MYLES UDLAND: You know, Chris, I'd love to talk about the mix you guys are seeing in terms of what people are buying either for themselves or as gifts between the flower business, certainly the food business a big part of what you guys are doing, and maybe how that changed throughout the year.

CHRIS MCCANN: Yeah. I think really, what we've seen as this pandemic really start to hit, we as a company pivoted a bit and leaned into the product categories that we saw our customers buying. So from the flowers side of our business, plants have just taken off. They were hot to begin with but have just accelerated tremendously.

You mentioned our gourmet food category led by Harry and David brand has been doing tremendous. But people are buying the gourmet food, prepared meals from Harry and David more so than just our food products, what we're known for. And we've leaned into that and really expanding that category.

And then we also saw the trend prior to the pandemic, again, accelerated during the pandemic, of personalized products. And we leaned so heavily into that that we made the largest acquisition in our company's history in the midst of this pandemic, buying Personalization Mall, which has just been a great addition to our platform. And that's really what we've built here as a company, this platform for growth.

We're a leader in floral. We're a leader in gourmet food gifting. Now we're a leader in the expressions business with Personalization Mall. So we're just so well-positioned for the future. We feel extremely confident as we move forward.

MYLES UDLAND: Chris, I've got about 30 seconds left. We are four days out from Valentine's Day. How late is too late for people out there?

CHRIS MCCANN: It's never too late to express your love. So don't worry about that. We're here to help our customers every single day of the year. And we're looking at this Valentine's Day. We'll be able to take orders in many locations Sunday morning. But don't wait until Sunday morning to place your Valentine order. It's a great opportunity to celebrate your romance all weekend long this year. And that's what we're trying to do. There are no limits on love this year. We've been limited enough.

MYLES UDLAND: There we go. I like that, no limits on love. We'll take that one to the bank beyond this weekend. Chris McCann, president and CEO 1-800-flowers.com. Chris, always great to get your thoughts. Thanks so much for spending some time with us this morning.

CHRIS MCCANN: Thank you all. It's good to be here.