Question-and-Answer Session
Operator
(Operator Instructions)
Your first question comes from Jeffrey Edelman – UBS
Jeffrey Edelman – UBS
It sounds like pretty close to a turning point we too have heard that department store sales have shown some improvements, I guess my first question is do you feel as if those are going out at full price and secondly if all the stores have really cut back quite a bit on their orders, do you think we’re past that high point in inventories relative to sales expectations?
Wesley Card
I think in April what we saw when the weather turned warmer which really was literally the first day of the second quarter there was clearly some pent-up demand that fueled pretty strong business across all the categories and as I noted our retail comps are actually in the black so far quarter-to-date. I think that the margins have also been concurrently pretty strong with that. So there really was good take-out, some pent-up demand, I think the rebate checks coming out could be a positive and tax refunds as well start to hit. I don’t think it would be prudent to say that this is a, we can count on this strength continuing at exactly the same rate for the balance of the year but it was clear that seasonal items as the weather warmed showed much better take-out initially and that helps a lot in terms of the first half because it starts to clear inventory as well as generate regular price selling. So we were quite pleased with that as a good start to the quarter but obviously have to continue to be concerned about the challenges as we go through the year.
I do think and finally the last part of your question I think its prudent for the department stores to order conservatively for the back half, I think that makes sense and I’m hoping that the channel will be clear and that as demand picks up naturally with holidays you have a chance for better regular price selling and better take-out at those first markdowns.
Jeffrey Edelman – UBS
Would you discuss how you feel your position with your management team today, it looks like its been fairly stable, are we seeing any more strengthening or what can we see on that front?
Wesley Card
I think we’ve been very steady; there’s been no turnover at the top levels. We are very pleased that [Rick Baterno] came back to Jones and is now running the wholesale business. So I think we’ve got good solid veterans in all of our spots. We brought in some new design talent as people know and I think we have some other additions. It’s a good time to pick up good strong talent and I feel we’re really well positioned and the lack of turnover as you know makes a huge difference.
- To read the full transcript on Seeking Alpha, click here »
