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Cabela's Inc. Q4 2007 Earnings Call Transcript

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2008-02-21 18:08:08.0

Tags: Cabelas Inc.

Question-and-Answer Session

Operator

(Operator Instructions)

Our first question comes from the line of Mitch Kaiser with Piper Jaffrey, please go ahead.

Mitch Kaiser - Piper Jaffrey

Thanks guys, good afternoon.

Dennis Highby

Good afternoon.

Mitch Kaiser - Piper Jaffrey

Could you talk about the extra advertising that you saw in the fourth quarter, and maybe obviously, it didn't show through on the comps. Could you talk about what products that was focused on, what regions, and then may be where it was disappointing relative to what your expectations were?

Dennis Highby

I think, Mitch, you remember in the third quarter, we felt good about our advertising, it was working. We had better product selection, more density on the pages. We shifted lot of the advertising from regular newspaper insertions into direct mailings. But it seem like in the fourth quarter, things were just tough all over, I think, that's typical of lot of people that experience a tough fourth quarter in the retail environment.

Mitch Kaiser - Piper Jaffrey

Okay. So, did it get worse throughout the quarter then, or is it bad November, or how did the quarter really play out, could you just shed some light on that?

Dennis Highby

Yeah, it just seem like, in general, anything we did for advertising, for retail, it didn't work, no catalog seem to hang in there pretty good. We weren’t really more promotional in advertising for our catalog business, but retail really took a dive in the fourth quarter.

Mitch Kaiser - Piper Jaffrey

Okay. And then, you mentioned three of the stores, three of the eight did not meet expectations, and I know, you brought Michael Copeland, and maybe could you just talk a little bit about what you are going to do specifically to address those three stores?

Dennis Highby

His goal is to do a lot of different things, but some of the highlights would be to continue to increase average ticket, some of the other people that we brought on Board, Chuck, Danny, in our merchandising area and they're committed to adding additional new products, every 12 weeks in the stores, especially in the clothing part of the company.

Another thing they are going to really focus on, we have not done as good a job as we are going to in the future, and what we call, like seasonal flex for the store. When archery is done, get rid of as much of it as you need to, move into more casual clothing for instance, when the fishing season is nearing its end this year, that’s going to shrink more significantly than it ever has.

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