Question-and-Answer Session
Operator
(Operator Instructions). Your first question comes from Omar Saad – Credit Suisse.
Omar Saad – Credit Suisse
Just two quick questions here, one is if we look at what your – how you've been thinking about the second quarter coming in from a tip line perspective and kind of how it shook out, I know you mentioned replenishment and some of the other factors.
Can you help us understand the upside in terms of where trends improved relative to your own expectations and how this replenishment plays a role in that your ability to replenish kind of in season what's going on, how important of that – how much of the upside did that factor really drive at, and then versus a macro improvement relative to your expectations coming in?
Roger Farah
All right, Omar, you know the time period of July, August and September, if you remember back, did not include some of the improved trends I think people are talking about in the last six weeks. So really, early placements in the wholesale channel were conservative, as retailers cut back their buys and tried to get stock and sales expectations in alignment. And our early guidance on the quarter really reflected you know that.
What happened, and particularly as the quarter began to unfold, new product selling was strong and I think that our ability to service that with either replenishment, which was up double digits in the quarter, or accelerate shipments of wanted merchandise, or read and react, which is a strategy that Jackie and the team have been pursuing now for a couple of years, which gives our supply chain the opportunity to take merchandise that's performing well, and get it back into the stores in season.
I think all of that reflected in the quarter's better than originally forecasted results, and I think it gives us another strategic weapon in terms of servicing during this very skittish time. And we expect to read and react and chase goods where necessary, as we work our way through the back half of this year.
Operator
(Operator Instructions). Our next question comes from Bob Drbul – Barclays Capital.
Robert Drbul – Barclays Capital
The question I have is on the southeast Asia investments, so when you look at the level of investment planned for the upcoming quarter, this quarter, the third quarter, can you give us a little bit more of a flavor around that dollar investment necessary? And I guess sort of what I'm looking for is the level of profitability or the run rate of the business once you actually assume the business in 2010.
- To read the full transcript on Seeking Alpha, click here »
