Jay Schmidt: Okay. So for sure, our casual business was better than our performance athletic business, the adult side. As we said, our kids business was up significantly and then the other businesses, which were smaller that we break out was — that was down, but that was a small piece of the total. And athletics though our LifeStride business was particularly strong and then I think our lifestyle business, I should say, was particularly strong versus the performance piece of it right now. And then finally, Mitch, we did have, as I called out in the beginning, our sandal weakness was really similar across both channels and it was down 11% in Famous and in the Brand Portfolio was down a similar amount in our total shipments.
Mitch Kummetz: Okay. And then on the comp, your minus 4.3%, you said that sales declines improved each month. Can you say where you ended the quarter, like, what was comp in July and have you seen continued improvement into August? And then, I guess, lastly, in terms of that improvement both 2Q versus 1Q or even over the course of 2Q, what would you attribute that to? Is some of it an improving macro or is it just more a function of more newness in the product?
Jay Schmidt: So, Mitch, our comps did improve as we move through the quarter. May was our worst month, we improved in June and then July significantly improved, too. But when we look at ahead so far, based on what we know, our guidance Famous really reflects really more of this historic trend of where we have been and we do think we will deliver against that trend that we put out there and we have kind of sold everything against that for the — certainly as we go into third quarter.
Jack Calandra: Yeah. I would just…
Mitch Kummetz: Okay.
Jack Calandra: Mitch…
Mitch Kummetz: Yeah.
Jack Calandra: Just to add to Jay’s comments. As a reminder, our back-to-school performance last year was a record performance and so some of that comp were up against some decent comps in the Famous business for back-to-school.
Mitch Kummetz: Okay. And maybe with that being said, Jack, on the 3Q guide, you said sales down low-single digits. Can you provide any color on how you think about that between Famous and BP and is there any change to your kind of overall outlook for the year between those two businesses? It didn’t sound like a BP was a little slower than you expected in 2Q and I don’t know if that changed how you are thinking about that business as a whole for the year?
Jack Calandra: Yeah. Mitch, so we have — I would say, our base case and our guidance for Famous is basically a continuation of what we saw in Q2. So call it that minus 5%. Obviously, the guidance provides a range and so if Famous does a little bit better, we are towards the higher end of that range and a little bit worse, we would be towards the lower end of that range. So I would say, Famous is pretty well set on what we have seen pretty consistently for the year because if we look at Q2 down 5% and then if you take out March out of Q1, that quarter was also down 5%. So I would say pretty consistent performance and that’s what we have modeled. In the case of Brand Portfolio, that’s where they are up against some really — we were up against some really tough compares in the first quarter, I mean, in the first half.
So in the first half of 2022, our Brand Portfolio business was up 41%, but then in the back half of 2022, only up 7%. And so part of our confidence other than all the operating things that we have talked about in terms of inventory management and things like that, is we are just up against much easier comps going into the back half of this year on Brand Portfolio.
Mitch Kummetz: Great. All right. Thank you.
Operator: Thank you. Our next questions come from the line of Abbie Zvejnieks with Piper Sandler. Please proceed with your question.
Abbie Zvejnieks: Great. Thanks so much for taking my question. So just on the inventory, like, how should we be thinking about inventory levels for the balance of the year and then how are you thinking about managing bringing in the newness that’s driving demand versus keeping controlled inventory levels given the uncertain macro?
Jay Schmidt: So, Abbie, hi. It’s Jay. Just in — how we are managing inventory is really, we are kind of setting up a new normal for us and we are really managing to a new inventory turn. So — and looking at this, we really are driving newness continually, we think the consumer demands it and we are chasing more product to our speed program, which is running at that — moving towards that 20% of our receipts. So we aren’t really seeing it as any detraction in terms of holding us back right now. And then the last thing I will say is, in particular, in the Brand Portfolio, we had a lot of our product last year show way, way earlier up into second quarter than we had planned. So what you are going to kind of see is a more balanced flow with us through this disciplined management and we will, I think, continue to be able to deliver the newness, but more importantly, chase it quickly and that inventory amounts that we are now working on in turn allow us to really pivot and react more aggressively.
And then, Jack, I think, you can share some of the numbers here, too.
Jack Calandra: Yeah. Abbie, thanks for the question. Just to add to Jay’s comments, for the back half, we expect to have lower inventory this year versus last year in both the third quarter and the fourth quarter. Now they won’t be down as much as they were in the first half when they were down low-teens, but we expect continued improvement year-over-year in that metric. We are always focused on both the quantity and the quality of inventory and certainly appreciate the importance of maintaining that healthy inventory to sales relationship.
Abbie Zvejnieks: Got it. And then just one more on the Brand Portfolio. I guess, like, in this environment, I would assume that your wholesale partners are like that you have a good capability for drop ship. Can you just talk about what you are doing in drop ship and if that increase as a percentage of the business as wholesale orders have tightened? Thanks.
Jay Schmidt: Yeah. So we are funding our drop ship fully. There is — it’s a continued important portion of our business. Most likely, what we are seeing is our wholesale partners continue to want to receive newness in a very timely way so they can react to it, and yes, they are acting more conservatively, but again, reacting more toward the real product that is working. So our model continues as it has been with a very dynamic piece with it with both drop ship and then replenishment being a very important portion of this. And I think it’s going to be similar for us versus how we have operated in Q2 and Q1. So I am not seeing a different shift for that as we go into Q3.
Abbie Zvejnieks: Got it. Thank you.
Jack Calandra: Thank you.
Operator: Thank you. There are no further questions at this time. I would now like to turn the floor back over to Jay Schmidt for any closing comments.
Jay Schmidt: Okay. Well, I’d like to thank everyone for joining us this morning. Before we close today, I’d like to thank the talented Caleres team for their hard work and dedication. We remain confident in our ability to create exceptional product to exceed our consumer’s expectations and drive value for our shareholders. We also look forward to providing you with some additional detail around our long-term growth strategies at our upcoming Investor Day in October. So, with that, I’d just like to say have a great holiday and we will talk soon. Thank you.
Operator: Thank you. This does conclude today’s teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.
