Hibbett, Inc. (NASDAQ:HIBB) Q4 2023 Earnings Call Transcript

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A – Bob Volke: Yeah, yeah, again I think there’s a lot of factors that have played into this over the last two to three years that obviously we would not have been able to foresee as we did our, you know that investor conversation a couple of years back. I agree with Mike. I think we are making a lot of investments in the business over the last year and with that came some additional costs of operations. Inflation has clearly been impactful across a number of different expense categories. Also, just kind of returning to more normalized business operations where people are traveling a little bit more and getting out into the €“ into events and meeting with the vendors. So a lot of that stuff has kind of come to roost now over the last 12 months.

We think we’re going to start again building back toward a higher EBIT percentage as we move forward. I don’t think it’s going to be an overnight you know significant blip, but again the commit we’re making is to continue to evaluate our cost structure and move that number up slowly toward as Mike said, into that 10% range again.

Justin Kleber : Got it. Okay, no that’s great to hear. And then just last question Bob, do you have any estimation on just what you’re thinking about free cash flow this year?

Bob Volke: Again, I think you know we still have plenty of cash necessary to execute the strategy, which is, you know buying back shares as we see the opportunity in the marketplace, intimidating as I said to invest $60 million to $70 million in CapEx. With our sales growth, with a declining inventory in the back half of the year, I mean I feel pretty comfortable with our cash flow position as the year progresses.

Justin Kleber : Great! Alright guys, thanks so much, and best of luck!

A – Mike Longo: Thank you.

Operator: Thank you. Our next questions come from the line of Mitch Kummetz with Seaport Research. Please proceed with your question.

Mitch Kummetz: Yes, thanks for taking my questions. Mike, I guess my first question is for you. Using your prepared remarks you talked about falling short of plan in the quarter. I just want to make sure I am totally clear as to kind of where and why you had that shortfall, because it looks like it’s more on the sales side than the margin side, and then kind of the split between footwear and Apparel. I know there’s been a lot of talk on this call about how Footwear had a good quarter, at least the year-over-year increase with strong Apparel was down. But I imagine that was sort of expected as well. So I’m not sure that was €“ you know Apparel was worse than expected and so we’re sort of in line, but maybe just a little bit more color on kind of where and why you miss planned in the quarter?

A – Mike Longo: Thank you. So Footwear, we were very pleased with the performance. We continue to see good sell through as high heat is high heat; nothing’s really changed with that. There maybe fractionally lower sell-throughs, but still the compelling product assortment works. Apparel was a bit of a disappointment, not only in terms of units, but in terms of the price and the growth of it. So I think Jared did a good job of going through that a couple of times, but I think he’s going to follow me up in just a moment. In the terms of the total revenue, what we had modeled as everyone knows, and we talked about a higher AUR and a somewhat higher transaction number. So the shortfall really was you know in the transactions number. So Jared, do you want to

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