Solo Brands, Inc. (NYSE:DTC) Q1 2024 Earnings Call Transcript

You mentioned the Mall of America, great opportunity for us because we’re seeing people where our Chubbies apparel all over the country regardless of location. And of course, the upper Midwest gets super-hot in the summer as well, but we just see the affinity for our brand stretch beyond just the Sunbelt and West Coast states.

Ryan Sigdahl : One quick clarification. Accrued expenses and other liabilities jumped up this quarter sequentially as well as debt, I think, associated with that. But can you clarify what’s going on there? And if any of that should reverse?

Laura Coffey : We did see an increase in those accounts, and we anticipate that we will be bringing that down over the summertime. As we’ve built up for our direct-to-consumer, our season upon us now, if you think about it, our best season is Q2 and Q4. So we always start to build some of our inventory for those time periods. We’re proud that our inventory is down from last year at the same time, sizably by about $13 million, but we anticipate that we’re going to continue to work that inventory down to more manageable levels. But that’s where you’re seeing some of those increases along the way.

Operator: [Operator Instructions]. At this time, we have no further questions registered. I’ll turn the call back to the management team.

Chris Metz : Thank you, operator. And we realize that it’s going to take some time to digest the results. And as always, we’re here willing and able to answer questions as we move forward. But I just want to reiterate that we’re in the early innings of our turnaround. We know that it’s going to take time for all that we are doing to fully take root. However, personally, I’m very happy with the progress we are making. We’re attracting great people and investing in capabilities. You’ve seen us through the first quarter and it continues into the second quarter, we stabilized our D2C business, and we’re leveraging our strong financial model with high gross margins and strong free cash flow. So we look forward to updating you on our results and our progress next quarter. Thank you.

Operator: Thank you, everyone, for joining us today. This concludes our call, and you may now disconnect your lines.