Bracken Darrell: Have you got it Matthew?
Operator: Thank you. Our next question comes from the line of Bob Drbul with Guggenheim. Please proceed with your question.
Bracken Darrell: Hi, Bob.
Robert Drbul: Hi, Bracken. I just got a couple of quick questions. First on Vans, is there anything more you can share with us on your 18-month plan just around I don’t know, marketing? Are you planning to bring the work to back pricing within the brand? Anything along those lines would be helpful. And second question is just around inventories. With the inventories down, I think was at 17% are there any pockets by brand geographically that you’re concerned about, either both in your business or at the wholesale level? Thanks.
Bracken Darrell: Thanks Bob. I’m going to let Matt take the second question, but I’ll take the first one. I’m not ready to be too specific on that yet, partly because I know that I’ve got a new brand president coming in, so we’ll have a latitude to make some changes. But what I would say is we’ve got a great – I mean I think a strong kind of very punctuated plan that combine – that integrates the marketing insights and then the marketing programs with the new products that are launching. And I’ve been through both sides of that equation, the two of them together, two or three times now, and I’m still not done, but I feel good about it, very good about it. We do not have plans to bring back the work tour, although we’re certainly crossed our mind and we’re talking about it a little bit.
The work tour was a really powerful thing, but it took time to drill. It would take quite a bit of time to rebuild. I think the objective though, of making sure that we’re really deeply in the hearts and minds of the youth audience is mission-critical for us.
Matt Puckett: Hey Bob, so on inventory, a couple of things. I will give you one number here that maybe is really useful. Relative to the 17%, Vans is actually down almost 30%. So Vans is in a really good place, I think, relative to where we sit from a top line and the reset actions in the Vans marketplace with the actions we’re taking is, by and large, going to be about where we would like it to be as we get towards the end of the fiscal year, maybe just modestly higher from a weeks of supply standpoint in the U.S., but pretty close. So I think we feel pretty good there. If you look at the overall average of 17%, Vans is on the higher side of that. Dickies is on the higher side in terms of reduction. The North Face is kind of right on the number and Timberland and all the other brands are lower.
And Supreme is actually probably the only brand where the inventories are modestly higher, and obviously, the business is performing well. So I think overall, we feel pretty good about where we are. If I say if there’s a pocket or two of inventory, it’s certainly coming out of the outdoor — in the outdoor segment coming out of this fall/winter selling season, and I think probably particularly in the Timberland business here in the U.S. is something that we’re taking a hard look at. But relatively speaking, Bands and The North Face are in pretty good shape.
Robert Drbul: Thank you.
Bracken Darrell: Thank you, Bob.
Operator: Our next question comes from the line of Paul Lejuez with Citi. Please proceed with your question.
Bracken Darrell: Hi, Paul.
Paul Lejuez: Hey. Thanks guys. You mentioned some of your wholesale partners are being cautious, I think, on their ordering. But curious where you’re seeing sellout performing better than sell-in, what brands, what regions? And how long do you see that dynamic lasting before sell-in and sell-out more aligned? And then just a quick second question. On the strategic review, is that all being done internally by you guys using some outside consultants. Sorry if I missed it, I’m just curious who’s involved in that.
Bracken Darrell: Yes. I’ll take the last one, and I’ll let Matthew take the first one. Yes, the strategic review. It’s an internal exercise. We do we get the advice of the people you would expect us to in that context, but we don’t have a consulting or someone we’re working with. We have a really strong team internally that’s doing the analysis and we’re working with the Board on that. We’ve got two different — I would say, two different groups on the Board who are really strong in this area, a lot of portfolio experience there. So that work has been ongoing — has been going. So I feel really good about it. You want to answer the first question on the…?
Matt Puckett: Yes, I think the most obvious place I would point you toward to where the sell out or sell-through is better than the sale-in is in Europe. We’re seeing that I’d say, generally across the board, maybe a little less so in Vans. But generally, across the board, the business is a little stronger, I would suggest, and maybe what the financial results imply. And I won’t be surprised to be surprised if that doesn’t continue for a little bit of time as wholesalers continue to be pretty cautious, but in Europe, that’s true. Certainly, with Vans and the reset actions, there’s a lot of noise in some of those numbers that distort the wholesale results for Vans as we do that. So the sellout is certainly a little bit better, but not good, right? It still continues to be in a place that we’re not happy with.
Bracken Darrell: That probably goes without saying, but Supreme sell-out continues to be very strong.
Matt Puckett: Yes. Europe. The only the thing I’d say about Europe is inventories in the marketplace across the board are really well positioned. U.S., a little — there’s a couple of pockets, as I said earlier, I think particularly Timberland, where we’re probably a little bit higher than we like to be. But Europe is in a good place from an inventory standpoint as is Asia, by the way.
Paul Lejuez: Got it. Thanks guys. Good luck.
Bracken Darrell: Thank you, Paul.
Operator: Our next question comes from the line of Jim Duffy with Stifel. Please proceed with your question.
Bracken Darrell: Hi, Jim.
James Duffy: Thank you. Hello everyone. Thank you for taking my question. Bracken, I want to dig in on the portfolio review. Your message last quarter was no sacred cows, bores aline [ph], et cetera. The announcement of a portfolio review doesn’t seem like new news. Can you give us sense of where you are in the process? Have banks been appointed to shop brands deemed unstrategic? And then when I think about the criteria you’ve outlined, growing markets, leaders in the markets it seems kind of a short list of brands that fit. Am I correct to interpret that that suggests a large-scale realignment of the portfolio as possible?
Bracken Darrell: I wouldn’t go that far. But I would say you’re right that we’ve been working on this for longer than we’ve been talking about it. That’s kind of the — I will try to do that regularly so that we don’t just come out with things that aren’t really pretty well along. So we are well along the way on this portfolio review. And while we haven’t hired bankers beyond the discussion that you know of, we’re certainly downstream on discussions on exactly what we do from a portfolio standpoint. And I don’t have more to say about that now, but you’ll hear more as it comes.
James Duffy: Okay. And then may be just a question on the mechanics of the Vans realignment, can you help us maybe better understand what that means? What were the specific tactics to try to clean up inventory in the channel? If you could explain more, that would be helpful. And I’m curious, like in that context, how did you miss on sales, but over-deliver on the inventory.
