1-800-FLOWERS.COM, Inc.

Good day and welcome to the 1-800-FLOWERS.COM, Inc. Fiscal 2020 First Quarter Results Conference Call. Today's conference is being recorded. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then 1 on your telephone keypad. To withdraw your question, please press star, then 2. I would now like to turn this conference over to Joe Petito, Senior Vice President, Investor Relations. Please go ahead, sir.

Thank you, Chantal. Good morning and thank you all for joining us today to discuss 1-800-FLOWERS.COM, Inc.'s financial results for our fiscal 2020 first quarter. For those of you who have not received a copy of our press release issued earlier this morning, the release can be accessed at the Investor Relations section of our corporate website at www.1800flowersinc.com. Our call today will begin with brief formal remarks, and then we will open the call to your questions. Presenting today will be Chris McCann, CEO, and Bill Shea, CFO. Before we begin, I need to remind everyone that some of the statements that we will make today may be forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the applicable statements. For a detailed description of these risks and uncertainties, please refer to our press release issued this morning, as well as our SEC filings, including the company's annual report on Form 10-K and quarterly reports on Form 10-Q. In addition, this morning we will discuss certain supplemental financial measures that were not prepared in accordance with generally accepted accounting principles. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures can be found in the tables accompanying the company's press release issued this morning. The company expressly disclaims any intent or obligation to update any of the forward-looking statements made in today's call, any recordings of today's call, the press release issued earlier today, or any of its SEC filings except as may be otherwise stated by the company. I'll now turn the call over to Chris McCann.

Good morning, everyone. We've had a strong start to fiscal 2020. As I stated in this morning's press release, our results for the first quarter represent a continuation of the momentum that we built throughout last year. Our revenue growth of more than 10% and EBITDA improvement of nearly 19% reflect the benefits we are getting from the investments that we made last year and continue to make this year in our key Harry and David and 1-800-FLOWERS brands, as well as in our BloomNet business. Importantly, we achieved solid growth in revenues, contribution margin across all three of our business segments. In gourmet food and gift baskets, we grew in revenues nearly 18%, driven by strong everyday gifting at Harry & David for such occasions as Birthday, Sympathy, and Thank You, along with its new Get Well collection, growing customer demands for the Harry & David Gourmet line, including prepared meals and wines for both gifting and entertaining that are attracting a younger shopper to the brand, continued growth in 1-800-BASKETS for direct-to-consumer gifts for everyday gifting, as well as increased wholesale shipments for the holiday season, and contributions from our new Sherry's Berries brand, which we acquired in mid-August. It's worth noting that we had the Sherry's Berries brand up on our multi-brand platform and helping customers deliver smiles literally within hours of having closed on the acquisition. This is a real testament to our culture of teamwork and our focus on execution. The integration and development of this new business has been going well. We've been working with our fulfillment partners to prepare for the upcoming holiday season, making changes to packaging and improving product quality, and we've begun to rework Sherry's Berry's messaging and marketing mix and testing into different marketing channels. While this is still very early, we're encouraged by the customer interest and demand we are seeing. In our floral businesses, 1-800-Flowers and Bluenet were able to effectively leverage the investments we've been making in innovative marketing and merchandising programs to achieve solid growth in revenue, gross margins, and contribution margins during the quarter. As a result, 1-800-Flowers further extended its market leadership position and BloomNet continued to grow its market share. We expect these trends to continue throughout the fiscal year. During the quarter, BloomNet's revenue growth was driven primarily by strong digital directory sales and increasing demand for our expanded line of wholesale products, along with continued growth in order volume. In our 1-800-FLOWERS business, we launched The Plant Shop, building on the strong growth that we are seeing in plants for both gifting and self-consumption. The plant shop features a new collection of on-trend customer favorites of houseplants and an expanded selection of succulents. We are quickly becoming the authority in this fast-growing category, a favorite of millennial customers. We also continue to differentiate and elevate our floral and gift offerings with now-trending collections for the fall season, including Rustic Farmhouse, and Pumpkin Spice, truly original and exclusive designs that are helping attract younger customers to the 1-800-FLOWERS brand. In addition to the strong revenue growth during the quarter, we also continued double-digit growth in our customer file as well as solid growth in membership in our passport program and in multi-brand customers. As we've noted in the past, these are our best performing customers in terms of purchase frequency, retention, and lifetime value. The strong growth in our customer file bodes well for us as we continue our momentum as we enter the key holiday shopping period. Before I turn the call over to Bill for the financial metrics for the quarter, I'd like to touch on a few of the initiatives we've taken ahead of the holiday season. On the merchandising front, we launched our new Cards with Pop line from the Popcorn Factory. Specialty designed envelope-shaped cards available with uniquely curated sentiments printed on the outside and gourmet popcorn on the inside. Cards with Pop are designed for customers who wish to express their thoughts through witty and relevant sentiments for everyday occasions, cultural moments, and holidays, all for $9.99, shipping included. Also off to a great start is the repositioning of our Wolferman's brand as Wolferman's Bakery, featuring an expansive assortment of exceptional baked goods perfect for entertaining, self-consumption, and gifting. The new positioning reflects how Wolferman's has evolved from a brand best known for its super thick English muffins to a full online bakery, offering sweet and savory items baked from scratch daily. As a result of its repositioning, Wolfman's has already seen some of the best customer demand that we have experienced in a while. As we head into the season of sharing, we've also launched a special collection of holiday gifts designed to benefit Smile Farms, a nonprofit organization that is dedicated to creating meaningful jobs for individuals with developmental disabilities. Throughout the holiday season, 20% of all net proceeds from this collection's sales will be donated to SmileFunnels. In terms of innovation to enhance the customer experience, we recently completed the rollout of PWA technology across our brands, significantly increasing site speeds for our customers on their mobile devices. We launched our new Magic Link capability, enhancing our customers' sign-in experience by allowing them to log into their accounts with a single click, even if they don't remember their username and password. And we deploy new 3D capabilities for a collection of top products on the 1-800-FLOWERS site, enabling customers to not only preview our products in three dimensions on both desktop and mobile, but also see what their gifts will look like on a table or in a room via augmented reality on their supported mobile devices. Looking ahead, as we enter the key holiday period, we have strong momentum across all our business segments. We continue to grow our customer files at a strong pace, and our customer metrics continue to be strong. And we have exciting new initiatives underway across the company designed to expand our product offerings and to continually enhance the customer experience. As a result, we are well positioned to deliver strong performance for the holiday period and for the full fiscal year. I'll now turn the call over to Bill. Bill?