Steven Madden, Ltd.

Good morning everyone and welcome to the Steve Madden Earnings Conference for 2023. I will now turn the call over to Danielle McCoy.

Thanks Savannah and good morning everyone. Thank you for joining our second quarter 2023 earnings call and webcast. Before we begin, I'd like to remind you that our remarks that follow, including answers to your questions, contain statements that we believe to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements are subject to risk that could cause actual results to materially differ from those expressed or implied by such forward-looking statements. These risks include, among others, matters that we have described in our press release issued earlier today and filings we make with the SEC. We disclaim any obligation to update these forward-looking statements, which may not be updated until our next quarterly earnings conference call, if at all. The financial results discussed on today's call are on an adjusted basis unless otherwise noted. A reconciliation to the most directly comparable GAAP financial measure and other associated disclosures are contained in our earnings release. Joining me on the call today is Ed Rosenfeld, Chairman and Chief Executive Officer, and Zine Mazzuzzi, Chief Financial Officer. With that, I'll turn the call over to Ed. Ed?

Well, thanks, Danielle, and good morning, everyone, and thank you for joining us to review Steve Madden's second quarter 2023 results. As expected, we face a challenging operating environment in the second quarter. In light of the difficult market conditions, in particular the cautious approach to orders by many of our wholesale customers in the United States, we were pleased to deliver earnings results in line with expectations for the quarter. And while we are never satisfied with financial performance that falls short of what we achieved in the prior year, I'm proud of how our team controlled what we could control in the quarter. As we, one, drove strong gross margin performance despite a promotional retail landscape, two, managed our inventory with discipline, delivering a 32% reduction in inventory at the end of Q2 compared to the prior year. And three, controlled expenses and drove cost efficiencies even as we continue to invest in product innovation, consumer engagement, and our long-term growth initiatives. As we move forward, we will remain focused on executing our strategy for long-term growth, the foundation of which is driving closer connections with consumers through the combination of consistently trend-right product assortments and effective consumer engagement, which in turn will enable success with our four key long-term business drivers. One, driving our direct-to-consumer business led by digital. Two, expanding in categories outside of footwear, like handbags and apparel. Three, growing in international markets. And four, strengthening our core U.S. wholesale footwear business. Now, turning to our performance by channel in Q2. In wholesale, revenue remained under pressure, declining 21% versus the second quarter of 2022. As expected, our private label business was again a significant drag on the top line, as our mass merchant customers have reduced orders in an effort to right-size overall inventory levels in our categories. Our branded business was also down, though not as dramatically as private label, as our branded customers also continued to take a conservative approach to orders. Despite strong sell-through in several key styles, our wholesale customers did not chase business in those styles the way they normally would, and reorders were significantly lower than we would see in a more typical retail environment. Looking ahead, while our wholesale customers remain cautious, we expect to see significant improvement in the balance of the year relative to the first half. Even if, similar to spring, we see limited chase business from wholesale customers in fall, we still believe we can be flat or close to flat to last year's wholesale revenue in the back half. In our direct-to-consumer business, revenue in the second quarter declined 5% compared to the same period in the prior year, with decreases in both the brick-and-mortar and e-commerce channels. While consumer demand trends remain choppy, we have seen improvements We have seen improvement in the year-over-year revenue performance over the last couple months as comparisons have eased, and we expect to return to year-over-year growth in DTC in the back half. Overall, while we are planning for the operating environment to remain choppy in the near term, we are poised to see significant improvement in our financial performance beginning in Q3. We knew coming into the year that the first half would be tough, and I'm proud of how our team weathered the storm and excited about our prospects for the balance of the year. Looking out further, I'm confident that with our strong brands, proven business model, and multiple significant growth opportunities, we are well positioned to drive top and bottom line gains for years to come. Now, I'll turn it over to Zeen to review our second quarter financial results in more detail and provide our outlook for 2023.