Vince Holding Corp.

Thank you for joining today's Vince Holding Corps second quarter 2022 earnings conference call. My name is Dante, and I'll be the operator for today's call. All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end. If you'd like to ask a question, please press star 1 on your telephone keypad. I would now like to pass the conference over to our host, Ms. Amy Levy with Vince Holding Corps. Ms. Amy, the floor is now yours.

Thank you, and good afternoon, everyone. Welcome to Vince Holding Corp's second quarter fiscal 2022 results conference call. Hosting the call today is Jack Schwefel, Chief Executive Officer, and Dave Stepko, Chief Financial Officer. Before we begin, let me remind you that certain statements made on this call may constitute forward-looking statements, which are subject to risks and uncertainties that could cause actual results to differ from those that the company expects. Those risks and uncertainties are described in today's press release and in the company's SEC filings, which are available on the company's website. Investors should not assume that statements made during the call will remain operative at a later time, and the company undertakes no obligation to update any information discussed on the call. After the prepared remarks, management will be available to take your questions for as long as time permits. Now I'll turn the call over to Jack.

Thank you, Amy, and thank you, everyone, for joining us this afternoon for a discussion on our second quarter performance. Before I begin, as you saw in our press release today, in light of the continued challenging macro environment and after careful consideration, we have made the difficult decision to exit the Rebecca Taylor business. This decision will allow us to focus all of our resources on the growth and profitability of the Vince brand going forward. Given this update, my discussion today will focus primarily on Vince, and I will provide an update on our strategic initiatives before turning the call over to Dave to review our financial results in more detail. Turning now to a review of our performance at Vince. During the quarter, both our direct-to-consumer and wholesale channels drove sales growth above both 2019 and 2021 levels. Our direct-to-consumer results were led by strength in our retail stores and our wholesale channel, benefiting from strong performance at the Nordstrom anniversary event, as well as the expected increase in sales into the off-price channel. During the quarter, our assortment continued to resonate with our customers as both women and men have gravitated into a dressier casual style and away from lounge as we have returned to more normalized activities and events. In women's, we saw strong demand for our dresses and pants as well as great reception to color, pattern and skirts, and new silhouettes and tops. While we scaled back the breadth and depth of our swimmer categories this year, we saw strength in our exclusives and more modest pieces. We are also pleased with the higher turns and increased margin rate we delivered for the line this year. In addition, For the women's business, we were very encouraged by the positive response we saw in our inclusive sizing event at our Fifth Avenue store last quarter, and we are exploring opportunities to offer inclusive sizing in more stores. In men's, we were again very pleased with the momentum we saw during the period. In particular, we saw strength in our men's essential and key summer items like our linen program and cabana shirts. We are now seeing customers buy Vince menswear in a dressier way. aligning similarly to our women's aesthetic, and we continue to see strong opportunity for growth in this line going forward in areas such as evergreen categories, such as bottoms. Looking ahead towards fall, we see a significant opportunity within cold weather accessories, and we are excited for our upcoming launch for both men and women with our new licensing partner, Amical. This expanded assortment which will be in stores later this month, includes a range of scarves, leather gloves, mittens, and other items in seasonal colorways. We are very excited for this lineup as we enter the fall and holiday seasons, which will complement our existing men's and women's styles and adds to our already strong gifting assortments. We also continue to offer a selection of accessories in partnership with Amical, supporting Ukrainian refugees, and are proud to have raised almost $30,000 since launch early June. During the store performance, we have continued to see sales and traffic migrate back to our retail stores following several quarters of COVID-driven e-commerce growth. As you may recall in May, we opened our Boston Seaport store and in June relocated our Merrick Park location and are seeing strength in both markets. In addition, during the quarter we closed two stores and have plans to relocate one store and remodel two locations before the end of the year. As customer shopping behaviors have migrated back to stores, our year-over-year comparison in e-commerce has been impacted, which highlights the growing importance of our omnichannel capabilities. We continue to view e-commerce as a key part of our growth strategy. With this in mind, we are excited for the upcoming relaunch of the VINs website. With our updated site, our customers will experience faster page loads and an improved customer journey highlighted by enhancements to navigation, and filters along with redesigned category and product pages. The new site will also bring a mobile-first experience, including a streamlined checkout process for customers. Along with these immediate improvements, we are also looking forward to the long-term scalable benefits from our relaunch and its applications for enhanced personalization, particularly alongside our new customer data platform, or CDP. Through our CDP, we now have enhanced targeted marketing and personalization capabilities which we believe will benefit our disciplined marketing approach that we have continued to highlight. Turning now to the wholesale channel, most exciting was, as I mentioned, the very strong performance we saw in both men's and women's at this year's Nordstrom anniversary sale. We were particularly proud of these results, especially on top of last year's record performance. While we did continue to experience delays due to ongoing supply chain challenges and did see more cautious approach to reorders in the period, We continue to work closely with our wholesale partners. To that end, we were very pleased to launch in SACS during the quarter. Later this fall, we will be celebrating Vince's 20th anniversary with our hashtag I love Vince campaign. As part of this milestone event, select wholesale partners will be joining the celebration with tailored capsule collections. These collections will showcase our brand favorites that defines Vince's tried and true heritage of understated luxury. In addition, we will be celebrating the campaign on social media with particular emphasis on our wardrobe essentials and classic Vince items while highlighting the three qualities of the brand, craftsmanship, quality, and heritage. We continue to be pleased with the increased engagement we are seeing across our social media channels. While the majority of our influencer campaigns are directed towards women, we were thrilled at the performance we saw at one post this summer highlighting our straight leg vintage wash jeans Tom Cruise wore in this year's blockbuster Top Gun Maverick. Looking ahead, we will continue to focus on driving increased engagement and are excited for not only our 20th anniversary campaign, but our holiday campaign as well, which will highlight occasion and gifting across our web and social pages later this year. Finally, our international business continues to show growth. We saw a particular strength in Korea supported by demand in tops, sweaters, and knits. We are also very pleased with our progress in the United Kingdom and look forward to the opening of our shop and shop at Harrods planned for October. In China, we are excited for the opening of our Shanghai pilot store and web launch later in September. In closing, we continue to operate in a challenging and dynamic environment, and I want to thank all of our employees for their hard work and dedication. As we look ahead, We are focused on making progress across all of our initiatives to best position Vince for profitable growth going forward. With that, I will turn it over to Dave.