Ladies and gentlemen, thank you for standing by, and welcome to the Hibbett Sports Second Quarter 2019 Conference Call. [Operator Instructions] As a reminder, today's call is being recorded Friday, August 24, 2018. Now I would like to turn the conference over to Pat Watson, Corporate Communications. Please go ahead, sir.

Thank you for joining Hibbett Sports to review the company's financial and operating results for the second quarter and first half of fiscal year 2019, which ended on August 4, 2018. Before we begin, I would like to remind everyone that management's comments during this conference call not based on historical facts, including those in response to your questions, are forward-looking statements. These statements, which reflect the company's views with respect to future events and financial performance, are made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are subject to uncertainties and risks. It should be noted that the company's future results may differ materially from those anticipated and discussed in the forward-looking statements. Some of the factors that could cause or contribute to such differences have been described in the news release issued earlier this morning, in the company's annual report on Form 10-K and in other filings with the Securities and Exchange Commission. We refer you to these sources for more information. Lastly, I would like to point out that management's remarks during this conference call are based on information and understandings believed accurate as of today's date, August 24, 2018. Because of the time-sensitive nature of this information, it is the policy of Hibbett Sports to limit the archived replay of this conference call webcast to a period of 30 days. I'd now like to turn the call over to Jeff Rosenthal, Chief Executive Officer. Please go ahead, Jeff.

Thank you, and good morning, everyone. Welcome to the Hibbett Sports second quarter earnings call. I have with me this morning Scott Bowman, Senior VP and CFO; Jared Briskin, Senior VP, Chief Merchant; and Cathy Pryor, Senior VP of Store Operations. Net sales for the 13-week period ending August 4, 2018, increased 12.3% to $211.1 million compared with $188 million for the 13-week period ending July 29, 2017. Comparable store sales increased 4.1%. E-commerce sales represented 8% of the total sales for the second quarter. The year-over-year increase in net sales also included an increase of approximately $16.9 million due to the week shift resulting from the 53rd week last year. We continue to make investments for the long-term success of the business, and we are starting to see benefits from these investments in our operations. Although we experienced softness in our licensed, equipment and accessory business in the quarter, we've seen significant movement in branded apparel and footwear. We are very encouraged by the acceleration of our e-commerce business. Additionally, our gross margin rate continues to show significant improvement, with cleaner inventory and much more full-priced selling. Looking forward, we expect continued improvement in our assortments as we approach the holiday season and to benefit from our omnichannel initiatives with the rollout, a Buy Online, Pick up in Store and Reserve in Store. This upcoming quarter, we will see enhancements in our omnichannel capabilities. Our Pick up in Store initiative is now being tested in our Birmingham stores with plans to roll out to more stores during Q3. The ability to shop your store and the choice to either buy or reserve items online, a compelling new experience to our customers that will drive both online sales and in-store purchases. We have an advanced implementation of our in-stock pickup that will differentiate, pivot and provide a robust set of features to better serve our customers. Customers can buy products to pick up in store. They can reserve items to try on at our stores. You can also shop the entire local store in a dedicated section on our website. We are very happy to report that we're continuing to see very robust results from our online business, driven by the continuing investments we are making in online marketing, merchandising and consumer experience. The last couple of weeks in Q2 marked our anniversary launch of the website. During the quarter, we invested more in advertising, which had a positive return on investment. Part of the decision to increase our spend was also to learn about the effectiveness of our marketing. As expected during our testing, we saw investments that had positive and negative results. These findings have allowed us to build more effective plans going into Q3 and Q4 to drive stores and fully optimize our return on advertising spend. As we begin the second half of the year, we feel that we're in great position to deliver the results. Our investments that we have made in system, example, BOPIS and ROPIS, and marketing and people will set Hibbett for the long term. I now will turn the call over to Jared Briskin, Senior VP, Chief Merchant, to talk about our merchandise trends.

Thank you, Jeff. Good morning. During the second quarter, we saw an acceleration from our first quarter trend. Apparel, footwear and cleats continue to improve, while accessories, licensed products and equipment remained headwinds and continue to downtrend. Our apparel business posted its third consecutive comp store gain, producing a low double-digit improvement. Men's and kids' apparel were both up double digits, while women's apparel grew mid-single digits. Trend-relevant sportswear that showed strong connectivity to our sneaker business was a primary driver across our all categories. We also saw improvement year-over-year in performance apparel as we lap big decreases as well as market play saturation from a year ago. The accessory category remains a challenge, down mid-single digits. We have solid gains in backpacks, sneaker cleaner and incremental sales from phone accessories. This was offset from declines in socks, sunglasses and hydration. Beginning with the third quarter, the hydration comparable becomes less of a headwind to our business. The licensed business remains our most challenged area, down high single digits. While this remains a poor trend, it has improved over our previous trends as we adjust and pivot. While the core fan apparel and headwear business remains very challenging, investments made in items that have strong connectivity to our sneaker business are trending and improving results. Team sports business was down low single digits. Cleated business comped high single digits and has now been positive in 3 consecutive quarters. We're very encouraged that all cleated categories were positive for the quarter, led by baseball, soccer and track, which were all up double digits. Softer equipment business, which was down mid-single digits, offset the cleated gains. Positive business in baseball, soccer and volleyball equipment did not offset declines in fitness and football. Footwear was up mid-single digits, posting a fourth consecutive quarterly comp store gain. Men's business was up double digits for the quarter, while women's was up low single digits. Both of these categories were led by new innovation platforms, a very strong retro trend and improvements in access and allocation of key models. The kids business was flat for the quarter. While similar trends were impacting the kids business as a whole, there is a lack of available product being taken down into kids' sizing to capitalize on the demand. As we head into the back half of the year, we're pleased with our inventory management efforts. Our inventory is leaner and much fresher than a year ago. We believe that our inventory position and flow of receipts have us positioned well for the back half as we continue to enhance the cross-category connectivity and relevancy of our assortment. I'll now turn the call over to Scott Bowman to discuss our financial results.

Thanks, Jared, and good morning. For the second quarter, total sales increased 12.3% to $211 million, and overall comp sales increased 4.1%. By month, comp sales were 3% in May, 5.4% in June and 3.7% in July. E-commerce sales continued to accelerate and represented 8% of sales in the quarter. As a point of clarification, the percentage increase in total sales is much higher than the increase in comp sales, mainly due to the week shift caused from the 53rd week last year. Due to the week shift, we captured a very high volume of back-to-school sales in the quarter and lost a relatively low volume week at the beginning of the quarter. The effect of this shift resulted in approximately $16.9 million of additional sales being recognized in the quarter. Originally, we estimated this week shift would result in an increase of approximately $18 million. We attribute this difference mainly to a slight difference in school start dates versus the prior year. Gross profit rate increased 248 basis points in the quarter. Product margin increased 80 basis points, mainly due to cleaner inventory and more full-priced selling. Logistics and store occupancy expenses increased -- or decreased 168 basis points as a percent of sales, which is mainly due to leverage gained from higher sales versus last year. SG&A expenses increased 15.7% in the quarter and increased 86 basis points as a percent of sales. The increase was mainly due to marketing and omnichannel investments and an increase in employee benefit costs. During the quarter, we expedited our initiative Buy Online, Pickup in Store and Reserve in Store in an effort to launch prior to the holiday season. The team did a great job on the development in store training needed to execute this initiative, and we are looking forward to rolling it out later in the quarter. We also increased our investment in marketing during the quarter, which helped to increase traffic but also allowed us to acquire more customers and increase brand awareness. As a point of reference, we have added over 860,000 customers to our loyalty program so far this year and loyalty members now represent 60% of our transactions. The income tax rate for the quarter was 28.9%, which compared to last year's rate of 39.1%. This reduction was mainly due to the decrease in the federal rate as a result of tax reform. Loss per share for the quarter was $0.06 per share compared to a loss of $0.15 per share last year. Turning to the balance sheet. The company ended the quarter with $120 million in cash versus $53 million last year, with no borrowings outstanding on our revolving credit facilities. Inventory decreased 10% from last year and was 9% lower on a per-store basis. We spent $3.9 million in CapEx for the quarter as we opened 6 new stores and made further progress on our major initiatives. Also, the company repurchased 336,000 shares for a total of $8 million in the quarter. At quarter-end, we had approximately $196 million remaining under the existing purchase authorization. Turning to our guidance. We are updating our full year guidance with the following changes. We are updating earnings per share to a range of $1.57 to $1.75 compared with previous guidance of $1.65 to $1.95. For comp sales, we are updating our guidance to a range of negative 1% to positive 1%, which compared to previous guidance of negative 1% to positive 2%. For SG&A expense, we are updating guidance to an increase of 7% to 9% compared with previous guidance of 6% to 8%. Finally, for CapEx, we expect to spend $18 million to $22 million compared with previous guidance of $20 million to $25 million. With that update, operator, we are now ready for questions.

[Operator Instructions] We'll get our first question from the line of Seth Sigman of Crédit Suisse.

A couple of questions here. Just in terms of the comps and the cadence throughout the quarter, I think you're running mid-single digits early in the second quarter. If I recall, the comparisons got a little bit more difficult throughout the quarter. So I just want to better understand how demand played out for you throughout the quarter. And then as we look at the change in the guidance at the high end, just any more color on what that difference is versus your initial expectations.

Yes, sure. As we started, May, we did see a pretty good demand and a pretty quick start in the month of May. It did soften up a little bit as we got further into the month. June was pretty solid for us. All in, up 5%, so we were pretty pleased there. In July, we mentioned we did 3.7%. And actually, the front end of July was better. We did see some weakness as we got into late July and specifically, the last week of July. And so kind of as I indicated with that week shift, we saw that last week of July pretty soft. But then as we got into August, without giving any comp numbers, we did see a little of that business go into the first week of August.

Okay, that's helpful. Just in terms of the SG&A moving pieces here, the increase in the guidance, any more color on what's driving that change? How much of that is internally driven versus external pressures? And then as you think about next year, should we be assuming basically a similar level of growth?

Sure. So the increase in the guidance with SG&A was mainly to just build in a little bit of overage that we saw in the second quarter. So health care costs were elevated. And with us being self-insured, we do see volatility from time to time in that expense. So part of it was that. I do expect that to moderate somewhat in the back half but may still be a tick higher. The other one is the marketing expense that we mentioned. We did overspend a bit in the quarter. And mainly, that was because we saw some things working and so we did put some more dollars behind it. We'll continue to do that, look for opportunities in the back half for marketing and advertising. And so those are really the 2 main components that led to the increase in guidance.

We'll get to our next question on the phone line from the line of Dan Wewer with Raymond James.

Jeff, first question I have is industry promotional activity and how you would evaluate that, let's say, compared to a year ago and how you see that playing out for the balance of 2018.

Yes. Dan, I'd say a pretty -- about the same as it was last year. I think you continue to see the same level of promotions going on. I do think there is some opportunity not to be promoting as some of these new models, as they come in, and some of the new innovative and higher-end products are doing well and they're really not being promoted. So I believe as we get into the second half, you won't see it quite as promotional. But we've seen so far this year, I would say it's pretty steady.

Okay. Scott, a question about operating margin rate. It looks like you're probably coming in at slightly under 4% this year. Do you think that operating margin rate drops again next year? Or do you think this year, we're going to see the bottom?

Dan, I think it will start to flatten out. I think we get into next year kind of to follow up on the SG&A comment, that increase should moderate. Remember this year that we did adjust some wages in owner stores, and we did have some omnichannel investments with our mobile app and with BOPIS in ROPIS and so that was a little elevated this year as well. Our gross margin, as we get into next year, we'll probably be fairly strong as our inventory is cleaner. So there's some positives that will carry into next year as well as continued acceleration of e-comm. And as it does that, it will get more profitable. So we think that there are some good opportunity to start to see some flattening out, if not improvement in that operating margin going into next year.

Okay. And the last question I have, it looks like the reduction in the fiscal year guidance is pretty much all due to the second quarter shortfall. It looks like the second half outlook -- correct me if I'm wrong, but it looks like the second half outlook is pretty much in line with the original expectations. If that's correct, why would you not maybe reduce the outlook for the second half of the year given the issues in 2Q?

I think it's a couple of things. As we look in the back half, the product pipeline will be much better than what we saw in the first half. So that will absolutely help us as we roll out BOPIS and ROPIS. That should help us stabilize some business, especially in the stores. We have some good opportunity in gross margin in the back half. We were way down last year and we're coming into the back half this year with much cleaner inventory. So those are the main things that we see helping us in the back half versus the first half.

We'll get our next question on the line from the line of Camilo Lyon of Canaccord Genuity.

This is Pallav Saini on behalf of Camilo. My first question is on the comp performance in Q2. Did the quarter unfold as you planned? Were there any surprises on the Academy performances? And if you can provide the traffic, transaction, ASP metrics, that will be helpful as well.

Yes, I'll cover the transaction and ASP average ticket. I will let Jared kind of give you his thoughts on kind of the progression by category. So in stores, our transactions were down low single digits, and average ticket was just down slightly. Our average unit retail was up. We saw our basket size contract a bit, so that was kind of the dynamics for the stores. And I will let Jared kind of give some commentary on cat performance.

Yes. From a category perspective, during our prepared remarks, we talked about some of the headwind categories, so those did perform slightly below our plan. But as Scott mentioned as well, the business during the last 2 weeks of the quarter was more negative than we had anticipated.

Got it. And my second question is on SG&A, you mentioned that you are accelerating some of the expenses associated with the -- with some of the omnichannel projects that you are launching and also talked about increase in advertising. Is there -- in your guidance going forward, is there an assumption of increased advertising in the back half as well? And if that is the case, why is that not being reflected in your comp guidance which you've taken down for the year? So I'm just trying to connect the dots there.

Sure. The back half is really pretty much as planned from an SG&A standpoint. As I said, with health care, that may be a little bit higher based on recent trends, but we do expect it to moderate. Outside of that, most of the increase in SG&A was just incorporating the overweight we saw in the second quarter.

Got it. And the last question is on gross margin. You saw some improvement in the merchandise margins, which was a bit lower than what we were expecting. As we look at -- look to Q3, should we expect a similar level of recovery in gross margin? Or do you see more opportunities there? How is the comparison from last year in Q3 than Q2, I believe?

We do. So I think the important thing for Q3 to understand is that there is probably a little more opportunity in the merch margin based on where we finished last year. But take a look at the logistics and store occupancy expenses, because with that week shift based on last year's numbers, there's about $17 million of revenue that would come out of Q3. Again, that can change, but based on last year's numbers. And so that will cause you to deleverage those expenses. Not to the degree that we saw the leverage in Q2, but there will be some deleverage there, which will temper that increase in merch margin in Q3.

We'll get to our next question on the line from the line of Ray Jadrosich from Bank of America Merrill Lynch.

The first question is, how should we think about the anniversary of the e-commerce launch and the benefit of clearance to comps from the back half of last year? And also as part of that, can you talk about how significant you think buy online and pickup in store could be for you?

Sure. From an e-comm standpoint, we expect -- we continue to drive more and more traffic up there. So we think, as we went through the year, we saw that continuing, and we expect that to continue throughout this year. Obviously, the compares will be a little bit difficult since you're going against something. But at the same time, a lot of the work we've done around SEO and search and loyalty, the app, we have a lot of things that we didn't have at this time last year. So we think that we can still have some pretty good increases there from an e-comm standpoint. Also, the mix will change too Last year, when we were coming in the third quarter and launching the site, we had a lot of aged inventory. We sold a lot of that online. This year with our inventory being much cleaner, we'll have a better balance between clearance and full-priced selling. So we have an opportunity there to make some margin there, which last year was really cleaning up inventory early.

That's helpful. And just in terms of margins for your online versus store, can you just talk about the early trends of your online margins? And then how do you think about the breakeven point for online sales?

Sure. Yes. So when you look at online margins, obviously, the biggest strategy is your freight costs. So that is a drag, but you do see some benefit because you don't have the occupancy and warehouse expenses like you did for store business. It's not a total loss yet, but it does help. I think as we go forward, that e-comm margin will firm up a little bit. It's always going to be overweighted on clearance. I mean, that's just the nature of online. But we have seen a tick-up as our clearance percentage is going down, so that's encouraging. Speaking to the breakeven point, I've said before that I think it's around $70 million. That will fluctuate a little bit and depending on how much effort we put into marketing and our clearance penetration. But as I would think that our clearance penetration will continue to decline a bit, our marketing will level off somewhat than -- that $70 million is kind of normalized with just normal operations of e-commerce. It's a pretty good number where we start to get close to that breakeven point.

And then one more for Jared. As you think about -- the license category has been soft for a while. As you think about the long-term strategy there, do you think you'll continue to reduce that? Or is there a point where it will start to flatten out? How should we think about that longer term?

Yes, I think long term, our expectation was we felt like as we ramped up e-commerce, we would start to hopefully claw back some potential licensed business that we may have lost from a fan perspective. Throughout our history, there's always been somewhat of a push-pull between branded apparel and licensed product depending on the trend. Today certainly, there is more of a trend with regard to branded apparel. We are pulling some investment out of the license category. But at the same time, we're broadening our assortment and offering from an online perspective with partnering with more of our vendors. So we're hoping to pick some of that back up. But so much of the licensed fan business is based off teams winning and losing, so there's a lot of volatility there that really does play out based on how the teams performed. We'll watch the trend. There have been times throughout our history where licensed products were trending, and we will certainly revamp our investments there. Today, that doesn't seem to be the trending area, so we are pulling back.

We'll go to our next question on the line from the line of Patrick McKeever with MKM Partners.

So then, Scott, you mentioned the $70 million breakeven point for e-commerce. You're pretty much there right now, right? Because I think it's around $68 million for the past 4 quarters. So would that imply that just absent some of the incremental investment in omnichannel in the back half of the year that you would be more or less breakeven on e-commerce from a normalized standpoint?

Yes. I think if you take the investment into account and the lower margins because of liquidating some of the clearance, under kind of a more normal margin scenario with lower clearance, which is what we're working into, I think that's really very close to breakeven.

Okay. And then how does the Buy Online, Pick Up in Store and reserve online, pickup in store and some of the other things that you're doing to drive traffic to the stores, how does that impact the store labor model?

It really doesn't affect the store labor model much. It's really driven off technology and business procedures in the stores. And the biggest part of it was really just getting ready for it and setting up. And really, we're ready to do that. And as I mentioned earlier, we're testing it in the Birmingham stores. And it really does feature some unique things that most people don't do such as both doing buy online or reserve online, which is a unique feature that most people do one or the other, or not both at one time. Another feature is that you'll be able actually look at exactly all the items that are available by store. So you'll be able to shop your store from anywhere and see if they have it in stock or not. So very unique for our industry. And we really think that it really -- once we get our associates and all our customers trained, that it really will drive a lot of traffic to the store. Also, hopefully, it will save some money on freight because people will pick it up in the stores instead of having to ship it to their home. So we're very encouraged and we really have innovative Buy Online, Pick Up in Store, and we think that we can drive additional business.

And we do look at some of those peak periods, whether it be back-to-school, holiday and so forth. And so we have discussions on labor during those time periods and do give them more labor during those periods because we know that demand will be higher. So we do have those discussions and have done that. The stores have gotten quite efficient in fulfilling product, though, and so this will be one more thing. But they have proven to be really efficient at fulfilling online orders, and that's -- the bulk of our online orders are fulfilled from stores. And so it's not an entirely new process for them.

Yes, okay. And then just the last one from me. Just thinking about the store closures across retail, particularly in the department store space. I think previously, you had said you don't really see much impact there one way or the other just given the geographic -- your geographic footprint in print and being in smaller markets. But I was wondering where, if you've had any change -- if that was the case, if there's been any change to your thought process there. I mean, are there opportunities with some of the more recent store closures that have been announced? Or do you think some of that market share just shifts to other players, maybe Kohl's and online retail and that kind of thing?

Yes. I think you'll see a mixture of both. In some of our markets, we have started seeing some Sears and a few Penney's and some of the department stores closed. So in some markets, it has affected us. Sometimes, it doesn't affect us as much as others. A lot of times, we go to a percent rent or lower our costs that way, but we have seen quite a few of those. I do believe on some of those categories, maybe it does lend itself a little bit to more online, some things I do think that we can pick up. But we have seen more and more of the anchors going out in some of the -- especially, mall places that we have seen over the last couple years.

And we'll get to our next question on the line from the line of Peter Benedict with Baird.

First question, Scott, could you isolate the occupancy impact on margin in the second quarter?

Yes, Peter. The occupancy expense was 145 basis points of benefit.

Okay. And then how should we think about -- now that you've got the store base net store closures, how are you thinking about the occupancy dollars this year in aggregate versus what you guys incurred last year?

Right. We should see occupancy dollars come down a bit because of that net closure number.

Okay, that makes sense. And then for the gross margin due in aggregate this year, I know at one point you were thinking 70 to 100 basis points. What's kind of the -- if you think about maybe the midpoint of your earnings guidance, what does that envision in terms of maybe what this gross margin will look like?

I'd see it still in that range, Peter. I mean, we were thinking about 66 points higher margin for the first half of the year. And so it's really kind of coming as I expected. And so I expect the back half to have similar favorability, maybe a little bit more favorability on the merch margin in Q3, as I said, but less on the store occupancy and warehouse expense. But it should still be in that 70 to 100 basis point range for the year.

Okay. And then just, I guess, last on the allocations, it sounds like better product coming in back half of the year. Is it -- are the allocation levels that you're getting from the key vendors similar to a year ago? Are they more narrow? Just what's kind of the latest on that?

I think it varies by category, but overall, we're seeing much more of a commitment from our vendor partners with regard to access and allocation.

And we'll get to our next question on the line from the line of Rick Nelson with Stephens.

I'd like to take a look at the SG&A as we think about next year. Are there onetime costs that are going to roll off? Or how should we think about the growth rate in SG&A?

I think you'll see the growth rate moderate next year. This year, we did have some increases with wages, with tax reform that I mentioned and some of the development costs, with omnichannel. So those are probably the 2 biggest ones that we'll see moderate next year. And so that 7% to 9% that we'll likely see this year will back off next year.

And how are you thinking about e-comm next year, Scott, if that would break into profitability?

I mean, we continue to see upside for e-comm going into next year, especially with BOPIS and ROPIS. I mean, we continue trying to do things to grow that business and the SEO traction that we're getting is pretty significant as well. So a lot of good signs. And so we continue or expect to continue some good growth next year. And as we do that, the profitability will continue to improve, because there is some good leverage in the model, and we'll likely see better margins as well with cleaner inventory.

We'll get to our next question on the line from the line of David Schick with Consumer Edge Research.

I have 2. First, could you just give us more detail on what you know about and see from the digital customer, whether it's differences in categories or AUR? So what you know about them either over time or just relative to your stores' customer. And second, if the traffic -- understood there's investments to drive folks into the store, but at the end of the day, it sounds like it's transaction at the store level. If that persists, how will you think about the store count to optimize for an omnichannel strategy?

I think from a trend perspective online, I mean, we are seeing our customers participate across all of our categories. We are seeing some additional leverage from our consumers, particularly in footwear as well as the cleated business and our apparel business. Obviously, as Scott's mentioned, our ability to clear clearance through the online channel is certainly significant. Although as our inventory has gotten into a much cleaner place, we are starting to see the balance change pretty significantly between clearance and regular price. But the drivers of our brick-and-mortar business from a category perspective are the same drivers online.

Yes, and as to your question around the traffic, so that is, obviously, a concern for us. And part of the marketing dollars that we'll spend going forward will be directed towards driving store traffic, and a lot of that will be communicating with our loyalty members to give them offers to come in our store. BOPIS, ROPIS, that connectivity with our website, we expect to see some benefit there. There's statistics out there that say that usually, a customer will increase their purchase once they come in to pick up an item. Apparel growth, apparel growth will remain strong. And so we're seeing some very nice traction with apparel in our stores. And so we've got some good learnings from that and we'll try to expand on that. And then on the other categories, we'll continue to look at those for opportunities and to fine-tune those assortments to try to stabilize those businesses as well.

[Operator Instructions] And we'll get to our next question on the line from Sam Poser with SIG.

Can you talk -- you talked about the weakness in licensed -- in the licensed businesses and the strength in apparel and footwear. Are you going to -- are you relooking at how you -- to what degree are you looking at remixing those businesses within the store and within online in order to better utilize, make your inventory even more efficient than it's starting to become?

Yes, Sam, we're absolutely looking at that. We've shifted a significant portion of the investment that we made historically in licensed products and to branded apparel as well as into the footwear businesses. We are seeing that pay off for us. From an online perspective, we have a pretty significant opportunity to broaden the assortments within categories that are weaker, such as licenses, such as equipment, working with our vendor partners through some vendors dropship programs. So while we are reducing some of that space and spend from an in-store perspective, we are actually getting lighter from an assortment perspective through our digital channels. So as I mentioned earlier, there's always kind of a push-pull between licensed and branded today that the branded part of the business is certainly outperforming the licensed core fan business. And then there is a fairly significant amount of licensed products that does connect to the current sneaker trend that's going on that we're certainly positioning some investment dollars in.

And then I think we're in the process of lapping the hurricanes from last summer in Houston and so on. How is that impacting the current trends, I guess, Scott, for that one?

Right now, we don't see that as a big impact. I think the impact last year was fairly isolated for us, so we're not seeing a material impact there.

And how much of the shortfall in the -- sorry, Jared, you said at the -- you said on -- in your response to another question that there was -- that it sounded like the last 2 weeks of the quarter were negative. Was that the case, or not?

Below expectations. Not negative, no.

Less positive.

Less positive.

And then have you -- and, I guess, what are the current trends quarter to date? And have you made up that number? I know you don't like to talk about it normally, but I think your stock is now close to 30% right now. So it might be something that would at least give everybody a little more perspective on what's going on.

Sure. Yes, so we did see business pick up in the first week of August. And just to be clear, that is kind of a 1-week shift, 2 weeks max. But we did see some of the recovery of dollars we lost in the last week or so in July. And to size it, Sam, it's probably between $1 million and $2 million from what we see.

And what about the current trend? I mean, you've guided, basically, the back half of the year to flat. And could you give us some idea where you are right now? We know it's going to change. We know that you have the headwinds of e-commerce -- or I don't know headwinds; you're going to lap the real start of the e-commerce business and that's sort of not a clear -- there's not a lot of visibility to how that will all play out with BOPIS, ROPIS, the app and so on. But can you give us some -- I mean, can you give us some idea of what's happening quarter to date to make this a onetime thing, given what's going on right now?

All I'll say is the early quarter-to-date numbers are good. And that number I gave you, $1 million to $2 million, is about the number that we see coming from that July shortfall. A lot of moving parts, but that's kind of a good estimate. I think as you look at the entire year -- so the guidance is negative 1 to plus 1 on comp. Year-to-date, we're at 1.6%, so that does say that we'll pull back a little bit. I think as you look at the e-commerce business, very strong trends, very good July business with e-comm. So we're confident that can continue to grow. And especially as we get in the holiday season, it was still fairly new last year kind of pre-holiday. So we think there's a good upside in that November, December time frame.

And we'll get to our next question on the line, it's another follow-up question from the line of Peter Benedict with Baird.

Scott, just curious what you're thinking in terms of buyback? What's kind of embedded in the plan and also just the second half tax rate?

Sure. As far as buyback, so we bought back about $8 million in the quarter. We'll likely pick up the pace in Q3 and Q4. Guidance is $40 million to $50 million, so I would expect it to be in that range but on the lower end of that range. The tax rate through the back half should be around 24%.

And, Mr. Rosenthal, we have no further questions at this time. I'll turn it back to you for any closing remarks.

Thank you for being on the call today. We look forward to giving our third quarter results in the near future. Thank you.

Thank you very much. And, ladies and gentlemen, this includes the conference call for today. We thank you for your participation. You may disconnect your lines. Have a good day. Bye-bye.