Greetings, and welcome to Hibbett Sports Fourth Quarter and Year End 2021 Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded Friday, March 5, 2021. I would now like to turn the conference over to Mr. Jason Freuchtel, Director of Finance and Investor Relations. Please go ahead.

Good morning. Please note that we have prepared a slide deck that we will refer to during our prepared remarks. The slide deck is available on hibbett.com via the Investor Relations link found at the bottom of the home page. These materials may help you follow along with our discussion this morning. Before we begin, I would like to remind everyone that some of management's comments during this conference call are forward-looking statements. These statements, which reflect the company's current 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 this morning and the company's annual report on Form 10-K, the most recent quarterly report on Form 10-Q and in other filings with the Securities and Exchange Commission. We refer you to those sources for more information. Also to the extent non-GAAP financial measures are discussed on this call, you may find a reconciliation to the most directly comparable GAAP measures on our website. Lastly, I would like to point out that management's remarks during the conference call are based on information and understandings believed accurate as of today's date, March 5, 2021. 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. The participants on this call are Mike Longo, President and Chief Executive Officer; Bob Volke, Chief Financial Officer; Jared Briskin, Senior Vice President and Chief Merchant; Bill Quinn, Senior Vice President of Marketing and Digital; and Ben Knighten, Senior Vice President of Operations. I will now turn the call over [Audio Dip]

Good morning. Thanks, Jason. Good morning to everyone, and welcome to the Hibbett Sports Q4 earnings call. And if you're following along using the slide deck, I'm on the third slide titled Introduction. This quarter was a terrific outcome from a financial perspective for the company. And as you saw in the press release, we reported a 22% sales comp. Our brick-and-mortar comp was almost 18%, and e-commerce was almost 45%. This resulted in a non-GAAP operating income of just over $31 million and non-GAAP earnings per share of $1.40. These results were made possible by the hard work of our 10,000 teammates in the stores, the store support center and the distribution center. As always, they help lead us through another quarter in a challenging business environment. We're proud to represent our teammates today, and we wanted to make sure to thank them all for a job well done. And as I'm fond of saying, and I repeat it often, retail is the ultimate team sport, and I couldn't have picked a better team to compete with. Move it along to the fourth slide, entitled sales drivers. We wanted to give you some background on the factors that we believe drove sales in Q4 and continue to produce those strong results. As noted previously in earnings calls, we believe the increases in sales are driven by several factors, including a temporary closures of competitors earlier in the year, accelerating consumer adoption of e-commerce, rotation of spending from travel, leisure and entertainment, and a boost from fiscal stimulus that gave consumers new – both new and existing, even more reasons to shop with us. And this manifested itself by driving traffic to the stores and to our website and yielded what we believe to be increased market share and higher sales. This gave us an opportunity to attract and retain many new consumers and drove higher sales volumes. In fact, our data shows that we've done a good job retaining these new consumers so far. We also believe that we have tailwinds in the future. In Q3, we began to see the effects of the closure, JC Penney's and Sage stores. We believe this presents an upside opportunities for us in both fashion and athletic categories. Additionally, we see what we believe is continued consumer adoption of the omni-channel experience. This plays to our strength with our best-in-class omni-channel experience, coupled with a great consumer experience in the stores. And finally, we believe that many of the new consumers we attracted last quarter and continue to attract will continue to shop with us in the future. In total, we believe these changes in the competitive landscape and changes to consumer behavior will result in $20 million to $40 million incremental sales opportunity for Hibbett. For this, and for a few other reasons, we're very confident in our future. But before we go into the future any further, I'm going to ask Jared Briskin to provide some detail about our merchandising performance. Jared?

Yes, good morning. Thanks Mike. If you will, please turn to the fifth slide, titled merchandising. Our strong comp sales performance was driven by apparel and footwear with significant gains across all genders. Team sports continues to be impacted by COVID-19 and it was down in the high-teens. Our toe to head merchandising strategy and consumer focus led to increases in average retail items for sale. As a result, we saw significant year-over-year dollar per transaction growth. While increased demand and supply chain challenges continue to impact our inventory ownership, our merchants did an incredible job securing and flowing in-demand merchandise into our assortment. Apparel business was up in the high-30%s. All apparel categories, including branded apparel, fashion apparel, licensed and accessories were positive. All genders were significantly positive. From the athletic brands, we continue to see strong demand for Athleisure, Loungewear and performance product has been capitalized on the casual and wellness trends. Multiple fabrications, fits and patterns and fleece tops and bottoms were exceptional during the quarter and drove our growth. We also saw strong results in outerwear, tees and shorts. Our fashion brand performance continued to be exceptional. Denim and fleece were the standout performers for the quarter. Our partners in this area are very nimble and we've been able to flow inventory to take advantage of the increased demand. Licensed business continued its recent strong performance, as our strategy of investment and toe to head connected merchandise was the growth driver for us, offsetting declines in the traditional fan business. Accessory business also remained very strong with socks, underwear and sneaker accessories, all significant gainers during the quarter. Footwear business was up in the low-20%s, this increase was driven by gains across lifestyle, basketball, performance, sandals, and boots. All genders were significantly positive with women's growth, outpacing men's and kids. While marketplace inventory in the supply chain remained a significant challenge, our merchants and vendor partners were able to deliver a strong flow of product. Lifestyle and basketball over the standout categories in the quarter with classic footwear performing exceptionally well, basketball business remained very strong with an exciting and robust launch calendar. Casual categories, such as boots and sandals continued to perform exceptionally well, as demand in these categories continues to be strong and supply remains very limited. Lastly, we continue to see strong results in technical running as health and wellness remain a key marketplace trend. Specific to footwear and apparel, our women's business was our fastest growing area with comp sales gains in the high-40%s. Men's grew in the mid-20%s and kids grew in the low teens. Inventory at the end of the quarter remained significantly down, increased demand and supply chain disruption continue to put pressure on our inventory. Age levels at the end of the quarter are at historical lows. As we move throughout this fiscal year, year-over-year inventory compares will be very inconsistent due to the prior year disruption. Our expectation is inventory decrease will moderate during Q1 and will be positive at the end of Q2 with inventory closer to fiscal 20 levels. I'll now turn the call over to Bob Volke to provide detail on our financial results.

Thanks, Jared, and good morning. If you will please refer to the sixth slide, titled fourth quarter fiscal 2021 results. As a reminder, our results include both Hibbett and City Gear and are reported on a combined basis. For the fourth quarter, total net sales increased 20.4% to $376.8 million and consolidated comp sales increased 21.9%. This compares to fourth quarter fiscal 2020 sales of $313 million and a comp sales increase of 4%. Brick-and-mortar comp sales remained strong and came in at a 17.7% increase. E-commerce comp sales increased 44.8% in the quarter, representing continued expansion in our omni-channel platform. For the quarter, e-commerce sales accounted for 17.1% of net sales compared to 14.2% in the fourth quarter of last year. Our GAAP gross margin expanded significantly to 37.1% of net sales compared to 31.5% in the prior year fourth quarter. This approximate 560 basis point improvement was due to higher initial sell-through, a low promotional environment and leverage of store occupancy expenses. There was a slight offset due to the higher volume of e-commerce sales, which carry a lower margin due to the incremental shipping costs associated with the sales. Our adjusted gross margin of 37.1% in the fourth quarter compared to a non-GAAP gross margin of 31.3% last year. Store operating, selling and administrative expenses, excluding depreciation and amortization were 26.8% of net sales in the fourth quarter, which was consistent with the 26.8% reported in the fourth quarter of fiscal 2020. In terms of dollar spend, employee compensation and benefits, advertising, variable expenses associated with higher sales volume and asset impairment charges due to the accelerating the closure of poor performing stores were the main drivers of the increase. City Gear acquisition and integration expenses were significantly lower in the current year quarter than in the same period last year, excluding these acquisition and integration costs, adjusted SG&A was 26.7% of net sales in the current quarter compared to adjusted SG&A of 25.3% in the prior year fourth quarter. The increase was primarily driven by asset impairments, higher advertising costs and expenses associated with increased e-commerce activity. Depreciation and amortization increased approximately $670,000, reflecting increased capital investments on organic growth opportunities and infrastructure projects. On a GAAP basis, we generated $31 million of operating profit, which compares to last year's operating income of $7.8 million. Excluding all non-GAAP adjustments for the fourth quarter, adjusted operating income was $31.2 million or 8.3% of sales compared to operating income of $11.7 million in the fourth quarter of fiscal 2020. GAAP earnings per share were $1.39 for this year's fourth quarter and non-GAAP earnings per share were $1.40, driven by strong profitability and a reduction in our bounce over the last three months, we generated operating cash flow of $52.5 million during the quarter. We also spent approximately $14 million in capital expenditures, which were largely related to new relocated and remodeled stores. In the prior year, fourth quarter operating cash flow is approximately $17.2 million and capital expenditures were $6.3 million. I'll now have you move forward to the seventh slide, titled full year fiscal 2021 results. On a full year basis, sales increased 19.9% to $1.42 billion from $1.18 billion in fiscal 2020. Comp sales on a full year basis were 22.2% with brick-and-mortar comp sales expanding 13.3% and e-commerce comp sales growing 89.3%. In fiscal 2021, e-commerce sales represented 16.7% of our total net sales compared to 10.4% last year. Our GAAP gross margin in fiscal 2021 was 35.5% of net sales compared to 32.4% last year, driven by the same factors noted previously for the fourth quarter. Excluding City Gear acquisition and integration costs incurred in both years, inventory reserve adjustments in the current year and strategic store alignment costs incurred in the prior year, adjusted gross margin was 35.8% this year, compared to 32.4% last year. In fiscal 2021, SG&A expenses, excluding depreciation, amortization, but inclusive of goodwill impairment were 26.5% of net sales compared to 26.9% last year. Leverage generated from increased sales revenue was the primary driver of this modest decline. Adjusted SG&A was 23.7% for the most recent year compared to 25.2% for fiscal 2020. On a GAAP basis, we produced $98.4 million in operating profit for fiscal 2021, compared to last year's operating profit of $36.1 million, excluding all non-GAAP adjustments in both years, adjusted operating income for the current year was $141.4 million equal to 10% of net sales compared to adjusted operating profit of $55.4 million last year or 4.7% of net sales. GAAP earnings per share for fiscal 2021 were $4.36 for the current year, compared to $1.52 for the prior fiscal year. And non-GAAP earnings per share were $6.12 this year compared to $2.33 in the prior year. We generated $197.7 million of operating cash flow in fiscal 2021 and spent $34.8 million in capital with a focus on new relocated and remodeled stores and other strategic initiatives that we believe will generate incremental sales and profitability opportunities. For fiscal 2020, operating cash flow was $92.3 million and capital expenditures were $17.3 million. Turning to the balance sheet. We ended the year with $209.3 million in cash and cash equivalents versus $66.1 million a year ago, and we currently remain debt-free. We have $75 million of borrowing capacity available to us, but do not anticipate the need to borrow under our secured credit line based on current cash projections. Inventory ended the quarter at $202 million, a 29.9% decline from last year's ending balance. The continued strong sales in both the brick-and-mortar and online channels, in addition to ongoing constraints in the supply chain drove the year-over-year decrease. We purchased approximately 150,000 shares during the fourth quarter under authorized share repurchase plan, and we have just over $136 million of remaining authorization through January 29, 2022 for future share repurchases at management's discretion. Now I’ll review our updated fiscal 2022 guidance on the eighth slide, titled future. Our anticipated results for fiscal 2022 are influenced by multiple factors. As Mike mentioned earlier, we have attract and retain new customers throughout fiscal year 2021 due to pent up demand, market disruption and government stimulus payments, continued consumer adoption of e-commerce will continue to drive growth across our best-in-class omni-channel platform. Our strong vendor relationships and targeted purchases by a merchandising team will also take advantage of the expected resulting increase in business. Other supply chain and selling initiatives should help drive sales growth as well. While we continue to experience challenges posed by the ongoing COVID-19 pandemic and uncertainty regarding the business environment, further stimulus payments and potential labor and tax legislation, we are confident in our business model and feel we can continue to capitalize on the trends we experienced in fiscal 2021. As a result, we are providing this limited GAAP guidance for fiscal 2022 in comparison to fiscal 2021. First, before comp sales will range from negative low single digits to positive low single digits, relative to last year, the first quarter should represent the easiest comp. And as a reminder, the benefit we expect to experience from the closure of JCPenney and Sage stores will have during the third quarter. Gross margin performance will face some headwinds as the year progresses, and we expect to see a decline of approximately 130 to 170 basis points on a full year basis. We also anticipate that we can generate modest SG&A leverage over the course of the year with the anticipated decline as a percentage of sales ranging from 5 to 45 basis points. Diluted EPS is forecasted to be in the range of $5 to $5.50, with an assumption that the effective tax rate will be approximately 25% and the weighted average diluted share count will be approximately $17 million. We do not anticipate the difference between our GAAP results and our non-GAAP results will be material throughout the year. From a capital allocation perspective, we plan to invest $45 million to $50 million on organic growth opportunities that we believe will lead to incremental sales and profitability, and also on strategic infrastructure projects that will enhance our distribution and back office efficiency. We believe that these investments will track new customers, enhance the consumer experience in stores and online and modernize our technology and processes. In addition to our capital expenditure plans, we tend to opportunistically allocate capital share repurchases, and currently, have approximately $136 million remaining under our share repurchase authorization. We will be providing longer-term financial and operational targets and additional insight into our compelling product offerings and customer centric culture, during our first formal Investor Day that will take place on June 24. We look forward to your attendance at that event. That concludes our prepared remarks. Operator, please open the line for questions.

Thank you. [Operator Instructions] And our first question comes from the line of Sam Poser from Susquehanna. Please proceed with your question.

Well, Sam Poser from Williams Trading. Good morning, everybody. Thanks for taking my questions. I've got a handful. Number one, can you give us the comps? Can you give us an update of what your comps were by month?

Sam, it’s Bob. We're not going to get into the details of month-by-month. So next question, I guess.

All right. So you talked in your – in the press release and you mentioned again in prepared, regarding your confidence in retaining new customers. Can you talk about how many new customers you had – you got during the year? What drove that anyway you can give it to us? And what's giving you the confidence that you're going to retain those customers, have those customers as new ones come back and shop with you multiple times, those kinds of things. Can you just help us out there, please?

Yes. Sam, this is Bill. So yes, we've continued to see the number of new customers grow during the quarter and during the year. Besides the number of new customers, we've also looked at their behaviors. We look at them on a 60-day mark and 120-day mark. And what we're finding is that new customers are shopping more often with us. We also have less one and down new customers. So our customers are buying more frequently than they normally do. And they're spending more than prior years’ new customers. So we're very happy with the behavior of new customers that we're seeing. In terms of our confidence around what we're going to do to keep them, three things. The first one is just really good service, both from a store perspective and from an online perspective, from surveying the new customers, we are providing that and we'll continue to provide that. The other thing is just communicate with them. So we do have all of their information whether it's their text number, phone number, push, email, et cetera, we're able to communicate with them instantaneously. And then the last thing is really around rewarding them. So a lot of these new customers are part of our loyalty program and they are rewarded for continuing to shop with us.

Thank you. And that's actually a great segue. Can you talk about how the rewards are working? Can you explain some of the reward levels and what the customers get your highest? However you – have everyone talked about it?

Yes, absolutely. So we've got two levels in our loyalty program. We've got an MVP level and a VIP level. And the great thing about this year and the quarter as we've seen more people shift to VIP, which is a larger spending bucket, and you get – you accrue award at a much greater rate. But the way, we start is for every $200 you spend, you get a $10 award. We're seeing a redemption of those awards go up year-over-year. So in terms of all of those operational metrics in the loyalty program, we are seeing very positive results.

Thank you. And then I guess, this is for Jared, you talked about the delays, the shipping delays, some catching up. Can you give us some details on what's going on there? And also, I guess, in general, can you give us some color you're up against pretty easy compares in the first quarter? Can you give us – can anybody give us any color on, how we should think about Q1 given that the compares sort of changed dramatically after Q1?

Yes. Good morning, Sam. So obviously, we've seen some pressure from a supply chain standpoint, without question. Our merchants, our logistics teams, our vendor partners continue to work incredibly hard to get product here. So certainly, with the increased demand and the pressure we've had on the supply chain we've seen some delays largely appears to be anywhere from two to three-week delays on most products, but very inconsistent. So something, we're certainly working through – something where we're looking at every day, but we do feel very confident in the pipeline as far as our order book is we just need to continue to work to get it delivered.

Okay. I guess I'll take the comp question. Obviously, we said that Q1 is our easiest compare. We came off last year with close to a minus 20%. So we certainly would expect the Q1 will come in fairly strong, but over the course of year, it's pretty difficult to predict the ups and downs from period-to-period. Again, I tell you, we've kind of given the full year guidance, which is low negative single digits, to low – high single – or low positive single digits. Again, I think, we'll say after Q1, it's going to be really difficult to predict, but we would expect that over the course of the year, it'll kind of normalize into that range.

I understand that, but how should we think about the first quarter, I guess, I mean, that's the question. How should we think about that given the compare for – the rest of the year, I understand, but I mean, I'm really talking about the first quarter by itself? I mean, are we looking at sort of – I mean, given the compare and everything else. I mean, you're planning on beating. I would assume you're planning on beating fiscal 2019 – fiscal 2020 levels, excuse me from a peer revenue perspective. And then given the current trends and everything else, I mean, should we just think of this as sort of somewhere in between what Q2 was and what Q3 and Q4 were?

Sam, this is Mike. We love the question. We're very comfortable with the full year guidance. You have pointed out and we agree that first quarter is the easiest compare. It was a negative 20%. So I think that's about as comfortable as we're going to get and about as far as we'll go in terms of guidance.

All right. Thank you guys very much and continued success.

Our next question comes from Alex Perry with Bank of America. Please proceed with your question.

Thanks for taking my question and congrats on a great quarter. Just a two part question and I guess a little bit of a follow-up, but maybe asking a little different way. Can you talk through how you're thinking about the delays you're probably seen in the tax refund dollars, there's the potential for additional stimulus? And then can you just remind us the stimulus is not included in the current guidance, right? And then just to follow-up on the inventory levels, have you seen that improve at all in recent weeks? And how do you feel about the flow, especially with potential stimulus hitting? And then could we see some sort of pent up demand effect once the inventory normalizes, given that we spends in some shortages in the channel?

Alex, it's Ben Knighten. And yes, I'll take the first part of your question around tax and what that flow's looking like. I think as everyone has seen out there. The RS has come out and said, they're running about two to three weeks behind from processing refunds relative to last year, it's pretty much what we're seeing in the street also now the magnitude and the duration of tax, after that not going to speculate this point. But we are starting to see a little bit of flow out there right now. So again about two to three-week delay relative to last year.

Alex, this is Jared. I think relevant to the second part of your question. We have seen some improvements, it seems to get a little bit better every day, but certainly still a challenge. I would agree that and do feel that as the marketplace does get caught up based off the demand that we're seeing, there could be some pent up demand for the products that we sell.

That's really helpful. And then just my follow-up is, I think in the guidance you said and I look for labor costs increases is sort of not contemplated. What is sort of your – I guess, outlook there and like, is it possible that the support that a wage increase would provide to the consumer would be able to offset the potential payroll increase?

This is Mike. Certainly, we were all watching those debates with a great deal of interest, where it all comes out is anyone's guess so far. And I think, that there are no significant federal minimum wage is coming through. We do we have seen and Ben has spoken to a number of States continue to inch theirs up. And we handle those in stride. We haven't seen much evidence that would suggest that increases in minimum wage, have a follow-through effect on revenue. Again, a great topic to debate with economists, but what we're seeing is, it all comes out in the watch eventually. What we don't know is what would happen at the step change function happened in minimum wage and it moved substantially in a short amount of time. We just don't know what you would imagine we're doing, is exactly what we're doing. Like every other business and every other retailer in the world, we're going to make sure that we're investing judicious amounts of capital into projects that limit our exposure to that risk.

That's super helpful. And best of luck going forward.

Our next question comes from Peter Benedict with Baird. Please proceed.

So the June investor meeting, it sounds like that you're planning that to be an in-person event. It sounds like, is that right?

It's going to be virtual event at this point.

All right. I thought you were giving the first one on the take with that. But anyway, it makes sense. I guess, my first question just is around the inventory and Bob, you made some comments on the flow, moderating declines in the first quarter. I was little confused on the second quarter. Are you saying that you think inventory will be flat year-over-year by the second quarter, or it will be up versus those depressed levels last year? And then how are you thinking about the back half? I apologize if you already went through this, but I just want to make sure we have our numbers right on that.

Yes. Peter, it's Jared. Commentary around the first quarter we expect it to be up. Second quarter we expect the inventory to be up as well. The comparison that I referenced was back to two years ago from a normalization perspective. Last year, the inventory levels are very choppy. So we do feel like we'll normalize somewhere closer to two year ago levels as we get through the second quarter.

Got it. Okay. That's quite answer. In terms of the higher CapEx in anyway, can you maybe break down that $45 million to $50 million, maybe some buckets where it's going? And then as we think about what's that going to mean for kind of the DNA profile of the business as we think about this year?

I think, again, our focus is obviously mostly on trying to continue to enhance and improve the store experience as well as on our online experience. So I would say, we're obviously opening new stores and we've talked about that before, low single – or low double digit doors in each of the two brands. We will continue to kind of touch a lot of the stores when it comes to refresh and remodel, we want to make sure that that's a great experience for the customer that comes into the brick-and-mortar location. Now we've got a few other things that we're going to do in the back office and kind of in the distribution side to enhance some of the efficiencies within the process. But again, I'd say probably the lion's share of that $45 million to $50 million will be focused on kind of the front of the house, so to speak.

Okay. And then maybe one for Mike. Just can you talk a little bit about kind of the M&A environment that's out there kind of in your channel, there's been some activity just curious, obviously you guys are in great capital position here too. Just, how are you thinking about that? What are you seeing different players’ kind of making moves in the sector? Just kind of curious what your latest thoughts are on that?

Yes. It's been an active last quarter for sure. We are in those conversations. We will always look at every strategic alternative. We think it's a good practice. We have vetted many opportunities. I think everyone's seen the two press releases that came out recently. So at least in the traditional environment of M&A, those two are off the board. We'll continue to look at other opportunities as they arise.

Okay. Fair enough. Good luck in the first quarter, guys. Thank you.

Our next question comes from Jim Chartier with Monness, Crespi, Hardt. Please proceed with your question.

Good morning. Thanks for taking my questions. First, could you talk about your – what kind of improvement in performance you're seeing in the stores that have been already updated? And then, Mike, where are you in terms of changing the selling culture and how much more opportunity do you see in that initiative?

Yes, good morning. It's Jared. So I'll start. So obviously, two major emphasis projects last year, first being our remodel program in our new store designed for the Hibbett brand. So thrilled with those results so far and the increases we've seen from an AB testing perspective, so very happy there. From a refresh perspective, results are very strong incredible feedback from our teammates out in the field as well as from customers. So really excited about what those have done and what those have brought. I think Ben, I think if you want to comment from a sales culture perspective.

Yes, Jared. Number one, I'd like to say, I think we have the best-in-class team out there in the stores and in field management. And we've really focused over the last year. Really around two things, one developing leaders in the field, right and we’re really taking ownership in the stores and at the DSM in our VP level. And the second piece is, salesmanship. And we’re really understanding, how to satisfy that customer out there. And we put a lot of investment there, a lot of training in there, and obviously, that's starting to pay off. But we're just tapping into that quite honestly. And I think we've got a long runway ahead of us to continue kind of accelerating the gains that we have available to us there.

Great. And then the press release, you mentioned increase in advertising. I guess, was the company historical level of advertising, do you think that was sufficient? Is this year the right level of spend? Or do you see additional opportunities for incremental advertising investments going forward?

This is Bill. I'll take that question. In Q4, we took the opportunity to make some incremental investments twofold. The first one was to acquire more customers. So we did some customer acquisition efforts, particularly around our mobile app that we're pleased with the results of also in certain local markets. There were displaced customers because of market interruptions, competitive closures, et cetera. So we took an opportunity to test acquisition programs in those local markets. So we spend more money in Q4 as a result of those two things. From a marketing investment standpoint, digital in particular social continues to be a very large investment for us and one that has very good returns. We're also going to continue to invest in our loyalty program. So we have a lot of plans around that. And then lastly, we're going to invest in local engagement and that comes in the form of local social media, as well as partnering with local schools in our sole school program.

Great. And then in terms of the comp performance through the apparel outperformed the rest of the business. And I believe you said, that the $20 million or $40 million incremental sales opportunity from competitor closeness was primarily in the apparel category. Is that the primary driver of the outperformance there? Or is there something else going on?

Yes. Our apparel business was excellent for the quarter. Certainly, we saw where we had some of that opportunity with regard to closures, it impacted the business overall. It is absolutely a little higher penetrated in the apparel categories, which is what we expected. But our apparel business was quite robust outside of those markets as well. So we were very pleased with our strategy around being very focused on our consumer ensuring that our product tied back to our sneaker business and that paid pretty handsomely for us with regard to apparel.

Great. Thank you.

[Operator Instructions] And our next question is a follow-up question from Sam Poser with Williams Trading. Proceed.

Thanks. I just – thank you for taking my follow-up. Was there – can you tell us any kind of difference between your mall-based stores and your off-mall stores? So if you saw any kind of – what kind of differential you saw from the comps there?

Yes. Thanks, Sam. This is Mike. We're having very good performance in both mall-based stores, as well as strip-based stores. I would characterize it as the strips doing slightly better.

Thank you. And then with that – it was probably for Jared, are you – how much, has there been a change in sort of the multiple sales involving both footwear and apparel? I mean, how successful – is part of the overall success that you're going head to toe or toe to head more often than you did a year ago? And how did that work out if I'm correct? How did that work out and so on?

Yes, thanks Sam. So, yes, I mean, we're seeing some pretty incredible results in the strategy. I mean, our measurement of the strategy certainly comes from items for sale and what we're selling from a unit perspective in the basket. So we're seeing very strong connectivity within apparel, very strong connectivity with apparel and accessories, and then strong connectivity with the full outfit tieback to sneakers. So I think a lot of work being done, certainly with our assortments and the way we're positioning those. But I also think from a consumer perspective around our sales culture and the way we're making that come to life, both from a digital perspective as well in the stores. So I think I'd like to open up for Ben to kind of comment because I do believe, it's a direct result of the improvements we're making within our sales culture out in the stores and the result of what Bill and team are doing from a marketing perspective.

Yes. I think what Jared said is absolutely right, it's that connectivity between the omni-channel shopper, the online shopper and digital, the buy that we're making in Jared's team and then connectivity all the way down in the store level and the training that we're doing, it's really tied to that strategy from the buy all the way down to how it's presented in stores and how it's approached and presented to the customer. And so it's that, key between all three of those that we think is really helpful. And that's been our focus.

And this is Bill. Just about talking about the digital real quick, but we built tens of thousands of outsets that we have displayed on our website. So that's part of that toe to head strategy. And then on top of that, from a marketing perspective, if someone buys a sneaker in the store or online, we're going to send them an email as well as other communications with this a suggested outset. So we're tying that through from a digital and from an in-store perspective.

Thank you. And then lastly, just to clarify, the $20 million to $40 million incremental revenue from the closures that you talked about is a fiscal 2022 opportunity. You do benefited from that in this past year, but you feel there's $20 million to $40 million within the guidance that you provided for fiscal 2022. Is that correct?

Yes. Thanks for the clarification. We have said $20 million to $40 million. We began to talk about that in Q3 of last year. The effects of it really began towards the end of Q3. I would say that its effect on Q4 was relatively minimal. So we're sticking with that $20 million to $40 million throughout fiscal year 2022. We feel pretty confident in that rolling forward in this fiscal year.

But more leaning towards the first half, I assume, just based on when it started.

Yes. It would be more of a first three quarter effect in the last quarter, for sure.

Okay, great. Thanks very much and again, continued success.

Mr. Longo, there are no further questions at this time. I'll turn the call back to you for closing remarks. A - Mike Longo: Well, thank you so much for everyone's participation today. Again, we're incredibly proud of what the team has accomplished and we look forward to the next call. Thank you very much.

That does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your lines.