Unverified Participant David Weinberg - SKECHERS USA, Inc. John M. Vandemore - SKECHERS USA, Inc. [0F94YQ-E David Buckley

Corinna Van Der Ghinst - Citigroup Global Markets, Inc. Scott D. Krasik - The Buckingham Research Group, Inc. John Kernan - Cowen & Company LLC Sam Poser - Susquehanna Financial Group LLLP Jeff Van Sinderen - B. Riley FBR, Inc. Omar Saad - Evercore Group LLC Laurent Vasilescu - Macquarie Capital (USA), Inc. Christopher Svezia - Wedbush Securities, Inc. Tom Nikic - Wells Fargo Securities LLC Jim A. Chartier - Monness, Crespi, Hardt & Co., Inc.

Greetings and welcome to the SKECHERS Q4 and Full Year 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. I'd now like to turn the conference over to SKECHERS.

Thank you, everyone for joining us on SKECHERS conference call today. I will now read the Safe Harbor statement. Certain statements contained herein including, without limitation, statements addressing the beliefs, plans, objectives, estimates or expectations of the company or future results or events may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as amended. Such forward-looking statements involve known and unknown risks including, but not limited to, global, national and local economic, business and market conditions in general and specifically as they apply to the retail industry and the company. There can be no assurance that the actual future results, performance or achievements expressed or implied by such forward-looking statements will occur. Users of the forward-looking statements are encouraged to review the company's filings with the U.S. Securities and Exchange Commission, including the most recent annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all other reports filed with the SEC as required by federal securities laws for a description of all other significant risk factors that may affect the company's business, results of operations and financial conditions. With that, I would like to turn the call over to SKECHERS Chief Operating Officer, David Weinberg; and Chief Financial Officer, John Vandemore. David? David Weinberg - SKECHERS USA, Inc.: Good afternoon, and thank you for joining us today to review SKECHERS fourth quarter and year-end 2017 financial results. Joining me on the call today is John Vandemore, SKECHERS new Chief Financial Officer, who will discuss our financial results in detail. Fourth quarter sales increased 27% to $970.6 million and full-year sales increased 16.9% to $4.16 billion. Both record sales achievements which are a testament to the strength and relevance of our product, marketing and brand worldwide and are focused on building our global infrastructure. Fourth quarter highlights include a 40.2% sales increase in our international wholesale business, primarily due to significant double-digit gains in our key subsidiary and joint venture countries including China and a triple-digit gain in several subsidiary markets; international wholesale and retail growing to 52.6% of our total business in the quarter; a 25.8% sales increase on a worldwide company-owned retail stores with comparable same store sales of 12% globally; domestic wholesale gains of 11.6% with an increase in pairs shipped of 13.9%; maintaining our position in the United States as the number one walking, work, and casual lifestyle footwear brand and the number two casual athletic brand and women's footwear brand; and a strong balance sheet with $736.4 million in cash and cash equivalents, or approximately $4.70 per diluted share. Full-year highlights include growing annual sales to more than $4 billion through four consecutive record quarters and double-digit growth across our three distribution channels and expanding our global retail footprint to 2,570 company and third-party owned SKECHERS stores, including the net addition of 142 stores in the quarter. Subsequent to the quarter-end, our board authorized a three-year $150 million stock repurchase program. Now turning to our business channels in detail. Our domestic wholesale business increased 11.6% for the fourth quarter and 4.1% for the year. The quarterly growth was the result of a 13.9% increase in pairs shipped and a 2% decrease in average price per pair, primarily due to the product mix and strength of several collection that have lower average selling price. Our men's and women's footwear achieved double-digit growth in the quarter. Our Kids business was flat for the period, but increased 6.4% for the full year. We believe that the fourth quarter results in our Kids business was due to a timing issue as we were up 37.9% in the third quarter, in part to prepare for the holiday selling season. The growth in our men's and women's businesses was across multiple lines including GO, On the GO, GOLF, casuals and work, among others. Men's Sport also performed extremely well. For the holiday period, we ran several digital and television campaigns including product focused spots for SKECHERS GOwalk Joy, Skech-Knit, Mark Nason, and Kids' lighted footwear. We also ran campaigns for our Sport and Relaxed Fit footwear, featuring our brand ambassadors, Sugar Ray Leonard and Howie Long, who also appeared on our Super Bowl campaign this year. We also launched a new campaign in English and Spanish with baseball legend David Ortiz. Targeting teens and young women, we ran our Camila Cabello's SKECHERS campaign both on TV and on social media. Camila released her debut solo album last month and broke records with her albums number one position in more than 100 markets within 24 hours of its release. Also, in the fourth quarter, SKECHERS' ambassador Meb completed the final race of the story career. At 42, the beloved marathoner placed 11th at the New York Marathon wearing SKECHERS Performance footwear. Meb will continue to work with SKECHERS Performance team as he has done over the past six years. We ended the year again as the leading, walking, work and casual lifestyle and casual dress footwear brand, and the second largest casual athletic footwear brand. With the resurgence in retro styling and our heritage footwear lines, we believe our domestic business will remain strong as consumers seek comfort and style at a compelling price. International wholesale remains our biggest distribution channel, representing 41.5% of our total sales for the year, while international wholesale and retail combined represented 50.6% for the same period. Total international wholesale sales increased by 40.2%, or $116.4 million in the fourth quarter and 24.3% or $338.7 million for the full year. The quarterly increases were the result of 53.6% growth in our subsidiary and joint venture businesses and 3.1% growth in our distributor business. The quarterly growth is attributable to double-digit increases in nearly every subsidiary and joint venture market as well as double-digit growth in several of our key distributors, including Australia, New Zealand, the Philippines, Russia and Turkey, and triple-digit gains in Ukraine. Additionally, several countries experienced pull forward into the fourth quarter to ensure timely spring deliveries. We were also able to achieve the international increases within our distributor business despite continued unrest in the Middle East, which negatively impacted results for the region for 2017. Further detailing our growth internationally, for the quarter our wholly-owned international subsidiary business grew by 41.8% and our joint venture sales grew by 58.9%. The markets with the highest dollar gains were China, South Korea and the UK, and those with the highest percentage gains were Italy and Spain. China shipped 5.2 million pairs in the quarter and 17 million for the full year. This includes 1.4 million pairs for Single's Day, which is an increase of 76% over last year. China opened 74 freestanding SKECHERS retail stores primarily through franchisees and with the closing of 10, they ended the fourth quarter with 796 SKECHERS stores. At quarter end, we had approximately 2,446 points of sale in China and the strong e-commerce business which grew double-digits in the fourth quarter. At year-end there were 19,025 SKECHERS branded stores owned and operated by international distribution partners, joint ventures and a growing network of franchisees. In the fourth quarter, 146 third-party owned stores opened, which include the already mentioned 74 in China as well as 22 in India, 7 in Indonesia, 5 each in Australia, Singapore, Thailand and Turkey, 3 in Spain, 2 each in France, Malaysia and Portugal and 1 each in Brazil, Denmark, Estonia, Hong Kong, Lebanon, New Zealand, Paraguay, the Philippines, St. Lucia, Switzerland, Ukraine and the UAE. 12 third-party owned SKECHERS stores have opened in the first quarter to-date including 8 in India, bringing the total third-party stores to 1,937. We expect another 500 to 525 third-party owned SKECHERS branded stores to open in 2018. Our international business remains the biggest growth opportunity and we believe it will continue to grow at a faster pace than that of our domestic businesses. In our global company-owned retail business, sales increased 25.8% for the fourth quarter and 21.9% for the full year. The fourth quarter gains were the result of a 15.2% increase in our domestic retail stores and a 53.5% increase in our international retail stores. This included positive comp store sales of 10.5% domestically and 16.5% internationally for a combined total comp store sales increase of 12% in the quarter. At quarter end we had 645 company-owned SKECHERS retail stores of which 196 were outside the United States. In the fourth quarter we opened 22 stores including an 18,000 square foot superstore in Tucson. Nine of the company-owned stores opened in our subsidiary; these included three in the United Kingdom; two each in Peru and Japan; and one each in Chile and Italy. In 2018, we expect to open an additional 75 to 85 company-owned SKECHERS stores and remodel or relocate 15 to 25 existing stores. Adding to our growth was our domestic e-commerce business, which grew by 28.2% for the quarter and 21.9% for the year. We also have company-owned and operated e-commerce sites in Chile, Germany, UK, Spain and Canada. Now, I'll turn the call over to John to review our financials. John M. Vandemore - SKECHERS USA, Inc.: Thank you, David. Before I begin, I would like to say how excited I am to be here working alongside Robert, Michael, David and the rest of the SKECHERS team. I look forward to being a part of the continued growth of this fabulous brand. Now, let me turn to our fourth quarter and full year results in detail. Fourth quarter sales increased 27% over the prior year to $970.6 million. This growth was driven by increases in all our business segments, including company-owned global retail stores of 25.8%, international wholesale of 40.2% and domestic wholesale of 11.6%. However, we do believe that the fourth quarter results were positively impacted by $20 million to $25 million of shipments originally planned for the first quarter. Gross profit was $454.1 million, up $97.9 million compared to the prior year and gross margins increased 20 basis points to 46.8%. This improvement was attributable to strength in our international company-owned retail business and a higher contribution to our sales from our international subsidiary. Selling expenses increased by $4.4 million to $63.9 million, or 6.6% of sales as compared to 7.8% of sales in the prior year period, an improvement of 120 basis points. This increased efficiency reflects our ability to scale operations. General and administrative expenses were up $67.4 million to $340.8 million, representing 35.1% of sales. This is compared to 35.8% of sales in the prior year period. The increase in dollars reflects our ongoing investments in our long-term global growth initiatives. It included $20.1 million associated with our 75 additional global retail stores and $37.8 million to support our international growth in both our joint venture and subsidiary businesses. China represented $22.1 million of this investment, in part, to support our record-breaking Single's Day performance and a 78% increase in sales. Domestic wholesale general and administrative expenses increased $9.6 million year-over-year, primarily due to increased head count in the United States to support our brand worldwide, as well as for improvements to our digital operations and expansion into new categories. Earnings from operations increased 96.9% to $55.7 million, representing 5.7% of sales and compared to 3.7% of sales in the prior year period. The leverage we delivered this quarter gives a glimpse into the opportunity before us as we continue to grow the top line and leverage our infrastructure investments of the past couple of years. Due to the enactment of the Tax Cuts and Jobs Act in December 2017, we recorded an additional income tax expense of $99.9 million for the fourth quarter or an impact of $0.64 per diluted share, which resulted in a net loss of $66.7 million or $0.43 per diluted share. The additional expense includes a one-time tax on accumulated overseas profits and the revaluation of deferred tax assets and liabilities. As a result, our reported tax rate, which includes this additional expense, was 194.4% for the fourth quarter and 38.8% for the full year. Excluding the additional income tax expense, our tax rate would have been 12.2% for the fourth quarter and 12.8% for the full year. We expect our normalized 2018 tax rate to be in the range of 12% to 17%. We are still evaluating many aspects of the recently enacted tax law as well as our potential response. Our guidance represents our best estimate of the rate in 2018, but that may change as the IRS promulgates more regulations and better defines application of the law. Excluding these one-time expenses, adjusted net earnings were $33.3 million or $0.21 per diluted share on 156.1 million shares outstanding compared to $6.7 million or $0.04 per diluted share on 155.4 million shares outstanding in the prior year period. For the full-year, net earnings were $179.2 million compared to $243.5 million in 2016. Diluted earnings per share were $1.14 on approximately 156.5 million shares outstanding compared to $1.57 on approximately 155.1 million shares outstanding last year. However, on an adjusted basis, net earnings for the year were $279.1 million or $1.78 per diluted share. Now, turning to our balance sheet. At December 31, 2017, we had $736.4 million in cash and cash equivalents. This balance was impacted by the timing of certain year-end payments in international markets, as we sought to efficiently navigate provision of the Tax Cuts and Jobs Act. Absent these actions, we believe cash balances would have been approximately $120 million higher. Trade accounts receivable at quarter end were $405.9 million, an increase of $79.1 million from December 31, 2016, and our DSOs were 32 days at December 31, 2017 compared to 34 days in the same period last year. Total inventory, including merchandise in transit, was $873 million, an increase of $172.5 million or 24.6% compared to the same period last year. This increase is in line with our year-end backlogs and incoming order rate and supports the worldwide sales growth we have planned for 2018, as well as our expanded retail footprint. Long-term debt was $71.1 million compared to $67.2 million at December 31, 2016. Working capital was $1.5 billion versus $1.2 billion at December 31, 2016, primarily reflecting the aforementioned inventory levels. Capital expenditures for the fourth quarter were approximately $33.2 million, of which $20.6 million was related to 22 new company-owned domestic and international store opening and several store remodels and $5.9 million for our domestic office and showroom upgrades. For 2018, we expect our ongoing capital expenditures to be approximately $45 million to $50 million, which includes an additional 75 to 85 company-owned retail store openings, 15 to 25 store remodels, expansions or relocations and office renovations. This estimate excludes capital expenditures related to our distribution center in China, which is currently in the design stage. And we expect to break ground later in 2018. Today, we have spent $20 million related to this project. In addition, our capital expense estimate excludes office expansion here in Manhattan Beach and Hermosa Beach which may break ground later this year. Our board of directors recently authorized a three-year $150 million stock repurchase program. This decision reflects the strength of our balance sheet, confidence in the ability to fund our growth prospects and a commitment to our capital allocation philosophy. Before turning to our quarterly guidance, it is important to note that we incorporate many performance indicators such as ASPs, mix, incoming order rate, backlog, shipments, comp store sales, new store openings, calendar shifts and more into our estimates. Comprehensively, these provide the best view into our future performance. But no one indicator captures the entirety of our diverse businesses, especially as direct to consumer offerings comprise an increasing portion of our overall revenue. As a result, we have made the decision to no longer provide specific information on our wholesale backlog. However, we will continue to provide sales and earnings per share guidance on a quarterly basis reflecting the combined input of all our information. That said, with new product deliveries and expanded global infrastructure and a strong cash and inventory position, we believe we will achieve first quarter sales in the range of $1.175 billion to $1.2 billion. And net earnings per diluted share of $0.70 to $0.75. I will now turn the call back to David for closing remarks. David Weinberg - SKECHERS USA, Inc.: Thank you, John. The fourth quarter marked a new record for the period and resulted in a new annual sales record and the first time we achieved $4 billion in annual sales. The growth in the quarter was the result of double-digit increases in our three distribution channels, a testament to the strength of our brand and the investments we have made to ensure our success this year and in the coming years. With international representing over 50% of our total business, we continue to believe that the global market poses our strongest growth potential. We believe our relevant and innovative brand and diverse distribution allow us to grow in multiple product channels and markets. To this end, we are continuing to invest in our design, marketing and worldwide infrastructure for our near and long-term success. And with that, I would now like to turn the call over to the operator to begin the question-and-answer portion of the conference call.

Thank you. At this time, we will be conducting a question-and-answer session. Our first question comes from Corinna Van Der Ghinst of Citi. Please proceed with your question. Corinna Van Der Ghinst - Citigroup Global Markets, Inc.: Hi. Hi David and welcome to John. David Weinberg - SKECHERS USA, Inc.: Hi. Corinna Van Der Ghinst - Citigroup Global Markets, Inc.: It looks like you guys had a very productive few months. First of all, it sounds like you guys are still working through the tax change implications, but do you have any initial thoughts on kind of your full-year top line growth and operating margins as you work towards that 12% to 13% medium-term margin goal? Is it reasonable to assume like a mid-teens top line growth given how much global momentum you guys are seeing? David Weinberg - SKECHERS USA, Inc.: Yeah, I think it's fair to say that we think we continue along our path here. We don't see the growth slowing down both domestically and internationally, and while we're still working through the tax changes and John can talk more to them, we do anticipate that we will continue to grow this year and in the future years. We see no reason to have this dollar growth we did this year replicate at least over the next two or three years to get us close to $6 billion in 2020. So we're still on pace for that, I know it's not a straight line, but we do anticipate that we continue to grow on a worldwide basis with our consumers and we'll get closer – continue to leverage as we move further along. Corinna Van Der Ghinst - Citigroup Global Markets, Inc.: Where along that kind of 12% to 13% spectrum though do you guys think that you're going to end up this year? David Weinberg - SKECHERS USA, Inc.: You know, that's very difficult because we're only giving guidance one quarter at a time. We think it's certainly possible to get there this year, but it's kind of early in the year to give full-year guidance and see exactly what's going on around the world, both with interest rates, demand, currency and all that. So, while we do believe we're on target for potentially this year, if not certainly next year, it's too early to get committed to that line. Corinna Van Der Ghinst - Citigroup Global Markets, Inc.: Okay, that's fair. And then, I just had a quick follow-up on your commentary in the prepared remarks, with the $150 million in authorized share repurchases, how are you guys thinking about the pace of buybacks for this year? And then, can you just talk a little bit about the women's business, are you seeing an inflection in some of the trends there and can you talk a little bit more about what categories or channels are driving that and how you feel about the order books from here? David Weinberg - SKECHERS USA, Inc.: So, I'll start with the repurchase. Obviously it's a three-year authorization. We have a perspective on value right now that we'll use as a guide post and we'll look to deploy that over the three-year window unless opportunities for undervalued shares continue to present themselves. Needless to say, one of the reasons why we're excited about it and we think it's prudent is we do believe our shares are undervalued in the marketplace, and so today they look like an attractive opportunity for us in certainly the near future. John M. Vandemore - SKECHERS USA, Inc.: Yeah. And as far as the women's are concerned, we're actually showing strength among all the categories, that includes Sports, Sport Active, Street, On The Go. So, on a worldwide basis we're seeing great success across the board not necessarily just as we said in the past, there are different leaders in different parts of the world, but we're showing very strong in our women's product around the world. International is picking up as well, and Southeast Asia, it's growing at even faster pace. We've got new developments that are just launching in Southeast Asia that haven't come fully to the States yet and they're showing very, very well. So we're feeling very good about the whole process and all of them, the men's, women's and Kids. Corinna Van Der Ghinst - Citigroup Global Markets, Inc.: Okay. Great. I'm sorry, I just, if I could sneak in one follow-up as well. You mentioned the international advertising that you guys added on this quarter, how are you guys thinking about advertising as a percent of sales going forward as you continue to expand in international? And can you tell us what it was as a percent of sales in fiscal 2017 as well? John M. Vandemore - SKECHERS USA, Inc.: We're not giving international percentages. I mean I think the most remarkable thing about the quarter was... Corinna Van Der Ghinst - Citigroup Global Markets, Inc.: I guess, total. John M. Vandemore - SKECHERS USA, Inc.: ... in total. But in the quarter, we leveraged selling expenses significantly. We saw a significant opportunity for leverage. And I think that's a testament to the opportunity, the brand to grow in markets that we've already seeded with selling investment. David Weinberg - SKECHERS USA, Inc.: Yeah, I think as far as advertising is concerned and it depends how you want to define it, not just media but our advertising in in-stores. We anticipate that the rate of growth will continue to slow as it has in the past and we'll be able to leverage some. We are going to change focus and advertise obviously more in international and relatively stable in the U.S. We would think that we're okay in the U.S. and all increases will come from international. So that's a very positive and we will match the sales. And we anticipate it would stay in the same range, maybe slight leverage as we go through the year. John M. Vandemore - SKECHERS USA, Inc.: For 2017 as a whole, selling expenses as a percent of sales was about 7.9%. David Weinberg - SKECHERS USA, Inc.: But that includes some non-advertising fees as well. John M. Vandemore - SKECHERS USA, Inc.: Correct. Absolutely. Corinna Van Der Ghinst - Citigroup Global Markets, Inc.: Okay, great. Thank you so much.

Our next question comes from Scott Krasik of Buckingham Research. Please proceed with your question. Scott D. Krasik - The Buckingham Research Group, Inc.: Hey everyone. Thanks and great job. David Weinberg - SKECHERS USA, Inc.: Thanks, Scott. Scott D. Krasik - The Buckingham Research Group, Inc.: Just a couple of questions, so the sales shifts, you called out $20 million to $25 million, was that split between domestic and international and then in terms of your guidance you've laid out for 1Q, are there any expectations around pulling forward orders in the spring? And then I have a follow-up. David Weinberg - SKECHERS USA, Inc.: Yeah. I think the biggest piece of the portfolio is obviously in the States, but we did have some in Europe as well. If you look at this year, how it broke out, we really did explode in December. So December became a very big shipping month worldwide, which pulled everything up and obviously some of that could have gone in January. So we guess it's about $20 million to $25 million. We are booked very strongly for February and March. So while we had a good January, we expect February and March to accelerate. Depending on the sales and the cadence, there's certainly a possibility of moving some of April into March which would certainly give us a leg up. But the way, Easter breaks this year early in April, it really does depend how the season opens up, but we're feeling very positive we came through January very strong and had a very strong incoming order month in January. So around the world, we are shipping well now all over, Belgium, for Europe, here, South America and Southeast Asia. So we think we're off to a very solid start, we think this stuff is checking very well and as weather and temperatures change, we'll see exactly how much more we can move into the quarter. Scott D. Krasik - The Buckingham Research Group, Inc.: Okay. And then, thanks for sharing that $6 billion in 2020 sort of long-term target. As you just think about that between domestic growth or how much domestic sales will represent in that $6 billion versus internationally. Could you give us your thoughts around that? David Weinberg - SKECHERS USA, Inc.: I think as we said in the past, I do believe that domestic will continue to grow. It will grow on the wholesale end I believe mid-single digits, maybe a little more and we'll certainly grow faster at the direct-to-consumer, which we're doing some of our own and some third-party, and our own stores, which we're building bigger stores outside the malls, that seem to be doing very, very well. And give us increased sales per location. So the rest obviously comes from retail around the world, which we're very positive on. We think we can expand significantly in our wholly-owned subsidiaries like South America, Europe, and Japan. And we think we'll continue to grow in China. So I think what you see, the growth drivers you see today or what came through the fourth quarter is what we anticipate will carry us out over the – near the midterm. Scott D. Krasik - The Buckingham Research Group, Inc.: Great. All right, well, good luck. Thanks. David Weinberg - SKECHERS USA, Inc.: Thanks.

Our next question comes from John Kernan of Cowen & Company. Please proceed with your question. John Kernan - Cowen & Company LLC: Hi, good afternoon, guys. Thanks for taking my question. Just wanted to... (31:25). John Kernan - Cowen & Company LLC: You bet. Just wanted to zero-in on both the domestic and international comps in your own retail, both the two-year stacked comp trend accelerated pretty meaningfully. I'm just wondering what you think the biggest drivers of that were and what your expectations are going into the first quarter for comps in the retail business. David Weinberg - SKECHERS USA, Inc.: Well, we think that it's driven by more than an item. Our stores continue to do quite well, and it's all in new product introductions we've gotten. And we think the brand resonates more. Excess inventories are cleared out to some degree through some of these channels of distribution. And so I think our stores, because of the new stores and the way we're merchandising and picking up well, it's also that last year, in the last six months, starting with back-to-school and certainly in the fourth quarter retail was in a very difficult position with all the bankruptcies and excess inventory in the marketplace, so it made comps relatively easier in the fourth quarter. As we go into first quarter in the month of January, we continue to comp higher than last year. We are up double-digits worldwide. As far as comps are concerned for January, we're up mid- to high single-digits domestically and obviously significantly better than on an international basis. So we don't see any significant change, and the rate of growth can continue through the quarter. John Kernan - Cowen & Company LLC: Impressive. John, did you give any detail between – the breakdown between gross margin and SG&A in the first quarter and your expectations? I know there's a lot of mix shift between international wholesale, domestic wholesale and retail. But can you just give us a little more detail on the margin expectations in Q1? John M. Vandemore - SKECHERS USA, Inc.: Yeah. Obviously, it'll depend on mix, right. The biggest trend in our gross margins has been the influence of increasing international participation in our overall revenue mix. What I would say is we're probably looking for stable-to-better gross margins in Q1, maybe a little bit better than that due to some mix shifts. And then, from an SG&A perspective, we think it will begin to show the leverage that we've experienced in Q4. To what degree, somewhat matters on the opportunity, because much of our SG&A spend has been linked to growth, impressive growth in China. China alone was a significant top line grower and obviously a contributor on the SG&A line. And there's also other influences that we don't have great visibility into right now, like currency and FX rates that'll impact us. John Kernan - Cowen & Company LLC: Okay, great. Thanks. Best of luck. John M. Vandemore - SKECHERS USA, Inc.: Thank you.

Our next question comes from Sam Poser of Susquehanna Financial Group. Please proceed with your question. Sam Poser - Susquehanna Financial Group LLLP: Thanks for taking my questions. Well, just to dig into the pull forward a little more. Was the majority of that pull forward domestic or how is that $20 million to $25 million split? David Weinberg - SKECHERS USA, Inc.: I think we addressed it. The biggest single piece was domestic, but there was little pieces everywhere in the world, and $25 million is a guesstimate because some of the (34:46). We felt even though we were significantly higher than what we had forecast last year, we picked up most of it in the quarter, but we think a big piece, like $20 million to $25 million, and it could be somewhat more than that move from January to December because December was quite a bit stronger than the rest of the month against forecast. Sam Poser - Susquehanna Financial Group LLLP: So, basically, given the early Easter, you're expecting basically a lot acceleration into Easter, but that may not allow for as much pull forward if Easter was, let's say, a week later? David Weinberg - SKECHERS USA, Inc.: So, obviously, the more time – if Easter came later, I don't know that'd be a pull forward because our quarter ends March 31. So it depends on delivery. So I think we're at maximum if we sell through very well over the next five or six weeks that there'll be a pickup to be ready in store for Easter, which we're seeing. But like I said, it's way too early to tell. Big deliveries are just starting in February, which is probably our biggest shipping month, both domestic and internationally, with Europe certainly in the quarter. So we're on a good roller jet, but it's way too early to make those assessments. John M. Vandemore - SKECHERS USA, Inc.: And keep in mind, Sam, as David mentioned, Easter straddles right on our quarter end. So it's not a significant shift out of one quarter into another that you normally experience. Maybe a slight benefit to retail, but in terms of overall results, not extraordinary. Sam Poser - Susquehanna Financial Group LLLP: So when we think of this $1.2 billion number you've guided to, I mean, how would you break that out by group? I mean, you said you expected some comps to remain strong, but that would be a meaningful deceleration, especially most likely in international wholesale, unless you're looking at a flat domestic wholesale number, which I don't think you're doing, if I read the tea leaves properly here? John M. Vandemore - SKECHERS USA, Inc.: Yeah, let me put some color. I think, as David mentioned, domestic wholesale probably in that same mid-single digit range. Keep in mind, international wholesale comprises everything from our subsidiaries all the way through distributors, and even in this quarter, you saw distributors weren't as aggressive. So it's a blended rate we see there. And then global retail, certainly, we're seeing excellent early season trends, but there is a lot of selling to be done. We don't expect a meaningful deceleration, but we still expect something of kind of the mid- to high-single digits trend throughout the quarter. David Weinberg - SKECHERS USA, Inc.: The one drag we do have, however, is the distributors. Because our largest distributor in the Middle East has come out of the year on a weaker basis, we're actually forecasting in this model that the distributor base will actually decline on a year-over-year basis because a little piece of it had moved into Q4, and our biggest distributor is now looking to come back. And we see some signs that they will pick up, but there won't be any increases early in the first quarter. Also, because you're talking about trends, we picked up bigger in the back half of the year in places like Europe than we have in the first quarter. First quarter was always strong and always the toughest comp. So I think we're trying to be conservative but honest in the fact that we moved some forward. We're full at our customers. They were all trading very, very well. We do have some opportunities at the back end of the quarter. And I don't think this – if you take it out and you take the quarters in sequence that you'll see actually a slowdown as we carry this forward. Sam Poser - Susquehanna Financial Group LLLP: So basically combined Q4 and Q1, sort of combine those two and then the momentum picks back up. David Weinberg - SKECHERS USA, Inc.: Correct. Sam Poser - Susquehanna Financial Group LLLP: Okay. David Weinberg - SKECHERS USA, Inc.: Depending on the switches at the end of the month. I mean, if you think about it, we grew 24% in the quarter. There has to be some deceleration because we don't make inventory that fast, that complete. We have some pickups we can make in April, but it doesn't compound itself because of availability. Sam Poser - Susquehanna Financial Group LLLP: Got you. So this is now where you've got to just deal with what the demand looks like as it gets warmer? David Weinberg - SKECHERS USA, Inc.: It's what we see on order, and everybody is coming at the early part of their dates to deliver. As we get to a better sell-through visibility, we'll know what that means at the end of the quarter. Sam Poser - Susquehanna Financial Group LLLP: Great. Well, thanks and continue success. David Weinberg - SKECHERS USA, Inc.: Thanks, Sam.

Our next question comes from Jeff Van Sinderen of B. Riley FBR. Please proceed with your question. Jeff Van Sinderen - B. Riley FBR, Inc.: Let me add my congratulations and welcome to John. John M. Vandemore - SKECHERS USA, Inc.: Thank you. Jeff Van Sinderen - B. Riley FBR, Inc.: I wonder if you can give us a sense. Are you factoring in any pull forward from Q2 into the higher end of your revenue guidance? And if so, maybe order of magnitude if there – if you can add that? John M. Vandemore - SKECHERS USA, Inc.: It's too early for us, as David explained it, until we see sell through, it's too early for us to conjecture as to what kind of pull we might get into Q1. So, no, none of that is included at this point. Jeff Van Sinderen - B. Riley FBR, Inc.: Okay. That's good to know. And then on the China DC, just wondering what your latest estimate on the cost of that is and then what you're looking at, at this point, in terms of timing of when that will be up and running. And then I guess anything else you can add on, on key initiatives you're most focused on to grow that China business this year? David Weinberg - SKECHERS USA, Inc.: Well, key initiatives as far as product is concerned, we are developing products for the China market that then moves to the States and everybody knowing how the D'Lites work and D'Lites are starting – D'Lites, not lighted fully, D'Lites is working and working here in the states, and it's starting to pick up worldwide as well. As far as cost estimates, it's difficult. We're going to automate the system and it's going to be a 1 million square feet and we're still finalizing construction costs. As a placeholder, if you just want to take a look at a cash need, I would venture to guess it's somewhere between $125 million to $150 million for the building and the equipment that we'll be putting inside. But, of course, like I said, we're finalizing, and we're still watching the growth rate and capacity issues as far as China growth is concerned. Jeff Van Sinderen - B. Riley FBR, Inc.: Okay. And is there a target date for that to be up and running at this point? David Weinberg - SKECHERS USA, Inc.: We'd like to be up and running at third quarter or fourth quarter of 2019. Jeff Van Sinderen - B. Riley FBR, Inc.: Okay. 3Q 2019. Okay, good to know. Thanks. And any I guess order of magnitude you can give us on what the ecomm, the direct part of your business is as a percentage of revenue. And that's growing really strong. Just wondering kind of where that stands at this point? David Weinberg - SKECHERS USA, Inc.: That's a moving target and very difficult. We do more third-party in the United States online, and we have a massive online presence. We've grown in those accounts that do well online. And in China, we keep it all for ourselves. So, you saw Single's Day, the 1.4 million pairs that all is through our own account. So I think it's fair to say without talking too deeply about the numbers that we show very well online, the brand is demanded online, it's searched online, and does sell whether it's directly through us, third parties around the world as we continue to grow our sites. We are investing significant amount of money into our digital capacity, and we will be changing the site. And once we get the new site developed, which is in work now, we will bring it out and try to have our own presence around the world every place we have subsidiaries. Jeff Van Sinderen - B. Riley FBR, Inc.: Okay. Good to know. Thanks for taking my questions and good luck for the rest of Q1. David Weinberg - SKECHERS USA, Inc.: Thanks. John M. Vandemore - SKECHERS USA, Inc.: Thanks, Jeff.

Our next question comes from Omar Saad of Evercore ISI. Please proceed with your question. Omar Saad - Evercore Group LLC: Hi, thanks. Maybe instead of focusing on the first quarter, I wanted to ask maybe a bigger picture longer-term question. How are you guys thinking about the brand? It's just doing so well in Europe and China and a lot of these international markets. How should we think about the brand positioning in those markets and the consumer perception around the brand, how it differentiates from what we know here in the United States? And also the mix of products across different styles and categories, how maybe those markets are different? It's pretty interesting to see those phenomenal growth rates and would be helpful to get a better understanding of how the consumer is consuming the brand over there. Thanks. David Weinberg - SKECHERS USA, Inc.: That would take us probably the rest of the afternoon if you wanted me to go territory by territory or country by country, so it's different. So, on a broad picture, and we can certainly talk about this offline as we go forward in more detail. In the U.S. we've grown predominantly through the mid-channel. The mid-channel doesn't necessarily exist everywhere in the world. The brand has the capacity on the top end of what we offer and what you see selling. And certainly within the GO product, which has been a big plus for us internationally. I know we've talked in the past that GO had slowed in growth, which is now starting to pick up by the way domestically, but that's not been true internationally. That continues to grow at a very nice pace, especially in Southeast Asia. So I would tell you that the brand is perceived as quality. It's not considered as mid, but it's considered as upper, although not the most expensive. So it's quality, designed well, fashion-forward at a price probably on average slightly higher pricing than we see here in the United States. So if I had to ticket it, it's probably a couple levels up in most parts outside the United States, certainly not all, because there are some third-world countries where the price is more significant than it is here in the United States. Omar Saad - Evercore Group LLC: Thanks, David. That's really helpful. Can I also ask, we're watching the kind of street wear fashion trend going on across the fashion industry in sneakers. You're seeing a lot of new brands at the very high-end, Gucci and Saint Laurent and Lanvin chasing the sneaker category, and it feels like that that kind of opportunity exists at your price point where the SKECHERS brand plays really well. Is that becoming a bigger part of your business? Is that a big opportunity for the brand or am I over thinking it? David Weinberg - SKECHERS USA, Inc.: I'm not really sure. I'll have to go think about that myself. I think there is an opportunity. We can play in a multitude of styles and categories as they go through the world. So as they develop, should they become meaningful, we certainly would participate and put our entrées into those categories. So it's like we've said in the past, change is good for us. Because we're so flexible and because we're a footwear company that can go in many categories, as things change and purchases have to increase because they were all brand new, they are not rebuying the same type of item, tends to be to our benefit, which is what we think has happened over the last six or nine months. Omar Saad - Evercore Group LLC: Congratulations. Great work. Thanks. John M. Vandemore - SKECHERS USA, Inc.: Thanks. David Weinberg - SKECHERS USA, Inc.: Thanks, Omar.

Our next question comes from Laurent Vasilescu of Macquarie Group. Please proceed with your question. Laurent Vasilescu - Macquarie Capital (USA), Inc.: Good afternoon, guys, and congrats on phenomenal results. I want to ask about China. I think in the prepared remarks you said it was up strong double digits. I just wanted to get a sense of where it ended up for fiscal year 2017. Is it fair to say $550 million? And any high level context of where we should think China can be by the end of fiscal year 2018? John M. Vandemore - SKECHERS USA, Inc.: Yeah. I mean for the year, it ended above the $550 million we had last spoken about just a little bit north of $575 million, so phenomenal growth, 78% for the quarter. I think for next year, early look would give you sense that about the same level of dollar increase for the year, maybe not as much in the percentage, because you're starting to deal with the law of large numbers there and obviously a significant growth in the stores. And then another challenge to overcome and improve on this record Single's Day performance, but obviously a phenomenal quarter this Q4 Laurent Vasilescu - Macquarie Capital (USA), Inc.: That's great. That's phenomenal. And then on the fourth quarter gross margin, any sense of how much – like what happened here with regards to puts and takes, like how much FX was a driver, maybe pricing was a driver, were there any offsets to those factors? And then any implications for the first quarter gross margin would be great. John M. Vandemore - SKECHERS USA, Inc.: Yeah. So for Q4 what we saw was about an equal offset between the uptick and improved mix from international contribution and higher margin businesses like retail with a little bit of in-category declines. And FX was a very slight differential. So what you generally saw was a push between kind of product mix, taking the margins just a little bit down, and then segment mix, more international, more retail, bringing it right back up. Q1 is going to be hard to look at right now simply because we've seen such volatility in foreign exchange. So there may be a bigger impact there. It's hard to assess at this point. The one thing I'll say is, again, as we continue to grow at above-average rate internationally, we'll see improvement in gross margin. And David mentioned, we're forecasting a little bit of a letdown from our distributors, which are always a net drag to our gross margin, so maybe a little bit more amplitude in the increase in Q1 than is normal. But, again, I think for the full year we're looking for stable-to-slight important overall. Laurent Vasilescu - Macquarie Capital (USA), Inc.: Okay. Very helpful. And then on inventories, inventories were up above the sales guide for the first quarter. So any sense of what's happening here? Is it like inventory in Asia, Europe, North America, any context of maybe by channel, I don't know, maybe you can give some context on that. That would be great. David Weinberg - SKECHERS USA, Inc.: Well, I think what you see basically is because first quarter is becoming so much larger for us and we do take into account all the merchandise in transit that by December 31 you have to have most of the first quarter already booked in, especially with Easter coming up closer and in our international business. So what I think you see is getting ready because as we increase and we've done probably over a 150 million pairs last year, we try to make sure that our production is in at the early part of the shipping cycle so that we can move it up forward should there be a demand from customers without speculating too significantly on inventory. If you look through where it's grown, I think you would find that it's grown where you would anticipate ahead of growth. It's grown in Europe. It's grown at our retail stores. It's grown in Southeast Asia, and of course, it's grown those places that are growing quicker that we've just started that were very underutilized last year like South America and Korea. So I think we're in good shape. I think it's there, and we're early, and we can take advantage of any opportunity without having taken too much risk. Laurent Vasilescu - Macquarie Capital (USA), Inc.: That's great. And then lastly and last question here is on tax. I think you guys gave a nice range here of 12% to 17% for the year. Obviously, there's still a lack of visibility on what's going to happen further going forward. But at least for the first quarter, any kind of directional guidance on where we could think the tax rate can be for the quarter? John M. Vandemore - SKECHERS USA, Inc.: I'm going to stick to the range at this point in time, and that's largely because of the newness of the tax law and the continuing learning everybody is doing with regard to exactly how that law is going to be applied. Keep in mind, we're giving you a perspective when we recorded a tax element that is provisional as we learn more about the application of law, learn more about our actual consolidated overseas profits. So we're going to stick to the 12% to 17% right now, but we'll try to give you more color as the year goes on and we learn more about the application of the law. Laurent Vasilescu - Macquarie Capital (USA), Inc.: Okay, great. And congrats, again. John M. Vandemore - SKECHERS USA, Inc.: Thanks.

Our next question comes from Chris Svezia of Wedbush Securities. Please proceed with your question. Christopher Svezia - Wedbush Securities, Inc.: Good afternoon, everyone, and congratulations on the quarter. John M. Vandemore - SKECHERS USA, Inc.: Thanks. David Weinberg - SKECHERS USA, Inc.: Thanks. Christopher Svezia - Wedbush Securities, Inc.: And I would also say congrats on the buyback. I guess John you have the magic touch, so congratulations on that too. John M. Vandemore - SKECHERS USA, Inc.: Not at all. It's an expression of the company's longstanding capital allocation philosophy, nothing to do with me personally. Christopher Svezia - Wedbush Securities, Inc.: Okay. So, I guess first, I just wanted to – Q1, when you think about the potential for inflection in revenues, in other words as you get through February and start getting into March, I guess what's the timeline whereby you could either, A, potentially see a pull forward of business from Q2 into Q1, or whereby things really start checking that there is a replenishment, the inventory that's already out there in the marketplace. I'm just trying to get an idea of how you're thinking about where you would see that point where things could start to change? David Weinberg - SKECHERS USA, Inc.: You probably see that point somewhere in mid-March, maybe slightly earlier but not much. Remember everybody – because at retail most fiscal year ends in January, but big shipping month is February. So it's just getting to retail in February for the north, and then you have weather issues in some of those places that may not take the new spring product. So you've got to wait until it gets through the system. And probably by the second week in March you have a good idea. Christopher Svezia - Wedbush Securities, Inc.: Okay. And that's on a global basis? David Weinberg - SKECHERS USA, Inc.: Yeah. Christopher Svezia - Wedbush Securities, Inc.: Okay. Would that happen sooner in the U.S. or no? David Weinberg - SKECHERS USA, Inc.: No, I think on the same timeline. It may happen a little bit sooner. It depends how much sell-through you get. So, February is not usually the strongest sell-through month. It's coming and new product is hitting. So it really does depend on the environment and the marketplace to come significantly earlier than that. I would tell you if it came earlier like in mid- to late February, it would be on an order of magnitude probably a large one. Christopher Svezia - Wedbush Securities, Inc.: Okay, fair enough. John, maybe a question for you or do you want anyone to answer this, but FX, I know you touched on gross margin, from a top line perspective, just your thoughts there, euro, pound and what's happened there. I know China has been a little more mixed, but just your thoughts about how you're thinking about currency impacting revenues for Q1? John M. Vandemore - SKECHERS USA, Inc.: Yeah. Again, as I mentioned, the movement, the volatility we've seen in currency, just the tail-end of Q4 and the beginning of Q1 makes that really hard to predict. Obviously, the dollar weakening overall, it would lead you to conclude that there's probably some tailwind there. In Q4, it wasn't a significant driver of top line growth, maybe 1 percentage point overall, but not much more than that. And it really depends on how the quarter sells out. I mean we've seen a lot of volatility in the market, which makes me certainly hesitant to predict anything in the currency markets going forward. Christopher Svezia - Wedbush Securities, Inc.: Okay. So it's fair to say nothing that material in your forecast for Q1 from a currency perspective? John M. Vandemore - SKECHERS USA, Inc.: Yeah. We haven't layered in anything that I would consider extraordinary in terms of – certainly not top line associated with FX, although we're watching the markets carefully. Christopher Svezia - Wedbush Securities, Inc.: Okay. Fair enough. And then just on China just real quick. I know you threw out the overall dollar size. What was the actual dollar – remind us again what the dollar increase was year-over-year? You mentioned it, John, if you're growing similar dollars, is it roughly $200 million? Is that the overall dollar increase year-over-year? John M. Vandemore - SKECHERS USA, Inc.: Yeah, a little north of $200 million. Christopher Svezia - Wedbush Securities, Inc.: Okay. Final thing just real quick here. When I think about the international, so you talked about the U.S. wholesale business sort of mid single-digit trajectory roughly for the year. International, I know there's moving parts on FX, but any reason to think that that couldn't be north of 20% growth, just given what you're seeing in China, what you're seeing in Europe and some of these other markets as they continue to gain momentum? Just any context about how we think about the international growth for the year, broadly? David Weinberg - SKECHERS USA, Inc.: Yeah. I think that's all certainly possible. Right now, the only drag to that number would be the distributor base, which is obviously – if things straighten out and don't have issues with other distributors. We have some distributors that are doing very small. They're just not – order of magnitude is biggest for us is the Middle East. And you know how that's moved the needle for us in the past. I think they're coming back. Should they come back strongly in the back half, I would have no problems and no issues with those numbers. Christopher Svezia - Wedbush Securities, Inc.: Okay. Thank you very much. All the best. John M. Vandemore - SKECHERS USA, Inc.: Thanks, Chris.

Our next question comes from Tom Nikic of Wells Fargo. Please proceed with your question. Tom Nikic - Wells Fargo Securities LLC: Hey, good afternoon, everyone. Thanks for taking my question. I was just sort of wondering about the – I guess it was touched on earlier, the gross margins, and I mean Q3 was really, really strong and Q4 was not quite as much. And then, it would seem like Q1 should be somewhere in the middle. I mean, can you just help us like understand why sort of the gross margins have sort of bounced around a bit the last couple of quarters? And I know that there's mix and stuff like that, but are there FX impacts or anything like that that we should really think about when we model out the gross margin? John M. Vandemore - SKECHERS USA, Inc.: I mean, I think you're picking up the most significant fact pattern, which is the mix, in particular, the contribution from international and retail has a significant influence, no doubt gross margins probably would have been higher in Q4, but domestic wholesale grew over 10%, which is a great fact pattern. I think Q3 was stronger than Q3 traditionally. And if you look at Q4 relative to full year on a historic basis, we're kind of right in line with where you expect the Q4 to result relative to your full-year gross margin range. Q1, the call out that I'd reinforce is the distributors, to the extent distributors are flat to down, that will increase gross margin, but that's again a major mix shift. Tom Nikic - Wells Fargo Securities LLC: Right. So basically, your lowest gross margin business should be down in Q1, as we get a much better mix than what you saw in Q4. John M. Vandemore - SKECHERS USA, Inc.: Yeah. Correct. Tom Nikic - Wells Fargo Securities LLC: All right. Thanks very much. Best of luck. John M. Vandemore - SKECHERS USA, Inc.: Yeah. Thanks.

Our next question comes from Jim Chartier of Monness, Crespi and Hardt (sic) [Monness, Crespi, Hardt & Co.,]. Please proceed with your question. Jim A. Chartier - Monness, Crespi, Hardt & Co., Inc.: Good afternoon. Thanks for taking my question. [0F94YQ-E David Buckley: Hi. Jim A. Chartier - Monness, Crespi, Hardt & Co., Inc.: Hi. I just wanted to touch on some of the newer international markets you've taken over in the last couple of years, Latin America and Korea. I know Korea is called out as one of the best growers. Overall, how are those doing? Did you start to see any margin improvement in fourth quarter? And how do you expect the margins in those businesses to trend next year? David Weinberg - SKECHERS USA, Inc.: In terms of operating or gross margins, because gross margins... Jim A. Chartier - Monness, Crespi, Hardt & Co., Inc.: Operating margin. David Weinberg - SKECHERS USA, Inc.: Operating margins, relatively flat in Korea, just gaining back some of that momentum. They are starting to increase in South America, but we are continuing to invest there. It's brand new and we're opening a lot of new stores. It's fair to say in South America, our comp store sales for the last quarter are extremely high, even higher than the company as a whole, but there's a limited number of stores. So it can't move the needle yet. So, I would tell you they're starting to take hold, certainly in Latin America, maybe a little more slowly in Korea, but we see great potential and we anticipate that we go through this year to the back half of the year, they will start to increase meaningfully. Jim A. Chartier - Monness, Crespi, Hardt & Co., Inc.: Great. And then, last quarter you talked a little bit about India. How was that business in fourth quarter? And what do you think the ultimate potential there is? David Weinberg - SKECHERS USA, Inc.: Well, often that depends on your timeframe. India is growing very nicely. It's doing a big franchise model. It's got mono-brand stores. The volume is increasing, but it's at a fairly slow rate. It's a little more difficult to get started in India, but the brand is certainly resonating and our stores are certainly comping up. So we've increased, it was a nice size increase, certainly in the double-digits. They did turn profitable last year for the first time. We expect that to continue. So we will continue to grow as to what the impact is ultimately. Right now, we do less than $100 million there. I think $60 million to $70 million as far as India is concerned for the year. We do believe it can be multi-hundred million dollar country for us, maybe even close to a $1 billion country for us as we take hold and build through what's a massive population as the middle class grows. So it's too early to make them a significant piece over the next two or three years. But certainly, if you wanted to take a longer-term perspective as a brand, they will be a key player. Jim A. Chartier - Monness, Crespi, Hardt & Co., Inc.: Great. Thank you.

Ladies and gentlemen, we have time for two quick follow ups. Our first follow up comes from Scott Krasik of Buckingham Research. Please proceed with your question. Scott D. Krasik - The Buckingham Research Group, Inc.: Hey, thanks for fitting me back in. Just a couple of clarifications. One, did you say what your distributor sales were in the fourth quarter or how much they grew? David Weinberg - SKECHERS USA, Inc.: 3%. You hear that? Scott D. Krasik - The Buckingham Research Group, Inc.: Say again. David Weinberg - SKECHERS USA, Inc.: 3%. John M. Vandemore - SKECHERS USA, Inc.: Yeah, they grew 3% in the quarter. Scott D. Krasik - The Buckingham Research Group, Inc.: Okay. Thanks. And then what sort of comps do you have embedded into your 1Q revenue guidance? David Weinberg - SKECHERS USA, Inc.: Low double-digits worldwide, mid to high single-digits domestically. Scott D. Krasik - The Buckingham Research Group, Inc.: Okay. Thanks. Good luck. David Weinberg - SKECHERS USA, Inc.: Thanks.

Our final question comes from Sam Poser of Susquehanna Financial Group. Please proceed with your question. Sam Poser - Susquehanna Financial Group LLLP: Well, given all these changes with buybacks and everything and given the inconsistency of currency here, do you foresee starting to hedge against all this international currency down the road to basically level the playing field for yourselves a bit? David Weinberg - SKECHERS USA, Inc.: No. I think right now we feel that we manage our exposure to foreign currencies relatively well. I mean, we'll continue obviously to the extent the volatility we see becomes a new normal, look at opportunities but only if they're accretive to the operations and they drive value. I would note just because we have cash overseas doesn't mean it's in a foreign currency, we already actively manage our exposure there, so that we're not seeing foreign currency fluctuations on active cash balances more than what we need in any given market. Sam Poser - Susquehanna Financial Group LLLP: But I'm referring to how it comes against purchases of inventory and impact to gross margin and SG&A and so on and so forth. I mean from that perspective for the use of – since you buy everything in dollars? David Weinberg - SKECHERS USA, Inc.: As you think back, it only is a short-term situation for us. It's very difficult to take a long-term view on currency. And it may be more volatile to hedge depending on how the matching can work than it is to live through the process. In the past, we've done very well with both sides, both with a stronger dollar and a weaker dollar. We've shown that we do have pricing power around the world when the dollar tends to get significantly stronger and take advantage and then, modestly adjust our price points when the dollar goes the other way. So I don't know that we'd look to even out short-term swings when the business is growing so dramatically. And like John said, we're always open. Should something develop or a process that we can match closer, then we certainly would take a look. Sam Poser - Susquehanna Financial Group LLLP: All right. Thank you very much. Have a great one. David Weinberg - SKECHERS USA, Inc.: Certainly, Sam.

Ladies and gentlemen, we have reached the end of our question-and-answer session. This will conclude today's conference. You may disconnect your lines at this time.