Good morning, everyone, and thank you for joining us to discuss our fourth quarter fiscal '24 results. Participants on the call expect to make forward-looking statements reflecting our expectations as of today, but actual results could be different. Genesco refers you to this morning's earnings release and the company's SEC filings, including its most recent 10-K and 10-Q filings for some of the factors that could cause differences from the expectations reflected in the forward-looking statements made today. Participants also expect to refer to certain adjusted financial measures during the call. All non-GAAP financial measures are reconciled to their GAAP counterparts in the attachments to this morning's press release and in schedules available on the company's website in the Quarterly Results section. We have also posted a presentation summarizing our results here as well. With me on the call today is Mimi Vaughn, Board Chair, President and Chief Executive Officer, and Tom George, Chief Financial Officer. Now, I'd like to turn the call over to Mimi.

Thanks, Darryl. Good morning, everyone, and thank you for joining us. Fiscal '24 highlighted how substantially our consumer shopping behavior has changed since the pandemic. Back in fiscal '22, consumers were flush with cash, thanks to fiscal stimulus, and spent heavily in the footwear category, which led to a record year for Journeys. As we entered fiscal '24, we saw a pronounced drop in purchases at the beginning of the year and have been working to close the gap ever since. The forward buying dynamic, along with a period of higher inflation that followed, competitive discounting to clear elevated athletic footwear inventories, and a general lack of innovation in footwear made for a challenging operating environment that persisted as we progressed through fiscal '24. Throughout the year, these evolving purchase patterns led to greater volatility and made it hard to forecast demand, particularly for Journeys. In the fourth quarter, following a robust Black Friday and solid kick-off to the holiday season, sales were negatively impacted by a more selective customer that shopped almost exclusively for key footwear items, coupled with a market shift away from boots. As we got into January, the combination of softer-than-anticipated sales due to disruptive winter storms and higher-than-anticipated expenses at Journeys is what drove EPS below our most recent guidance. Our core product assortment was under greater pressure than we initially expected at the beginning of Q4, and we expect this dynamic to carry into this current year. Given our limited ability to impact product for spring, we believe it will remain a significant headwind in the first half despite facing easier comparisons. We are clearly disappointed with these results. However, I want to stress that we have faced challenging times before and consistently demonstrated a strong track record of turning around our businesses to emerge even stronger when confronted with economic and consumer disruption. Our response to the pandemic and recent turnarounds at Schuh and J&M, evidenced by another year of record sales for both, are clear examples of this, and I'm confident we will achieve the same success with Journeys. It's also important to note, despite a very difficult operating climate, in fiscal '24, our overall sales declined only low single-digits, and our gross margin compressed by just 30 basis points. The sensitivity of our model is such that smaller movements in sales are magnified with quite a bit of deleverage against our largely fixed cost base. Coupled with our low share count, this had a substantial effect on our bottom line. The inverse is also true; in a sales growth environment, as we've demonstrated before, our model provides significant leverage and earnings upside potential. Our cost savings initiatives aim to improve this further. As we turn the page to fiscal '25, the operating environment remains difficult. Given the steeper challenges in our core business, we now have more work to do in our assortment. As such, we're counting on more time for a Journeys rebound. All that said, we have a very clear understanding of what we need to achieve; Journeys' continued turnaround is our number one priority. With the right new leadership already in place and a strong team overall, we're better positioned than ever to accomplish this task. I've said before, we are well positioned strategically with a spotlight focus on the team; no other retailer serves this customer quite the same as Journeys. Journeys is the one-stop shop for a broad range of both casual and athletic brands. This unique proposition as the destination for teen fashion footwear, particularly for the teen girl, remains solidly intact. As fashion broadens and teens embrace multiple wearing occasions, we will achieve success with a more diversified assortment that addresses these needs and fills out our customers' closets. Importantly, we already have the backing of our consumer who consistently scores Journeys higher than key competitors in market research and our brand partners who demonstrate exceptional support. Under Andy Gray's leadership, the Journeys team is working to dramatically accelerate the pace of improvement in response to how the consumer has changed. With his strong merchant background, excellent vendor relationships, and expertise in brand building and product innovation, Andy's insight has already proven tremendously valuable. We are working with great urgency. However, these efforts will take some time given footwear industry's lead times. Already in the works though, they will set the stage for more significant progress for back-to-school and especially for holiday. I will discuss some of these initiatives in more detail shortly. But first, I'd like to point out some important highlights from the quarter and year beyond the record sales years Schuh and J&M delivered. We grew our comparable digital business by 5% in Q4, 8% for the year, and expanded digital penetration in fiscal '24 to 23% versus 20% a year ago. We launched Journeys All Access loyalty program and Buy Online, Pick Up In Store in North America to encouraging initial results. BOPUS was a bright spot in Journeys during its first holiday in operation, accounting for almost 30% of e-commerce sales in the week leading up to Christmas. Importantly, we made further progress rightsizing our inventory. Journeys ended Q4 with inventory down over 20% versus last year, enabling us to generate strong cash flow and enter the new fiscal year in a very clean position. This also helped us deliver solid gross margins ahead of expectations and positions us well to buy into the products we need to drive Journeys' sales. Furthermore, we continued to advance our strategies to position the business for better productivity and profitability. We closed nearly 100 underperforming Journeys stores and are evaluating up to 50 more closures this fiscal year as we reshape the footprint to align with the shopping patterns of today's consumer. And we made substantial progress in realigning our cost base and are now targeting an increased run rate of $45 million to $50 million in annual savings by the end of this year. And now for color on our individual businesses. Starting with Journeys. While we were pleased that sales once again improved sequentially in Q4, results nonetheless fell short of our initial expectations. Following a strong Thanksgiving weekend, business decelerated in December as customer shopping trends remained choppy. That said, store traffic was positive, and consumers responded well to the newness in our assortment, which tells us that Journeys remains a key destination for our team. However, a decline in conversion outweighed this, given our consumer's selective appetite for key items. Once we ran out of high-demand product, we were not able, as we usually are, to motivate an alternate purchase, and discounting did not drive enough sales to be effective. This was evident in boots. While we planned our boot business down in anticipation of a challenging season, it was weaker due to both warm weather and shifting style preferences. Boot sales, which typically represent 50% of Journeys' holiday business, were down 20% during the holiday period. And as I mentioned, we experienced more pressure than we expected in our core assortment, including vulcanized product. The overall sales decline in Q4 was confined to stores as Journeys' digital business performed quite well, up mid-single digits versus last year. We tested numerous engagement and traffic-driving programs with All Access members, increased SMS usage, and launched influencer and paid social campaigns to generate awareness and drive conversion. In fact, as we exited the year, we saw some acceleration in total comps in January, led by Journeys e-commerce, which increased 35% during the month. Moving to the UK. Despite experiencing a slowdown in Q4 comps against a difficult compare, Schuh delivered an exceptional year with strong comp growth throughout the first nine months. Our efforts to strengthen Schuh's value proposition have differentiated the business from competitors, grabbing the attention of new customers and enhancing our brand relationships and access to top-tier products. That said, sales in Q4 were challenged by a tough boot business, coupled with a more cautious UK consumer who, against recessionary economic challenges, was also more discriminating in their purchases. The pressure was primarily in stores, as Schuh's e-commerce business remained positive in the quarter, accounting for over 40% of total sales. Kids also remained a bright spot with sales up 8%, while non-footwear categories saw strong growth of 35%. Even amidst a difficult operating environment, Schuh held strong market share. As of mid-January, Schuh maintained its Number 10 rank in total UK footwear market share, according to Kantar, a position it's held since May 2023 after moving up three spots during the year. Loyalty has played a key role in strengthening Schuh's market position. Currently accounting for roughly 30% of total sales, Schuh Club members now stand at 2.3 million and are more engaged than non-loyalty customers, purchasing more frequently. Turning to Johnston & Murphy, the business was a standout over the holiday with a record fourth quarter as we continued to invest to drive growth. Compelling product and strong sales of non-footwear led to nicely positive comps, demonstrating a solid recovery from the ERP implementation challenges in Q3. However, relative to the run rate over the holiday, sales were pressured by the disruptive January winter storms. Our efforts to reimagine J&M as a more comfortable lifestyle brand with products suited for today's more casual preferences resonate well with our consumers. In Q4, J&M's direct-to-consumer business was robust across all channels: e-commerce, retail, and factory. Although the casual and casual athletic categories were key drivers in J&M's footwear business, apparel and accessories were an even bigger call-out in Q4. Apparel and accessories increased 18%, driven by strong growth in blazers and outerwear, accounting for almost half of J&M's DTC sales. J&M is a great example of how we've taken our strong DTC capabilities built in retail and applied them to a branded concept. With the work of repositioning to an updated multi-category lifestyle brand, we are well positioned to drive meaningful growth, with opportunities across categories, age demographics, geographies, and genders. As the cornerstone of our branded platform, the future for this business is incredibly bright. Now switching back to Journeys. Andy and the team have taken a deep dive on the business and put a sharper focus on a turnaround program and growth strategy that will impact the customer through product, marketing, and experience. I will highlight some key initiatives for this fiscal year, which are a mix of both strategic acceleration and disciplined expense management. Number 1, drive product leadership and create marketplace differentiation. To continue improving Journeys' footwear leadership and assortment, we're implementing new strategies led by our recently appointed Chief Merchant to meaningfully increase product access and boost investment in key fashion, athletic, and casual brands. This includes diversifying and adding new key styles with our existing brand partners, increasing our leadership position with all our key brands, enhancing in-store social and digital exposure to build awareness with our customer to shop Journeys for these brands, and working to add brands beyond those we are traditionally known for. Number 2, build the Journeys brand and enhance the omni experience. We're intensifying efforts to build and promote Journeys as an industry-leading retail brand. We're currently onboarding a new creative agency to develop a new brand communication strategy. We plan to roll this out in the latter part of the year, along with an updated brand mission, vision, and purpose. In parallel, we're improving Journeys' brand presence and upgrading the customer experience with quick actions in both stores and online, including refreshed messaging and visuals that tell a cohesive brand story across channels and social media. We're excited about the investment we're making to personalize and improve the timeliness and relevance of our marketing communications as well. We're also evolving the All Access loyalty program, where we've signed up over 2 million members in six months, continuing to provide an exciting feature-rich program that differentiates Journeys, generates valuable consumer insights, and encourages consumers to consolidate purchases across brands with us. Finally, we'll ultimately pursue an updated store concept and next-generation design to further enrich the customer experience. Number 3, leverage the power of our people. This initiative leverages the expertise of our store employees to set us apart by providing excellent service as a differentiator. Over the past year, we've introduced new capabilities, including mobile point of sale and BOPUS to improve efficiency and customer engagement. This year, we'll further improve training execution and roll out additional features like data-informed suggested selling. Number 4, optimize to drive operational and cost efficiencies. We're implementing several initiatives here, including continued efforts to optimize the store footprint, closing unproductive stores, and redirecting traffic and sales while strategically opening mall and off-mall locations and prioritizing optimization projects focused on selling salaries, rent expenses, inventory management, and digital marketing spend efficiency. In summary, I want to emphasize my belief in our team's ability to reshape our business and unlock Journeys' considerable earnings potential. In addition, we're executing new initiatives to accelerate growth for Schuh and J&M in fiscal '25, all building off our footwear-focused strategy. I'll discuss a few select examples. With a data capture rate of over 75% for customers in North America and growing loyalty and affinity programs across our concepts, we're augmenting our understanding of our customers' needs and driving up repeat purchase rates using our CRM platforms and more advanced analytics. For J&M, we're excited for the launch of the brand's refreshed marketing campaigns this spring. Powered by a new agency, this campaign aims to increase overall brand awareness and appeal, attracting a broader and younger consumer, while also changing the perception that J&M is still primarily a dress shoe resource. Revamped social media content and organic social campaigns will be key drivers of these efforts, along with new digital and in-store rollouts. Finally, building out the Schuh Club loyalty offering will accelerate member sign-ups and customer engagement. Turning now to our outlook for fiscal '25, we continue to navigate volatile consumer behavior and are not assuming any significant change in the near term. As I mentioned, we anticipate a difficult first half with significant pressure in Q1 given the product challenges at Journeys, and we are planning for the back half to be much stronger than the front as we make an aggressive push to reposition our assortment. Our guidance for the year reflects this view, with the expected front-half results impacting our ability to further grow EPS in fiscal '25, but the product build we're putting in place sets us up well for fiscal '26 and beyond. Before closing, I'd like to say that while this past year has truly tested us, I'm extremely proud of our resilience and drive to overcome the challenges we faced. None of this would be possible without our incredible talented people. I'd like to thank you all for your tremendous efforts and for all the great work you will be doing in the coming year. And with that, I'll turn it over to Tom.

Thanks, Mimi. The headwinds in Journeys along with the inclement weather we faced in January had a greater impact on our fourth quarter financial performance than we initially anticipated. Relative to our revised guidance, the net earnings per share result was below our expectations, primarily due to expense pressures at Journeys coupled with the lost store traffic and earnings resulting from January's unusually impactful snow and ice storms. Looking ahead, the efforts we've made and continue to make to contain expenses and drive productivity will better position us to withstand this pressure and emerge even stronger as sales growth returns. Turning to results for the quarter. Consolidated revenue was $739 million, up approximately 2% compared to last year, driven by sales increases in all divisions other than Journeys. Excluding the 53rd week, total sales declined 2%. Relative to our expectations, sales were largely in line with our revised guidance, with the exception of J&M, which was especially impacted by January's weather disruptions. Total comps were down 4%. For Journeys, although comps were negative 5%, the business continued to improve sequentially. Schuh comps were down 5%, driven by stores. Even with the January shortfall, J&M comps increased a healthy 8%. By channel, total store comps were down 7%, while direct comps were up 5%, with digital sales accounting for 27% of total retail sales, up from 25% last year. We ended the quarter with 69 fewer stores versus a year ago, largely the result of closing underperforming Journeys stores as we optimize our store footprint and drive productivity in our remaining store fleet. Overall, gross margin was down 10 basis points compared to last year, which was ahead of our expectations due to lower planned promotions at Journeys. With our consumers focused on purchasing key items, discounting was not as effective in driving sales, so we moderated our promotional stance. Relative to last year, Journeys' gross margin was down 30 basis points due primarily to product mix shift. Schuh's gross margin was down 10 basis points versus last year, while J&M's gross margin increased by 70 basis points, driven largely by lower freight expense and a favorable mix shift to retail versus wholesale, partially offset by higher retail markdowns. Lastly, Genesco Brands gross margin was up 420 basis points as we lapped last year's freight and logistics cost pressures and benefited from price increases this year. Moving down the P&L. Adjusted SG&A expense was 41.1% of sales, 170 basis points above last year, with roughly 60 basis points of the increase attributable to the 53rd week. While the 53rd week added to our top line, it was a low sales volume week that was particularly dilutive to our bottom line. Adjusting for the 53rd week, SG&A expenses were relatively flat in absolute dollars compared to last year, despite additional variable expenses associated with our direct sales growth, reflecting the impact and benefit of our cost savings initiatives. The increase in operating expenses relative to our guidance was primarily driven by Journeys in addition to the incremental cost to support higher-than-expected direct sales. Product returns to our vendors resulted in greater-than-anticipated wage and freight pressure. Finally, we experienced additional store expenses, including occupancy costs. Lowering overall occupancy costs and reducing the amount of fixed expenses in the store channel remains a key priority. In Q4, we achieved a 15% reduction in straight-line rent expense on 47 lease renewals across the company with an average term of approximately three years. This brings our full year fiscal '24 renewals to 202, resulting in a 15% reduction in straight-line rent expense. With over 50% of our fleet coming up for renewal in the next couple of years, we continue to have a lot of runway to capture additional savings. In summary, for the fourth quarter, we realized adjusted operating income of $38.5 million compared to adjusted operating income of $51 million for Q4 last year. This all resulted in adjusted diluted earnings per share of $2.59 for the quarter versus earnings per share of $3.06 last year. For the 53rd week, operating income was an estimated loss of $2.6 million, or approximately $0.18 per share. Turning now to capital allocation and the balance sheet. We ended the quarter in a slightly positive net cash position and generated approximately $108 million of free cash flow. We ended the year with clean inventories, down 17% from last year. With respect to Journeys, we worked with our brand partners to adjust inventory levels, enabling us to end the quarter with inventories 22% lower than last year, and well positioned to bring newness and freshness to the assortment. Our strong cash flow, balance sheet, and liquidity under our revolving line of credit provide the financial capacity to support all our strategic efforts. Capital expenditures in Q4 were $10 million, with investments primarily directed to retail stores and our digital and omnichannel initiatives. We opened five stores, primarily off-mall, and closed 24, ending the quarter with 1,341 total stores. Lastly, we didn't repurchase any shares during the quarter, but bought back 10% over the year, and our current authorization remains at $52 million. Over the past five years, we have repurchased almost 50% of our outstanding shares. Regarding cost savings, when you combine our efforts to increase the variability of our cost structure with savings under our cost savings plan, we made meaningful progress on expense reductions in fiscal '24. Our updated plan now targets a reduction in annualized run rate before reinvesting of $45 million to $50 million by the end of fiscal '25, which is above our original target of $40 million. We expect savings from reduced store rents, selling salary productivity gains, reduced warehouse and logistics costs, and reduced freight costs from inventory optimization initiatives. With respect to store closures, we closed 94 Journeys stores in fiscal '24, or roughly 8% of the total fleet. For fiscal '25, we are aiming to close up to 50 more Journeys stores. Savings from these closures will eliminate approximately $14 million of annualized costs from SG&A expenses, which adds to the roughly $25 million of annualized savings from the stores closed this past year and is in addition to the $45 million to $50 million of run rate savings we expect to achieve by the end of this year. The goal of these cost savings and store closure programs is to gain better expense leverage and expand operating margin even with modest increases in sales. Now turning to guidance. Recognizing that we're starting this year in a difficult position given the product challenges we are facing, I'd like to start providing some specifics around Q1. Starting with the top-line, we don't expect to see the demand curve improve within Journeys' core product assortment, which makes up a sizable portion of our spring business. That pressure will make it difficult to drive sales growth. As such, we expect a mid- to high-single digit sales decline versus last year, driven primarily by Journeys and, to a lesser extent, Genesco Brands Group. Regarding Q1 gross margins, we expect an overall gross margin decrease of 40 to 50 basis points, mainly due to product mix shift at Journeys and Schuh. As Q1 is also one of our lower volume quarters with expenses at minimum levels and largely fixed, the sales decline will result in roughly 320 to 350 basis points of SG&A deleverage, resulting in an earnings per share loss of approximately $1.10, more than we lost in Q1 last year. Moving to the full year, while we are confident that our turnaround strategy at Journeys can begin to drive improvements in the back half, especially for holiday, since this is a transition year for Journeys, we believe it's prudent to adopt a cautious view throughout fiscal '25 with opportunity for a more significant rebound in fiscal '26. We are also taking a more conservative view for Schuh and J&M as they both cycle robust multi-year compares. Taking this all into account, we expect fiscal '25 total sales to decrease 2% to 3%, or down 1% to 2% when excluding the 53rd week from last year. The variance between the high and the low end of the range is primarily due to uncertainty in the consumer and macro environments, particularly in the UK. Regarding EPS, we expect adjusted earnings per share in the range of $0.60 to $1. We expect a challenging first half to give way to positive earnings in the back half as back-to-school and holiday give us the opportunity to generate profitability on higher sales. Net-net, we expect improvement over last year to be weighted to Q4 as further pivoting the Journeys assortment will take time. We expect gross margin rates to be flat to up 10 basis points for the year, with improvement at Schuh mitigating some product and channel mix pressure at Journeys. As a percentage of sales, we expect adjusted SG&A to range from deleverage of 30 basis points to flat with the cost reduction efforts I described earlier and other actions working to partially offset deleverage on fixed expenses. All of these inputs result in an operating margin that is in the range of fiscal '24's operating margin. Our guidance assumes no additional share repurchases, which results in fiscal '25 average shares outstanding of approximately 11.3 million, and we expect the tax rate to be approximately 26%. In closing, we are taking aggressive actions to accelerate our Journeys’ turnaround, and while those efforts will take a little time to create impact in the P&L, we believe they will best position us to unlock Journeys' considerable earnings potential, return to growth and create meaningful shareholder value.

Thank you. We will now begin the question-and-answer session. Our first question is from Jeff Lick with B. Riley Securities. Please go ahead with your questions.

Good morning, everyone. Thank you for taking my question. I have a three-part inquiry. First, it seems that Journeys sales improved in January. The pre-release indicated a 6% decline, but it ended up being down 5%. Given the poor weather, could you elaborate on this? Additionally, Tom, you mentioned product challenges in your remarks. I am curious about what specific product challenges you faced in the first half and the first quarter. Lastly, there seems to be a perception that declining sales were the main issue, but it appears the real concern is with expenses, as you've noted unanticipated costs. To provide some context, in 2019, your gross profit was $317 million, but this year it increased to $342 million despite having fewer stores, although your SG&A has risen by $43 million. This suggests that expenses may be more of a problem than sales or gross profit. Could you clarify this for us? Thank you.

Jeff, thank you for your questions. Let's address them one at a time. You inquired about how Journeys sales improved in January. Indeed, they did get better. To recap the quarter's progression, we began well in November with a strong Black Friday weekend. However, sales dipped in December before picking up again in January. In December, we noticed that while customer traffic in our stores increased, shoppers were primarily focused on specific must-have items. Although we can usually encourage customers to consider other products, this year it proved more challenging due to various economic pressures. Moving into January, we observed a significant boost in our e-commerce business, which we have been developing over the years, so it was great to see that growth. The winter storms prompted many Journeys customers to shop online, and we also promoted clearance products, which attracted interest. This combination contributed to our success in January. Now, regarding product challenges in Q1, before I pass it over to Tom, we've made strides with Journeys this year. Coming into this year, after a relatively stable previous year, we faced a significant decline as consumers sought new styles different from their usual purchases. We experienced record years post-pandemic, but this led to a shift in demand. We have been working throughout the year to mitigate the gap that started with a 14% decline in sales. We have seen improvements. Journeys is well-positioned as the go-to place for teens looking for diverse products, from fashion athletic to casual items. Notably, while the hot products we anticipated for the fourth quarter sold well, some core products did not perform as strongly as expected, which poses challenges for the first half of the year. With new leadership in Journeys, including a new Head and Chief Merchant, we are actively pursuing products we believe will greatly impact sales. They bring valuable expertise and relationships that will help us further strengthen these connections. We are looking into additional products that will resonate well as the year progresses, especially with teens expanding their style choices across various occasions. This trend is promising for both fashion athletic and casual segments. Additionally, we see some exciting developments in apparel as we pursue greater demand for freshness and newness in brands that resonate with consumers now and throughout the year. I will now hand it off to Tom for the final question.

Yeah, Jeff, let me try to tackle the expenses and hit some of the points. I think the first one was an understanding of the expenses in January, and we did have some additional expenses more than we originally anticipated in Journeys, and it was around the store channel. Some of it was the occupancy cost for Journeys, and it's related to just some of the final timing of some store closures there as well as we had some additional costs in January over and above what we expected, processing some significant returns to vendors. As a result of that, the good news is we got our inventories down at the end of the year. Journeys is down about 22% related to the prior year, so there was some return on those additional expenses. And then, there was just some other additional store expenses related even to labor to process that return to the vendor. So that's the January number. When you look at expenses relative to calendar '19, our fiscal year '20, the important thing to point out is there's been a huge transformation in the business, and there's been a massive movement towards our direct business in all our businesses, especially Journeys. With that growth in our e-commerce business, there is an investment in operating expenses. So, you need to consider that when you're evaluating the growth in expenses. I think another thing to point out on expenses in terms of guidance going forward for next year is that it implies a significant reduction in our expenses going forward. We feel good about where we're at on expenses. And when you look at the guidance, you can see the traction we're getting, taking expenses out. Just another thing back on fiscal year '24, we achieved a lot of traction within the Journeys store channel, reducing expenses, so feel good where we are.

Just a quick follow-up then...

Yeah, go ahead.

Tom, I am curious about the timing of store closures, vendor returns, and the associated labor. It seems like it could have been easy to categorize those as non-recurring, but you did not. Do you have any insights on that and possibly an estimate of what that amount could have been?

It's part of the normal process, so we can't really classify those situations as non-recurring. We were hoping to use this conference call to discuss some of those one-time events.

Yeah, we had an aggressive push, and I think the great news is that we are in terrific shape in our inventory. Journeys is down more than 20%. And so, that, and we did that without having to take an excessive amount of markdowns. And so...

Right.

...we're clean. We've got ample open-to-buy to chase into the product that we know we will bring in during the course of the year. And so, I think that's the positive, and we had a chance to be able to push back more inventory that didn't work to our brand partners who've been exceptionally cooperative and are excited about being able to work with us to bring new styles in and to bring in to feed some of the trends like clogs and the fashion athletic that we see a lot of appetite for.

Good morning, and thanks for taking my question. Mimi, longer term in nature, curious to how you think about the go-forward margin trajectory for the business, and what the right margin profile for the enterprise might be more broadly, and what are the building blocks to get you to that level over a multi-year time horizon?

Thank you for your question, Corey. I’m pleased to report that both Johnston & Murphy and Schuh have achieved record years consecutively, reflecting the extensive efforts we've put into these businesses. The pandemic brought significant changes in consumer behavior, and both brands faced challenges in the past. We focused on revitalizing them through strategic actions related to product, marketing, and technology, enabling them to return to mid-single-digit operating income levels historically achieved. Now, regarding Journeys, its value proposition remains robust. We have a proven track record of navigating various cycles effectively. However, the current cycle is distinct due to multiple influencing factors, and we are confident in the Journeys business, which is a key destination for teens and plays a vital role in their fashion footwear choices. Our partnerships with brands are strong, and we are actively discussing new product introductions to cater to teen demands. Journeys is a resilient business. Our ability to handle economic fluctuations and trends is evident from our history. Our business model provides flexibility to pivot towards trending brands and rotate our product offerings effectively. Importantly, there are opportunities for growth in our digital segment, which is not only profitable but also contributes positively to our earnings, with double-digit profitability in digital. While Schuh's digital business stands at 40%, Journeys is currently below that, presenting a significant growth opportunity down the line. To improve our cost structure, we've implemented several measures, including closing underperforming stores and optimizing productivity and expenses, which will positively impact Journeys' overall profit and loss. The main challenge we face, as Tom mentioned, is the need to manage our expense base in relation to negative store performance. The solution lies in rebuilding and driving sales. Our focus is on increasing sales through introducing new and fresh products, benefiting both in-store and online sales. I am confident that we can return to historical levels of profitability for Journeys, especially within the mid-single-digit range, provided we achieve positive comparable store sales.

I would like to mention that on the branded side of the business, particularly with Johnston & Murphy and our Genesco Branded group, we are seeing significant progress in enhancing our gross margins. We have plans in place to further boost our gross margins in this area, which will contribute to improving the overall operating margin of the company.

Great. Thanks. And then, just to double-click on gross margin, it sounds like there's an expectation for sales to be down this year, but gross margin to be up. So, Tom, could you just maybe walk through how to get to that from the first quarter through the full year? And what the underlying drivers are? And maybe rank the drivers, if you could?

Let me begin, and then I'll pass it to Tom. We have maintained our inventories in great shape throughout the year, which means we haven't had to take markdowns anywhere near what others in the industry have faced. In fact, we exceeded our gross margin expectations in the fourth quarter. We don't expect significant pressure from markdowns due to our clean inventory levels. Although there is some minor pressure from the brand mix in both Journeys and Schuh, we have other initiatives in place to support gross margin. We anticipate a slight increase, and now I'll turn it over to Tom to discuss that further.

We expect our performance to be flat or slightly improved for the year, and Mimi highlighted an important aspect of the promotional environment we're anticipating on the Journeys side. Additionally, we are actively working on initiatives to enhance gross margin in our Schuh business, and we will see some positive results from that.

Some of that is related to renegotiated freight contracts. We've got more efficiency within our distribution centers, both in the U.S. and the UK, which will allow us to have more efficient warehousing and distribution expenses.

And then, on the branded side of the business, we expect to see some improved margins there as well. But one thing to point out in terms of the cadence in that, in the first quarter, we're expecting some decline in gross margin, and that's mainly around the product mix in both Journeys and Schuh in the first quarter, and that seems to moderate as the rest of the year goes by.

Yes. Thank you. Can you guys hear me okay? I'm having some phone issues.

We can.

We can.

Okay. Good. I've got a handful of questions. I'm going to maybe just do these one by one. First on Journeys, you mentioned the sequential improvement in Q4. Has that continued through February? Or have you seen the business kind of fall back again?

So, when you think about the fourth quarter, I just talked about how January picked up a bit. The key here, Mitch, is that what emerged over the holidays is that our consumer moved further away from core products. While we made improvements in terms of the winter assortment brought in and the newness and freshness, it's the core product that the consumer moved further away from. That is core product that we anticipated to carry into spring. That is really what we have focused on in terms of our outlook for the first quarter that we'd have pressure as a result of that. We wouldn't anticipate that trend would pick up further. We have had nice sequential improvements, but we expect we'll sort of be where we are, at least for the first quarter of the year; that will improve a little bit as we can bring product in and affect the trend in the back part of the second year, even more pickup in the third quarter, and we have a huge push in the fourth quarter just given the overall lead times for footwear, which are in the range of six months.

And then on Journeys, so you're expecting Journeys comp to be down mid singles for the year, I believe, if I read the presentation correctly. It sounds like from a sales standpoint, you expect the most pressure in Q1. So, what is your plan for Journeys in the first quarter? Are you expecting it to be down like double digits?

No.

No, not expecting it to be down double digits.

Right, yeah.

And for the year, I think we just need to check that number...

Yeah, I don't think we gave...

...for the year.

Correct.

Okay. It looks like in the presentation, you've got Journeys down mid-single digits, but I guess that's on a sales side, not a comp side.

That's right. We have it correct.

That's correct. That is because of the stores that we've closed that are unproductive.

Right. That's right.

Okay. And then, on Schuh, I know that you're lapping some difficult comps in the first half of the year. You guys were, I think, double-digit comp last year in the first half. So, how are you thinking about the shape of Schuh for the year just given tougher compares in the first half and then that easing in the back half?

Yes, that's correct. In the first half, we anticipate the most challenges for Schuh due to strong comparisons from previous years. We believe there will still be pressures on Schuh, especially given the tough economic conditions. However, we expect some relief in the second quarter. We see potential for Schuh in the latter part of the year, especially with the holiday season and back-to-school period approaching. The inflation rate is decreasing, and UK consumers are adapting to the higher prices. As the inflation issues improve, we expect consumers to have a greater willingness to spend in the latter part of the year. Additionally, the recent wage increases in the UK are expected to positively impact consumer spending. Despite the challenges, Schuh has been gaining market share in a difficult environment. Retail sales in the UK were down during the holiday season, but as consumers bounce back and we move into the spring season, we anticipate demand for spring products and sandals, which we hope to capitalize on in the latter part of the year. So, it is indeed a challenging start to the year, paving the way for a more optimistic latter part.

I'm trying to understand your confidence in the Journeys business improving in the second half of the year. During the holiday season, boots were underperforming, but you mentioned selling out of important items. In the first half of the year, you noted challenges in the core business for spring. As you look ahead to the second half, are you expecting better access and allocations for these key items? Also, regarding the core business, do you see any positive changes? You mentioned difficulties with vulcanized products in Q4; are you expecting improvements in that area or are you shifting focus to other core products that could perform better? I'm trying to clarify how much of this improvement is due to better allocation of key items versus changes in the core business in the second half compared to the first half.

So, a lot of questions there, Mitch, but we are absolutely anticipating that we are going to be getting better allocations of products. We are absolutely anticipating that we are going to be shifting into brands and increasing the assortment in the brands that are working. We've got line of sight into what those are. We've actually got line of sight into a bigger order book based on the actions that we have already taken. When I think about the strength of our Journeys' merchant relationships, we have doubled down on that by bringing in even more expertise that our new Chief Merchant and Andy have, as well as the relationships they have with the brands that are really important. So, it's a full-court press to get more allocation of items that we are excited about, diversifying our mix with brands that are working today. We absolutely do not anticipate that core products that we've been selling traditionally will rebound; instead, the vulcanized products that I referenced will not be rebounding. It is about introducing additional products on the athletic and casual side to be able to build sales throughout the course of the year.

Okay. That's helpful. I appreciate the color. So, thanks, and good luck.

All right, thanks.

Thank you.

Thank you. At this time, I will turn the floor back to management for any further remarks.

Great. Thank you for joining us today. We look forward to you joining us on future calls where we're going to talk about the progress that we are making within our Journeys business. And thanks again.

This will conclude today's conference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.