Good morning, and welcome to the 1-800-FLOWERS.COM, Inc. 2Q 2021 Conference call. Please note this event is being recorded. I would now like to turn the conference over to Joe Pititto. Please go ahead..

Thank you, Grant. Good morning, and thank you all for joining us today to discuss 1-800-FLOWERS.COM, Inc's. Financial Results for our Fiscal 2021 Second Quarter.

For those of you who have not received a copy of our press release issued earlier this morning, the release can be accessed at the Investor Relations section of our corporate website at www.1800flowersinc.com. Our call today will begin with brief formal remarks, and then we will open the call to your questions.

Presenting today will be Chris McCann, CEO; and Bill Shea, CFO..

Thank you, Joe. So this morning we are very pleased to report the highest quarterly revenue and profit in our company's history. This reflects a continuation of the momentum that we've been building over the past several years, including accelerated revenue growth that began in our fiscal... .

Pardon me, we seem to lost connection to your line again, Chris. We can no longer hear you..

Thanks, everyone. I apologize for the technical difficulties. It's good to have somewhat of a backup plan in place, and it's a heck of a way to kick off a celebration of a great quarter. So let's jump back in.

So, as I started to say, this morning, we are very, very pleased to report our highest quarterly revenue and profit in our company's history, and this reflects the continuation of the momentum that we've been building over the past several years.

This includes the accelerated revenue growth that we saw begin in fiscal '18, continued through '19, and into fiscal '20 and accelerating further since the start of the COVID pandemic.

Our record results for the quarter were driven by strong double-digit e-commerce growth across our Gourmet Foods and Gift Baskets brands in our market-leading 1-800-Flowers brand and in our newest market-leading brand, Personalization Mall.

Our strong e-commerce growth, combined with excellent operational execution, enabled us to drive record adjusted EBITDA and EPS results despite the significant headwinds that we faced in the year-end holiday period, including what we're all familiar with the increased labor and product shipping costs as well as operating inefficiencies related to the ongoing pandemic..

Thank you, Chris.

As noted, we achieved record top and bottom line results for our fiscal second quarter, despite the significant headwinds that we told you about as we headed into the year-end holiday period, including increased costs for seasonal labor, volume constraints from third-party shippers, higher shipping costs related to the holiday season, COVID-related expenses and operating inefficiencies related to the ongoing pandemic.

This was no small achievement and all our associates across the company are to be commended for going above and beyond in a very challenging environment to help millions of our customers stay connected and express themselves to the important people in their lives. Now breaking down some highlights from the quarter. First, in terms of revenue.

Total consolidated revenues increased 44.8% or $271.6 million to $877.3 million compared with $605.6 million in the prior year period. The strong growth was driven by e-commerce growth of 59.7%, including revenue contributions from PersonalizationMall.com, which we acquired in August, 2020.

Excluding PMall, total revenues increased 24.7% and e-commerce revenues increased 34.6% compared with the prior year period. Gross profit margin for the quarter increased 100 basis points to 45.4% compared with 44.4% in the prior year period.

The gross margin improvement primarily reflects strong PMall gross margins and our successful efforts to reduce promotions during what is typically a highly promotional environment. These efforts more than offset higher costs associated with seasonal labor and third-party shippers.

Operating expenses as a percent of total revenues was 28.6% compared with 28% in the prior year period. The slight deleverage in the quarter reflects several factors, including investments we have made in enterprise marketing, personnel and programs designed to help drive future strong growth.

The acquisition of PMall, which has higher gross profit margin, but also higher operating costs compared with the overall company and the impact in the quarter of the higher investment income associated with our company's nonqualified deferred compensation plan with the offset being compensation expense.

Combination of these factors resulted in increase of 48.4% or $53.6 million in adjusted EBITDA to $164.3 million compared with adjusted EBITDA of $110.7 million in the prior year period.

Net income for the quarter increased 53.3% or $39.5 million to $113.7 million or $1.71 per diluted share compared with net income of $74.2 million or $1.12 per diluted share in the prior year period..

Thank you, Bill. So to sum up, again we achieved the highest quarterly revenue and profit in our company's history. We've had a tremendous holiday season with strong customer demand, truly incredible execution, offsetting the headwinds that we told you about back in the fall.

And I just can't say enough about how proud I am of how well our associates rose to the occasion during this very challenging environment.

Now during the quarter, we saw a continuation of strong growth in new customers, increased frequency from our existing customers, more customers signing up for Celebrations Passport and more customers buying from multiple brands.

The strong growth in enhanced behaviors that we're seeing in our customer file give us the confidence in our outlook for continued strong revenue growth going forward.

Importantly, the strong momentum that we have been building for the past several years now in our top and bottom line results, reflects the investments that we've made and continue to make in our technology stack, digital marketing and innovative merchandising programs, our laser-focused initiatives in customer experience and customer care and in strategic and highly accretive acquisitions.

As a result, we have built a highly scalable and leveragable e-commerce platform that is designed and built for growth. We're confident that our business platform positions us well to continue to drive growth, both near and longer term.

Now before I turn the call back to Grant to provide instructions for the Q&A portion of the call, I'd like to again thank all of our associates as well as our vendors and suppliers for their hard work and commitment to helping our customers solve for their connective and expressive needs, sentiments that are more important than ever in today's environment.

With that, I will turn the call back to you, Grant. Thank you..

First question today will come from Dan Kurnos with The Benchmark Company..

Congratulations on the quarter. I thought the revenue number was a misprint. But just, Chris, I mean, look, the kind of the key here, I think, maybe just talk about PMall a little bit. I think it was some probably 50% higher, $120 plus million in the quarter than where we -- most people were expecting it to come in.

I know there was a lot of underlying strength in e-com demand, but we were talking originally when you walked us about non-complete integration by the holiday period. I know you were really pushing hard for it.

Can you just give us some color around either cross-sell -- about -- around any of the metrics or learnings you've had, and how much more do you have to do here to get kind of full integration if you're not there yet on PMall? I am just trying to get a sense of where the growth rates on this thing can actually go?.

Yes, Dan, thank you very much. We really couldn't be more pleased with the acquisition of PMall than we are right now.

And from an integration point of view, we did focus on some efforts early in the beginning making sure that we got it up in one form or fashion on our Multi-Brand site, integrated the customer database so Passport customers would have access to PMall. So, we did some of those things. A lot of the integration is still yet to come.

There was limited capabilities that we could do before we really hit holiday time, when then we would think the risk factor was too high to mingle with it at that time. But the fact of how we've added that to our platform now, you'll see PMall products on the flowers side for Valentine’s Day this year, showing further integration.

It's really given us great capabilities that we're starting to integrate across the company, across the brands, moves us into a whole new category for our customers. So, we really couldn't be more pleased with it and the progress that we're making.

Then from an early point of view, one of the early areas that we said we were going to focus on from an integration was really on the marketing side of things in the digital marketing. And now, we're really happy with the early first holiday season results helping to increase its growth rate.

Bill, why don't you give a little more color on that?.

Again, as Chris mentioned, we're tremendously pleased with the results of PMall. You were able to do the math, we'd like to leave a little math for you guys to do within the earnings call, but -- and the earnings release, but the $122 million is a pretty accurate number. That is what we achieved. They were up 50% year-over-year.

I think a lot of people had about $80 million in their models, and they did contribution margin of $25 million, $26 million, so significantly profitable business, so we're extremely with the results..

And a really good team of people there, Dan, that integrating well with us, meshing with our teams. And really, it's a really strong operational team that we're very, very proud of..

That's super helpful. And then just as we look into calendar Q1, fiscal Q3 here, we know Valentine's Day is on a Sunday, you kind of pointed that out, which has been historically bad, but we have still, obviously, the lingering effects of COVID.

Everybody at home just kind of trying to gauge -- look, obviously, the guidance you've given is well ahead of where people are too.

And so, we're seeing that momentum but just trying to gauge, are you going to be able to -- and I know it is probably not quite like Mother's Day, but is there some flexibility, may be earlier in the week around shipping dates and how you're kind of working around that?.

Right, as we look at Valentine's Day, you're right, there's a day placement shift there.

Bill will cover that in a minute, but what we're looking at is the ability to change things around and looking at this holiday season instead of just a decrease that we normally would expect, we're such well positioned right now as a company, much better than we were even a year ago, and we're bigger, we're better. We have a stronger customer file.

We have consumer demand. We have broader product categories. So, as we’ve headed into this quarter, even with that headwind, gives us the confidence with the guidance.

And Bill, why don't you cover that in a little more detail as well?.

Yes. As we mentioned in the -- in our release and in the call this morning, we're providing overall guidance for revenue growth of 45% to 50% with the contributions of PMall, it still represents 35-plus percent organic growth, and that builds in the impact of the Floral brand and the Sunday day placement.

Typically, when we move from a Friday, which is a great day placement for Valentine's Day to the weekend into a Sunday, revenue is usually impacted and decremented by about 20%. This year is certainly atypical due to the pandemic. Most recipients are not going to be in the office.

We do anticipate that we're going to be able to achieve double-digit growth within the Flowers brand. And that combined with a very strong everyday gifting that we're seeing within the Flowers brand, within our Food brands, and within PMall, leads us to the overall topline growth.

But on top of that, there's a lot of headwinds that were -- that we continue to face from a cost perspective, and we're very pleased to be providing guidance of adjusted EBITDA improvement of approximately $7 million turning what is typically an adjusted EBITDA loss quarter into a positive quarter.

And therefore, we'll have all kind of 4 quarters positive for the year..

Got it. Really helpful. Last one, if I could just -- I mean, Chris, look, I get not wanting to give guidance, right, given the tough comp coming up and sort of just the uncertainties.

But I guess, maybe if I just ask from a high level, you're now building what effectively is four straight quarters of challenging comps, but it seems like the business is just underlying accelerating.

Should we just be thinking of this as kind of the new baseline for the business that we can kind of grow off of these levels?.

Well, I think what you're seeing here is that the momentum we have going into the pandemic, the acceleration that we've got from pandemic, decisions we've made to jettison the retail at Harry & David and double down and focus on e-commerce, the customer file that we've built, which is -- it's been a pivotal moment for us -- for our company to really seize the opportunities that have been presented.

So I think you're right, Dan. I think that we're in a much better position than we were a year ago. We're a bigger, stronger, better company better assets, the additional acquisitions that we've done put us in place, and we're looking at good growth rates going forward..

Our next question comes from Anthony Lebiedzinski with Sidoti & Company..

So in previous calls, you guys talked about the Friday placement of Christmas being beneficial. Did that kind as you expected? And also just wondering as far as -- I guess, based on the strong -- also it doesn't seem like much of an issue, but as far as third-party carriers.

But if you could just touch on that as far as if you had any issues with FedEx or any of the other carriers, that would be great?.

Yes. I think as we did the Christmas Day placement was beneficial for us. It gave us 2 extra shopping days in the season compared to last year. So that ramped up. So much of our volume really came in earlier than that last week than it normally does. And that also gave us the capability to push the numbers a little bit.

The 27% e-commerce growth that we got in the Gourmet Foods brands, as an example, Anthony, was a little bit ahead of our expectations. So we're able to achieve that.

On the shipping distribution front, Bill, why don't you cover that?.

Yes. I'm going to reiterate with Chris. I think there were so many stories about shipping challenges that the consumer is trained to buy a little earlier, which did kind of create an earlier demand than we normally have. So that wasn't kind of the late push, which we would have otherwise gotten a benefit with the Friday day placement.

There certainly will continue to be challenges within the shipping environment. We had to go into the quarter, planning for volume constraints with it, and we manage very well. We have a great partner in FedEx that does a lot of our a significant amount of our shipments and work with them daily on any of the challenges that we have.

But we did have increased costs, and we had to absorb those within that. I think increased shipping costs are the new normal. Basically, the third-party carriers have instituted what essentially are permanent surcharges.

They start off with, first with COVID surcharges, then it became holiday surcharges and now with past holiday, so we have a new set of surcharges. So kind of increased shipping costs was new normal, we all have to adjust for it. I think we've done a very good job.

I think we've historically demonstrated our ability to absorb challenges that we have with regard to whether it be shipping costs or increased labor costs and build it into our plans, automate certain things to help offset these items..

Got it.

So is there any way you can quantify these higher labor and transportation costs, higher shipping costs, any sort of ballpark estimate as to how much that impacted the quarter?.

I mean they're significant, Anthony, but bottom line, I think they're here to stay. So it's not like they're going to go away, and all of a sudden, we're going to have these positive comps in those areas going forward. We're going to have a $15 minimum wage rate across the countries.

We've operated in that environment already in Oregon as they've stepped up towards that $15 rate. In other locations, we don't have that but we've been -- because of supply and demand on labor, we're already paying very close to those rates. So these are here to stay, increased labor costs, increased shipping costs are kind of here to stay.

We have to continue to invest to automate what we can in the manufacturing and distribution side of our business so that we're less reliant on that seasonal labor force. But these are the things we do. Each year, we face with challenges, both short term and long term. And we address them and continue to grow both top and bottom line..

And all of that, Anthony, is part of the reason why we're really pleased to provide the guidance for Q3, the nice improvement on the bottom line that we're showing, taking it from a loss, you know, positive in this quarter, even with those new increased costs..

Got it.

And then last question from me to -- just give us a sense as to the order vol versus AOV quarter?.

Yes go ahead -- Bill, go ahead cover the AOV..

Yes. I mean AOV was up a couple of points during the quarter. It was really mainly driven -- the e-commerce growth was mainly driven by volume..

Our next question will come from Michael Kupinski with NOBLE Capital Markets..

Congratulations, some companies would have problem scaling to the level of revenue growth you've achieved over the last past year. And I think it's a great testament to you and your team to successfully handle that type of revenue growth you've gotten. So congratulations. My question is going back to the seasonal labor and the cost there.

As you mentioned, you had some markets that are already implemented a $15 minimum wage.

I was just wondering in terms of how -- in those markets, how competitive it's been? Have you been able to get labor at $15 an hour? Or do you have to raise your wages higher than that? And in those markets where you have not seen the minimum wage, I know given the competitiveness of what you see for seasonal labor, are you -- I'm just kind of trying to get a sense of how the minimum wage is impacted your seasonal labor hiring and the cost for seasonal labor in the markets that you've already seen that?.

Yes. So I'll give 2 examples. Oregon is a minimum wage state. It's not at $15 yet, but it's phased up towards $15. And every year, we get a step-up in what the minimum wage is, and we pay above that. Ohio, another big state where we have a lot of employees, is not a minimum wage state or has not been.

However, as you mentioned, Southern Ohio is kind of the distribution capital of the world. So it really becomes more of a supply and demand issue, which drives higher wages in that market. It is tough to get employees.

I mean, both -- the combination, I think we always -- we have said this before that when the unemployment a year ago was at 3.5% and then at the beginning of the pandemic, it jumped to double digits, we anticipated that labor would be not as much of a challenge going forward.

But as unemployment came down -- but because of the COVID environment that we're operating in, labor was still tough to get. So supply and demand still drives higher wage rates. Our answer to that is we need to attract that. We need to bring that labor in. We need to pay what the market rates are that drive that, but we continue to invest in automation.

And that's how -- and we have big projects. Some of them were stalled during the pandemic. We've launched some big automation projects going forward, and that's going to allow us to be less reliant on the seasonal labor force..

Yes.

I think, Michael, to your comment and you complement on the beginning of your question about the scalability of our business, in addition to focusing on the scalability that I referenced in my opening remarks regarding scalability of our IT platforms, we're looking at the full platform, including our manufacturing and distribution platforms and making the appropriate investments there to scale into the future to handle the demand that we see..

And then in terms of PMall, kind of going back to the significant amount of space and facilities that you've acquired there, can you talk a little bit about your now? I know you haven't been into PMall that much, but you still have such a large facility there.

Have you thought about the integration on the facility? And what you -- how you might use the facility at this point?.

We've begun some discussions on that, Michael. No rock solid plans there yet on how we utilize that facility further than what it is currently being used or how we integrate some of the personalization capabilities into some of our other facilities as well. Again, looking to move that product line closer to the customer around the country.

So as we talk about investing into this distribution and manufacturing and assembly capabilities of our business. Those are the things that are in consideration now, but no hard plans in place at this point..

My final question is about gross margins. You said that it benefited from reduced marketing spend. And of course, this could be because of your scale and your broad platform, but it also might just be due to the fact that you're just seeing e-commerce sales being very strong.

So can you provide some color on your decrease in marketing spend in the quarter? What do you believe will be the sustainable gross margins going forward? And just kind of give us an idea about whether or not you're currently just benefiting from the platform of adding more onto your platform and not really seeing the type of incremental increases in market spend?.

Thanks, Michael. I think as we look at the marketing spend here, and as we look at last year, last year, we had extremely low marketing costs as we went into the pandemic. So we're seeing those marketing costs return to normal. But because we're seeing effectiveness, we continue to lean into the growth rate.

We continue to lean into new customer acquisition with the marketing spend. As long as we're getting the proper return on ad spend we'll continue to push that.

How that might impact gross margin, Bill?.

Yes. So let's just be clear, when we're talking about marketing spend, what affects gross margins is promotions and discounting. Actual marketing advertising spend sits in operating expenses. So what we saw in the second quarter was a reduced level of promotions in what is normally a very promotional environment.

We were able to pull back our promotions in the quarter, and that helped offset a bunch of the headwinds that we've talked about with regard to seasonal labor and transportation costs and operating inefficiencies because of the pandemic, which allowed us to produce better gross margins year-over-year.

As we reported, gross margins were up 100 basis points for the quarter. PMall was a big -- was a nice contributor to that because they have high gross margins. Without PMall, we're still flat with gross margins, but even that was a bit of a mix because we saw better margins on the 1-800-Flowers brand.

We saw better margins within the Food brands, but because the Floral brand grew higher and traditionally has lower gross margin, that mix blended to the overall 44%. I think what we see going forward is we're going to continue to -- we started to do this before the pandemic was be less promotional.

We want to get our messaging out about -- on our products and our brands and be less promotional. So I think we will continue to be less promotional going forward, which is going to help gross margins and help offset those ongoing headwinds that we have on cost.

From a marketing side, we actually did, as Chris mentioned, we actually leaned into it a little bit. We're getting a good return on it. We'll spend some more dollars to help drive growth, both revenue growth as well as customer file growth because we think that bodes well for the future..

Our next question will come from Linda Bolton-Weiser with D.A. Davidson..

So not to rain on your parade here because it's a great quarter, congratulations, but your organic sales growth is decelerating from when the pandemic started. Although you are guiding to a reacceleration next quarter.

But can you kind of give us some color or some feel on why the growth would be decelerating? Is it just as the world reopens, there is just simply less need for kind of remote gifting, or kind of what is the phenomenon that's going on? I mean, why would your business really slow at all here, even though it was a very high-growth rate, which can't be expected to continue, but the growth rate has slowed a bit.

Can you give a little bit of color?.

So Linda, after we significantly outperformed the consensus revenue numbers, just if you have a -- I mean, the bottom line in the second quarter is different than the rest of the quarter. I think we guided as we went into the quarter saying, we have volume restrictions that the third-party carriers have put on all e-commerce companies.

We have to live within that. The tremendous growth in overall industry e-commerce has put a lot of pressure on the third-party carriers. So they outlined, starting back in the summer, there have been tons of stories about that, about the constraints that -- and the pressure, the on-time delivery of the third-party carriers were suffering.

So they put restrictions on it. We've talked about some of the labor challenges that all companies are having in this environment. So the ability to produce all the inventory to ship out, even if there were volume constraints from the third-party carriers. So those is what impacted the second quarter. With that said, we had a tremendous second quarter..

And when you look at that, Bill, first of all, if you can't look at us as a quarter-to-quarter sequential basis, right, because of the seasonality of our business. And certainly, Linda, you understand that. So -- and as we look at the Gourmet Foods category, for example, is where we've had most of the restrictions that Bill just mentioned.

We grew e-commerce there 27%, certainly a real strong result. That's our largest quarter, led by the Gourmet Foods category.

One of the other areas that we said in our last call when questioned, where could there be some upside in the business for the calendar fiscal Q2, calendar Q4? We said, well, we don't probably see a lot of upside in Gourmet Foods. We did get some, but where we saw upside was in Consumer Floral where it continues to grow.

And there's certainly been no deceleration in Consumer Floral growth as we've gone forward here, hitting about 58%....

58% in the quarter..

58% in the quarter. So BloomNet hitting 33% growth. So I'm not sure really what you're seeing in deceleration..

Great. And can you remind us when you come up against that comparison of 54% organic growth in the June quarter, when the pandemic hit was the demand sort of coming -- did it come late in the June quarter last year? Or was it right from the get-go in April? As soon as the pandemic hit, you had strong growth really throughout the quarter.

Is there any way you can remind us about how that worked last year?.

No, it was strong right from -- really from day 1. Actually, what we saw is initially a little hold on the Floral side of the business, but the Food took off right away. But certainly, with Easter being April 10 or 11th, even Floral bounced right back, and we had very strong growth in the month of April, and that continued throughout the quarter..

And I think it's important to note that as we look forward and as we come up to some of those next quarter the comps going to be difficult? Sure, they're going to be difficult. Everybody recognizes that and understands that.

I think the fact that you have to look at our business, as I mentioned earlier, this has been a pivotal moment for our business going through this pandemic, the way we responded to it, the way we reacted to it, the momentum we had going into it.

So when we look forward, we see ourselves as a much bigger, much stronger, better positioned company, and we look at the trends that we're seeing. There's been a seismic shift of off-line to online sales that we are just so well positioned for.

The shift of consumer sentiment out there that we've all learned the need to express and connect, and our business, obviously, is well positioned for that. And then the third big trend that we see is the trend of nesting. And that's not going away either. And I think we were well positioned for that trend to begin with.

But now with the addition of PMall, it's even better. So -- and again, our focus as an e-commerce company, keep in mind, in Q2, we also lost a lot of revenue from the decision we made on the retail stores that we didn't have this year in Q2. So we got to factor that into our growth rates.

But that just keeps us laser-focused on what we're doing, how we're building our customer file. So will we grow in the future? Yes..

Our next question will come from Doug Lane with Lane Research..

Just on that note of the retail stores here, Chris and Bill, I had in my model, that was about $20 million of revenue to you guys that is not there this year that was there last year.

Is that about right?.

That's about right..

And the wholesale..

And wholesale is down as well as we guided people to going into the quarter..

Okay. Fair enough. And getting back on the Floral, I mean, PMall obviously blew away my numbers, but also the organic growth at Floral was pretty astounding. To your point, Chris, and I wondered if you could give a step back and give us some color on the retail landscape at Floral. I know a lot of flower shops around here are closed.

I don't see them coming back.

Is there just a permanent dislocation going on at Floral? Or how do you view the whole retail market a year from now or so when we come out of the COVID thing?.

I think what we're seeing in the health that was seeing in BloomNet and Bill really referenced, Doug, what we saw in the benefits that we're seeing in BloomNet from the aid that we gave in the early pandemic. So I think as we look at the retail florist industry, there's always a different number of closings.

And certainly, many shops have been hit harder by the pandemic than others. And again, we're fortunate that as an industry we've been well positioned during this pandemic. And even while orders have shifted from offline to online, it still is benefiting the BloomNet partners for us from a fulfillment perspective.

So what we expected last summer was a little bit more of a challenge of shops closing up. It hasn't been what we expected. There are those situations, those unfortunate situations in every town. But I would say we have not really seen that acceleration there on the retail store side.

And as we look at our distribution capabilities, we continue to see the benefits of our franchise shops, our BloomNet shops as well as our direct ship capabilities and having that flexibility in the network works very well for us, especially as we manage the high-volume holidays like Valentine's Day coming up..

Okay. That's helpful. And just one more thing. You talked about your balance sheet. It's getting a lot better. You're getting all this cash in from the December quarter. Obviously, the acquisition strategy is on point, Shari’s Berries, Personalization Mall, and not what you guys do, but acquisitions, as you know, are difficult to time.

So what else can you do with the financial strength here as far as stock buyback as far as reinvestment in the business, CapEx, digital marketing? Just what's sort of the backup plan pending the next acquisition?.

Yes. Thank you, Doug. First and foremost, I think we've always been proven to be very good stewards of our balance sheet. And we utilize our balance sheet to drive investments in our existing business.

As we talked about some of the investments Bill highlighted a moment ago, certainly around the scaling up the operational capabilities of the a company, implementing automation, et cetera, investments in technology that we like to make. And as you've pointed out, I think we've proven very capable and adept at acquiring companies and integrating them.

You're right, you can't predict timing on that, unfortunately. And also, I think we've been very diligent in our approach, and we'll continue to be very diligent in our approach on the M&A aspect. So I think that's how we're looking to utilize our cash in general.

But Bill, why don't speak to buybacks, et cetera?.

Yes, we still -- our kind of our stated strategy is that we're going to buy back shares at a level design to offset any sort of share creep. We did in the first half of the year, spent about $12.5 million and bought back about 550,000 shares actually at a price of $22, I guess, we're pretty good stock pickers, too.

And if you look at the denominators on our EPS calculation, you'll see that our share count is slightly down year-over-year. So we are effectively implementing that strategy..

And Doug, our goal at the end of the day is to put our underleveraged balance sheet to work for our shareholders primarily through acquisitions that help us accelerate our growth..

Our next question will come from Tim Vierengel with Northcoast Research..

Just one question for you guys. I -- from my notes, I think you guys cited like a 40% to 50% growth in that kind of customer profile or portfolio during that pandemic shutdown quarter back in June last year. I was -- and if you look at the e-commerce growth rate, it's above that number.

So clearly, you guys are getting some leverage on the Multi-Brand customer front.

Can you guys speak more specifically about what you're seeing from both Passport and the percentage of people in your portfolio buying from multiple brands?.

Tim, thank you very much. As we look at the customer file overall, you referenced some earlier numbers from the earlier days of the pandemic. But even I think we see that growth in our customer file continue. As we mentioned, we'll continue to invest new customer acquisition when and where we see the opportunities.

This past quarter, I think we grew new customers north of 50% over last year. So....

Not including PMall..

Not including PMall, right, just kind of from an organic perspective. So I think that continues. And in addition to that, as you point out from our remarks, we're seeing good increases in retention and frequency, especially from our top cohorts, whether it be our top decile customers, our Passport members, customers buying for more than one brand.

And what's very encouraging is during this time period, we're seeing new customers convert into Passport at a higher rate than average at a higher rate than previous. New customers become Multi-Brand customers at a higher rate and then average and a higher rate we have been previously experiencing. So we continue to grow that file.

We have said previously that Multi-Brand customers were accounting for about 10% of our 12-month active file. We're not forecasting that, but that is growing, and that is increasing as time goes on very nicely.

So we'll -- so that's -- when we look at our customer file, we look at those behavior metrics, we look at what's happening to the new customers that have come on during the past year and see their behavior slightly than the average, we see that very, very encouraging..

No. I appreciate that color.

And I was wondering, looking deeper into the customer profile, if you guys could give us an indication whether those new customers are skewing younger or older? Maybe as older people get more accustomed to buying e-commerce wise? I know there's been some talk about younger consumers shying away from using a service like you guys? Just some color there would be great as well..

Yes. We're seeing good customer traction across the demographics. Each one of our brands may vary a little bit slightly from one to the other. But if we look at, Tim if we look at the Flowers brand, Flowers brand, really follows the population more than anything else from a demographic breakdown.

And without prowess in digital marketing, we continue to attract younger customers, some of our new product lines like the Jason Wu Wild Beauty Line. Our plants category is attracting new and younger customers as well.

And then if we shift over to the Gourmet Foods side, we've been saying for a while, the fastest-growing product category that we have in Harry & David is our Gourmet Foods line. And that's driven by also coupled with our digital marketing efforts, so that naturally invites a younger audience to the mix there as well.

So -- and then -- but I would also say that there's reports coming out right now that's saying, with the shift from off-line to online, the biggest category that's shifting offline to online is baby boomers and that's been the core of our business for a long time. So that benefits as well as we look to the future..

Our next question will come from Alex Fuhrman with Craig-Hallum..

Congratulations on a terrific quarter and a terrific calendar year. I wanted to ask about, I guess, sort of the pace of revenue growth as well. I mean, I would imagine, it sounds like a lot of the reason that your growth rate in percentage terms probably came back a little bit in the holiday quarter.

It's just a law of large numbers, given how big your base of business in. And as we're kind of looking into the March quarter, where obviously, you're guiding to revenue growth reaccelerating it to a very strong rate.

It crosses my mind that it looks like, I think last year, in the March quarter was, I believe, a record quarter for you guys in terms of Consumer Floral. And obviously, Valentine’s Day, I imagine, drove a lot of that.

So can you kind of give us sense how much room is there to continue to grow on the Floral platform given that, that becomes really your workhorse brand for the Valentine's Day and Mother's Day season? Can you give us a sense of how much growth potential there is in the years to come during those peak holidays if the demand is there?.

What we've built into -- and Alex, thanks for the question. We've built into our guidance for the third quarter, what we could do at Valentine’s Day for the 1-800-Flowers brand. Again, normally, under normal conditions, Valentine's Day would take moving from Friday to a Sunday, there would be a 20-plus percent decrement in revenues.

And we do think under the current circumstances, we're going to be able to grow that double digits. But -- so that's all built into our plan. We had a very strong third quarter a year ago. We had a 10% growth at Valentine's Day a year ago. I think we're tracking at around 10% for most of the quarter.

And then what I mentioned before, the outset the pandemic consumer flow dropped a little bit at the end of March and then picked right back up in April very strongly.

But we're continuing to build out our infrastructure so that we can handle the growth, not only every day where we have kind of unlimited capabilities to grow, but also at the peak time.

So that at holiday time in December and at the peak floral holidays of Valentine's Day and Mother's Day that we're going to be able to continue to handle the increased demand that we anticipate..

There being no further questions. This will conclude our question-and-answer session. I'd like to turn the conference back over to Chris McCann for any closing remarks..

So again, thank you, everyone, for joining us today. As we celebrate a record quarter for us in terms of revenue and profit, something we're very, very proud of, very proud of the team in how we've managed through this process during this very challenging time. So thank you. If you have any further questions, don't hesitate to call us.

We'll be glad to handle those questions. And of course, as we've talked on the call, don't forget Valentine’s Day is right around the corner. We have some great opportunities. We have some multi-gifting capability -- multi-day gifting capabilities for you to make sure you're saying I love you on numerous days, not just one day.

But get your orders early and remember this year, there are no limits on love. Thank you..

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect..