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The costs of these functions, other than those of the Customer Service Center, which are allocated directly to the above categories based upon usage, are included within corporate expenses as they are not directly allocable to a specific segment. The Company has established a NQDC Plan for certain members of senior management. Deferred compensation plan assets are invested in mutual funds held in a "rabbi trust," which is restricted for payment to participants of the NQDC Plan. 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Table of Contents

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024

 

or 

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___ to ___

 

Commission File No. 0-26841

flws20231231_10qimg001.jpg

 

1-800-FLOWERS.COM, Inc.

(Exact name of registrant as specified in its charter)

 

Delaware

11-3117311

(State of incorporation)

(I.R.S. Employer Identification No.)

Two Jericho Plaza, Suite 200, Jericho, NY 11753

(516) 237-6000

(Address of principal executive offices) (Zip code)

(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading symbol(s)

Name of each exchange on which registered

Class A common stock

FLWS

The Nasdaq Stock Market

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐         

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or such shorter period that the registrant was required to submit such files). Yes ☑   No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

 

☐Large accelerated filer

☑Accelerated filer

☐Non-accelerated filer

☐Smaller reporting company

 

☐Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ☐  No ☑

 

The number of shares outstanding of each of the Registrant’s classes of common stock as of May 3, 2024:

 

Class A common stock: 37,141,975

Class B common stock: 27,068,221

 

 
Table of Contents

   

 

1-800-FLOWERS.COM, Inc.

FORM 10-Q

For the quarterly period ended March 31, 2024

TABLE OF CONTENTS

 

   

Page

Part I.

Financial Information

  

Item 1.

Condensed Consolidated Financial Statements

1
 

Condensed Consolidated Balance Sheets – March 31, 2024 (Unaudited) and July 2, 2023

1
 

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) – Three and Nine Months Ended March 31, 2024 and April 2, 2023

2
 

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) – Three and Nine Months Ended March 31, 2024 and April 2, 2023

3
 

Condensed Consolidated Statements of Cash Flows (Unaudited) – Nine Months Ended March 31, 2024 and April 2, 2023

5
 

Notes to Condensed Consolidated Financial Statements (Unaudited)

6

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

19

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

35

Item 4.

Controls and Procedures

35
     

Part II.

Other Information

36

Item 1.

Legal Proceedings

36

Item 1A.

Risk Factors

36

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

37

Item 3.

Defaults upon Senior Securities

37

Item 4.

Mine Safety Disclosures

37

Item 5.

Other Information

37

Item 6.

Exhibits

38
     

Signatures

 

 

 
Table of Contents
 

 

 

PART I. – FINANCIAL INFORMATION

 

ITEM 1. – CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

1-800-FLOWERS.COM, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in thousands, except for share data)

 

  

March 31, 2024

  

July 2, 2023

 
  

(unaudited)

     

Assets

        

Current assets:

        

Cash and cash equivalents

 $183,956  $126,807 

Trade receivables, net

  26,779   20,419 

Inventories

  159,458   191,334 

Prepaid and other

  26,437   34,583 

Total current assets

  396,630   373,143 
         

Property, plant and equipment, net

  223,939   234,569 

Operating lease right-of-use assets

  114,784   124,715 

Goodwill

  153,577   153,376 

Other intangibles, net

  116,783   139,888 

Other assets

  34,269   25,739 

Total assets

 $1,039,982  $1,051,430 
         

Liabilities and Stockholders' Equity

        

Current liabilities:

        

Accounts payable

 $47,015  $52,588 

Accrued expenses

  138,004   141,914 

Current maturities of long-term debt

  10,000   10,000 

Current portion of long-term operating lease liabilities

  15,250   15,759 

Total current liabilities

  210,269   220,261 
         

Long-term debt, net

  179,432   186,391 

Long-term operating lease liabilities

  107,918   117,330 

Deferred tax liabilities, net

  22,599   31,134 

Other liabilities

  34,438   24,471 

Total liabilities

  554,656   579,587 
         

Commitments and contingencies (See Note 14)

          
         

Stockholders' equity:

        

Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued

  -   - 

Class A common stock, $0.01 par value, 200,000,000 shares authorized, 58,781,134 and 58,273,747 shares issued at March 31, 2024 and July 2, 2023, respectively

  588   583 

Class B common stock, $0.01 par value, 200,000,000 shares authorized, 32,348,221 shares issued at March 31, 2024 and July 2, 2023

  323   323 

Additional paid-in capital

  396,109   388,215 

Retained earnings

  285,845   271,083 

Accumulated other comprehensive loss

  (170)  (170)

Treasury stock, at cost, 21,514,159 and 20,565,875 Class A shares at March 31, 2024 and July 2, 2023, respectively and 5,280,000 Class B shares at March 31, 2024 and July 2, 2023

  (197,369)  (188,191)

Total stockholders’ equity

  485,326   471,843 

Total liabilities and stockholders’ equity

 $1,039,982  $1,051,430 

 

See accompanying Notes to Condensed Consolidated Financial Statements. 

 

1
Table of Contents
 

 

1-800-FLOWERS.COM, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

(in thousands, except for per share data)

(unaudited)

 

  

Three Months Ended

  

Nine Months Ended

 
  

March 31,

  

April 2,

  

March 31,

  

April 2,

 
  

2024

  

2023

  

2024

  

2023

 
                 

Net revenues

 $379,405  $417,566  $1,470,509  $1,619,047 

Cost of revenues

  240,688   277,126   874,167   1,009,383 

Gross profit

  138,717   140,440   596,342   609,664 

Operating expenses:

                

Marketing and sales

  105,828   106,472   376,903   390,077 

Technology and development

  15,291   14,837   45,417   44,529 

General and administrative

  32,295   25,922   87,938   81,075 

Depreciation and amortization

  13,232   13,267   40,578   40,276 

Goodwill and intangible impairment

  -   64,586   19,762   64,586 

Total operating expenses

  166,646   225,084   570,598   620,543 

Operating income (loss)

  (27,929)  (84,644)  25,744   (10,879)

Interest expense, net

  881   1,712   8,974   8,676 

Other (income) expense, net

  (3,574)  1,404   (5,836)  2,474 

Income (loss) before income taxes

  (25,236)  (87,760)  22,606   (22,029)

Income tax (benefit) expense

  (8,333)  (16,767)  7,844   126 

Net income (loss) and comprehensive net income (loss)

  (16,903)  (70,993)  14,762   (22,155)
                 

Basic net income (loss) per common share

 $(0.26) $(1.10) $0.23  $(0.34)
                 

Diluted net income (loss) per common share

 $(0.26) $(1.10) $0.23  $(0.34)
                 

Weighted average shares used in the calculation of net income (loss) per common share:

                

Basic

  64,489   64,767   64,703   64,660 

Diluted

  64,489   64,767   65,057   64,660 

 

See accompanying Notes to Condensed Consolidated Financial Statements.

 

2
Table of Contents
 

 

1-800-FLOWERS.COM, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders' Equity

(in thousands, except share data)

(unaudited)

 

  

Three Months Ended March 31, 2024 and April 2, 2023

 
                          

Accumulated

             
  

Common Stock

  

Additional

      

Other

          

Total

 
  

Class A

  

Class B

  

Paid-in

  

Retained

  

Comprehensive

  

Treasury Stock

  

Stockholders’

 
  

Shares

  

Amount

  

Shares

  

Amount

  

Capital

  

Earnings

  

Loss

  

Shares

  

Amount

  

Equity

 
                                         

Balance at December 31, 2023

  58,743,969  $588   32,348,221  $323  $392,849  $302,748  $(170)  26,369,336  $(192,978) $503,360 

Net loss

  -   -   -   -   -   (16,903)  -   -   -   (16,903)

Stock-based compensation

  12,262   -   -   -   3,046   -   -   -   -   3,046 

Exercise of stock options

  24,903   -   -   -   214   -   -   -   -   214 

Acquisition of Class A treasury stock

  -   -   -   -   -   -   -   424,823   (4,391)  (4,391)

Balance at March 31, 2024

  58,781,134  $588   32,348,221  $323  $396,109  $285,845  $(170)  26,794,159  $(197,369) $485,326 
                                         

Balance at January 1, 2023

  58,256,031  $583   32,348,221  $323  $383,335  $364,623  $(211)  25,838,644  $(188,127) $560,526 

Net loss

  -   -   -   -   -   (70,993)  -   -   -   (70,993)

Stock-based compensation

  4,166   -   -   -   2,487   -   -   -   -   2,487 

Conversion – Class B into Class A

  -   -   -   -   -   -   -   -   -   - 

Acquisition of Class A treasury stock

  -   -   -   -   -   -   -   1,757   (22)  (22)

Balance at April 2, 2023

  58,260,197  $583   32,348,221  $323  $385,822  $293,630  $(211)  25,840,401  $(188,149) $491,998 

 

3
Table of Contents

 

1-800-FLOWERS.COM, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders' Equity

(in thousands, except share data)

(unaudited)

 

  

Nine Months Ended March 31, 2024 and April 2, 2023

 
                          

Accumulated

             
  

Common Stock

  

Additional

      

Other

          

Total

 
  

Class A

  

Class B

  

Paid-in

  

Retained

  

Comprehensive

  

Treasury Stock

  

Stockholders’

 
  

Shares

  

Amount

  

Shares

  

Amount

  

Capital

  

Earnings

  

Loss

  

Shares

  

Amount

  

Equity

 
                                         

Balance at July 2, 2023

  58,273,747  $583   32,348,221  $323  $388,215  $271,083  $(170)  25,845,875  $(188,191) $471,843 

Net income

  -   -   -   -   -   14,762   -   -   -   14,762 

Stock-based compensation

  477,374   5   -   -   7,636   -   -   -   -   7,641 

Exercise of stock options

  30,013   -   -   -   258   -   -   -   -   258 

Acquisition of Class A treasury stock

  -   -   -   -   -   -   -   948,284   (9,178)  (9,178)

Balance at March 31, 2024

  58,781,134  $588   32,348,221  $323  $396,109  $285,845  $(170)  26,794,159  $(197,369) $485,326 
                                         

Balance at July 3, 2022

  57,706,389  $577   32,529,614  $325  $379,885  $315,785  $(211)  25,698,396  $(186,952) $509,409 

Net loss

  -   -   -   -   -   (22,155)  -   -   -   (22,155)

Stock-based compensation

  372,415   4   -   -   5,937   -   -   -   -   5,941 

Conversion – Class B into Class A

  181,393   2   (181,393)  (2)  -   -   -   -   -   - 

Acquisition of Class A treasury stock

  -   -   -   -   -   -   -   142,005   (1,197)  (1,197)

Balance at April 2, 2023

  58,260,197  $583   32,348,221  $323  $385,822  $293,630  $(211)  25,840,401  $(188,149) $491,998 

 

See accompanying Notes to Condensed Consolidated Financial Statements.

 

4
Table of Contents
 

 

1-800-FLOWERS.COM, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

 

  

Nine Months Ended

 
  

March 31,

  

April 2,

 
  

2024

  

2023

 
         

Operating activities:

        

Net income (loss)

 $14,762  $(22,155)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

        

Goodwill and intangible impairment

  19,762   64,586 

Depreciation and amortization

  40,578   40,276 

Amortization of deferred financing costs

  541   998 

Deferred income taxes

  (8,535)  (4,390)

Bad debt expense

  418   2,997 

Stock-based compensation

  7,641   5,941 

Other non-cash items

  (122)  (245)

Changes in operating items:

        

Trade receivables

  (6,778)  (15,977)

Inventories

  31,674   57,031 

Prepaid and other

  4,761   2,706 

Accounts payable and accrued expenses

  (6,077)  (59,806)

Other assets and liabilities

  1,426   1,102 

Net cash provided by operating activities

  100,051   73,064 
         

Investing activities:

        

Acquisitions, net of cash acquired

  -   (5,000)

Capital expenditures

  (26,482)  (31,351)

Net cash used in investing activities

  (26,482)  (36,351)
         

Financing activities:

        

Acquisition of treasury stock

  (9,178)  (1,197)

Proceeds from exercise of employee stock options

  258   - 

Proceeds from bank borrowings

  82,000   195,900 

Repayment of bank borrowings

  (89,500)  (210,900)

Debt issuance cost

  -   (383)

Net cash used in financing activities

  (16,420)  (16,580)
         

Net change in cash and cash equivalents

  57,149   20,133 

Cash and cash equivalents:

        

Beginning of period

  126,807   31,465 

End of period

 $183,956  $51,598 

 

See accompanying Notes to Condensed Consolidated Financial Statements.

 

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1-800-FLOWERS.COM, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(unaudited)

 

 

 

Note 1 – Accounting Policies

 

Basis of Presentation

 

The accompanying unaudited condensed consolidated financial statements have been prepared by 1-800-FLOWERS.COM, Inc. and Subsidiaries (the “Company”) in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three and nine-month periods ended March 31, 2024 are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2024. These financial statements should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended July 2, 2023, which provides a more complete understanding of our accounting policies, financial position, operating results and other matters.

 

The Company’s quarterly results may experience seasonal fluctuations. Due to the seasonal nature of the Company’s business, and its continued expansion into non-floral products, the Thanksgiving through Christmas holiday season, which falls within the Company’s second fiscal quarter, is expected to generate over 40% of the Company’s annual revenues, and all of its earnings. Due to the number of major floral gifting occasions, including Mother's Day, Valentine’s Day, Easter, and Administrative Professionals Week, revenues also have historically risen during the Company’s fiscal third and fourth quarters in comparison to its fiscal first quarter.

 

Use of Estimates

 

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

 

Revenue Recognition

 

Net revenue is measured based on the amount of consideration that we expect to receive, reduced by discounts and estimates for credits and returns (calculated based upon previous experience and management’s evaluation). Service and outbound shipping charged to customers are recognized at the time the related merchandise revenues are recognized and are included in net revenues. Inbound and outbound shipping and delivery costs are included in cost of revenues. Net revenues exclude sales and other similar taxes collected from customers.

 

A description of our principal revenue generating activities is as follows:

 

●

E-commerce revenues - consumer products sold through our online and telephonic channels. Revenue is recognized when control of the merchandise is transferred to the customer, which generally occurs upon shipment. Payment is typically due prior to the date of shipment.

●

Retail revenues - consumer products sold through our retail stores. Revenue is recognized when control of the goods is transferred to the customer, at the point of sale, at which time payment is received.

●

Wholesale revenues - products sold to our wholesale customers for subsequent resale. Revenue is recognized when control of the goods is transferred to the customer, in accordance with the terms of the applicable agreement. Payment terms are typically 30 days from the date control over the product is transferred to the customer.

●

BloomNet Services - membership fees as well as other service offerings to florists. Membership and other subscription-based fees are recognized monthly as earned. Services revenues related to orders sent through the floral network are variable, based on either the number of orders or the value of orders, and are recognized in the period in which the orders are delivered. The contracts within BloomNet Services are typically month-to-month and, as a result, no consideration allocation is necessary across multiple reporting periods. Payment is typically due less than 30 days from the date the services were performed. 

 

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Deferred Revenues

 

Deferred revenues are recorded when the Company has received consideration (i.e. advance payment) before satisfying its performance obligations. As such, customer orders are recorded as deferred revenue prior to shipment or rendering of product or services. Deferred revenues primarily relate to e-commerce orders placed, but not shipped, prior to the end of the fiscal period, as well as for subscription programs, including our various food, wine, and plant-of-the-month clubs and our Celebrations Passport® program.

 

Our total deferred revenue as of  July 2, 2023 was $30.8 million (included in “Accrued expenses” on our consolidated balance sheets), of which $2.8 million and $29.6 million was recognized as revenue during the three and nine months ended March 31, 2024, respectively. The deferred revenue balance as of  March 31, 2024 was $31.7 million.

 

Impairment Evaluation

 

The Company performs its annual assessment of goodwill and indefinite-lived intangible impairment during its fiscal fourth quarter, or more frequently if events occur or circumstances change such that it is more likely than not that an impairment  may exist. During the quarter ended December 31, 2023, as a result of a decline in the actual and projected revenue for the Company’s PersonalizationMall tradename (indefinite-lived intangible asset), as well as a higher discount rate resulting from the higher interest rate environment, the Company determined that an impairment assessment was required for this tradename. This assessment resulted in the Company recording a non-cash impairment charge of $19.8 million to reduce the recorded carrying value of the PersonalizationMall tradename.

 

The Company concluded that goodwill and other indefinite-lived intangible assets, excluding its PersonalizationMall tradename, did not require an impairment assessment. See Note 5 – Goodwill and Intangible Assets, Net for further information.

 

Recently Issued Accounting Pronouncements

 

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 requires enhanced disclosures about significant segment expenses, includes enhanced interim disclosure requirements, clarifies circumstances in which an entity can disclose multiple segment measures of profit or loss, provides new segment disclosure requirements for entities with a single reportable segment, and contains other disclosure requirements. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. ASU 2023-07 is to be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact of ASU 2023-07 on its consolidated financial statements and related disclosures.

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires the disclosure of additional information with respect to the reconciliation of the effective tax rate to the statutory rate for federal, state, and foreign income taxes and requires greater detail about significant reconciling items in the reconciliation. Additionally, the amendment requires disaggregated information pertaining to taxes paid, net of refunds received, for federal, state, and foreign income taxes. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and allows for either a prospective or retrospective approach on adoption. The Company is currently evaluating the impact of ASU 2023-09 on its consolidated financial statements and related disclosures.

 

 

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Note 2 – Net Income (Loss) Per Common Share

 

Basic net income (loss) per common share is computed by dividing the net income (loss) during the period by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted into common stock.

 

The following table sets forth the computation of basic and diluted net income (loss) per common share:

 

  

Three Months Ended

  

Nine Months Ended

 
  

March 31,

  

April 2,

  

March 31,

  

April 2,

 
  

2024

  

2023

  

2024

  

2023

 
  

(in thousands, except per share data)

 

Numerator:

                

Net income (loss)

 $(16,903) $(70,993) $14,762  $(22,155)
                 

Denominator:

                

Weighted average shares outstanding

  64,489   64,767   64,703   64,660 

Effect of dilutive stock options and unvested restricted stock awards

  -   -   354   - 
                 

Diluted weighted-average shares outstanding

  64,489   64,767   65,057   64,660 
                 

Net income (loss) per common share

                

Basic

 $(0.26) $(1.10) $0.23  $(0.34)

Diluted

 $(0.26) $(1.10) $0.23  $(0.34)

 
 

Note 3 – Acquisitions

 

Acquisition of Things Remembered

 

On January 10, 2023, the Company completed its acquisition of certain assets of the Things Remembered brand, a provider of personalized gifts, whose operations are integrated within the PersonalizationMall.com brand, in the Consumer Floral & Gifts segment. The Company used cash on hand to fund the $5.0 million purchase, which included the intellectual property, customer list, certain inventory, and equipment. The acquisition did not include Things Remembered retail stores. Things Remembered’s annual revenues from its e-commerce operations, based on its most recently available unaudited financial information was $30.4 million for the twelve months ended November 30, 2022.

 

The total consideration of $5.0 million was allocated to the identifiable assets acquired and liabilities assumed based on our estimates of their fair values on the acquisition date, including: goodwill of $1.9 million (deductible for income tax purposes), trademarks of $0.8 million (indefinite life), customer lists of $0.8 million (3-year life), inventory of $1.1 million, and equipment of $0.4 million. During the quarter ended December 31, 2023, the Company finalized its purchase price allocation, resulting in immaterial adjustments to the preliminary carrying value of the respective recorded assets and the residual amount that was allocated to goodwill.

 

Operating results of the Things Remembered business are reflected in the Company’s consolidated financial statements from the date of acquisition within the Consumer Floral & Gifts segment. Pro forma results of operations have not been presented, as the impact on the Company’s consolidated financial results was not material.

 

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Note 4 – Inventory

 

The Company’s inventory, valued at the lower of cost or net realizable value, includes purchased and manufactured finished goods for sale, packaging supplies, crops, raw material ingredients for manufactured products and associated manufacturing labor, and is classified as follows:

 

  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Finished goods

 $86,503  $92,582 

Work-in-process

  22,299   33,818 

Raw materials

  50,656   64,934 

Total inventory

 $159,458  $191,334 

 
 

Note 5 – Goodwill and Intangible Assets, Net

 

The following table presents goodwill by segment and the related change in the net carrying amount:

 

          

Gourmet

     
  

Consumer

      

Foods &

     
  

Floral &

      

Gift

     
  

Gifts

  

BloomNet

  

Baskets

  

Total

 
  

(in thousands)

 

Balance at July 2, 2023

 $153,376  $-  $-  $153,376 

Measurement period adjustment for Things Remembered Acquisition

  201   -   -   201 

Balance at March 31, 2024

 $153,577  $-  $-  $153,577 

 

The Company’s other intangible assets consist of the following:

 

     

March 31, 2024

  

July 2, 2023

 
     

Gross

          

Gross

         
  

Amortization

  

Carrying

  

Accumulated

      

Carrying

  

Accumulated

     
  

Period

  

Amount

  

Amortization

  

Net

  

Amount

  

Amortization

  

Net

 
  

(in years)

  

(in thousands)

 

Intangible assets with determinable lives

                           

Investment in licenses

 14 - 16  $7,420  $6,648  $772  $7,420  $6,569  $851 

Customer lists

 3 - 10   29,071   24,830   4,241   29,071   21,611   7,460 

Other

 5 - 14   2,946   2,649   297   2,946   2,604   342 

Total intangible assets with determinable lives

     39,437   34,127   5,310   39,437   30,784   8,653 

Trademarks with indefinite lives

     111,473   -   111,473   131,235   -   131,235 

Total identifiable intangible assets

    $150,910  $34,127  $116,783  $170,672  $30,784  $139,888 

 

Future estimated amortization expense is as follows: remainder of fiscal 2024 - $1.1 million, fiscal 2025 - $1.9 million, fiscal 2026 - $1.3 million, fiscal 2027 - $0.5 million, fiscal 2028 - $0.2 million and thereafter - $0.3 million.

 

The Company performs its annual assessment of goodwill and indefinite-lived intangible impairment during its fiscal fourth quarter, or more frequently if events occur or circumstances change such that it is more likely than not that an impairment  may exist.

 

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During the quarter ended December 31, 2023, as a result of a decline in the actual and projected revenue for the Company’s PersonalizationMall tradename (indefinite-lived intangible asset), as well as a higher discount rate resulting from the higher interest rate environment, the Company determined that an impairment assessment was required. The Company’s impairment test for the indefinite-lived intangible asset encompassed calculating a fair value of the indefinite-lived intangible asset and comparing that result to its carrying value. To determine fair value of the indefinite-lived intangible asset, the Company used an income approach, the relief-from-royalty method. This method assumes that, in lieu of ownership, a third party would be willing to pay a royalty in order to obtain the rights to use the comparable asset. Indefinite-lived intangible assets’ fair values require significant judgments in determining both the assets’ estimated cash flows as well as the appropriate discount and royalty rates applied to those cash flows to determine fair value. Based on the impairment assessment performed for the quarter ended  December 31, 2023, the Company recorded a non-cash impairment charge of $19.8 million to reduce the recorded carrying value of the PersonalizationMall tradename to its estimated fair value. This impairment charge was recorded in the Company’s Consumer Floral & Gifts reporting unit. The Company concluded that goodwill and other indefinite-lived intangible assets, excluding its PersonalizationMall tradename, did not require an impairment assessment.

   
 

Note 6 – Investments

 

Equity investments without a readily determinable fair value

 

Investments in non-marketable equity instruments of private companies, where the Company does not possess the ability to exercise significant influence, are accounted for at cost, less impairment (assessed qualitatively at each reporting period), adjusted for observable price changes from orderly transactions for identical or similar investments of the same issuer. These investments are included within “Other assets” in the Company’s consolidated balance sheets. The aggregate carrying amount of the Company’s equity investments without a readily determinable fair value was $2.6 million as of  March 31, 2024 and July 2, 2023, respectively. 

 

Equity investments with a readily determinable fair value

 

The Company also holds certain trading securities associated with its Non-Qualified Deferred Compensation Plan (“NQDC Plan”). These investments are measured using quoted market prices at the reporting date and are included within the “Other assets” line item in the consolidated balance sheets (see Note 9 - Fair Value Measurements). 

   
 

Note 7 – Debt, Net

 

The Company’s current and long-term debt consists of the following:

 

  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Revolver

 $-  $- 

Term Loans

  192,500   200,000 

Deferred financing costs

  (3,068)  (3,609)

Total debt

  189,432   196,391 

Less: current maturities of long-term debt

  10,000   10,000 

Long-term debt, net

 $179,432  $186,391 

 

On June 27, 2023, the Company, certain of its U.S. subsidiaries, the lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent entered into a Third Amended and Restated Credit Agreement (the “Third Amended Credit Agreement”). The Third Amended Credit Agreement amends and restates the Company’s Second Amended and Restated Credit Agreement, dated as of May 31, 2019 (as amended by the First Amendment, dated as of August 20, 2020, the Second Amendment, dated as of November 8, 2021, and the Third Amendment, dated as of August 29, 2022). The Third Amended Credit Agreement, among other modifications: (i) increases the amount of the outstanding term loan (“Term Loan”) from approximately $150 million to $200 million, (ii) decreases the amount of the commitments in respect of the revolving credit facility from $250 million to $225 million, subject to a seasonal reduction to an aggregate amount of $125 million for the period from January 1 to August 1, (iii) extends the maturity date of the outstanding term loan and the revolving credit facilities by approximately 48 months to June 27, 2028, and (iv) increases the applicable interest rate margins for SOFR and base rate loans by 25 basis points.

 

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For each borrowing under the Third Amended Credit Agreement, the Company may elect that such borrowing bear interest at an annual rate equal to either: (1) a base rate plus an applicable margin varying based on the Company’s consolidated leverage ratio, where the base rate is the highest of (a) the prime rate, (b) the New York fed bank rate plus 0.5%, and (c) an adjusted SOFR rate plus an applicable margin varying based on the Company’s consolidated leverage ratio. The adjusted SOFR rate includes a credit spread adjustment of 0.1% for all interest periods.

 

The Third Amended Credit Agreement requires that while any borrowings or commitments are outstanding the Company comply with certain financial covenants and affirmative covenants as well as certain negative covenants that, subject to certain exceptions, limit the Company’s ability to, among other things, incur additional indebtedness, make certain investments and make certain restricted payments. The Company was in compliance with these covenants as of March 31, 2024. The Third Amended Credit Agreement is secured by substantially all of the assets of the Company.

 

The principal of the Term Loan is payable at a rate of $2.5 million for the first 8 quarterly installments beginning on September 29, 2023, increasing to a quarterly payment of $5.0 million, commencing on September 26, 2025, for the remaining 11 payments, with the remaining balance of $125.0 million due upon maturity on June 27, 2028.

 

Future principal term loan payments under the Third Amended Credit Agreement are as follows: $2.5 million – remainder of Fiscal 2024, $10.0 million – Fiscal 2025, $20.0 million – Fiscal 2026, $20.0 million – Fiscal 2027, and $140.0 million – Fiscal 2028.

   
 

Note 8 – Property, Plant and Equipment, Net

 

The Company’s property, plant and equipment consists of the following:

 

  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Land

 $33,827  $33,866 

Orchards in production and land improvements

  20,604   20,401 

Building and building improvements

  68,911   67,647 

Leasehold improvements

  30,973   29,524 

Production equipment

  130,890   125,297 

Furniture and fixtures

  9,294   9,102 

Computer and telecommunication equipment

  42,832   41,859 

Software

  192,837   181,085 

Capital projects in progress

  17,608   18,205 

Property, plant and equipment, gross

  547,776   526,986 

Accumulated depreciation and amortization

  (323,837)  (292,417)

Property, plant and equipment, net

 $223,939  $234,569 

 
 

Note 9 – Fair Value Measurements

 

Cash and cash equivalents, trade and other receivables, prepaids, accounts payable and accrued expenses are reflected in the consolidated balance sheets at carrying value, which approximates fair value due to the short-term nature of these instruments. Although no trading market exists, the Company believes that the carrying amount of its debt approximates fair value due to its variable nature (these are level 2 investments). The Company’s investments in non-marketable equity instruments of private companies are carried at cost and are periodically assessed for other-than-temporary impairment when an event or circumstances indicate that an other-than-temporary decline in value may have occurred. The Company’s remaining financial assets and liabilities are measured and recorded at fair value (see table below). The Company’s non-financial assets, such as definite lived intangible assets and property, plant and equipment, are recorded at cost and are assessed for impairment when an event or circumstance indicates that an other-than-temporary decline in value may have occurred. Goodwill and indefinite lived intangibles are tested for impairment annually, or more frequently, if events occur or circumstances change such that it is more likely than not that an impairment may exist, as required under the accounting standards.

 

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Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants at the measurement date. The authoritative guidance for fair value measurements establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy under the guidance are described below:

 

Level 1

Valuations based on quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.

Level 2

Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.

Level 3

Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

 

The following table presents by level, within the fair value hierarchy, financial assets and liabilities measured at fair value on a recurring basis:

 

  

Carrying

  

Fair Value Measurements

 
  

Value

  

Assets (Liabilities)

 
      

Level 1

  

Level 2

  

Level 3

 
  

(in thousands)

 

As of March 31, 2024

                

Trading securities held in a “rabbi trust” (1)

 $31,160  $31,160  $-  $- 

Total assets (liabilities) at fair value

 $31,160  $31,160  $-  $- 
                 

As of July 2, 2023

                

Trading securities held in a “rabbi trust” (1)

 $22,617  $22,617  $-  $- 

Total assets (liabilities) at fair value

 $22,617  $22,617  $-  $- 

 

 

(1)

The Company has established a NQDC Plan for certain members of senior management. Deferred compensation plan assets are invested in mutual funds held in a “rabbi trust,” which is restricted for payment to participants of the NQDC Plan. Trading securities held in a rabbi trust are measured using quoted market prices at the reporting date and are included in the “Other assets” line item, with the corresponding liability included in the “Other liabilities” line item in the consolidated balance sheets. 

   
 

Note 10 – Income Taxes

 

The Company computed the interim tax provision using an estimated annual effective rate, adjusted for discrete items. This estimate is used in providing for income taxes on a year-to-date basis and may change in subsequent interim periods. The Company’s effective tax rate for the three and nine months ended March 31, 2024 was 33.0% and 34.7%, respectively, compared to 19.1% and -0.6% in the same periods of the prior year. The Company’s effective tax rate for fiscal 2024 and fiscal 2023 differed from the U.S. federal statutory rate of 21.0% primarily due to impairment charges within the respective periods, thus reducing the amount of income reflected in the Company’s estimated annual effective tax rate. Further impacting the effective tax rate for fiscal 2024 and fiscal 2023 were tax deficiencies (shortfalls) from stock-based compensation, state income taxes and non-deductible executive compensation, partially offset by tax credits.

 

On a regular basis, the Company evaluates the recoverability of deferred tax assets and the need for a valuation allowance. Such evaluations involve the application of significant judgment. The Company considers multiple factors in its evaluation of the need for a valuation allowance, including reversal of deferred tax liabilities, available tax planning strategies that could be implemented to realize the deferred tax assets, and forecasted future taxable income.  A valuation allowance is provided when it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. At both  March 31, 2024 and July 2, 2023, the Company had valuation allowances of approximately $3.2 million, primarily related to certain state and foreign net operating losses.

 

The Company files income tax returns in the U.S. federal jurisdiction, various state jurisdictions, and various foreign countries. The Company’s fiscal years 2020, 2021, and 2022 remain subject to U.S. federal examination. Due to ongoing state examinations and nonconformity with the U.S. federal statute of limitations for assessment, certain states remain open from fiscal 2016. The Company's foreign income tax filings from fiscal 2017 are open for examination by its respective foreign tax authorities, mainly Canada and Brazil.

 

The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. At March 31, 2024, the Company has an unrecognized tax benefit, including accrued interest and penalties, of approximately $3.2 million. The Company believes that $0.4 million of unrecognized tax positions will be resolved over the next twelve months. 

 

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Note 11 – Business Segments

 

The Company’s management reviews the results of its operations by the following three business segments:

 

•

Consumer Floral & Gifts,

•

BloomNet, and

•

Gourmet Foods & Gift Baskets

 

Segment performance is measured based on contribution margin, which includes only the direct controllable revenue and operating expenses of the segments. As such, management’s measure of profitability for these segments does not include the effect of corporate overhead (see (a) below), nor does it include depreciation and amortization, other (income) expense, net and income taxes, or stock-based compensation, which are included within corporate overhead. Assets and liabilities are reviewed at the consolidated level by management and not accounted for by segment.

 

  

Three Months Ended

  

Nine Months Ended

 
  

March 31,

  

April 2,

  

March 31,

  

April 2,

 
  

2024

  

2023

  

2024

  

2023

 
  

(in thousands)

 

Net Revenues:

                

Segment Net Revenues:

                

Consumer Floral & Gifts

 $221,207  $233,019  $618,236  $672,248 

BloomNet

  27,314   36,968   83,420   103,187 

Gourmet Foods & Gift Baskets

  130,989   147,863   769,061   844,522 

Corporate

  167   36   716   152 

Intercompany eliminations

  (272)  (320)  (924)  (1,062)

Total net revenues

 $379,405  $417,566  $1,470,509  $1,619,047 
                 

Operating Income:

                

Segment Contribution Margin:

                

Consumer Floral & Gifts

 $22,190  $26,136  $41,609  $64,832 

BloomNet

  7,506   10,982   25,981   29,847 

Gourmet Foods & Gift Baskets

  (8,172)  (78,480)  98,953   26,313 

Segment Contribution Margin Subtotal

  21,524   (41,362)  166,543   120,992 

Corporate (a)

  (36,221)  (30,015)  (100,221)  (91,595)

Depreciation and amortization

  (13,232)  (13,267)  (40,578)  (40,276)

Operating income

 $(27,929) $(84,644) $25,744  $(10,879)

 

(a) Corporate expenses consist of the Company’s enterprise shared service cost centers, and include, among other items, Information Technology, Human Resources, Accounting and Finance, Legal, Executive and Customer Service Center functions, as well as Stock-based compensation. In order to leverage the Company’s infrastructure, these functions are operated under a centralized management platform, providing support services throughout the organization. The costs of these functions, other than those of the Customer Service Center, which are allocated directly to the above categories based upon usage, are included within corporate expenses as they are not directly allocable to a specific segment.

 

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The following tables represent a disaggregation of revenue from contracts with customers, by channel: 

 

  

Three Months Ended

 
  

Consumer Floral &

          

Gourmet Foods &

  

Corporate and

         
  

Gifts

  

BloomNet

  

Gift Baskets

  

Eliminations

  

Consolidated

 
  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

 
  (in thousands) 

Net revenues

                                        

E-commerce

 $218,590  $230,403  $-  $-  $121,651  $127,398  $-  $-  $340,241  $357,801 

Other

  2,617   2,616   27,314   36,968   9,338   20,465   (105)  (284)  39,164   59,765 

Total net revenues

 $221,207  $233,019  $27,314  $36,968  $130,989  $147,863  $(105) $(284) $379,405  $417,566 
                                         

Other revenues detail

                                        

Retail and other

  2,617   2,616   -   -   1,629   1,686   -   -   4,246   4,302 

Wholesale

  -   -   12,364   14,695   7,709   18,779   -   -   20,073   33,474 

BloomNet services

  -   -   14,950   22,273   -   -   -   -   14,950   22,273 

Corporate

  -   -   -   -   -   -   167   36   167   36 

Eliminations

  -   -   -   -   -   -   (272)  (320)  (272)  (320)

Total other revenues

 $2,617  $2,616  $27,314  $36,968  $9,338  $20,465  $(105) $(284) $39,164  $59,765 

 

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Nine Months Ended

 
  

Consumer Floral &

          

Gourmet Foods &

  

Corporate and

         
  

Gifts

  

BloomNet

  

Gift Baskets

  

Eliminations

  

Consolidated

 
  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

 
  (in thousands) 

Net revenues

                                        

E-commerce

 $611,770  $665,866  $-  $-  $676,788  $721,267  $-  $-  $1,288,558  $1,387,133 

Other

  6,466   6,382   83,420   103,187   92,273   123,255   (208)  (910)  181,951   231,914 

Total net revenues

 $618,236  $672,248  $83,420  $103,187  $769,061  $844,522  $(208) $(910) $1,470,509  $1,619,047 
                                         

Other revenues detail

                                        

Retail and other

  6,466   6,382   -   -   7,859   7,907   -   -   14,325   14,289 

Wholesale

  -   -   32,867   40,370   84,414   115,348   -   -   117,281   155,718 

BloomNet services

  -   -   50,553   62,817   -   -   -   -   50,553   62,817 

Corporate

  -   -   -   -   -   -   716   152   716   152 

Eliminations

  -   -   -   -   -   -   (924)  (1,062)  (924)  (1,062)

Total other revenues

 $6,466  $6,382  $83,420  $103,187  $92,273  $123,255  $(208) $(910) $181,951  $231,914 

 

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Note 12 – Leases 

 

The Company currently leases plants, warehouses, offices, store facilities, and equipment under various leases through fiscal 2036. Most lease agreements are of a long-term nature (over a year), although the Company does also enter into short-term leases, primarily for seasonal needs. Lease agreements may contain renewal options and rent escalation clauses and require the Company to pay real estate taxes, insurance, common area maintenance and operating expenses applicable to the leased properties. The Company accounts for its leases in accordance with ASC 842.

 

At contract inception, the Company determines whether a contract is, or contains, a lease by determining whether it conveys the right to control the use of the identified asset for a period of time, by assessing whether the Company has the right to obtain substantially all of the economic benefits from use of the identified asset and the right to direct the use of the identified asset.

 

At the lease commencement date, the Company determines if a lease should be classified as an operating or a finance lease (the Company currently has no finance leases) and recognizes a corresponding lease liability and a right-of-use asset on its Balance Sheet. The lease liability is initially and subsequently measured as the present value of the remaining fixed minimum rental payments (including base rent and fixed common area maintenance) using discount rates as of the commencement date. Variable payments (including most utilities, real estate taxes, insurance and variable common area maintenance) are expensed as incurred. Further, the Company elected a short-term lease exception policy, permitting it to not apply the recognition requirements of this standard to short-term leases (i.e. leases with terms of 12 months or less) and an accounting policy to account for lease and non-lease components as a single component for certain classes of assets. The right-of-use asset is initially and subsequently measured at the carrying amount of the lease liability adjusted for any prepaid or accrued lease payments, remaining balance of lease incentives received, unamortized initial direct costs, or impairment charges relating to the right-of-use asset. Right-of-use assets are assessed for impairment using the long-lived assets impairment guidance. The discount rate used to determine the present value of lease payments is the Company’s estimated collateralized incremental borrowing rate, based on the yield curve for the respective lease terms, as the Company generally cannot determine the interest rate implicit in the lease.

 

The Company recognizes expense for its operating leases on a straight-line basis over the lease term. As these leases expire, it can be expected that in the normal course of business they will be renewed or replaced. Renewal option periods are included in the measurement of lease liability, where the exercise is reasonably certain to occur. Key estimates and judgments in accounting for leases include how the Company determines: (1) lease payments, (2) lease term, and (3) the discount rate used in calculating the lease liability.

 

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Additional information related to our leases is as follows:

 

  

Three Months Ended

  

Nine Months Ended

 
  

March 31,

  

April 2,

  

March 31,

  

April 2,

 
  

2024

  

2023

  

2024

  

2023

 
  

(in thousands)

 

Lease costs:

                

Operating lease costs

 $5,693  $5,627  $16,966  $16,580 

Variable lease costs

  6,399   6,499   20,481   18,953 

Short-term lease cost

  282   474   3,700   4,928 

Sublease income

  (238)  (253)  (735)  (737)

Total lease costs

 $12,136  $12,347  $40,412  $39,724 
                 

Cash paid for amounts included in measurement of operating lease liabilities

         $16,957  $15,431 

Right-of-use assets obtained in exchange for new operating lease liabilities

         $3,153  $11,790 

 

  

March 31,

 
  

2024

 
  

(in thousands)

 

Weighted-average remaining lease term - operating leases (in years)

  8.2 

Weighted-discount rate - operating leases

  4.1%

 

Maturities of lease liabilities in accordance with ASC 842 as of March 31, 2024 and reconciliation to balance sheet are as follows (in thousands):

 

Fiscal Year:

    

Remainder of 2024

 $3,838 

2025

  20,998 

2026

  19,076 

2027

  17,447 

2028

  16,514 

Thereafter

  68,722 

Total Future Minimum Lease Payments

  146,595 

Less: Imputed Remaining Interest

  23,427 

Total Operating Lease Liabilities

  123,168 

Less: Current portion of long-term operating lease liabilities

  15,250 

Long-term operating lease liabilities

 $107,918 

 
 

Note 13 – Accrued Expenses

 

Accrued expenses consisted of the following:

 

  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Payroll and employee benefits

 $25,786  $33,927 

Deferred revenue

  31,661   30,811 

Accrued marketing expenses

  15,190   13,679 

Accrued florist payout

  12,733   13,437 

Accrued purchases

  16,578   18,351 

Other

  36,056   31,709 

Accrued Expenses

 $138,004  $141,914 

 

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Note 14 – Commitments and Contingencies

 

Litigation

 

There are various claims, lawsuits, and pending actions against the Company and its subsidiaries incident to the operations of its businesses. It is the opinion of management, after consultation with counsel, that the final resolution of such claims, lawsuits and pending actions will not have a material adverse effect on the Company's consolidated financial position, results of operations or liquidity.

 
 

Note 15 – Subsequent Events

 

Acquisition of Card Isle

 

On April 3, 2024, the Company completed its acquisition of Card Isle, an e-commerce greeting card company, expanding the Company’s presence in the greeting card category across all brands.

 

The Company used cash on its balance sheet to fund the approximate $3.5 million purchase. Card Isle annual revenue, based on its most recently available financial information, is deemed immaterial to the Company’s consolidated financial statements.

  

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

This “Management’s Discussion and Analysis of Financial Condition and Results of Operations” ("MD&A") is intended to provide an understanding of our financial condition, change in financial condition, cash flow, liquidity, and results of operations. The following MD&A discussion should be read in conjunction with the consolidated financial statements and notes to those statements that appear elsewhere in this Form 10-Q and in the Company’s Annual Report on Form 10-K, for the year ended July 2, 2023. The following discussion contains forward-looking statements that reflect the Company’s plans, estimates and beliefs. The Company’s actual results could differ materially from those discussed or referred to in the forward-looking statements. Factors that could cause or contribute to any differences include, but are not limited to, those discussed under the caption “Forward-Looking Information and Factors That May Affect Future Results,” under Part I, Item 1A, of the Company’s Annual Report on Form 10-K, for the year ended July 2, 2023 under the heading “Risk Factors” and Part II-Other Information, Item 1A in this Form 10-Q.

 

Business Overview

 

1-800-FLOWERS.COM, Inc. and its subsidiaries (collectively, the “Company”) is a leading provider of gifts designed to help inspire customers to give more, connect more, and build more and better relationships. The Company’s e-commerce business platform features an all-star family of brands, including: 1-800-Flowers.com®, 1-800-Baskets.com®, Cheryl’s Cookies®, Harry & David®, PersonalizationMall.com®, Shari’s Berries®, FruitBouquets.com®, Things Remembered®, Moose Munch®, The Popcorn Factory®, Wolferman’s Bakery®, Vital Choice®, Simply Chocolate®, and Card Isle®. Through the Celebrations Passport® loyalty program, which provides members with free standard shipping and no service charge on eligible products across our portfolio of brands, 1-800-FLOWERS.COM, Inc. strives to deepen relationships with customers. The Company also operates BloomNet®, an international floral and gift industry service provider offering a broad-range of products and services designed to help members grow their businesses profitably; Napco℠, a resource for floral gifts and seasonal décor; DesignPac Gifts, LLC, a manufacturer of gift baskets and towers; and Alice’s Table®, a lifestyle business offering fully digital floral, culinary and other experiences to guests across the country.

 

For additional information, see Item 7 of Part II, “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview” of our Annual Report on Form 10-K, for the year ended July 2, 2023. 

 

Macro-economic Conditions

 

Overall, broader macro-economic conditions continue to impact our consumers as they continue to moderate their discretionary income. Consumers remain pressured by persistent inflation, higher interest rates, and the resumption of student loan repayments. Throughout the past several years, we have seen that customer spending on “Everyday” gifting occasions has slowed, whereas spending for the major holidays has held up better. However, customers did remain more conservative regarding their Christmas and Valentine's Day holiday spending than originally anticipated. In line with this, total consolidated revenues decreased 9.1% to $379.4 million and 9.2% to $1.47 billion during the three and nine months ended March 31, 2024, respectively, compared with the same periods of the prior year. As we look ahead to the end of fiscal 2024, we continue to expect our e-commerce sales trends to improve albeit at a slower pace than initially anticipated.

 

The challenging macro-economic conditions that have affected our customers have also impacted our operating costs. During the second quarter of fiscal 2022, in-bound and out-bound shipping, commodity, labor and fuel costs began to surge, and escalated throughout the balance of the year and into fiscal 2023. During our second quarter and third quarter of fiscal 2023, while certain commodity prices remained near historical highs, we began to see a more stable labor market, and significant year-over-year reductions in ocean freight costs. As a result of these trends, combined with our strategic pricing initiatives, automation efforts, and other internal management initiatives, we started to see year-over-year improvement in gross margin commencing in the second quarter of fiscal 2023. These trends and initiatives continued into fiscal 2024 and we saw a significant improvement in year-over-year gross margin in the third quarter and first nine months of fiscal 2024. This improvement and a reduction of expenses helped to offset the aforementioned year-over-year decline in sales.

 

Intangible Impairment

 

During the quarter ended December 31, 2023, as a result of a decline in the actual and projected revenue for the Company’s PersonalizationMall tradename, as well as a higher discount rate resulting from the higher interest rate environment, the Company determined that an impairment assessment was required for this tradename. This assessment resulted in the Company recording a non-cash impairment charge of $19.8 million to reduce the recorded carrying value of the PersonalizationMall tradename. See Note 5 – Goodwill and Intangible Assets, Net for further information.

 

 

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Acquisition of Things Remembered

 

On January 10, 2023, the Company completed its acquisition of certain assets of the Things Remembered brand, a provider of personalized gifts, whose operations have been integrated within the PersonalizationMall.com brand, in the Consumer Floral & Gifts segment. The Company used cash on hand to fund the $5.0 million purchase, which included intellectual property, customer list, certain inventory, and equipment - see Note 3 –Acquisitions in Item 1. 

 

Acquisition of Card Isle

 

On April 3, 2024, the Company completed its acquisition of Card Isle, an e-commerce greeting card company, expanding the Company’s presence in the greeting card category across all brands.  The Company used cash on its balance sheet to fund the approximate $3.5 million purchase. – See Note 15 – Subsequent Events in Item 1. 

 

Amended and Restated Credit Agreement

 

On June 27, 2023, the Company entered into a Third Amended and Restated Credit Agreement to, among other modifications, (i) increase the amount of the outstanding term loan from approximately $150 million to $200 million, (ii) decrease the amount of the commitments in respect of the revolving credit facility from $250 million to $225 million, subject to a seasonal reduction to an aggregate amount of $125 million for the period from January 1 to August 1, (iii) extend the maturity date of the outstanding term loan and the revolving credit facilities by approximately 48 months to June 27, 2028, and (iv) increase the applicable interest rate margins for SOFR and base rate loans by 25 basis points (See Note 7 - Debt, Net in Item 1, for details).

 

Company Guidance

 

For Fiscal 2024, the Company continues to expect revenue to remain pressured by a challenging consumer environment, but certain year-over-year trends continue to improve. The Company also expects continued improvement in gross margin.

 

As a result, the Company is reiterating its Fiscal 2024 guidance as follows:

 

 

●

total revenues on a percentage basis to decline in a range of 7% to 9%, as compared with the prior year;

 

 

●

Adjusted EBITDA to be in a range of $95 million to $100 million; and

 

 

●

Free Cash Flow to be in a range of $60 million to $65 million.

 

Refer to "Definitions of non-GAAP Financial Measures" for reconciliation of non-GAAP results to applicable GAAP results.

 

Definitions of non-GAAP Financial Measures:

 

We sometimes use financial measures derived from consolidated financial information, but not presented in our financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain of these are considered "non-GAAP financial measures" under the U.S. Securities and Exchange Commission rules. See below for definitions and the reasons why we use these non-GAAP financial measures. Where applicable, see the Segment Information and Results of Operations sections below for reconciliations of these non-GAAP measures to their most directly comparable GAAP financial measures. These non-GAAP financial measures are referred to as “non-GAAP” or “adjusted” below, as these terms are used interchangeably. Reconciliations for forward-looking figures would require unreasonable efforts at this time because of the uncertainty and variability of the nature and amount of certain components of various necessary GAAP components, including, for example, those related to compensation, tax items, amortization or others that may arise during the year, and the Company's management believes such reconciliations would be confusing or misleading to investors. For the same reasons, the Company is unable to address the probable significance of the unavailable information. The lack of such reconciling information should be considered when assessing the impact of such disclosures.

 

EBITDA and Adjusted EBITDA

 

We define EBITDA as net income (loss) before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA adjusted for the impact of stock-based compensation, Non-Qualified Deferred Compensation Plan (“NQDC Plan”) Investment appreciation/depreciation, and certain items affecting period-to-period comparability. See Segment Information for details on how EBITDA and Adjusted EBITDA were calculated for each period presented.

 

The Company presents EBITDA and Adjusted EBITDA because it considers such information meaningful supplemental measures of its performance and believes such information is frequently used by the investment community in the evaluation of similarly situated companies. The Company uses EBITDA and Adjusted EBITDA as factors to determine the total amount of incentive compensation available to be awarded to executive officers and other employees. The Company's credit agreement uses EBITDA and Adjusted EBITDA to determine its interest rate and to measure compliance with certain covenants. EBITDA and Adjusted EBITDA are also used by the Company to evaluate and price potential acquisition candidates.

 

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EBITDA and Adjusted EBITDA have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of the Company's results as reported under GAAP. Some of the limitations are: (a) EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements for, the Company's working capital needs; (b) EBITDA and Adjusted EBITDA do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on the Company's debts; and (c) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future and EBITDA does not reflect any cash requirements for such capital expenditures. EBITDA and Adjusted EBITDA should only be used on a supplemental basis combined with GAAP results when evaluating the Company's performance.

 

Segment contribution margin and adjusted segment contribution margin

 

We define segment contribution margin as earnings before interest, taxes, depreciation and amortization, before the allocation of corporate overhead expenses. Adjusted segment contribution margin is defined as contribution margin adjusted for certain items affecting period-to-period comparability. See Segment Information for details on how segment contribution margin was calculated for each period presented.

 

When viewed together with our GAAP results, we believe segment contribution margin and adjusted segment contribution margin provide management and users of the financial statements meaningful information about the performance of our business segments.

 

Segment contribution margin and adjusted segment contribution margin are used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. The material limitation associated with the use of segment contribution margin and adjusted segment contribution margin is that they are an incomplete measure of profitability as they do not include all operating expenses or non-operating income and expenses. Management compensates for this limitation when using this measure by looking at other GAAP measures, such as operating income and net income. 

 

Adjusted net income (loss) and adjusted net income (loss) per common share

 

We define adjusted net income (loss) and adjusted net income (loss) per common share as net income (loss) and net income (loss) per common share adjusted for certain items affecting period-to-period comparability. See Segment Information below for details on how adjusted net income (loss) and adjusted net income (loss) per common share were calculated for each period presented.

 

We believe that adjusted net income (loss) and adjusted net income (loss) per common share are meaningful measures because they increase the comparability of period-to-period results.

 

Since these are not measures of performance calculated in accordance with GAAP, they should not be considered in isolation of, or as a substitute for, GAAP net income (loss) and net income (loss) per common share, as indicators of operating performance and they may not be comparable to similarly titled measures employed by other companies. 

 

Free Cash Flow

 

We define free cash flow as net cash provided by operating activities, less capital expenditures. The Company considers free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after the purchases of fixed assets, which can then be used to, among other things, invest in the Company’s business, make strategic acquisitions, strengthen the balance sheet, and repurchase stock or retire debt. Free cash flow is a liquidity measure that is frequently used by the investment community in the evaluation of similarly situated companies.

 

Since free cash flow is not a measure of performance calculated in accordance with GAAP, it should not be considered in isolation or as a substitute for analysis of the Company's results as reported under GAAP. A limitation of the utility of free cash flow as a measure of financial performance is that it does not represent the total increase or decrease in the company's cash balance for the period.

 

The following table reconciles net cash provided by operating activities, a GAAP measure, to free cash flow, a non-GAAP Measure.

 

   

Nine Months Ended

  
   

March 31,

    

April 2,

  
   

2024

    

2023

  
    (in thousands)  

Net cash provided by operating activities

   $ 100,051     $ 73,064  

Capital expenditures

     (26,482 )     (31,351 )

Free Cash Flow

   $ 73,569     $ 41,713  

 

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Segment Information

 

The following table presents the net revenues, gross profit and segment contribution margin from each of the Company’s business segments, as well as consolidated EBITDA, and Adjusted EBITDA.

 

   

Three Months Ended

  
                                           

Things

                  
                   

As Adjusted

            

Goodwill and

    

Remembered

    

As Adjusted

          
              Restructuring cost/       (non-GAAP)               Intangible       Transaction       (non-GAAP)     %
   

March 31, 2024

    

Severance

    

March 31, 2024

    

April 2, 2023

    

Impairment

    

Costs

    

April 2, 2023

    

Change

  
    (dollars in thousands)  

Net revenues:

                                                                

Consumer Floral & Gifts

   $ 221,207     $ -     $ 221,207     $ 233,019     $ -     $ -     $ 233,019       -5.1 %

BloomNet

     27,314               27,314       36,968                       36,968       -26.1 %

Gourmet Foods & Gift Baskets

     130,989               130,989       147,863                       147,863       -11.4 %

Corporate

     167               167       36                       36       363.9 %

Intercompany eliminations

     (272 )             (272 )     (320 )                     (320 )     15.0 %

Total net revenues

   $ 379,405     $ -     $ 379,405     $ 417,566     $ -     $ -     $ 417,566       -9.1 %
                                                                 

Gross profit:

                                                                

Consumer Floral & Gifts

   $ 87,005     $ -     $ 87,005     $ 88,317     $ -     $ -     $ 88,317       -1.5 %
      39.3 %             39.3 %     37.9 %                     37.9 %        
                                                                 

BloomNet

     12,411               12,411       15,720                       15,720       -21.0 %
      45.4 %             45.4 %     42.5 %                     42.5 %        
                                                                 

Gourmet Foods & Gift Baskets

     39,169               39,169       36,371                       36,371       7.7 %
      29.9 %             29.9 %     24.6 %                     24.6 %        
                                                                 

Corporate

     132               132       32                       32       312.5 %
      79.0 %             79.0 %     88.9 %                     88.9 %        
                                                                 

Total gross profit

   $ 138,717     $ -     $ 138,717     $ 140,440     $ -     $ -     $ 140,440       -1.2 %
      36.6 %     -       36.6 %     33.6 %     -       -       33.6 %        
                                                                 

EBITDA (non-GAAP):

                                                                

Segment Contribution Margin (non-GAAP) (a):

                                                                

Consumer Floral & Gifts

   $ 22,190     $ 630     $ 22,820     $ 26,136     $ -     $ -     $ 26,136       -12.7 %

BloomNet

     7,506       69       7,575       10,982                       10,982       -31.0 %

Gourmet Foods & Gift Baskets

     (8,172 )     538       (7,634 )     (78,480 )     64,586               (13,894 )     45.1 %

Segment Contribution Margin Subtotal

     21,524       1,237       22,761       (41,362 )     64,586       -       23,224       -2.0 %

Corporate (b)

     (36,221 )     1,180       (35,041 )     (30,015 )             201       (29,814 )     -17.5 %

EBITDA (non-GAAP)

     (14,697 )     2,417       (12,280 )     (71,377 )     64,586       201       (6,590 )     -86.3 %

Add: Stock-based compensation

     3,046               3,046       2,487                       2,487       22.5 %

Add: Compensation charge related to NQDC Plan Investment Appreciation (Depreciation)

     3,534               3,534       (1,446 )                     (1,446 )     344.4 %

Adjusted EBITDA (non-GAAP)

   $ (8,117 )   $ 2,417     $ (5,700 )   $ (70,336 )   $ 64,586     $ 201     $ (5,549 )     -2.7 %

 

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Nine Months Ended

  
                                                   

Things

                  
                           

As Adjusted

            

Goodwill and

    

Remembered

    

As Adjusted

          
              Intangible       Restructuring cost/       (non-GAAP)               Intangible       Transaction       (non-GAAP)     %
   

March 31, 2024

    

Impairment

    

Severance

    

March 31, 2024

    

April 2, 2023

    

Impairment

    

Costs

    

April 2, 2023

    

Change

  
    (dollars in thousands)  

Net revenues:

                                                                        

Consumer Floral & Gifts

   $ 618,236     $ -     $ -     $ 618,236     $ 672,248     $ -     $ -     $ 672,248       -8.0 %

BloomNet

     83,420                       83,420       103,187                       103,187       -19.2 %

Gourmet Foods & Gift Baskets

     769,061                       769,061       844,522                       844,522       -8.9 %

Corporate

     716                       716       152                       152       371.1 %

Intercompany eliminations

     (924 )                     (924 )     (1,062 )                     (1,062 )     13.0 %

Total net revenues

   $ 1,470,509     $ -     $ -     $ 1,470,509     $ 1,619,047     $ -     $ -     $ 1,619,047       -9.2 %
                                                                         

Gross profit:

                                                                        

Consumer Floral & Gifts

   $ 252,503     $ -     $ -     $ 252,503     $ 262,510     $ -     $ -     $ 262,510       -3.8 %
      40.8 %                     40.8 %     39.0 %                     39.0 %        
                                                                         

BloomNet

     39,883                       39,883       44,086                       44,086       -9.5 %
      47.8 %                     47.8 %     42.7 %                     42.7 %        
                                                                         

Gourmet Foods & Gift Baskets

     303,276                       303,276       302,902                       302,902       0.1 %
      39.4 %                     39.4 %     35.9 %                     35.9 %        
                                                                         

Corporate

     680                       680       166                       166       309.6 %
      95.0 %                     95.0 %     109.2 %                     109.2 %        
                                                                         

Total gross profit

   $ 596,342     $ -     $ -     $ 596,342     $ 609,664     $ -     $ -     $ 609,664       -2.2 %
      40.6 %     -       -       40.6 %     37.7 %     -       -       37.7 %        
                                                                         

EBITDA (non-GAAP):

                                                                        

Segment Contribution Margin (non-GAAP) (a):

                                                                        

Consumer Floral & Gifts

   $ 41,609     $ 19,762     $ 630     $ 62,001     $ 64,832     $ -     $ -     $ 64,832       -4.4 %

BloomNet

     25,981               69       26,050       29,847                       29,847       -12.7 %

Gourmet Foods & Gift Baskets

     98,953               538       99,491       26,313       64,586               90,899       9.5 %

Segment Contribution Margin Subtotal

     166,543       19,762       1,237       187,542       120,992       64,586       -       185,578       1.1 %

Corporate (b)

     (100,221 )             1,180       (99,041 )     (91,595 )             444       (91,151 )     -8.7 %

EBITDA (non-GAAP)

     66,322       19,762       2,417       88,501       29,397       64,586       444       94,427       -6.3 %

Add: Stock-based compensation

     7,641                       7,641       5,941                       5,941       28.6 %

Add: Compensation charge related to NQDC Plan Investment Appreciation (Depreciation)

     5,712                       5,712       (2,548 )                     (2,548 )     324.2 %

Adjusted EBITDA (non-GAAP)

   $ 79,675     $ 19,762     $ 2,417     $ 101,854     $ 32,790     $ 64,586     $ 444     $ 97,820       4.1 %

 

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Reconciliation of net income (loss) to adjusted net income (loss) (non-GAAP):

  

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

March 31,

    

April 2,

  
   

2024

    

2023

    

2024

    

2023

  
      (in thousands, except for share data)  

Net income (loss)

   $ (16,903 )   $ (70,993 )   $ 14,762     $ (22,155 )

Adjustments to reconcile net income (loss) to adjusted net income (loss) (non-GAAP)

                                

Add: Transaction costs

     -       201       -       444  

Add: Restructuring cost/Severance

     2,417       -       2,417       -  

Add: Goodwill and intangible impairment

     -       64,586       19,762       64,586  

Deduct: Income tax effect on adjustments

     (3,538 )     (11,546 )     (3,538 )     (11,609 )

Adjusted net income (loss) (non-GAAP)

   $ (18,024 )   $ (17,752 )   $ 33,403     $ 31,266  
                                 

Basic and diluted net income (loss) per common share

                                

Basic

   $ (0.26 )   $ (1.10 )   $ 0.23     $ (0.34 )

Diluted

   $ (0.26 )   $ (1.10 )   $ 0.23     $ (0.34 )
                                 
                                 

Basic and diluted adjusted net income (loss) per common share (non-GAAP)

                                

Basic

   $ (0.28 )   $ (0.27 )   $ 0.52     $ 0.48  

Diluted

   $ (0.28 )   $ (0.27 )   $ 0.51     $ 0.48  
                                 

Weighted average shares used in the calculation of basic and diluted net income (loss) and adjusted net income (loss) per common share

                                

Basic

     64,489       64,767       64,703       64,660  

Diluted

     64,489       64,767       65,057       64,660  

 

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Reconciliation of net income (loss) to Adjusted EBITDA (non-GAAP):

  

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

March 31,

    

April 2,

  
   

2024

    

2023

    

2024

    

2023

  
      (in thousands)  

Net income (loss)

   $ (16,903 )   $ (70,993 )   $ 14,762     $ (22,155 )

Add: Interest expense and other, net

     (2,693 )     3,116       3,138       11,150  

Add: Depreciation and amortization

     13,232       13,267       40,578       40,276  

Add: Income tax (benefit) expense

     (8,333 )     (16,767 )     7,844       126  

EBITDA

     (14,697 )     (71,377 )     66,322       29,397  

Add: Stock-based compensation

     3,046       2,487       7,641       5,941  

Add: Compensation charge related to NQDC plan investment Appreciation (Depreciation)

     3,534       (1,446 )     5,712       (2,548 )

Add: Transaction costs

     -       201       -       444  

Add: Restructuring cost/Severance

     2,417       -       2,417       -  

Add: Goodwill and intangible impairment

     -       64,586       19,762       64,586  

Adjusted EBITDA

   $ (5,700 )   $ (5,549 )   $ 101,854     $ 97,820  

 

(a) Segment performance is measured based on segment contribution margin or segment Adjusted EBITDA, reflecting only the direct controllable revenue and operating expenses of the segments, both of which are non-GAAP measurements. As such, management’s measure of profitability for these segments does not include the effect of corporate overhead, described above, depreciation and amortization, other income (net), and other items that we do not consider indicative of our core operating performance.

 

(b) Corporate expenses consist of the Company’s enterprise shared service cost centers, and include, among other items, Information Technology, Human Resources, Accounting and Finance, Legal, Executive and Customer Service Center functions, as well as Stock-based compensation. In order to leverage the Company’s infrastructure, these functions are operated under a centralized management platform, providing support services throughout the organization. The costs of these functions, other than those of the Customer Service Center, which are allocated directly to the above categories based upon usage, are included within corporate expenses as they are not directly allocable to a specific segment.

 

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Results of Operations

 

Net revenues

 

   

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

%

    

March 31,

    

April 2,

    

%

  
   

2024

    

2023

    

Change

    

2024

    

2023

    

Change

  
   

(dollars in thousands)

          

Net revenues:

                                                

E-Commerce

   $ 340,241     $ 357,801       -4.9 %   $ 1,288,558     $ 1,387,133       -7.1 %

Other

     39,164       59,765       -34.5 %     181,951       231,914       -21.5 %

Total net revenues

   $ 379,405     $ 417,566       -9.1 %   $ 1,470,509     $ 1,619,047       -9.2 %

 

Net revenues consist primarily of the selling price of the merchandise, service or outbound shipping charges, less discounts, returns and credits.

 

Net revenues decreased 9.1% and 9.2% during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year, due to lower order volume across all segments, reflecting a continuation of the trends that the Company had experienced throughout the prior fiscal year, as consumer discretionary income remains pressured, and consumers continue to moderate spending. Contributing to this decline was the prudent use of promotional offerings and advertising campaigns, which balance the long-term goals of the Company with strategies to improve gross margins and tightly control operating expenses during this challenging economic environment.

 

The Company acquired Things Remembered on January 10, 2023 and launched the brand on its e-commerce platform in April 2023. Things Remembered revenues were not significant during the three and nine months ended March 31, 2024.

 

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Three Months Ended

  
   

Consumer Floral & Gifts

    

BloomNet

    

Gourmet Foods & Gift Baskets

    

Corporate and Eliminations

    

Consolidated

  
   

March 31, 2024

    

April 2, 2023

    

% Change

    

March 31, 2024

    

April 2, 2023

    

% Change

    

March 31, 2024

    

April 2, 2023

    

% Change

    

March 31, 2024

    

April 2, 2023

    

March 31, 2024

    

April 2, 2023

    

% Change

  
    (dollars in thousands)  

Net revenues

                                                                                                                

E-commerce

   $ 218,590     $ 230,403       -5.1 %   $ -     $ -       - %   $ 121,651     $ 127,398       -4.5 %   $ -     $ -     $ 340,241     $ 357,801       -4.9 %

Other

     2,617       2,616       0.0 %     27,314       36,968       -26.1 %     9,338       20,465       -54.4 %     (105 )     (284 )     39,164       59,765       -34.5 %

Total net revenues

   $ 221,207     $ 233,019       -5.1 %   $ 27,314     $ 36,968       -26.1 %   $ 130,989     $ 147,863       -11.4 %   $ (105 )   $ (284 )   $ 379,405     $ 417,566       -9.1 %
                                                                                                                 

Other revenues detail

                                                                                                                

Retail and other

     2,617       2,616       0.0 %     -       -       -       1,629       1,686       -3.4 %     -       -       4,246       4,302       -1.3 %

Wholesale

     -       -       -       12,364       14,695       -15.9 %     7,709       18,779       -58.9 %     -       -       20,073       33,474       -40.0 %

BloomNet services

     -       -       -       14,950       22,273       -32.9 %     -       -       -       -       -       14,950       22,273       -32.9 %

Corporate

     -       -       -       -       -       -       -       -       -       167       36       167       36       363.9 %

Eliminations

     -       -       -       -       -       -       -       -       -       (272 )     (320 )     (272 )     (320 )     15.0 %

Total other revenues

   $ 2,617     $ 2,616       0.0 %   $ 27,314     $ 36,968       -26.1 %   $ 9,338     $ 20,465       -54.4 %   $ (105 )   $ (284 )   $ 39,164     $ 59,765       -34.5 %

 

   

Nine Months Ended

  
   

Consumer Floral & Gifts

    

BloomNet

    

Gourmet Foods & Gift Baskets

    

Corporate and Eliminations

    

Consolidated

  
   

March 31, 2024

    

April 2, 2023

    

% Change

    

March 31, 2024

    

April 2, 2023

    

% Change

    

March 31, 2024

    

April 2, 2023

    

% Change

    

March 31, 2024

    

April 2, 2023

    

March 31, 2024

    

April 2, 2023

    

% Change

  
    (dollars in thousands)  

Net revenues

                                                                                                                

E-commerce

   $ 611,770     $ 665,866       -8.1 %   $ -     $ -       - %   $ 676,788     $ 721,267       -6.2 %   $ -     $ -     $ 1,288,558     $ 1,387,133       -7.1 %

Other

     6,466       6,382       1.3 %     83,420       103,187       -19.2 %     92,273       123,255       -25.1 %     (208 )     (910 )     181,951       231,914       -21.5 %

Total net revenues

   $ 618,236     $ 672,248       -8.0 %   $ 83,420     $ 103,187       -19.2 %   $ 769,061     $ 844,522       -8.9 %   $ (208 )   $ (910 )   $ 1,470,509     $ 1,619,047       -9.2 %
                                                                                                                 

Other revenues detail

                                                                                                                

Retail and other

     6,466       6,382       1.3 %     -       -       -       7,859       7,907       -0.6 %     -       -       14,325       14,289       0.3 %

Wholesale

     -       -       -       32,867       40,370       -18.6 %     84,414       115,348       -26.8 %     -       -       117,281       155,718       -24.7 %

BloomNet services

     -       -       -       50,553       62,817       -19.5 %     -       -       -       -       -       50,553       62,817       -19.5 %

Corporate

     -       -       -       -       -       -       -       -       -       716       152       716       152       371.1 %

Eliminations

     -       -       -       -       -       -       -       -       -       (924 )     (1,062 )     (924 )     (1,062 )     13.0 %

Total other revenues

   $ 6,466     $ 6,382       1.3 %   $ 83,420     $ 103,187       -19.2 %   $ 92,273     $ 123,255       -25.1 %   $ (208 )   $ (910 )   $ 181,951     $ 231,914       -21.5 %

 

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Table of Contents

 

Revenue by sales channel:

 

E-commerce revenues (combined online and telephonic) decreased 4.9% and 7.1% during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year, primarily due to the decline in demand across all our segments as a result of the macro-economic conditions noted above. These external influences have negatively impacted consumer discretionary spending.

 

During the three and nine months ended March 31, 2024, the Company fulfilled approximately 4.3 million and 14.8 million orders through its e-commerce sales channel (online and telephonic sales), a decrease of 6.2% and 9.5%, respectively, compared to the same periods of the prior year. During the three and nine months ended March 31, 2024, average order value increased 1.4% and 2.7%, to $79.36 and $87.29, respectively, as a result of product mix trending into higher price point items, including bundles, and customer mix with more affluent consumers buying at a higher rate than less affluent. During the quarter ended March 31, 2024, the Company has introduced a wider selection of more modestly priced items to attract broader segments of our customer base to purchase. This did have some negative impact on our average order value.

 

Other revenues are comprised of the Company’s BloomNet segment, as well as the wholesale and retail channels of its Consumer Floral & Gifts and Gourmet Foods & Gift Baskets segments.

 

Other revenues during the three and nine months ended March 31, 2024, decreased 34.5% and 21.5%, respectively. compared to the same periods of the prior year, due to lower volumes in both wholesale and BloomNet services. The decrease in wholesale revenue was primarily due to certain retailers reducing their Easter orders in light of the consumer environment. The lower service revenues were due to lower shop-to-shop volumes.

 

Revenue by segment:

 

Consumer Floral & Gifts – this segment, which includes the operations of the 1-800-Flowers.com, PersonalizationMall, and Alice’s Table brands, and the Things Remembered brand, subsequent to its acquisition on January 10, 2023, derives revenue from the sale of consumer floral products and gifts through its e-commerce sales channels (telephonic and online sales), retail stores, and royalties from its franchise operations. 

 

Net revenues within this segment decreased 5.1% and 8.0% during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year. The Consumer Floral & Gifts segment experienced an increase in volume trend driven by the Valentine's Day holiday, but due to continued economic pressure, the brands focused their efforts on improving gross margin and operating spend efficiency, in the face of softening demand.

 

During the three and nine months ended March 31, 2024, Consumer Floral & Gifts orders through its e-commerce sales channel (online and telephonic sales) decreased 5.6% and 10.2%, respectively, compared to the same periods of the prior year. This was partially offset by an increase in average order value of 0.5% and 2.3%, respectively, as a result of product mix into higher price point items, including bundles, and customer mix with more affluent consumers buying at a higher rate than less affluent. During the quarter ended March 31, 2024, the Company has introduced a wider selection of more modestly priced items to attract broader segments of our customer base to purchase. This did have some negative impact on our average order value in the quarter.

 

BloomNet - revenues in this segment are derived from membership fees, as well as product and service offerings.

 

Net revenues decreased 26.1% and 19.2% during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year. The net revenue decline was due to soft wholesale product revenues, as well as, lower services revenues, attributable to a decline in order volume processed through the network.

 

Gourmet Foods & Gift Baskets – this segment includes the operations of Harry & David, Wolferman’s, Cheryl’s Cookies, The Popcorn Factory, 1-800-Baskets/DesignPac, Shari’s Berries, and Vital Choice. Revenue is derived from the sale of gourmet fruits, cookies, baked gifts, premium chocolates and confections, gourmet popcorn, gift baskets, dipped berries, prime steaks, chops, and fish, through the Company’s e-commerce sales channels (telephonic and online sales) and company-owned and operated retail stores under the Harry & David and Cheryl’s brand names, as well as wholesale operations.

 

Net revenues within this segment decreased 11.4% and 8.9% during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year, as a result of lower e-commerce and wholesale revenues, primarily due to macro-economic weakness. As such, the brands focused their efforts on improving gross margin and operating spend efficiency in the face of softening demand. 

 

During the three and nine months ended March 31, 2024, Gourmet Foods & Gift Baskets orders through its e-commerce sales channel (online and telephonic sales) decreased 7.3% and 8.7%, respectively, compared to the same periods of the prior year. This was partially offset by an increase in average order value of 3.0% and 2.8%, respectively, as a result of product mix trending into higher price point items, including bundles, and customer mix with more affluent consumers buying at a higher rate than less affluent.

 

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Gross profit

 

   

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

%

    

March 31,

    

April 2,

    

%

  
   

2024

    

2023

    

Change

    

2024

    

2023

    

Change

  
   

(dollars in thousands)

  
                                                 

Gross profit

   $ 138,717     $ 140,440       -1.2 %   $ 596,342     $ 609,664       -2.2 %

Gross profit %

     36.6 %     33.6 %             40.6 %     37.7 %        

 

Gross profit consists of net revenues less cost of revenues, which is comprised primarily of florist fulfillment costs (fees paid directly to florists), the cost of floral and non-floral merchandise sold from inventory or through third parties, and associated costs, including inbound and outbound shipping charges. Additionally, cost of revenues includes labor and facility costs related to direct-to-consumer and wholesale production operations, as well as payments made to sending florists related to order volume referred through the Company’s BloomNet network. 

 

Gross profit decreased 1.2% and 2.2% during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year, due to lower revenues as noted above, principally offset by a favorable gross profit percentage.

 

Gross profit percentage increased 300 and 290 basis points during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year, driven by lower florist fulfillment and rebate costs, as well as lower freight costs, a decline in certain commodity costs, reduced labor costs in our Gourmet Foods & Gift Baskets segment, and better inventory management.

 

Gross profit by segment follows:

 

Consumer Floral & Gifts segment - Gross profit decreased by 1.5% and 3.8% during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year, due to the impact of the lower revenues noted above, partially offset by favorable gross profit percentage attributable to lower florist fulfillment costs and lower freight costs in both the three and nine months ended March 31, 2024, and labor efficiencies for the nine months ended March 31, 2024.

 

BloomNet segment - Gross profit decreased by 21.0% and 9.5% during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year, due to the decrease in revenues noted above, partially offset by improved gross profit percentage. Gross profit percentage increased in comparison to the prior year primarily due to improvements in wholesale margins, lower freight costs and lower florist rebates due to lower volume.

 

Gourmet Foods & Gift Baskets segment – Gross profit increased by 7.7% and 0.1% during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year despite the revenue decrease noted above, as the brands delivered improved gross profit percentage. Gross profit percentage increased 530 and 350 basis points during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year. The increased gross profit percentage was attributable to lower freight costs, a decline in certain commodity prices, labor efficiencies, and better inventory management.

 

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Marketing and sales expense

 

   

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

%

    

March 31,

    

April 2,

    

%

  
   

2024

    

2023

    

Change

    

2024

    

2023

    

Change

  
   

(dollars in thousands)

  
                                                 

Marketing and sales

   $ 105,828     $ 106,472       -0.6 %   $ 376,903     $ 390,077       -3.4 %

Percentage of net revenues

     27.9 %     25.5 %             25.6 %     24.1 %        

 

Marketing and sales expense consists primarily of advertising and promotional expenditures, catalog costs, online portal and search costs, retail store and fulfillment operations (other than costs included in cost of revenues) and customer service center expenses, as well as the operating expenses of the Company’s departments engaged in marketing, selling and merchandising activities. 

 

Marketing and sales expense decreased 0.6% and 3.4% during the three and nine months ended March 31, 2024, respectively, compared to the same periods of the prior year, due to variable components associated with lower revenues, combined with planned reductions in advertising spend focused on driving profitable volume during a period when consumer discretionary purchases are under pressure.

 

Technology and development expense 

 

   

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

%

    

March 31,

    

April 2,

    

%

  
   

2024

    

2023

    

Change

    

2024

    

2023

    

Change

  
   

(dollars in thousands)

  
                                                 

Technology and development

   $ 15,291     $ 14,837       3.1 %   $ 45,417     $ 44,529       2.0 %

Percentage of net revenues

     4.0 %     3.6 %             3.1 %     2.8 %        

 

Technology and development expense consists primarily of payroll and operating expenses of the Company’s information technology group, costs associated with its websites, including hosting, design, content development and maintenance and support costs related to the Company’s order entry, customer service, fulfillment, and database systems.

 

Technology and development expense increased by 3.1% and 2.0% during the three and nine-month periods ended March 31, 2024, compared to the same periods of the prior year, primarily due to higher maintenance and support for the Company's technology platform enhancements, partially offset by lower web hosting costs in the quarter ended March 31, 2024, and reduced labor and consulting costs for the nine months ended March 31, 2024.

 

General and administrative expense

 

   

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

%

    

March 31,

    

April 2,

    

%

  
   

2024

    

2023

    

Change

    

2024

    

2023

    

Change

  
   

(dollars in thousands)

  
                                                 

General and administrative

   $ 32,295     $ 25,922       24.6 %   $ 87,938     $ 81,075       8.5 %

Percentage of net revenues

     8.5 %     6.2 %             6.0 %     5.0 %        

 

General and administrative expense consists of payroll and other expenses in support of the Company’s executive, finance and accounting, legal, human resources and other administrative functions, as well as professional fees and other general corporate expenses.

 

General and administrative expenses increased 24.6% and 8.5% during the three and nine-month periods ended March 31, 2024, respectively, compared to the same period of the prior year, primarily due to increases in labor costs driven by changes in the value of the Company’s NQDC plan investments (offset in Other Income below), as well as a severance charge taken during the quarter ended March 31, 2024, related to an enterprise reduction in workforce, partially offset by favorable bad debt expense and lower insurance and professional fees.

 

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Depreciation and amortization expense

 

   

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

%

    

March 31,

    

April 2,

    

%

  
   

2024

    

2023

    

Change

    

2024

    

2023

    

Change

  
   

(dollars in thousands)

  
                                                 

Depreciation and amortization

   $ 13,232     $ 13,267       -0.3 %   $ 40,578     $ 40,276       0.7 %

Percentage of net revenues

     3.5 %     3.2 %             2.8 %     2.5 %        

 

Depreciation and amortization expense decreased 0.3% during the three months ended March 31, 2024 , compared to the same period of the prior year, due to the timing of certain assets becoming fully depreciated, offset in part by distribution facility automation projects and IT-related ecommerce/platform enhancements. Depreciation and amortization expense increased 0.7% during the nine months ended March 31, 2024 compared to the same period of the prior year, due to distribution facility automation projects and IT-related ecommerce/platform enhancements.

 

Goodwill and Intangible impairment

 

   

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

%

    

March 31,

    

April 2,

    

%

  
   

2024

    

2023

    

Change

    

2024

    

2023

    

Change

  
   

(dollars in thousands)

  
                                                 

Goodwill and Intangible impairment

   $ -     $ 64,586       -100.0 %   $ 19,762     $ 64,586       -69.4 %

 

During the quarter ended December 31, 2023, the Company recorded a non-cash impairment charge of $19.8 million related to its PersonalizationMall trademark, due to a decline in the actual and projected revenue, combined with a higher discount rate resulting from the higher interest rate environment. See Note 5 - Goodwill and Intangible Assets, Net, in Item 1 for further information.

 

During the quarter ended April 2, 2023, the Company recorded a non-cash impairment charge of $64.6 million related to its Gourmet Foods & Gift Baskets reporting unit. The Company fully impaired the related goodwill and partially impaired certain tradenames within the reporting unit.

 

Interest expense, net

 

   

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

%

    

March 31,

    

April 2,

    

%

  
   

2024

    

2023

    

Change

    

2024

    

2023

    

Change

  
   

(dollars in thousands)

  
                                                 

Interest expense, net

   $ 881     $ 1,712       -48.5 %   $ 8,974     $ 8,676       3.4 %

 

Interest expense, net consists primarily of interest expense and amortization of deferred financing costs attributable to the Company’s credit facility (See Note 7 - Debt, Net in Item 1 for details), net of income earned on the Company’s available cash balances.

 

Interest expense, net decreased 48.5% during the three months ended March 31, 2024 compared to the same period of the prior year, primarily due to interest earned on available cash balances, partially offset by higher interest rates on the Company's credit facility. Interest expense, net increased 3.4% during the nine months ended March 31, 2024, compared to the same period of the prior year, due to higher interest rates on the Company's credit facility, partially offset by favorable interest earned on available cash balances.

 

Other expense (income), net

 

   

Three Months Ended

    

Nine Months Ended

  
   

March 31,

    

April 2,

    

%

    

March 31,

    

April 2,

    

%

  
   

2024

    

2023

    

Change

    

2024

    

2023

    

Change

  
   

(dollars in thousands)

  
                                                 

Other (income) expense, net

   $ (3,574 )   $ 1,404       354.6 %   $ (5,836 )   $ 2,474       335.9 %

 

Other (income) expense consists primarily of investment losses (gains) on the Company’s NQDC Plan investments.

 

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Income Taxes

 

The Company recorded income tax benefit of $8.3 million and income tax expense of $7.8 million during the three and nine months ended March 31, 2024, respectively, compared to an income tax benefit of $16.8 million and income tax expense of $0.1 million, during the three and nine months ended April 2, 2023, respectively. The Company’s effective tax rate for the three and nine months ended March 31, 2024, was 33.0% and 34.7%, respectively, compared to 19.1% and -0.6% in the same periods of the prior year. The Company’s effective tax rate for fiscal 2024 and fiscal 2023 differed from the U.S. federal statutory rate of 21.0% primarily due to impairment charges within the respective periods, thus reducing the amount of income reflected in the Company’s estimated annual effective tax rate. Further impacting the effective tax rate for fiscal 2024 and fiscal 2023 were tax deficiencies (shortfalls) from stock-based compensation, state income taxes and non-deductible executive compensation, partially offset by tax credits.

 

Liquidity and Capital Resources

 

Liquidity and borrowings

 

The Company's principal sources of liquidity are cash on hand, cash flows generated from operations, and borrowings available under the Company’s credit agreement (see Note 7 - Debt, Net in Item 1 for details). At March 31, 2024, the Company had working capital of $186.4 million, including cash and cash equivalents of $184.0 million, compared to working capital of $152.9 million, including cash and cash equivalents of $126.8 million, at July 2, 2023. 

 

Due to the seasonal nature of the Company’s business, and its continued expansion into non-floral products, the Thanksgiving through Christmas holiday season, which falls within the Company’s second fiscal quarter, is expected to generate over 40% of the Company’s annual revenues, and all of its earnings. Due to the number of major floral gifting occasions, including Mother’s Day, Valentine’s Day, Easter, and Administrative Professionals Week, revenues also have historically risen during the Company’s fiscal third and fourth quarters in comparison to its fiscal first quarter.

 

During the first two quarters of fiscal 2024, the Company borrowed under its revolving credit agreement to fund pre-holiday manufacturing and inventory procurement requirements, with borrowings peaking at $82.0 million in November 2023. Cash generated from operations during the Christmas holiday shopping season enabled the Company to repay the borrowings under the Revolver in December 2023. Based on current projected cash flows, the Company believes that available cash balances will be sufficient to provide for the Company’s operating needs through the remainder of fiscal 2024, at which time the Company would again expect to borrow against its Revolver to fund pre-holiday manufacturing and inventory purchases. The Company had no amounts outstanding under its Revolver as of March 31, 2024.

 

While we believe that our sources of funding will be sufficient to meet our anticipated operating cash needs for at least the next twelve months, any projections of future cash needs and cash flows are subject to substantial uncertainty. We continually evaluate, and will, from time to time, consider the acquisition of, or investment in, complementary businesses, products, services, capital infrastructure, and technologies, which might affect our liquidity requirements or cause us to require additional financing.

 

Cash Flows

 

Net cash provided by operating activities of $100.1 million, for the nine months ended March 31, 2024, was primarily attributable to the Company’s net income during the period, adjusted by non-cash charges related to the intangible impairment, depreciation and amortization, stock-based compensation and changes in deferred income taxes, combined with seasonal changes in net working capital, driven by a decrease in inventories.

 

Net cash used in investing activities of $26.5 million, for the nine months ended March 31, 2024, was attributable to capital expenditures primarily related to the Company's technology and automation initiatives.

 

Net cash used in financing activities of $16.4 million, for the nine months ended March 31, 2024, related primarily to net repayment of bank borrowings under the Company’s working capital line of credit and the repurchase of common stock.

 

Free Cash Flow

 

Free cash flow was $73.6 million for the nine months ended March 31, 2024, compared with free cash flow of $41.7 million for the nine months ended April 2, 2023, an increase of $31.9 million primarily driven by an increase in cash flows from operations. Refer to "Definitions of non-GAAP Financial Measures" for reconciliation of non-GAAP results to applicable GAAP results.

 

 

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Table of Contents

 

Stock Repurchase Program

 

See Item 2 in Part II below for details.

 

Contractual Obligations

 

At March 31, 2024, the Company’s contractual obligations consist of:

 

●

Long-term debt obligations - payments due under the Company's credit agreement (see Note 7 - Debt, Net in Item 1 for details and payments due by period).

●

Operating lease obligations – payments due under the Company’s operating leases (see Note 12 - Leases in Item 1 for details and payments due by period for the long-term operating leases).

●

Purchase commitments - consisting primarily of inventory and IT-related equipment purchase orders and license agreements made in the ordinary course of business – see below for the contractual payments due by period.

 

   

Payments due by period

  
   

(in thousands)

  
   

Remaining

                                                  
   

Fiscal

    

Fiscal

    

Fiscal

    

Fiscal

    

Fiscal

                  
   

2024

    

2025

    

2026

    

2027

    

2028

    

Thereafter

    

Total

  

Purchase commitments

   $ 54,971     $ 42,956     $ 5,039     $ 805     $ -     $ -     $ 103,771  

 

Critical Accounting Estimates

 

As disclosed in the Company’s Annual Report on Form 10-K, for the fiscal year ended July 2, 2023, the discussion and analysis of the Company’s financial condition and results of operations are based upon the consolidated financial statements, which have been prepared in conformity with U.S. generally accepted accounting principles. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. Management bases its estimates and assumptions on historical experience and on various other factors that are believed to be reasonable under the circumstances, and management evaluates its estimates and assumptions on an ongoing basis. Actual results may differ from these estimates under different assumptions or conditions. The Company’s most critical accounting policies relate to goodwill, other intangible assets and income taxes. There have been no significant changes to the assumptions and estimates related to the Company’s critical accounting policies since July 2, 2023.

 

Recently Issued Accounting Pronouncements 

 

See Note 1 - Accounting Policies in Item 1 for details regarding the impact of accounting standards that were recently issued on our consolidated financial statements.

 

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Table of Contents

 

Forward Looking Information and Factors that May Affect Future Results

 

Our disclosure and analysis in this report contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent the Company’s current expectations or beliefs concerning future events and can generally be identified by the use of statements that include words such as “estimate,” “expects,” “project,” “believe,” “anticipate,” “intend,” “plan,” “foresee,” “forecast,” “likely,” “will,” “goal,” “target” or similar words or phrases. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of the Company’s control that could cause actual results to differ materially from the results expressed or implied in the forward-looking statements, including:

 

●

the Company’s ability:

 

 

o

to achieve revenue and profitability;
 

o

to leverage its operating platform and reduce operating expenses;
 

o

to manage the seasonality of its business;
 

o

to cost effectively acquire and retain customers;
 

o 

to successfully integrate acquired businesses and assets;
 

o 

to reduce working capital requirements and capital expenditures;
 

o 

to mitigate the impact of supply chain cost and capacity constraints;
 

o

to compete against existing and new competitors;
 

o

to manage expenses associated with sales and marketing and necessary general and administrative and technology investments; and
 

o 

to address the effects of changes in accounting policies, practices, or assumptions, including changes that could potentially require future impairment charges;

 

●

the outcome of contingencies, including legal proceedings in the normal course of business; and

●

general consumer sentiment and economic conditions that may affect, among other things, the levels of discretionary customer purchases of the Company’s products and the costs of shipping and labor.

 

We cannot guarantee that any forward-looking statement will be realized, although we believe we have been prudent in our plans and assumptions. Achievement of future results is subject to risks, uncertainties, and inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could vary materially from past results and those anticipated, estimated, or projected. Investors should bear this in mind as they consider forward-looking statements.

 

We undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our Forms 10-Q, 8-K and 10-K reports to the Securities and Exchange Commission. Our Annual Report on Form 10-K for the fiscal year ended July 2, 2023 listed various important factors that could cause actual results to differ materially from expected and historic results. We note these factors for investors as permitted by the Private Securities Litigation Reform Act of 1995. Readers can find them in Part I, Item 1A, of that filing under the heading “Cautionary Statements Under the Private Securities Litigation Reform Act of 1995”. We incorporate that section of that Form 10-K in this filing and investors should refer to it. In addition, please refer to any additional risk factors in Part II, Item 1A in this Form 10-Q.

 

34
Table of Contents

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

The Company is exposed to market risk from the effect of interest rate changes.

 

Interest Rate Risk

 

The Company’s exposure to market risk for changes in interest rates relates primarily to the Company’s investment of available cash balances and its long-term debt. The Company generally invests its cash and cash equivalents in investment grade corporate and U.S. government securities. Borrowings under the Company’s credit facility bear interest at a variable rate, plus an applicable margin, and therefore expose the Company to market risk for changes in interest rates. The effect of a 50 basis point increase in current interest rates on the Company’s interest expense would be approximately $0.2 and $0.8 million during the three and nine months ended March 31, 2024, respectively.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures 

 

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as of March 31, 2024. Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have each concluded that the Company’s disclosure controls and procedures were effective as of March 31, 2024.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting identified in connection with the Company’s evaluation required by Rules 13a-15(d) or 15d-15(d) of the Securities Exchange Act of 1934 during the quarter ended March 31, 2024, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. 

 

Limitations on Effectiveness of Controls and Procedures

 

Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives, as specified above. Our management recognizes that any control system, no matter how well designed and operated, is based upon certain judgments and assumptions and cannot provide absolute assurance that its objectives will be met.

 

35
Table of Contents
 

 

PART II. – OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

Litigation

 

There are various claims, lawsuits, and pending actions against the Company and its subsidiaries incident to the operations of its businesses. It is the opinion of management, after consultation with counsel, that the final resolution of such claims, lawsuits and pending actions will not have a material adverse effect on the Company's consolidated financial position, results of operations or liquidity. 

 

ITEM 1A. RISK FACTORS

 

There were no material changes to the Company’s risk factors as discussed in Part 1, Item 1A-Risk Factors in the Company’s Annual Report on Form 10-K for the year ended July 2, 2023.

 

36
Table of Contents

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

The Company has a stock repurchase plan through which purchases can be made from time to time in the open market and through privately negotiated transactions, subject to general market conditions. The repurchase program is financed utilizing available cash. On April 22, 2021, the Company’s Board of Directors authorized an increase to its stock repurchase plan of up to $40.0 million. In addition, on February 3, 2022, the Company’s Board of Directors authorized an increase to its stock repurchase plan of up to $40.0 million. As of March 31, 2024, $22.8 million remained authorized under the plan.

 

The following table sets forth, for the months indicated, the Company’s purchase of common stock during the first nine months of fiscal 2024, which includes the period July 3, 2023 through March 31, 2024:

 

                   

Total

    

Dollar

  
                   

Number of

    

Value of

  
                   

Shares

    

Shares

  
                   

Purchased

    

that May

  
                   

as Part of

    

Yet Be

  
   

Total

    

Average

    

Publicly

    

Purchased

  
   

Number of

    

Price

    

Announced

    

Under the

  
   

Shares

    

Paid Per

    

Plans or

    

Plans or

  

Period

  

Purchased

    

Share (1)

    

Programs

    

Programs

  
   

(in thousands, except average price paid per share)

          
                                 

07/03/23 – 07/30/23

     -     $ -       -     $ 31,965  

07/31/23 – 08/27/23

     -     $ -       -     $ 31,965  

08/28/23 – 10/01/23

     10,483     $ 7.08       10,483     $ 31,890  

10/02/23 – 10/29/23

     -     $ -       -     $ 31,890  

10/30/23 – 11/26/23

     272,978     $ 8.56       272,978     $ 29,549  

11/27/23 – 12/31/23

     240,000     $ 9.85       240,000     $ 27,178  

01/01/24 – 01/28/24

     180,000     $ 10.38       180,000     $ 25,305  

01/29/24 – 02/25/24

     124,823     $ 10.10       124,823     $ 24,040  

02/26/24 – 03/31/24

     120,000     $ 10.42       120,000     $ 22,787  

Total

     948,284     $ 9.65       948,284          

 

(1)

Average price per share excludes commissions and other transaction fees.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

Not applicable.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable. 

 

 

ITEM 5. OTHER INFORMATION

 

None.

 

37
Table of Contents
     
 

ITEM 6. EXHIBITS

 

31.1

Certification of the principal executive officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *

31.2

Certification of the principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *

32.1

Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *

101.INS

Inline XBRL Instance Document

101.SCH

Inline XBRL Taxonomy Extension Schema Document

101.CAL

Inline XBRL Taxonomy Calculation Linkbase Document

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

Inline XBRL Taxonomy Extension Label Document

101.PRE

Inline XBRL Taxonomy Definition Presentation Document

104

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

 

* Filed herewith.

 

 

38
Table of Contents

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

1-800-FLOWERS.COM, Inc. 

(Registrant)
 

Date: May 8, 2024

/s/ James F. McCann      

James F. McCann
Executive Chairman and Chief Executive Officer
(Principal Executive Officer)  
   

Date: May 8, 2024

/s/ William E. Shea      
William E. Shea
Senior Vice President, Treasurer and
Chief Financial Officer (Principal
Financial and Accounting Officer)

 

39

Exhibit 31.1

 

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

(RULE 13a-14(a))

 

 

I, James F. McCann, certify that:

 

 

(1)

I have reviewed this quarterly report on Form 10-Q of 1-800-FLOWERS.COM, Inc.;

 

 

(2)

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

 

(3)

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

 

(4)

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

 

(a)

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

 

(b)

designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

 

(c)

evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

 

(d)

disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

 

 

(5)

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

 

(a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

 

(b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

 

Date: May 8, 2024

/s/ James F. McCann
 

James F. McCann
 

Executive Chairman and Chief Executive Officer
   

 

 

 

Exhibit 31.2

 

CERTIFICATION OF THE CHIEF FINANCIAL OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

(RULE 13a-14(a))

 

 

I, William E. Shea, certify that:

 

 

(1)

I have reviewed this quarterly report on Form 10-Q of 1-800-FLOWERS.COM, Inc.;

 

 

(2)

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

 

(3)

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

 

(4)

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

 

(a)

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

 

(b)

designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

 

(c)

evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

 

(d)

disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

 

 

(5)

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

 

(a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

 

(b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

 

Date: May 8, 2024

/s/ William E. Shea
 

William E. Shea
 

Senior Vice President, Treasurer and
 

Chief Financial Officer

 

 

 

Exhibit 32.1

 

CERTIFICATIONS PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

 

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of 1-800-FLOWERS.COM, Inc. (the “Company”) hereby certifies, to the best of such officer's knowledge, that:

 

(1) the Quarterly Report on Form 10-Q of the Company for the quarter ended March 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

 

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

Dated: May 8, 2024

/s/ James F. McCann
 

James F. McCann

Executive Chairman and Chief Executive Officer
   

Dated: May 8, 2024

/s/ William E. Shea
 

William E. Shea

Senior Vice President, Treasurer

and Chief Financial Officer

 

These certifications are furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by such Act, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such certifications will not be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates them by reference.

 

 

 
v3.24.1.u1
Document And Entity Information - shares
 9 Months Ended
Mar. 31, 2024
May 03, 2024
Document Information [Line Items]    
Entity Central Index Key 0001084869  
Entity Registrant Name 1 800 FLOWERS COM INC  
Amendment Flag false  
Current Fiscal Year End Date --06-30  
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2024  
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Mar. 31, 2024  
Document Transition Report false  
Entity File Number 0-26841  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 11-3117311  
Entity Address, Address Line One Two Jericho Plaza, Suite 200  
Entity Address, City or Town Jericho  
Entity Address, State or Province NY  
Entity Address, Postal Zip Code 11753  
City Area Code 516  
Local Phone Number 237-6000  
Title of 12(b) Security Class A common stock  
Trading Symbol FLWS  
Security Exchange Name NASDAQ  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Accelerated Filer  
Entity Small Business false  
Entity Emerging Growth Company false  
Entity Shell Company false  
Common Class B [Member]    
Document Information [Line Items]    
Entity Common Stock, Shares Outstanding   27,068,221
Common Class A [Member]    
Document Information [Line Items]    
Entity Common Stock, Shares Outstanding   37,141,975
v3.24.1.u1
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($)
$ in Thousands
Mar. 31, 2024
Jul. 02, 2023
Current assets:    
Cash and cash equivalents $ 183,956 $ 126,807
Trade receivables, net 26,779 20,419
Inventories 159,458 191,334
Prepaid and other 26,437 34,583
Total current assets 396,630 373,143
Property, plant and equipment, net 223,939 234,569
Operating lease right-of-use assets 114,784 124,715
Goodwill 153,577 153,376
Total identifiable intangible assets, net 116,783 139,888
Other assets 34,269 25,739
Total assets 1,039,982 1,051,430
Current liabilities:    
Accounts payable 47,015 52,588
Accrued expenses 138,004 141,914
Current maturities of long-term debt 10,000 10,000
Current portion of long-term operating lease liabilities 15,250 15,759
Total current liabilities 210,269 220,261
Long-term debt, net 179,432 186,391
Long-term operating lease liabilities 107,918 117,330
Deferred tax liabilities, net 22,599 31,134
Other liabilities 34,438 24,471
Total liabilities 554,656 579,587
Commitments and contingencies (See Note 14)
Stockholders' equity:    
Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued 0 0
Additional paid-in capital 396,109 388,215
Retained earnings 285,845 271,083
Accumulated other comprehensive loss (170) (170)
Treasury stock, at cost, 21,514,159 and 20,565,875 Class A shares at March 31, 2024 and July 2, 2023, respectively and 5,280,000 Class B shares at March 31, 2024 and July 2, 2023 (197,369) (188,191)
Total stockholders’ equity 485,326 471,843
Total liabilities and stockholders’ equity 1,039,982 1,051,430
Common Class A [Member]    
Stockholders' equity:    
Common stock 588 583
Common Class B [Member]    
Stockholders' equity:    
Common stock $ 323 $ 323
v3.24.1.u1
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - $ / shares
Mar. 31, 2024
Jul. 02, 2023
Preferred stock, par value (in dollars per share) $ 0.01 $ 0.01
Preferred stock, authorized (in shares) 10,000,000 10,000,000
Preferred stock, issued (in shares) 0 0
Common Class A [Member]    
Common stock, par value (in dollars per share) $ 0.01 $ 0.01
Common stock, authorized (in shares) 200,000,000 200,000,000
Common stock, issued (in shares) 58,781,134 58,273,747
Treasury stock, shares (in shares) 21,514,159 20,565,875
Common Class B [Member]    
Common stock, par value (in dollars per share) $ 0.01  
Common stock, authorized (in shares) 200,000,000  
Common stock, issued (in shares) 32,348,221 32,348,221
Treasury stock, shares (in shares) 5,280,000 5,280,000
v3.24.1.u1
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($)
shares in Thousands, $ in Thousands
 3 Months Ended 9 Months Ended
Mar. 31, 2024
Apr. 02, 2023
Mar. 31, 2024
Apr. 02, 2023
Net revenues $ 379,405 $ 417,566 $ 1,470,509 $ 1,619,047
Cost of revenues 240,688 277,126 874,167 1,009,383
Gross profit 138,717 140,440 596,342 609,664
Operating expenses:        
Marketing and sales 105,828 106,472 376,903 390,077
Technology and development 15,291 14,837 45,417 44,529
General and administrative 32,295 25,922 87,938 81,075
Depreciation and amortization 13,232 13,267 40,578 40,276
Goodwill and intangible impairment 0 64,586 19,762 64,586
Total operating expenses 166,646 225,084 570,598 620,543
Operating income (loss) (27,929) (84,644) 25,744 (10,879)
Interest expense, net 881 1,712 8,974 8,676
Other (income) expense, net (3,574) 1,404 (5,836) 2,474
Income (loss) before income taxes (25,236) (87,760) 22,606 (22,029)
Income tax (benefit) expense (8,333) (16,767) 7,844 126
Net income (loss) and comprehensive net income (loss) $ (16,903) $ (70,993) $ 14,762 $ (22,155)
Basic net income (loss) per common share (in dollars per share) $ (0.26) $ (1.1) $ 0.23 $ (0.34)
Diluted net income (loss) per common share (in dollars per share) $ (0.26) $ (1.1) $ 0.23 $ (0.34)
Weighted average shares used in the calculation of net income (loss) per common share:        
Basic (in shares) 64,489 64,767 64,703 64,660
Diluted (in shares) 64,489 64,767 65,057 64,660
v3.24.1.u1
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($)
$ in Thousands
Common Stock Outstanding [Member]
Common Class A [Member]
Common Stock Outstanding [Member]
Common Class B [Member]
Common Stock [Member]
Common Class A [Member]
Common Stock [Member]
Common Class B [Member]
Additional Paid-in Capital [Member]
Retained Earnings [Member]
AOCI Attributable to Parent [Member]
Treasury Stock, Common [Member]
Total
Balance (in shares) at Jul. 03, 2022 57,706,389 32,529,614           25,698,396  
Balance at Jul. 03, 2022     $ 577 $ 325 $ 379,885 $ 315,785 $ (211) $ (186,952) $ 509,409
Net income (loss)     0 0 0 (22,155) 0 $ 0 (22,155)
Stock-based compensation (in shares) 372,415 0           0  
Stock-based compensation     4 0 5,937 0 0 $ 0 5,941
Acquisition of Class A treasury stock (in shares) 0 0           142,005  
Acquisition of Class A treasury stock     0 0 0 0 0 $ (1,197) (1,197)
Conversion – Class B into Class A (in shares) 181,393                
Conversion – Class B into Class A     2            
Conversion – Class B into Class A (in shares)   (181,393)              
Conversion – Class B into Class A       (2)          
Balance (in shares) at Apr. 02, 2023 58,260,197 32,348,221           25,840,401  
Balance at Apr. 02, 2023     583 323 385,822 293,630 (211) $ (188,149) 491,998
Balance (in shares) at Jan. 01, 2023 58,256,031 32,348,221           25,838,644  
Balance at Jan. 01, 2023     583 323 383,335 364,623 (211) $ (188,127) 560,526
Net income (loss)     0 0 0 (70,993) 0 $ 0 (70,993)
Stock-based compensation (in shares) 4,166 0           0  
Stock-based compensation     0 0 2,487 0 0 $ 0 2,487
Acquisition of Class A treasury stock (in shares) 0 0           1,757  
Acquisition of Class A treasury stock     0 0 0 0 0 $ (22) (22)
Conversion – Class B into Class A (in shares) 0                
Conversion – Class B into Class A     0            
Conversion – Class B into Class A (in shares)   0              
Conversion – Class B into Class A       0          
Balance (in shares) at Apr. 02, 2023 58,260,197 32,348,221           25,840,401  
Balance at Apr. 02, 2023     583 323 385,822 293,630 (211) $ (188,149) 491,998
Balance (in shares) at Jul. 02, 2023 58,273,747 32,348,221           25,845,875  
Balance at Jul. 02, 2023     583 323 388,215 271,083 (170) $ (188,191) 471,843
Net income (loss)     0 0 0 14,762 0 $ 0 14,762
Stock-based compensation (in shares) 477,374 0           0  
Stock-based compensation     5 0 7,636 0 0 $ 0 7,641
Exercise of stock options (in shares) 30,013 0           0  
Exercise of stock options     0 0 258 0 0 $ 0 258
Acquisition of Class A treasury stock (in shares) 0 0           948,284  
Acquisition of Class A treasury stock     0 0 0 0 0 $ (9,178) (9,178)
Balance (in shares) at Mar. 31, 2024 58,781,134 32,348,221           26,794,159  
Balance at Mar. 31, 2024     588 323 396,109 285,845 (170) $ (197,369) 485,326
Balance (in shares) at Dec. 31, 2023 58,743,969 32,348,221           26,369,336  
Balance at Dec. 31, 2023     588 323 392,849 302,748 (170) $ (192,978) 503,360
Net income (loss)     0 0 0 (16,903) 0 $ 0 (16,903)
Stock-based compensation (in shares) 12,262 0           0  
Stock-based compensation     0 0 3,046 0 0 $ 0 3,046
Exercise of stock options (in shares) 24,903 0           0  
Exercise of stock options     0 0 214 0 0 $ 0 214
Acquisition of Class A treasury stock (in shares) 0 0           424,823  
Acquisition of Class A treasury stock     0 0 0 0 0 $ (4,391) (4,391)
Balance (in shares) at Mar. 31, 2024 58,781,134 32,348,221           26,794,159  
Balance at Mar. 31, 2024     $ 588 $ 323 $ 396,109 $ 285,845 $ (170) $ (197,369) $ 485,326
v3.24.1.u1
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
$ in Thousands
 9 Months Ended
Mar. 31, 2024
Apr. 02, 2023
Operating activities:    
Net income (loss) $ 14,762 $ (22,155)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:    
Goodwill and intangible impairment 19,762 64,586
Depreciation and amortization 40,578 40,276
Amortization of deferred financing costs 541 998
Deferred income taxes (8,535) (4,390)
Bad debt expense 418 2,997
Stock-based compensation 7,641 5,941
Other non-cash items (122) (245)
Changes in operating items:    
Trade receivables (6,778) (15,977)
Inventories 31,674 57,031
Prepaid and other 4,761 2,706
Accounts payable and accrued expenses (6,077) (59,806)
Other assets and liabilities 1,426 1,102
Net cash provided by operating activities 100,051 73,064
Investing activities:    
Acquisitions, net of cash acquired 0 (5,000)
Capital expenditures (26,482) (31,351)
Net cash used in investing activities (26,482) (36,351)
Financing activities:    
Acquisition of treasury stock (9,178) (1,197)
Proceeds from exercise of employee stock options 258 0
Proceeds from bank borrowings 82,000 195,900
Repayment of bank borrowings (89,500) (210,900)
Debt issuance cost 0 (383)
Net cash used in financing activities (16,420) (16,580)
Net change in cash and cash equivalents 57,149 20,133
Cash and cash equivalents:    
Beginning of period 126,807 31,465
End of period $ 183,956 $ 51,598
v3.24.1.u1
Note 1 - Accounting Policies
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block]

Note 1 – Accounting Policies

 

Basis of Presentation

 

The accompanying unaudited condensed consolidated financial statements have been prepared by 1-800-FLOWERS.COM, Inc. and Subsidiaries (the “Company”) in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three and nine-month periods ended March 31, 2024 are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2024. These financial statements should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended July 2, 2023, which provides a more complete understanding of our accounting policies, financial position, operating results and other matters.

 

The Company’s quarterly results may experience seasonal fluctuations. Due to the seasonal nature of the Company’s business, and its continued expansion into non-floral products, the Thanksgiving through Christmas holiday season, which falls within the Company’s second fiscal quarter, is expected to generate over 40% of the Company’s annual revenues, and all of its earnings. Due to the number of major floral gifting occasions, including Mother's Day, Valentine’s Day, Easter, and Administrative Professionals Week, revenues also have historically risen during the Company’s fiscal third and fourth quarters in comparison to its fiscal first quarter.

 

Use of Estimates

 

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

 

Revenue Recognition

 

Net revenue is measured based on the amount of consideration that we expect to receive, reduced by discounts and estimates for credits and returns (calculated based upon previous experience and management’s evaluation). Service and outbound shipping charged to customers are recognized at the time the related merchandise revenues are recognized and are included in net revenues. Inbound and outbound shipping and delivery costs are included in cost of revenues. Net revenues exclude sales and other similar taxes collected from customers.

 

A description of our principal revenue generating activities is as follows:

 

●

E-commerce revenues - consumer products sold through our online and telephonic channels. Revenue is recognized when control of the merchandise is transferred to the customer, which generally occurs upon shipment. Payment is typically due prior to the date of shipment.

●

Retail revenues - consumer products sold through our retail stores. Revenue is recognized when control of the goods is transferred to the customer, at the point of sale, at which time payment is received.

●

Wholesale revenues - products sold to our wholesale customers for subsequent resale. Revenue is recognized when control of the goods is transferred to the customer, in accordance with the terms of the applicable agreement. Payment terms are typically 30 days from the date control over the product is transferred to the customer.

●

BloomNet Services - membership fees as well as other service offerings to florists. Membership and other subscription-based fees are recognized monthly as earned. Services revenues related to orders sent through the floral network are variable, based on either the number of orders or the value of orders, and are recognized in the period in which the orders are delivered. The contracts within BloomNet Services are typically month-to-month and, as a result, no consideration allocation is necessary across multiple reporting periods. Payment is typically due less than 30 days from the date the services were performed. 

 

Deferred Revenues

 

Deferred revenues are recorded when the Company has received consideration (i.e. advance payment) before satisfying its performance obligations. As such, customer orders are recorded as deferred revenue prior to shipment or rendering of product or services. Deferred revenues primarily relate to e-commerce orders placed, but not shipped, prior to the end of the fiscal period, as well as for subscription programs, including our various food, wine, and plant-of-the-month clubs and our Celebrations Passport® program.

 

Our total deferred revenue as of  July 2, 2023 was $30.8 million (included in “Accrued expenses” on our consolidated balance sheets), of which $2.8 million and $29.6 million was recognized as revenue during the three and nine months ended March 31, 2024, respectively. The deferred revenue balance as of  March 31, 2024 was $31.7 million.

 

Impairment Evaluation

 

The Company performs its annual assessment of goodwill and indefinite-lived intangible impairment during its fiscal fourth quarter, or more frequently if events occur or circumstances change such that it is more likely than not that an impairment  may exist. During the quarter ended December 31, 2023, as a result of a decline in the actual and projected revenue for the Company’s PersonalizationMall tradename (indefinite-lived intangible asset), as well as a higher discount rate resulting from the higher interest rate environment, the Company determined that an impairment assessment was required for this tradename. This assessment resulted in the Company recording a non-cash impairment charge of $19.8 million to reduce the recorded carrying value of the PersonalizationMall tradename.

 

The Company concluded that goodwill and other indefinite-lived intangible assets, excluding its PersonalizationMall tradename, did not require an impairment assessment. See Note 5 – Goodwill and Intangible Assets, Net for further information.

 

Recently Issued Accounting Pronouncements

 

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 requires enhanced disclosures about significant segment expenses, includes enhanced interim disclosure requirements, clarifies circumstances in which an entity can disclose multiple segment measures of profit or loss, provides new segment disclosure requirements for entities with a single reportable segment, and contains other disclosure requirements. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. ASU 2023-07 is to be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact of ASU 2023-07 on its consolidated financial statements and related disclosures.

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires the disclosure of additional information with respect to the reconciliation of the effective tax rate to the statutory rate for federal, state, and foreign income taxes and requires greater detail about significant reconciling items in the reconciliation. Additionally, the amendment requires disaggregated information pertaining to taxes paid, net of refunds received, for federal, state, and foreign income taxes. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and allows for either a prospective or retrospective approach on adoption. The Company is currently evaluating the impact of ASU 2023-09 on its consolidated financial statements and related disclosures.

 

 
v3.24.1.u1
Note 2 - Net Income (Loss) Per Common Share
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Earnings Per Share [Text Block]

Note 2 – Net Income (Loss) Per Common Share

 

Basic net income (loss) per common share is computed by dividing the net income (loss) during the period by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted into common stock.

 

The following table sets forth the computation of basic and diluted net income (loss) per common share:

 

  

Three Months Ended

  

Nine Months Ended

 
  

March 31,

  

April 2,

  

March 31,

  

April 2,

 
  

2024

  

2023

  

2024

  

2023

 
  

(in thousands, except per share data)

 

Numerator:

                

Net income (loss)

 $(16,903) $(70,993) $14,762  $(22,155)
                 

Denominator:

                

Weighted average shares outstanding

  64,489   64,767   64,703   64,660 

Effect of dilutive stock options and unvested restricted stock awards

  -   -   354   - 
                 

Diluted weighted-average shares outstanding

  64,489   64,767   65,057   64,660 
                 

Net income (loss) per common share

                

Basic

 $(0.26) $(1.10) $0.23  $(0.34)

Diluted

 $(0.26) $(1.10) $0.23  $(0.34)

 
v3.24.1.u1
Note 3 - Acquisitions
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Mergers, Acquisitions and Dispositions Disclosures [Text Block]

Note 3 – Acquisitions

 

Acquisition of Things Remembered

 

On January 10, 2023, the Company completed its acquisition of certain assets of the Things Remembered brand, a provider of personalized gifts, whose operations are integrated within the PersonalizationMall.com brand, in the Consumer Floral & Gifts segment. The Company used cash on hand to fund the $5.0 million purchase, which included the intellectual property, customer list, certain inventory, and equipment. The acquisition did not include Things Remembered retail stores. Things Remembered’s annual revenues from its e-commerce operations, based on its most recently available unaudited financial information was $30.4 million for the twelve months ended November 30, 2022.

 

The total consideration of $5.0 million was allocated to the identifiable assets acquired and liabilities assumed based on our estimates of their fair values on the acquisition date, including: goodwill of $1.9 million (deductible for income tax purposes), trademarks of $0.8 million (indefinite life), customer lists of $0.8 million (3-year life), inventory of $1.1 million, and equipment of $0.4 million. During the quarter ended December 31, 2023, the Company finalized its purchase price allocation, resulting in immaterial adjustments to the preliminary carrying value of the respective recorded assets and the residual amount that was allocated to goodwill.

 

Operating results of the Things Remembered business are reflected in the Company’s consolidated financial statements from the date of acquisition within the Consumer Floral & Gifts segment. Pro forma results of operations have not been presented, as the impact on the Company’s consolidated financial results was not material.

 
v3.24.1.u1
Note 4 - Inventory
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Inventory Disclosure [Text Block]

Note 4 – Inventory

 

The Company’s inventory, valued at the lower of cost or net realizable value, includes purchased and manufactured finished goods for sale, packaging supplies, crops, raw material ingredients for manufactured products and associated manufacturing labor, and is classified as follows:

 

  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Finished goods

 $86,503  $92,582 

Work-in-process

  22,299   33,818 

Raw materials

  50,656   64,934 

Total inventory

 $159,458  $191,334 

 
v3.24.1.u1
Note 5 - Goodwill and Intangible Assets, Net
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Goodwill and Intangible Assets Disclosure [Text Block]

Note 5 – Goodwill and Intangible Assets, Net

 

The following table presents goodwill by segment and the related change in the net carrying amount:

 

          

Gourmet

     
  

Consumer

      

Foods &

     
  

Floral &

      

Gift

     
  

Gifts

  

BloomNet

  

Baskets

  

Total

 
  

(in thousands)

 

Balance at July 2, 2023

 $153,376  $-  $-  $153,376 

Measurement period adjustment for Things Remembered Acquisition

  201   -   -   201 

Balance at March 31, 2024

 $153,577  $-  $-  $153,577 

 

The Company’s other intangible assets consist of the following:

 

     

March 31, 2024

  

July 2, 2023

 
     

Gross

          

Gross

         
  

Amortization

  

Carrying

  

Accumulated

      

Carrying

  

Accumulated

     
  

Period

  

Amount

  

Amortization

  

Net

  

Amount

  

Amortization

  

Net

 
  

(in years)

  

(in thousands)

 

Intangible assets with determinable lives

                           

Investment in licenses

 14 - 16  $7,420  $6,648  $772  $7,420  $6,569  $851 

Customer lists

 3 - 10   29,071   24,830   4,241   29,071   21,611   7,460 

Other

 5 - 14   2,946   2,649   297   2,946   2,604   342 

Total intangible assets with determinable lives

     39,437   34,127   5,310   39,437   30,784   8,653 

Trademarks with indefinite lives

     111,473   -   111,473   131,235   -   131,235 

Total identifiable intangible assets

    $150,910  $34,127  $116,783  $170,672  $30,784  $139,888 

 

Future estimated amortization expense is as follows: remainder of fiscal 2024 - $1.1 million, fiscal 2025 - $1.9 million, fiscal 2026 - $1.3 million, fiscal 2027 - $0.5 million, fiscal 2028 - $0.2 million and thereafter - $0.3 million.

 

The Company performs its annual assessment of goodwill and indefinite-lived intangible impairment during its fiscal fourth quarter, or more frequently if events occur or circumstances change such that it is more likely than not that an impairment  may exist.

 

During the quarter ended December 31, 2023, as a result of a decline in the actual and projected revenue for the Company’s PersonalizationMall tradename (indefinite-lived intangible asset), as well as a higher discount rate resulting from the higher interest rate environment, the Company determined that an impairment assessment was required. The Company’s impairment test for the indefinite-lived intangible asset encompassed calculating a fair value of the indefinite-lived intangible asset and comparing that result to its carrying value. To determine fair value of the indefinite-lived intangible asset, the Company used an income approach, the relief-from-royalty method. This method assumes that, in lieu of ownership, a third party would be willing to pay a royalty in order to obtain the rights to use the comparable asset. Indefinite-lived intangible assets’ fair values require significant judgments in determining both the assets’ estimated cash flows as well as the appropriate discount and royalty rates applied to those cash flows to determine fair value. Based on the impairment assessment performed for the quarter ended  December 31, 2023, the Company recorded a non-cash impairment charge of $19.8 million to reduce the recorded carrying value of the PersonalizationMall tradename to its estimated fair value. This impairment charge was recorded in the Company’s Consumer Floral & Gifts reporting unit. The Company concluded that goodwill and other indefinite-lived intangible assets, excluding its PersonalizationMall tradename, did not require an impairment assessment.

   
v3.24.1.u1
Note 6 - Investments
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Equity Method Investments and Joint Ventures Disclosure [Text Block]

Note 6 – Investments

 

Equity investments without a readily determinable fair value

 

Investments in non-marketable equity instruments of private companies, where the Company does not possess the ability to exercise significant influence, are accounted for at cost, less impairment (assessed qualitatively at each reporting period), adjusted for observable price changes from orderly transactions for identical or similar investments of the same issuer. These investments are included within “Other assets” in the Company’s consolidated balance sheets. The aggregate carrying amount of the Company’s equity investments without a readily determinable fair value was $2.6 million as of  March 31, 2024 and July 2, 2023, respectively. 

 

Equity investments with a readily determinable fair value

 

The Company also holds certain trading securities associated with its Non-Qualified Deferred Compensation Plan (“NQDC Plan”). These investments are measured using quoted market prices at the reporting date and are included within the “Other assets” line item in the consolidated balance sheets (see Note 9 - Fair Value Measurements). 

   
v3.24.1.u1
Note 7 - Debt, Net
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Debt Disclosure [Text Block]

Note 7 – Debt, Net

 

The Company’s current and long-term debt consists of the following:

 

  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Revolver

 $-  $- 

Term Loans

  192,500   200,000 

Deferred financing costs

  (3,068)  (3,609)

Total debt

  189,432   196,391 

Less: current maturities of long-term debt

  10,000   10,000 

Long-term debt, net

 $179,432  $186,391 

 

On June 27, 2023, the Company, certain of its U.S. subsidiaries, the lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent entered into a Third Amended and Restated Credit Agreement (the “Third Amended Credit Agreement”). The Third Amended Credit Agreement amends and restates the Company’s Second Amended and Restated Credit Agreement, dated as of May 31, 2019 (as amended by the First Amendment, dated as of August 20, 2020, the Second Amendment, dated as of November 8, 2021, and the Third Amendment, dated as of August 29, 2022). The Third Amended Credit Agreement, among other modifications: (i) increases the amount of the outstanding term loan (“Term Loan”) from approximately $150 million to $200 million, (ii) decreases the amount of the commitments in respect of the revolving credit facility from $250 million to $225 million, subject to a seasonal reduction to an aggregate amount of $125 million for the period from January 1 to August 1, (iii) extends the maturity date of the outstanding term loan and the revolving credit facilities by approximately 48 months to June 27, 2028, and (iv) increases the applicable interest rate margins for SOFR and base rate loans by 25 basis points.

 

For each borrowing under the Third Amended Credit Agreement, the Company may elect that such borrowing bear interest at an annual rate equal to either: (1) a base rate plus an applicable margin varying based on the Company’s consolidated leverage ratio, where the base rate is the highest of (a) the prime rate, (b) the New York fed bank rate plus 0.5%, and (c) an adjusted SOFR rate plus an applicable margin varying based on the Company’s consolidated leverage ratio. The adjusted SOFR rate includes a credit spread adjustment of 0.1% for all interest periods.

 

The Third Amended Credit Agreement requires that while any borrowings or commitments are outstanding the Company comply with certain financial covenants and affirmative covenants as well as certain negative covenants that, subject to certain exceptions, limit the Company’s ability to, among other things, incur additional indebtedness, make certain investments and make certain restricted payments. The Company was in compliance with these covenants as of March 31, 2024. The Third Amended Credit Agreement is secured by substantially all of the assets of the Company.

 

The principal of the Term Loan is payable at a rate of $2.5 million for the first 8 quarterly installments beginning on September 29, 2023, increasing to a quarterly payment of $5.0 million, commencing on September 26, 2025, for the remaining 11 payments, with the remaining balance of $125.0 million due upon maturity on June 27, 2028.

 

Future principal term loan payments under the Third Amended Credit Agreement are as follows: $2.5 million – remainder of Fiscal 2024, $10.0 million – Fiscal 2025, $20.0 million – Fiscal 2026, $20.0 million – Fiscal 2027, and $140.0 million – Fiscal 2028.

   
v3.24.1.u1
Note 8 - Property, Plant and Equipment, Net
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Property, Plant and Equipment Disclosure [Text Block]

Note 8 – Property, Plant and Equipment, Net

 

The Company’s property, plant and equipment consists of the following:

 

  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Land

 $33,827  $33,866 

Orchards in production and land improvements

  20,604   20,401 

Building and building improvements

  68,911   67,647 

Leasehold improvements

  30,973   29,524 

Production equipment

  130,890   125,297 

Furniture and fixtures

  9,294   9,102 

Computer and telecommunication equipment

  42,832   41,859 

Software

  192,837   181,085 

Capital projects in progress

  17,608   18,205 

Property, plant and equipment, gross

  547,776   526,986 

Accumulated depreciation and amortization

  (323,837)  (292,417)

Property, plant and equipment, net

 $223,939  $234,569 

 
v3.24.1.u1
Note 9 - Fair Value Measurements
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Fair Value Disclosures [Text Block]

Note 9 – Fair Value Measurements

 

Cash and cash equivalents, trade and other receivables, prepaids, accounts payable and accrued expenses are reflected in the consolidated balance sheets at carrying value, which approximates fair value due to the short-term nature of these instruments. Although no trading market exists, the Company believes that the carrying amount of its debt approximates fair value due to its variable nature (these are level 2 investments). The Company’s investments in non-marketable equity instruments of private companies are carried at cost and are periodically assessed for other-than-temporary impairment when an event or circumstances indicate that an other-than-temporary decline in value may have occurred. The Company’s remaining financial assets and liabilities are measured and recorded at fair value (see table below). The Company’s non-financial assets, such as definite lived intangible assets and property, plant and equipment, are recorded at cost and are assessed for impairment when an event or circumstance indicates that an other-than-temporary decline in value may have occurred. Goodwill and indefinite lived intangibles are tested for impairment annually, or more frequently, if events occur or circumstances change such that it is more likely than not that an impairment may exist, as required under the accounting standards.

 

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants at the measurement date. The authoritative guidance for fair value measurements establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy under the guidance are described below:

 

Level 1

Valuations based on quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.

Level 2

Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.

Level 3

Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

 

The following table presents by level, within the fair value hierarchy, financial assets and liabilities measured at fair value on a recurring basis:

 

  

Carrying

  

Fair Value Measurements

 
  

Value

  

Assets (Liabilities)

 
      

Level 1

  

Level 2

  

Level 3

 
  

(in thousands)

 

As of March 31, 2024

                

Trading securities held in a “rabbi trust” (1)

 $31,160  $31,160  $-  $- 

Total assets (liabilities) at fair value

 $31,160  $31,160  $-  $- 
                 

As of July 2, 2023

                

Trading securities held in a “rabbi trust” (1)

 $22,617  $22,617  $-  $- 

Total assets (liabilities) at fair value

 $22,617  $22,617  $-  $- 

 

 

(1)

The Company has established a NQDC Plan for certain members of senior management. Deferred compensation plan assets are invested in mutual funds held in a “rabbi trust,” which is restricted for payment to participants of the NQDC Plan. Trading securities held in a rabbi trust are measured using quoted market prices at the reporting date and are included in the “Other assets” line item, with the corresponding liability included in the “Other liabilities” line item in the consolidated balance sheets. 

   
v3.24.1.u1
Note 10 - Income Taxes
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

Note 10 – Income Taxes

 

The Company computed the interim tax provision using an estimated annual effective rate, adjusted for discrete items. This estimate is used in providing for income taxes on a year-to-date basis and may change in subsequent interim periods. The Company’s effective tax rate for the three and nine months ended March 31, 2024 was 33.0% and 34.7%, respectively, compared to 19.1% and -0.6% in the same periods of the prior year. The Company’s effective tax rate for fiscal 2024 and fiscal 2023 differed from the U.S. federal statutory rate of 21.0% primarily due to impairment charges within the respective periods, thus reducing the amount of income reflected in the Company’s estimated annual effective tax rate. Further impacting the effective tax rate for fiscal 2024 and fiscal 2023 were tax deficiencies (shortfalls) from stock-based compensation, state income taxes and non-deductible executive compensation, partially offset by tax credits.

 

On a regular basis, the Company evaluates the recoverability of deferred tax assets and the need for a valuation allowance. Such evaluations involve the application of significant judgment. The Company considers multiple factors in its evaluation of the need for a valuation allowance, including reversal of deferred tax liabilities, available tax planning strategies that could be implemented to realize the deferred tax assets, and forecasted future taxable income.  A valuation allowance is provided when it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. At both  March 31, 2024 and July 2, 2023, the Company had valuation allowances of approximately $3.2 million, primarily related to certain state and foreign net operating losses.

 

The Company files income tax returns in the U.S. federal jurisdiction, various state jurisdictions, and various foreign countries. The Company’s fiscal years 2020, 2021, and 2022 remain subject to U.S. federal examination. Due to ongoing state examinations and nonconformity with the U.S. federal statute of limitations for assessment, certain states remain open from fiscal 2016. The Company's foreign income tax filings from fiscal 2017 are open for examination by its respective foreign tax authorities, mainly Canada and Brazil.

 

The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. At March 31, 2024, the Company has an unrecognized tax benefit, including accrued interest and penalties, of approximately $3.2 million. The Company believes that $0.4 million of unrecognized tax positions will be resolved over the next twelve months. 

 
v3.24.1.u1
Note 11 - Business Segments
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]

Note 11 – Business Segments

 

The Company’s management reviews the results of its operations by the following three business segments:

 

•

Consumer Floral & Gifts,

•

BloomNet, and

•

Gourmet Foods & Gift Baskets

 

Segment performance is measured based on contribution margin, which includes only the direct controllable revenue and operating expenses of the segments. As such, management’s measure of profitability for these segments does not include the effect of corporate overhead (see (a) below), nor does it include depreciation and amortization, other (income) expense, net and income taxes, or stock-based compensation, which are included within corporate overhead. Assets and liabilities are reviewed at the consolidated level by management and not accounted for by segment.

 

  

Three Months Ended

  

Nine Months Ended

 
  

March 31,

  

April 2,

  

March 31,

  

April 2,

 
  

2024

  

2023

  

2024

  

2023

 
  

(in thousands)

 

Net Revenues:

                

Segment Net Revenues:

                

Consumer Floral & Gifts

 $221,207  $233,019  $618,236  $672,248 

BloomNet

  27,314   36,968   83,420   103,187 

Gourmet Foods & Gift Baskets

  130,989   147,863   769,061   844,522 

Corporate

  167   36   716   152 

Intercompany eliminations

  (272)  (320)  (924)  (1,062)

Total net revenues

 $379,405  $417,566  $1,470,509  $1,619,047 
                 

Operating Income:

                

Segment Contribution Margin:

                

Consumer Floral & Gifts

 $22,190  $26,136  $41,609  $64,832 

BloomNet

  7,506   10,982   25,981   29,847 

Gourmet Foods & Gift Baskets

  (8,172)  (78,480)  98,953   26,313 

Segment Contribution Margin Subtotal

  21,524   (41,362)  166,543   120,992 

Corporate (a)

  (36,221)  (30,015)  (100,221)  (91,595)

Depreciation and amortization

  (13,232)  (13,267)  (40,578)  (40,276)

Operating income

 $(27,929) $(84,644) $25,744  $(10,879)

 

(a) Corporate expenses consist of the Company’s enterprise shared service cost centers, and include, among other items, Information Technology, Human Resources, Accounting and Finance, Legal, Executive and Customer Service Center functions, as well as Stock-based compensation. In order to leverage the Company’s infrastructure, these functions are operated under a centralized management platform, providing support services throughout the organization. The costs of these functions, other than those of the Customer Service Center, which are allocated directly to the above categories based upon usage, are included within corporate expenses as they are not directly allocable to a specific segment.

 

The following tables represent a disaggregation of revenue from contracts with customers, by channel: 

 

  

Three Months Ended

 
  

Consumer Floral &

          

Gourmet Foods &

  

Corporate and

         
  

Gifts

  

BloomNet

  

Gift Baskets

  

Eliminations

  

Consolidated

 
  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

 
  (in thousands) 

Net revenues

                                        

E-commerce

 $218,590  $230,403  $-  $-  $121,651  $127,398  $-  $-  $340,241  $357,801 

Other

  2,617   2,616   27,314   36,968   9,338   20,465   (105)  (284)  39,164   59,765 

Total net revenues

 $221,207  $233,019  $27,314  $36,968  $130,989  $147,863  $(105) $(284) $379,405  $417,566 
                                         

Other revenues detail

                                        

Retail and other

  2,617   2,616   -   -   1,629   1,686   -   -   4,246   4,302 

Wholesale

  -   -   12,364   14,695   7,709   18,779   -   -   20,073   33,474 

BloomNet services

  -   -   14,950   22,273   -   -   -   -   14,950   22,273 

Corporate

  -   -   -   -   -   -   167   36   167   36 

Eliminations

  -   -   -   -   -   -   (272)  (320)  (272)  (320)

Total other revenues

 $2,617  $2,616  $27,314  $36,968  $9,338  $20,465  $(105) $(284) $39,164  $59,765 

 

  

Nine Months Ended

 
  

Consumer Floral &

          

Gourmet Foods &

  

Corporate and

         
  

Gifts

  

BloomNet

  

Gift Baskets

  

Eliminations

  

Consolidated

 
  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

 
  (in thousands) 

Net revenues

                                        

E-commerce

 $611,770  $665,866  $-  $-  $676,788  $721,267  $-  $-  $1,288,558  $1,387,133 

Other

  6,466   6,382   83,420   103,187   92,273   123,255   (208)  (910)  181,951   231,914 

Total net revenues

 $618,236  $672,248  $83,420  $103,187  $769,061  $844,522  $(208) $(910) $1,470,509  $1,619,047 
                                         

Other revenues detail

                                        

Retail and other

  6,466   6,382   -   -   7,859   7,907   -   -   14,325   14,289 

Wholesale

  -   -   32,867   40,370   84,414   115,348   -   -   117,281   155,718 

BloomNet services

  -   -   50,553   62,817   -   -   -   -   50,553   62,817 

Corporate

  -   -   -   -   -   -   716   152   716   152 

Eliminations

  -   -   -   -   -   -   (924)  (1,062)  (924)  (1,062)

Total other revenues

 $6,466  $6,382  $83,420  $103,187  $92,273  $123,255  $(208) $(910) $181,951  $231,914 

 
v3.24.1.u1
Note 12 - Leases
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Lessee, Operating Leases [Text Block]

Note 12 – Leases 

 

The Company currently leases plants, warehouses, offices, store facilities, and equipment under various leases through fiscal 2036. Most lease agreements are of a long-term nature (over a year), although the Company does also enter into short-term leases, primarily for seasonal needs. Lease agreements may contain renewal options and rent escalation clauses and require the Company to pay real estate taxes, insurance, common area maintenance and operating expenses applicable to the leased properties. The Company accounts for its leases in accordance with ASC 842.

 

At contract inception, the Company determines whether a contract is, or contains, a lease by determining whether it conveys the right to control the use of the identified asset for a period of time, by assessing whether the Company has the right to obtain substantially all of the economic benefits from use of the identified asset and the right to direct the use of the identified asset.

 

At the lease commencement date, the Company determines if a lease should be classified as an operating or a finance lease (the Company currently has no finance leases) and recognizes a corresponding lease liability and a right-of-use asset on its Balance Sheet. The lease liability is initially and subsequently measured as the present value of the remaining fixed minimum rental payments (including base rent and fixed common area maintenance) using discount rates as of the commencement date. Variable payments (including most utilities, real estate taxes, insurance and variable common area maintenance) are expensed as incurred. Further, the Company elected a short-term lease exception policy, permitting it to not apply the recognition requirements of this standard to short-term leases (i.e. leases with terms of 12 months or less) and an accounting policy to account for lease and non-lease components as a single component for certain classes of assets. The right-of-use asset is initially and subsequently measured at the carrying amount of the lease liability adjusted for any prepaid or accrued lease payments, remaining balance of lease incentives received, unamortized initial direct costs, or impairment charges relating to the right-of-use asset. Right-of-use assets are assessed for impairment using the long-lived assets impairment guidance. The discount rate used to determine the present value of lease payments is the Company’s estimated collateralized incremental borrowing rate, based on the yield curve for the respective lease terms, as the Company generally cannot determine the interest rate implicit in the lease.

 

The Company recognizes expense for its operating leases on a straight-line basis over the lease term. As these leases expire, it can be expected that in the normal course of business they will be renewed or replaced. Renewal option periods are included in the measurement of lease liability, where the exercise is reasonably certain to occur. Key estimates and judgments in accounting for leases include how the Company determines: (1) lease payments, (2) lease term, and (3) the discount rate used in calculating the lease liability.

 

Additional information related to our leases is as follows:

 

  

Three Months Ended

  

Nine Months Ended

 
  

March 31,

  

April 2,

  

March 31,

  

April 2,

 
  

2024

  

2023

  

2024

  

2023

 
  

(in thousands)

 

Lease costs:

                

Operating lease costs

 $5,693  $5,627  $16,966  $16,580 

Variable lease costs

  6,399   6,499   20,481   18,953 

Short-term lease cost

  282   474   3,700   4,928 

Sublease income

  (238)  (253)  (735)  (737)

Total lease costs

 $12,136  $12,347  $40,412  $39,724 
                 

Cash paid for amounts included in measurement of operating lease liabilities

         $16,957  $15,431 

Right-of-use assets obtained in exchange for new operating lease liabilities

         $3,153  $11,790 

 

  

March 31,

 
  

2024

 
  

(in thousands)

 

Weighted-average remaining lease term - operating leases (in years)

  8.2 

Weighted-discount rate - operating leases

  4.1%

 

Maturities of lease liabilities in accordance with ASC 842 as of March 31, 2024 and reconciliation to balance sheet are as follows (in thousands):

 

Fiscal Year:

    

Remainder of 2024

 $3,838 

2025

  20,998 

2026

  19,076 

2027

  17,447 

2028

  16,514 

Thereafter

  68,722 

Total Future Minimum Lease Payments

  146,595 

Less: Imputed Remaining Interest

  23,427 

Total Operating Lease Liabilities

  123,168 

Less: Current portion of long-term operating lease liabilities

  15,250 

Long-term operating lease liabilities

 $107,918 

 
v3.24.1.u1
Note 13 - Accrued Expenses
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Accounts Payable, Accrued Liabilities, and Other Liabilities Disclosure, Current [Text Block]

Note 13 – Accrued Expenses

 

Accrued expenses consisted of the following:

 

  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Payroll and employee benefits

 $25,786  $33,927 

Deferred revenue

  31,661   30,811 

Accrued marketing expenses

  15,190   13,679 

Accrued florist payout

  12,733   13,437 

Accrued purchases

  16,578   18,351 

Other

  36,056   31,709 

Accrued Expenses

 $138,004  $141,914 

 
v3.24.1.u1
Note 14 - Commitments and Contingencies
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Commitments and Contingencies Disclosure [Text Block]

Note 14 – Commitments and Contingencies

 

Litigation

 

There are various claims, lawsuits, and pending actions against the Company and its subsidiaries incident to the operations of its businesses. It is the opinion of management, after consultation with counsel, that the final resolution of such claims, lawsuits and pending actions will not have a material adverse effect on the Company's consolidated financial position, results of operations or liquidity.

 
v3.24.1.u1
Note 15 - Subsequent Events
 9 Months Ended
Mar. 31, 2024
Notes to Financial Statements  
Subsequent Events [Text Block]

Note 15 – Subsequent Events

 

Acquisition of Card Isle

 

On April 3, 2024, the Company completed its acquisition of Card Isle, an e-commerce greeting card company, expanding the Company’s presence in the greeting card category across all brands.

 

The Company used cash on its balance sheet to fund the approximate $3.5 million purchase. Card Isle annual revenue, based on its most recently available financial information, is deemed immaterial to the Company’s consolidated financial statements.

  
v3.24.1.u1
Insider Trading Arrangements
 9 Months Ended
Mar. 31, 2024
Insider Trading Arr Line Items  
Material Terms of Trading Arrangement [Text Block]

ITEM 5. OTHER INFORMATION

 

None.

 
Rule 10b5-1 Arrangement Adopted [Flag] false
Rule 10b5-1 Arrangement Terminated [Flag] false
Non-Rule 10b5-1 Arrangement Terminated [Flag] false
Non-Rule 10b5-1 Arrangement Adopted [Flag] false
v3.24.1.u1
Significant Accounting Policies (Policies)
 9 Months Ended
Mar. 31, 2024
Accounting Policies [Abstract]  
Basis of Accounting, Policy [Policy Text Block]

Basis of Presentation

 

The accompanying unaudited condensed consolidated financial statements have been prepared by 1-800-FLOWERS.COM, Inc. and Subsidiaries (the “Company”) in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three and nine-month periods ended March 31, 2024 are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2024. These financial statements should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended July 2, 2023, which provides a more complete understanding of our accounting policies, financial position, operating results and other matters.

 

The Company’s quarterly results may experience seasonal fluctuations. Due to the seasonal nature of the Company’s business, and its continued expansion into non-floral products, the Thanksgiving through Christmas holiday season, which falls within the Company’s second fiscal quarter, is expected to generate over 40% of the Company’s annual revenues, and all of its earnings. Due to the number of major floral gifting occasions, including Mother's Day, Valentine’s Day, Easter, and Administrative Professionals Week, revenues also have historically risen during the Company’s fiscal third and fourth quarters in comparison to its fiscal first quarter.

 
Use of Estimates, Policy [Policy Text Block]

Use of Estimates

 

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

 
Revenue from Contract with Customer [Policy Text Block]

Revenue Recognition

 

Net revenue is measured based on the amount of consideration that we expect to receive, reduced by discounts and estimates for credits and returns (calculated based upon previous experience and management’s evaluation). Service and outbound shipping charged to customers are recognized at the time the related merchandise revenues are recognized and are included in net revenues. Inbound and outbound shipping and delivery costs are included in cost of revenues. Net revenues exclude sales and other similar taxes collected from customers.

 

A description of our principal revenue generating activities is as follows:

 

●

E-commerce revenues - consumer products sold through our online and telephonic channels. Revenue is recognized when control of the merchandise is transferred to the customer, which generally occurs upon shipment. Payment is typically due prior to the date of shipment.

●

Retail revenues - consumer products sold through our retail stores. Revenue is recognized when control of the goods is transferred to the customer, at the point of sale, at which time payment is received.

●

Wholesale revenues - products sold to our wholesale customers for subsequent resale. Revenue is recognized when control of the goods is transferred to the customer, in accordance with the terms of the applicable agreement. Payment terms are typically 30 days from the date control over the product is transferred to the customer.

●

BloomNet Services - membership fees as well as other service offerings to florists. Membership and other subscription-based fees are recognized monthly as earned. Services revenues related to orders sent through the floral network are variable, based on either the number of orders or the value of orders, and are recognized in the period in which the orders are delivered. The contracts within BloomNet Services are typically month-to-month and, as a result, no consideration allocation is necessary across multiple reporting periods. Payment is typically due less than 30 days from the date the services were performed. 

 

Deferred Revenues

 

Deferred revenues are recorded when the Company has received consideration (i.e. advance payment) before satisfying its performance obligations. As such, customer orders are recorded as deferred revenue prior to shipment or rendering of product or services. Deferred revenues primarily relate to e-commerce orders placed, but not shipped, prior to the end of the fiscal period, as well as for subscription programs, including our various food, wine, and plant-of-the-month clubs and our Celebrations Passport® program.

 

Our total deferred revenue as of  July 2, 2023 was $30.8 million (included in “Accrued expenses” on our consolidated balance sheets), of which $2.8 million and $29.6 million was recognized as revenue during the three and nine months ended March 31, 2024, respectively. The deferred revenue balance as of  March 31, 2024 was $31.7 million.

 
Impairment or Disposal of Long-Lived Assets, Including Intangible Assets, Policy [Policy Text Block]

Impairment Evaluation

 

The Company performs its annual assessment of goodwill and indefinite-lived intangible impairment during its fiscal fourth quarter, or more frequently if events occur or circumstances change such that it is more likely than not that an impairment  may exist. During the quarter ended December 31, 2023, as a result of a decline in the actual and projected revenue for the Company’s PersonalizationMall tradename (indefinite-lived intangible asset), as well as a higher discount rate resulting from the higher interest rate environment, the Company determined that an impairment assessment was required for this tradename. This assessment resulted in the Company recording a non-cash impairment charge of $19.8 million to reduce the recorded carrying value of the PersonalizationMall tradename.

 

The Company concluded that goodwill and other indefinite-lived intangible assets, excluding its PersonalizationMall tradename, did not require an impairment assessment. See Note 5 – Goodwill and Intangible Assets, Net for further information.

 
New Accounting Pronouncements, Policy [Policy Text Block]

Recently Issued Accounting Pronouncements

 

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 requires enhanced disclosures about significant segment expenses, includes enhanced interim disclosure requirements, clarifies circumstances in which an entity can disclose multiple segment measures of profit or loss, provides new segment disclosure requirements for entities with a single reportable segment, and contains other disclosure requirements. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. ASU 2023-07 is to be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact of ASU 2023-07 on its consolidated financial statements and related disclosures.

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires the disclosure of additional information with respect to the reconciliation of the effective tax rate to the statutory rate for federal, state, and foreign income taxes and requires greater detail about significant reconciling items in the reconciliation. Additionally, the amendment requires disaggregated information pertaining to taxes paid, net of refunds received, for federal, state, and foreign income taxes. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and allows for either a prospective or retrospective approach on adoption. The Company is currently evaluating the impact of ASU 2023-09 on its consolidated financial statements and related disclosures.

 
v3.24.1.u1
Note 2 - Net Income (Loss) Per Common Share (Tables)
 9 Months Ended
Mar. 31, 2024
Notes Tables  
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]
  

Three Months Ended

  

Nine Months Ended

 
  

March 31,

  

April 2,

  

March 31,

  

April 2,

 
  

2024

  

2023

  

2024

  

2023

 
  

(in thousands, except per share data)

 

Numerator:

                

Net income (loss)

 $(16,903) $(70,993) $14,762  $(22,155)
                 

Denominator:

                

Weighted average shares outstanding

  64,489   64,767   64,703   64,660 

Effect of dilutive stock options and unvested restricted stock awards

  -   -   354   - 
                 

Diluted weighted-average shares outstanding

  64,489   64,767   65,057   64,660 
                 

Net income (loss) per common share

                

Basic

 $(0.26) $(1.10) $0.23  $(0.34)

Diluted

 $(0.26) $(1.10) $0.23  $(0.34)
v3.24.1.u1
Note 4 - Inventory (Tables)
 9 Months Ended
Mar. 31, 2024
Notes Tables  
Schedule of Inventory, Current [Table Text Block]
  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Finished goods

 $86,503  $92,582 

Work-in-process

  22,299   33,818 

Raw materials

  50,656   64,934 

Total inventory

 $159,458  $191,334 
v3.24.1.u1
Note 5 - Goodwill and Intangible Assets, Net (Tables)
 9 Months Ended
Mar. 31, 2024
Notes Tables  
Schedule of Goodwill [Table Text Block]
          

Gourmet

     
  

Consumer

      

Foods &

     
  

Floral &

      

Gift

     
  

Gifts

  

BloomNet

  

Baskets

  

Total

 
  

(in thousands)

 

Balance at July 2, 2023

 $153,376  $-  $-  $153,376 

Measurement period adjustment for Things Remembered Acquisition

  201   -   -   201 

Balance at March 31, 2024

 $153,577  $-  $-  $153,577 
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets by Major Class [Table Text Block]
     

March 31, 2024

  

July 2, 2023

 
     

Gross

          

Gross

         
  

Amortization

  

Carrying

  

Accumulated

      

Carrying

  

Accumulated

     
  

Period

  

Amount

  

Amortization

  

Net

  

Amount

  

Amortization

  

Net

 
  

(in years)

  

(in thousands)

 

Intangible assets with determinable lives

                           

Investment in licenses

 14 - 16  $7,420  $6,648  $772  $7,420  $6,569  $851 

Customer lists

 3 - 10   29,071   24,830   4,241   29,071   21,611   7,460 

Other

 5 - 14   2,946   2,649   297   2,946   2,604   342 

Total intangible assets with determinable lives

     39,437   34,127   5,310   39,437   30,784   8,653 

Trademarks with indefinite lives

     111,473   -   111,473   131,235   -   131,235 

Total identifiable intangible assets

    $150,910  $34,127  $116,783  $170,672  $30,784  $139,888 
v3.24.1.u1
Note 7 - Debt, Net (Tables)
 9 Months Ended
Mar. 31, 2024
Notes Tables  
Schedule of Debt [Table Text Block]
  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Revolver

 $-  $- 

Term Loans

  192,500   200,000 

Deferred financing costs

  (3,068)  (3,609)

Total debt

  189,432   196,391 

Less: current maturities of long-term debt

  10,000   10,000 

Long-term debt, net

 $179,432  $186,391 
v3.24.1.u1
Note 8 - Property, Plant and Equipment, Net (Tables)
 9 Months Ended
Mar. 31, 2024
Notes Tables  
Property, Plant and Equipment [Table Text Block]
  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Land

 $33,827  $33,866 

Orchards in production and land improvements

  20,604   20,401 

Building and building improvements

  68,911   67,647 

Leasehold improvements

  30,973   29,524 

Production equipment

  130,890   125,297 

Furniture and fixtures

  9,294   9,102 

Computer and telecommunication equipment

  42,832   41,859 

Software

  192,837   181,085 

Capital projects in progress

  17,608   18,205 

Property, plant and equipment, gross

  547,776   526,986 

Accumulated depreciation and amortization

  (323,837)  (292,417)

Property, plant and equipment, net

 $223,939  $234,569 
v3.24.1.u1
Note 9 - Fair Value Measurements (Tables)
 9 Months Ended
Mar. 31, 2024
Notes Tables  
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]
  

Carrying

  

Fair Value Measurements

 
  

Value

  

Assets (Liabilities)

 
      

Level 1

  

Level 2

  

Level 3

 
  

(in thousands)

 

As of March 31, 2024

                

Trading securities held in a “rabbi trust” (1)

 $31,160  $31,160  $-  $- 

Total assets (liabilities) at fair value

 $31,160  $31,160  $-  $- 
                 

As of July 2, 2023

                

Trading securities held in a “rabbi trust” (1)

 $22,617  $22,617  $-  $- 

Total assets (liabilities) at fair value

 $22,617  $22,617  $-  $- 
v3.24.1.u1
Note 11 - Business Segments (Tables)
 9 Months Ended
Mar. 31, 2024
Notes Tables  
Schedule of Segment Reporting Information, by Segment [Table Text Block]
  

Three Months Ended

  

Nine Months Ended

 
  

March 31,

  

April 2,

  

March 31,

  

April 2,

 
  

2024

  

2023

  

2024

  

2023

 
  

(in thousands)

 

Net Revenues:

                

Segment Net Revenues:

                

Consumer Floral & Gifts

 $221,207  $233,019  $618,236  $672,248 

BloomNet

  27,314   36,968   83,420   103,187 

Gourmet Foods & Gift Baskets

  130,989   147,863   769,061   844,522 

Corporate

  167   36   716   152 

Intercompany eliminations

  (272)  (320)  (924)  (1,062)

Total net revenues

 $379,405  $417,566  $1,470,509  $1,619,047 
                 

Operating Income:

                

Segment Contribution Margin:

                

Consumer Floral & Gifts

 $22,190  $26,136  $41,609  $64,832 

BloomNet

  7,506   10,982   25,981   29,847 

Gourmet Foods & Gift Baskets

  (8,172)  (78,480)  98,953   26,313 

Segment Contribution Margin Subtotal

  21,524   (41,362)  166,543   120,992 

Corporate (a)

  (36,221)  (30,015)  (100,221)  (91,595)

Depreciation and amortization

  (13,232)  (13,267)  (40,578)  (40,276)

Operating income

 $(27,929) $(84,644) $25,744  $(10,879)
Disaggregation of Revenue [Table Text Block]
  

Three Months Ended

 
  

Consumer Floral &

          

Gourmet Foods &

  

Corporate and

         
  

Gifts

  

BloomNet

  

Gift Baskets

  

Eliminations

  

Consolidated

 
  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

 
  (in thousands) 

Net revenues

                                        

E-commerce

 $218,590  $230,403  $-  $-  $121,651  $127,398  $-  $-  $340,241  $357,801 

Other

  2,617   2,616   27,314   36,968   9,338   20,465   (105)  (284)  39,164   59,765 

Total net revenues

 $221,207  $233,019  $27,314  $36,968  $130,989  $147,863  $(105) $(284) $379,405  $417,566 
                                         

Other revenues detail

                                        

Retail and other

  2,617   2,616   -   -   1,629   1,686   -   -   4,246   4,302 

Wholesale

  -   -   12,364   14,695   7,709   18,779   -   -   20,073   33,474 

BloomNet services

  -   -   14,950   22,273   -   -   -   -   14,950   22,273 

Corporate

  -   -   -   -   -   -   167   36   167   36 

Eliminations

  -   -   -   -   -   -   (272)  (320)  (272)  (320)

Total other revenues

 $2,617  $2,616  $27,314  $36,968  $9,338  $20,465  $(105) $(284) $39,164  $59,765 
  

Nine Months Ended

 
  

Consumer Floral &

          

Gourmet Foods &

  

Corporate and

         
  

Gifts

  

BloomNet

  

Gift Baskets

  

Eliminations

  

Consolidated

 
  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

  

March 31, 2024

  

April 2, 2023

 
  (in thousands) 

Net revenues

                                        

E-commerce

 $611,770  $665,866  $-  $-  $676,788  $721,267  $-  $-  $1,288,558  $1,387,133 

Other

  6,466   6,382   83,420   103,187   92,273   123,255   (208)  (910)  181,951   231,914 

Total net revenues

 $618,236  $672,248  $83,420  $103,187  $769,061  $844,522  $(208) $(910) $1,470,509  $1,619,047 
                                         

Other revenues detail

                                        

Retail and other

  6,466   6,382   -   -   7,859   7,907   -   -   14,325   14,289 

Wholesale

  -   -   32,867   40,370   84,414   115,348   -   -   117,281   155,718 

BloomNet services

  -   -   50,553   62,817   -   -   -   -   50,553   62,817 

Corporate

  -   -   -   -   -   -   716   152   716   152 

Eliminations

  -   -   -   -   -   -   (924)  (1,062)  (924)  (1,062)

Total other revenues

 $6,466  $6,382  $83,420  $103,187  $92,273  $123,255  $(208) $(910) $181,951  $231,914 
v3.24.1.u1
Note 12 - Leases (Tables)
 9 Months Ended
Mar. 31, 2024
Notes Tables  
Lease, Cost [Table Text Block]
  

Three Months Ended

  

Nine Months Ended

 
  

March 31,

  

April 2,

  

March 31,

  

April 2,

 
  

2024

  

2023

  

2024

  

2023

 
  

(in thousands)

 

Lease costs:

                

Operating lease costs

 $5,693  $5,627  $16,966  $16,580 

Variable lease costs

  6,399   6,499   20,481   18,953 

Short-term lease cost

  282   474   3,700   4,928 

Sublease income

  (238)  (253)  (735)  (737)

Total lease costs

 $12,136  $12,347  $40,412  $39,724 
                 

Cash paid for amounts included in measurement of operating lease liabilities

         $16,957  $15,431 

Right-of-use assets obtained in exchange for new operating lease liabilities

         $3,153  $11,790 
  

March 31,

 
  

2024

 
  

(in thousands)

 

Weighted-average remaining lease term - operating leases (in years)

  8.2 

Weighted-discount rate - operating leases

  4.1%
Lessee, Operating Lease, Liability, to be Paid, Maturity [Table Text Block]

Fiscal Year:

    

Remainder of 2024

 $3,838 

2025

  20,998 

2026

  19,076 

2027

  17,447 

2028

  16,514 

Thereafter

  68,722 

Total Future Minimum Lease Payments

  146,595 

Less: Imputed Remaining Interest

  23,427 

Total Operating Lease Liabilities

  123,168 

Less: Current portion of long-term operating lease liabilities

  15,250 

Long-term operating lease liabilities

 $107,918 
v3.24.1.u1
Note 13 - Accrued Expenses (Tables)
 9 Months Ended
Mar. 31, 2024
Notes Tables  
Schedule of Accrued Liabilities [Table Text Block]
  

March 31, 2024

  

July 2, 2023

 
  

(in thousands)

 

Payroll and employee benefits

 $25,786  $33,927 

Deferred revenue

  31,661   30,811 

Accrued marketing expenses

  15,190   13,679 

Accrued florist payout

  12,733   13,437 

Accrued purchases

  16,578   18,351 

Other

  36,056   31,709 

Accrued Expenses

 $138,004  $141,914 
v3.24.1.u1
Note 1 - Accounting Policies (Details Textual) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Mar. 31, 2024
Apr. 02, 2023
Mar. 31, 2024
Apr. 02, 2023
Jul. 02, 2023
Contract with Customer, Liability, Current $ 31,700   $ 31,700   $ 30,800
Contract with Customer, Liability, Revenue Recognized 2,800   29,600    
Goodwill and Intangible Asset Impairment $ 0 $ 64,586 $ 19,762 $ 64,586  
v3.24.1.u1
Note 2 - Net Income (Loss) Per Common Share - Basic and Diluted Net Income Per Common Share (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
 3 Months Ended 9 Months Ended
Mar. 31, 2024
Apr. 02, 2023
Mar. 31, 2024
Apr. 02, 2023
Net income (loss) $ (16,903) $ (70,993) $ 14,762 $ (22,155)
Basic (in shares) 64,489 64,767 64,703 64,660
Effect of dilutive stock options and unvested restricted stock awards (in shares) 0 0 354 0
Diluted weighted-average shares outstanding (in shares) 64,489 64,767 65,057 64,660
Basic net income (loss) per common share (in dollars per share) $ (0.26) $ (1.1) $ 0.23 $ (0.34)
Diluted net income (loss) per common share (in dollars per share) $ (0.26) $ (1.1) $ 0.23 $ (0.34)
v3.24.1.u1
Note 3 - Acquisitions (Details Textual) - USD ($)
$ in Thousands
 12 Months Ended
Jan. 10, 2023
Nov. 30, 2022
Mar. 31, 2024
Jul. 02, 2023
Goodwill     $ 153,577 $ 153,376
Things Remembered Brand [Member]        
Revenue from Contract with Customer, Including Assessed Tax   $ 30,400    
Things Remembered Brand [Member]        
Business Combination, Consideration Transferred $ 5,000      
Goodwill 1,900      
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory 1,100      
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Equipment 400      
Things Remembered Brand [Member] | Customer Lists [Member]        
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles $ 800      
Finite-Lived Intangible Asset, Useful Life (Year) 3 years      
Things Remembered Brand [Member] | Trademarks [Member]        
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Indefinite-Lived Intangible Assets $ 800      
v3.24.1.u1
Note 4 - Inventory - Summary of Inventory (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Jul. 02, 2023
Finished goods $ 86,503 $ 92,582
Work-in-process 22,299 33,818
Raw materials 50,656 64,934
Total inventory $ 159,458 $ 191,334
v3.24.1.u1
Note 5 - Goodwill and Intangible Assets, Net (Details Textual) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Mar. 31, 2024
Apr. 02, 2023
Mar. 31, 2024
Apr. 02, 2023
Finite-Lived Intangible Asset, Expected Amortization, Remainder of Fiscal Year $ 1,100   $ 1,100  
Finite-Lived Intangible Asset, Expected Amortization, Year One 1,900   1,900  
Finite-Lived Intangible Asset, Expected Amortization, Year Two 1,300   1,300  
Finite-Lived Intangible Asset, Expected Amortization, Year Three 500   500  
Finite-Lived Intangible Asset, Expected Amortization, Year Four 200   200  
Finite-Lived Intangible Asset, Expected Amortization, Year Five 300   300  
Goodwill and Intangible Asset Impairment $ 0 $ 64,586 $ 19,762 $ 64,586
v3.24.1.u1
Note 5 - Goodwill and Intangible Assets, Net - Goodwill by Segment (Details)
$ in Thousands
 9 Months Ended
Mar. 31, 2024
USD ($)
Balance $ 153,376
Measurement period adjustment for Things Remembered Acquisition 201
Balance 153,577
Consumer Floral [Member]  
Balance 153,376
Measurement period adjustment for Things Remembered Acquisition 201
Balance 153,577
BloomNet Wire Service [Member]  
Balance 0
Measurement period adjustment for Things Remembered Acquisition 0
Balance 0
Gourmet Foods and Gift Baskets [Member]  
Balance 0
Measurement period adjustment for Things Remembered Acquisition 0
Balance $ 0
v3.24.1.u1
Note 5 - Goodwill and Intangible Assets, Net - Other Intangible Assets (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Jul. 02, 2023
Intangible assets with determinable lives, gross $ 39,437 $ 39,437
Accumulated amortization 34,127 30,784
Intangible assets with determinable lives, net 5,310 8,653
Trademarks with indefinite lives, gross 111,473 131,235
Total identifiable intangible assets, gross 150,910 170,672
Total identifiable intangible assets, net 116,783 139,888
Licensing Agreements [Member]    
Intangible assets with determinable lives, gross 7,420 7,420
Accumulated amortization 6,648 6,569
Intangible assets with determinable lives, net $ 772 851
Licensing Agreements [Member] | Minimum [Member]    
Finite-lived intangible asset, useful life (Year) 14 years  
Licensing Agreements [Member] | Maximum [Member]    
Finite-lived intangible asset, useful life (Year) 16 years  
Customer Lists [Member]    
Intangible assets with determinable lives, gross $ 29,071 29,071
Accumulated amortization 24,830 21,611
Intangible assets with determinable lives, net $ 4,241 7,460
Customer Lists [Member] | Minimum [Member]    
Finite-lived intangible asset, useful life (Year) 3 years  
Customer Lists [Member] | Maximum [Member]    
Finite-lived intangible asset, useful life (Year) 10 years  
Other Intangible Assets [Member]    
Intangible assets with determinable lives, gross $ 2,946 2,946
Accumulated amortization 2,649 2,604
Intangible assets with determinable lives, net $ 297 $ 342
Other Intangible Assets [Member] | Minimum [Member]    
Finite-lived intangible asset, useful life (Year) 5 years  
Other Intangible Assets [Member] | Maximum [Member]    
Finite-lived intangible asset, useful life (Year) 14 years  
v3.24.1.u1
Note 6 - Investments (Details Textual) - USD ($)
$ in Millions
Mar. 31, 2024
Jul. 02, 2023
Equity Securities without Readily Determinable Fair Value, Amount $ 2.6 $ 2.6
v3.24.1.u1
Note 7 - Debt, Net (Details Textual) - USD ($)
$ in Millions
 7 Months Ended
Jun. 27, 2023
Aug. 01, 2023
Mar. 31, 2024
Jun. 26, 2023
The 2020 Credit Agreement [Member] | Revolving Credit Facility [Member]        
Line of Credit Facility, Maximum Borrowing Capacity $ 225.0     $ 250.0
Line of Credit Facility, Maximum Borrowing Capacity During Seasonal Reduction   $ 125.0    
The 2020 Credit Agreement [Member] | Revolving Credit Facility [Member] | Base Rate [Member]        
Debt Instrument, Basis Spread on Variable Rate, Increase (Decrease) 0.25%      
The New Term Loan [Member] | The 2020 Credit Agreement [Member]        
Debt Instrument, Face Amount $ 200.0     $ 150.0
Long-Term Debt, Maturity, First 8 Payments, Quarterly     $ 2.5  
Long-Term Debt, Maturity, Subsequent 11 Payments, Quarterly     5.0  
Long-Term Debt, Maturity, Due on Maturity Date     125.0  
Long-Term Debt, Maturity, Remainder of Fiscal Year     2.5  
Long-Term Debt, Maturity, Year One     10.0  
Long-Term Debt, Maturity, Year Two     20.0  
Long-Term Debt, Maturity, Year Three     20.0  
Long-Term Debt, Maturity, Year Four     $ 140.0  
Line of Credit and Term Loan [Member] | Fed Funds Effective Rate Overnight Index Swap Rate [Member]        
Debt Instrument, Base Rate, Basis Spread on Variable Rate 0.50%      
Line of Credit and Term Loan [Member] | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member]        
Debt Instrument, Base Rate, Basis Spread on Variable Rate 0.10%      
v3.24.1.u1
Note 7 - Debt, Net - Summary of Current and Long-term Debt (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Jul. 02, 2023
Deferred financing costs $ (3,068) $ (3,609)
Debt instrument, carrying amount 189,432 196,391
Less: current maturities of long-term debt 10,000 10,000
Long-term debt, net 179,432 186,391
Line of Credit [Member]    
Revolver 0 0
Term Loan [Member]    
Term Loans $ 192,500 $ 200,000
v3.24.1.u1
Note 8 - Property, Plant and Equipment, Net - Summary of Property, Plant and Equipment (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Jul. 02, 2023
Property, plant, and equipment, gross $ 547,776 $ 526,986
Accumulated depreciation and amortization (323,837) (292,417)
Property, plant and equipment, net 223,939 234,569
Land [Member]    
Property, plant, and equipment, gross 33,827 33,866
Orchards in Production and Land Improvements [Member]    
Property, plant, and equipment, gross 20,604 20,401
Building and Building Improvements [Member]    
Property, plant, and equipment, gross 68,911 67,647
Leasehold Improvements [Member]    
Property, plant, and equipment, gross 30,973 29,524
Equipment [Member]    
Property, plant, and equipment, gross 130,890 125,297
Furniture and Fixtures [Member]    
Property, plant, and equipment, gross 9,294 9,102
Computer and Telecommunication Equipment [Member]    
Property, plant, and equipment, gross 42,832 41,859
Software and Software Development Costs [Member]    
Property, plant, and equipment, gross 192,837 181,085
Capital Projects in Progress [Member]    
Property, plant, and equipment, gross $ 17,608 $ 18,205
v3.24.1.u1
Note 9 - Fair Value Measurements - Assets and Liabilities Measured at Fair Value (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Jul. 02, 2023
Trading securities held in a “rabbi trust” [1] $ 31,160 $ 22,617
Total assets (liabilities) at fair value 31,160 22,617
Fair Value, Inputs, Level 1 [Member]    
Trading securities held in a “rabbi trust” [1] 31,160 22,617
Total assets (liabilities) at fair value 31,160 22,617
Fair Value, Inputs, Level 2 [Member]    
Trading securities held in a “rabbi trust” [1] 0 0
Total assets (liabilities) at fair value 0 0
Fair Value, Inputs, Level 3 [Member]    
Trading securities held in a “rabbi trust” [1] 0 0
Total assets (liabilities) at fair value $ 0 $ 0
[1] The Company has established a NQDC Plan for certain members of senior management. Deferred compensation plan assets are invested in mutual funds held in a "rabbi trust," which is restricted for payment to participants of the NQDC Plan. Trading securities held in a rabbi trust are measured using quoted market prices at the reporting date and are included in the "Other assets" line item, with the corresponding liability included in the "Other liabilities" line item in the consolidated balance sheets.
v3.24.1.u1
Note 10 - Income Taxes (Details Textual) - USD ($)
$ in Millions
 3 Months Ended 9 Months Ended
Mar. 31, 2024
Apr. 02, 2023
Mar. 31, 2024
Apr. 02, 2023
Jul. 02, 2023
Effective Income Tax Rate Reconciliation, Percent 33.00% 19.10% 34.70% (0.60%)  
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent 21.00% 21.00% 21.00% 21.00%  
Deferred Tax Assets, Valuation Allowance $ 3.2   $ 3.2   $ 3.2
Unrecognized Tax Benefits 3.2   3.2    
Significant Change in Unrecognized Tax Benefits is Reasonably Possible, Amount of Unrecorded Benefit $ 0.4   $ 0.4    
Domestic Tax Jurisdiction [Member]          
Open Tax Year     2020 2021 2022    
State and Local Jurisdiction [Member]          
Open Tax Year     2016 2017 2018 2019 2020 2021 2022    
Foreign Tax Jurisdiction [Member]          
Open Tax Year     2017 2018 2019 2020 2021 2022    
v3.24.1.u1
Note 11 - Business Segments (Details Textual)
 9 Months Ended
Mar. 31, 2024
Number of Reportable Segments 3
v3.24.1.u1
Note 11 - Business Segments - Segment Performance (Details) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Mar. 31, 2024
Apr. 02, 2023
Mar. 31, 2024
Apr. 02, 2023
Net revenues $ 379,405 $ 417,566 $ 1,470,509 $ 1,619,047
Depreciation and amortization (13,232) (13,267) (40,578) (40,276)
Operating income (27,929) (84,644) 25,744 (10,879)
Operating Segments [Member]        
Contribution margin 21,524 (41,362) 166,543 120,992
Segment Reporting, Reconciling Item, Corporate Nonsegment [Member]        
Net revenues 167 36 716 152
Corporate (a) [1] (36,221) (30,015) (100,221) (91,595)
Intersegment Eliminations [Member]        
Net revenues (272) (320) (924) (1,062)
Consumer Floral and Gifts [Member] | Operating Segments [Member]        
Net revenues 221,207 233,019 618,236 672,248
BloomNet [Member] | Operating Segments [Member]        
Net revenues 27,314 36,968 83,420 103,187
Gourmet Foods and Gift Baskets [Member] | Operating Segments [Member]        
Net revenues 130,989 147,863 769,061 844,522
Contribution margin (8,172) (78,480) 98,953 26,313
Consumer Floral [Member] | Operating Segments [Member]        
Contribution margin 22,190 26,136 41,609 64,832
BloomNet Wire Service [Member] | Operating Segments [Member]        
Contribution margin $ 7,506 $ 10,982 $ 25,981 $ 29,847
[1] Corporate expenses consist of the Company’s enterprise shared service cost centers, and include, among other items, Information Technology, Human Resources, Accounting and Finance, Legal, Executive and Customer Service Center functions, as well as Stock-based compensation. In order to leverage the Company’s infrastructure, these functions are operated under a centralized management platform, providing support services throughout the organization. The costs of these functions, other than those of the Customer Service Center, which are allocated directly to the above categories based upon usage, are included within corporate expenses as they are not directly allocable to a specific segment.
v3.24.1.u1
Note 11 - Business Segments - Disaggregation of Revenue From Contracts With Customers (Details) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Mar. 31, 2024
Apr. 02, 2023
Mar. 31, 2024
Apr. 02, 2023
Net revenues $ 379,405 $ 417,566 $ 1,470,509 $ 1,619,047
Operating Segments [Member] | Consumer Floral and Gifts [Member]        
Net revenues 221,207 233,019 618,236 672,248
Operating Segments [Member] | BloomNet [Member]        
Net revenues 27,314 36,968 83,420 103,187
Operating Segments [Member] | Gourmet Foods and Gift Baskets [Member]        
Net revenues 130,989 147,863 769,061 844,522
Corporate and Eliminations [Member]        
Net revenues (105) (284) (208) (910)
Segment Reporting, Reconciling Item, Corporate Nonsegment [Member]        
Net revenues 167 36 716 152
E-commerce [Member]        
Net revenues 340,241 357,801 1,288,558 1,387,133
E-commerce [Member] | Operating Segments [Member] | Consumer Floral and Gifts [Member]        
Net revenues 218,590 230,403 611,770 665,866
E-commerce [Member] | Operating Segments [Member] | BloomNet [Member]        
Net revenues 0 0 0 0
E-commerce [Member] | Operating Segments [Member] | Gourmet Foods and Gift Baskets [Member]        
Net revenues 121,651 127,398 676,788 721,267
E-commerce [Member] | Corporate and Eliminations [Member]        
Net revenues 0 0 0 0
Product and Service, Other [Member]        
Net revenues 39,164 59,765 181,951 231,914
Product and Service, Other [Member] | Retail and Other [Member]        
Net revenues 4,246 4,302 14,325 14,289
Product and Service, Other [Member] | Wholesale [Member]        
Net revenues 20,073 33,474 117,281 155,718
Product and Service, Other [Member] | Bloomnet Services [Member]        
Net revenues 14,950 22,273 50,553 62,817
Product and Service, Other [Member] | Operating Segments [Member] | Consumer Floral and Gifts [Member]        
Net revenues 2,617 2,616 6,466 6,382
Product and Service, Other [Member] | Operating Segments [Member] | Consumer Floral and Gifts [Member] | Retail and Other [Member]        
Net revenues 2,617 2,616 6,466 6,382
Product and Service, Other [Member] | Operating Segments [Member] | Consumer Floral and Gifts [Member] | Wholesale [Member]        
Net revenues 0 0 0 0
Product and Service, Other [Member] | Operating Segments [Member] | Consumer Floral and Gifts [Member] | Bloomnet Services [Member]        
Net revenues 0 0 0 0
Product and Service, Other [Member] | Operating Segments [Member] | BloomNet [Member]        
Net revenues 27,314 36,968 83,420 103,187
Product and Service, Other [Member] | Operating Segments [Member] | BloomNet [Member] | Retail and Other [Member]        
Net revenues 0 0 0 0
Product and Service, Other [Member] | Operating Segments [Member] | BloomNet [Member] | Wholesale [Member]        
Net revenues 12,364 14,695 32,867 40,370
Product and Service, Other [Member] | Operating Segments [Member] | BloomNet [Member] | Bloomnet Services [Member]        
Net revenues 14,950 22,273 50,553 62,817
Product and Service, Other [Member] | Operating Segments [Member] | Gourmet Foods and Gift Baskets [Member]        
Net revenues 9,338 20,465 92,273 123,255
Product and Service, Other [Member] | Operating Segments [Member] | Gourmet Foods and Gift Baskets [Member] | Retail and Other [Member]        
Net revenues 1,629 1,686 7,859 7,907
Product and Service, Other [Member] | Operating Segments [Member] | Gourmet Foods and Gift Baskets [Member] | Wholesale [Member]        
Net revenues 7,709 18,779 84,414 115,348
Product and Service, Other [Member] | Operating Segments [Member] | Gourmet Foods and Gift Baskets [Member] | Bloomnet Services [Member]        
Net revenues 0 0 0 0
Product and Service, Other [Member] | Corporate and Eliminations [Member]        
Net revenues (105) (284) (208) (910)
Product and Service, Other [Member] | Corporate and Eliminations [Member] | Retail and Other [Member]        
Net revenues 0 0 0 0
Product and Service, Other [Member] | Corporate and Eliminations [Member] | Wholesale [Member]        
Net revenues 0 0 0 0
Product and Service, Other [Member] | Corporate and Eliminations [Member] | Bloomnet Services [Member]        
Net revenues 0 0 0 0
Product and Service, Other [Member] | Segment Reporting, Reconciling Item, Corporate Nonsegment [Member]        
Net revenues 167 36 716 152
Product and Service, Other [Member] | Consolidation, Eliminations [Member]        
Net revenues $ (272) $ (320) $ (924) $ (1,062)
v3.24.1.u1
Note 12 - Leases - Lease Costs (Details) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Mar. 31, 2024
Apr. 02, 2023
Mar. 31, 2024
Apr. 02, 2023
Operating lease costs $ 5,693 $ 5,627 $ 16,966 $ 16,580
Variable lease costs 6,399 6,499 20,481 18,953
Short-term lease cost 282 474 3,700 4,928
Sublease income (238) (253) (735) (737)
Total lease costs $ 12,136 $ 12,347 40,412 39,724
Cash paid for amounts included in measurement of operating lease liabilities     16,957 15,431
Right-of-use assets obtained in exchange for new operating lease liabilities     $ 3,153 $ 11,790
Weighted-average remaining lease term - operating leases (in years) (Year) 8 years 2 months 12 days   8 years 2 months 12 days  
Weighted-discount rate - operating leases 4.10%   4.10%  
v3.24.1.u1
Note 12 - Leases - Maturities of Lease Liabilities (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Jul. 02, 2023
Remainder of 2024 $ 3,838  
2025 20,998  
2026 19,076  
2027 17,447  
2028 16,514  
Thereafter 68,722  
Total Future Minimum Lease Payments 146,595  
Less: Imputed Remaining Interest 23,427  
Total Operating Lease Liabilities 123,168  
Less: Current portion of long-term operating lease liabilities 15,250 $ 15,759
Long-term operating lease liabilities $ 107,918 $ 117,330
v3.24.1.u1
Note 13 - Accrued Expenses - Accrued Expenses (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Jul. 02, 2023
Payroll and employee benefits $ 25,786 $ 33,927
Deferred revenue 31,661 30,811
Accrued marketing expenses 15,190 13,679
Accrued florist payout 12,733 13,437
Accrued purchases 16,578 18,351
Other 36,056 31,709
Accrued Expenses $ 138,004 $ 141,914
v3.24.1.u1
Note 15 - Subsequent Events (Details Textual)
$ in Millions
Apr. 03, 2024
USD ($)
Subsequent Event [Member] | Card Isle [Member]  
Payments to Acquire Businesses, Gross $ 3.5
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