Operator fluency on fresh ground

Steven Madden, Ltd. (SHOO) — this company's answers

The model's full reasoning — Q1 2017 call → NOWe need to determine if the dynamic described is present. The question asks about a recently emerged positive element of the business, probed by analysts, and management responds with unhesitating, granular operational command, answering follow-ups with specific present-tense working detail, while conveying that contribution is still early. Conditions: (1) real and current, (2) young, (3) management's answers across at least two exchanges add specific operational substance beyond prepared remarks, (4) management conveys most of effect lies ahead. Look at the transcript. Analysts probe several things. One candidate: SM Europe joint venture. In prepared remarks, Ed mentions SM Europe as standout, trending above expectations. Then later, Erinn Murphy asks about SM Europe: "can you just remind us what's the size today? ... And then how big should that business be overtime? And then maybe just talk more about your key accounts there; you referenced Blondo but what other key accounts are you really working to grow with scale in Europe?" Ed responds: "We have not broken that out in terms of what it's doing today, so I don't think we're going to provide that information. In terms of what it could be, but it's so early. I mean we're not even a year in here. I think that we clearly see the brand resonating -- we clearly think there is a big opportunity there but it's a little too early to try to size that for you." Then Erinn asks about ASOS, Ed says "Yes, I should've mentioned that." That's not granular operational detail. It's more deflection, not adding specific working detail. So that fails condition 3. Another candidate: Madden NYC exclusive to Kohl's. In prepared remarks, Ed mentions launch, available in 450 Kohl's locations, offerings include shoes, accessories, active wear, outerwear, strong initial sell-throughs, modest sales contribution, confidence. Analysts? I don't see any analyst question specifically about Madden NYC. So no. Another candidate: Schwartz & Benjamin acquisition. Analysts ask about it. Erinn Murphy asks: "On Schwartz & Benjamin, it was a little bit better in the quarter I think on the top line, and you referenced still breakeven for the year, I guess how quickly can that ramp to profitability beyond 2017?" Ed responds: "We expect a nice profit contribution in 2018. Again, not provide -- we're not ready to provide details on that right now.

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