Categories Consumer, Interviews, LATEST CEO: Will reward shareholders through growth-oriented acquisitions

In an interview with AlphaStreet, Chris McCann, CEO of, speaks about the various aspects of the business including growth strategy, acquisitions, and outlook, Inc. (NASDAQ: FLWS), a leading eCommerce provider of products and services designed to inspire more human expression, connection, and celebration, has transformed itself from a collection of specialty brands into a unique e-commerce platform. Over the years, the company has expanded its footprint considerably in the highly fragmented gifting market, delivering sustained revenue growth.

The e-commerce platform features an array of popular brands including Harry & David,, PersonalizationMall, Shari’s Berries, and Cheryl’s Cookies, among others. The Company’s Celebrations Passport loyalty program provides members with free standard shipping and no service fee across its broad portfolio of brands.

In the first quarter of fiscal 2022,’s net revenue increased 9% year-over-year to $309.4 million. The company incurred a loss of $0.20 per share during the quarter, on an adjusted basis, compared to a loss of $0.10 per share in the prior-year period. The management expects full-year revenues to grow between 10% and 12%.

Is the recent portfolio expansion part of the strategy adopted in view of the pandemic, or is it something that was already there in the pipeline?

Courtesy:, Inc.

Over the years, we have demonstrated the ability to successfully acquire and integrate complementary brands and businesses that help solve more of our customers’ gifting and sharing needs, including Cheryl’s Cookies in 2005 and Harry & David in 2014. Our three most recent acquisitions are Shari’s Berries,, and Vital Choice.

Through strategic and highly accretive acquisitions, we have been able to expand the depth of our category offerings to help our customers express, connect and celebrate. As good stewards of our balance sheet, any acquisition targets must be highly complementary to our core business. Our goal is to put our cash and our under-leveraged balance sheet to work for shareholders through acquisitions that can help us accelerate top and bottom-line growth. We plan to continue to invest in our business to support our strong growth.

Last month, we acquired Vital Choice, a trusted provider of exceptional quality premium wild-caught seafood and sustainably farmed shellfish, as well as a growing range of pastured proteins, organic foods, and marine-source nutritional supplements.

Can you provide some insights into the Vital Choice acquisition, and how soon do you expect it to be accretive to earnings?

The acquisition of Vital Choice is a natural fit with our existing brands and will help us expand our product offerings across the “better for you” food category, providing our customers with even more healthy eating options. Expanding this category speaks to the growing consumer interest in food that is healthy, natural, and convenient. Newer, younger customers are especially drawn to “better for you” products. Q1 2022 earnings infographic

Vital Choice will benefit from the highly scalable e-commerce platform we’ve built and the investments we continue to make in our family of brands, including our advanced technology stack, digital marketing programs, expanded merchandising initiatives, customer service platform, and our customer engagement efforts. Our focus will be on helping Vital Choice grow, delivering improved revenue growth rates and enhanced profitability as part of our business platform.

We anticipate that Vital Choice will be modestly accretive to our fiscal 2022 top and bottom line. We look forward to integrating Vital Choice onto our platform and providing access to our digital marketing capabilities and our large and growing customer file to accelerate both revenue growth and contribution margin.

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Do you see the seasonal nature of the core business as a barrier to maintaining the current growth momentum, considering the COVID-related market uncertainty?

We’ve essentially doubled the size of our business over the past three years – and we expect to continue to drive sustainable, long-term revenue growth. This growth has included the significant work we’ve done to increase the recognition and relevancy of our gourmet food and gift baskets brands for everyday occasions, including birthday, sympathy, get well, new baby, anniversary, just because, and more. We have created entire product collections around key everyday gifting occasions, providing customers with more options for expressing themselves during milestone moments year-round.

The strong growth trends that we were seeing prior to the pandemic were significantly accelerated during the health crisis as customers increasingly turned to our brands to help them stay connected and express themselves. While there is a seasonal nature to the gifting calendar, because of our strength in everyday gifting, FLWS is profitable in three out of four quarters.

Since the start of the pandemic, we’ve become a bigger, stronger, better company with a dramatically larger customer file, continued strong double-digit growth in new customers, and increasing frequency from existing customers. We’re seeing strong growth in our Celebrations Passport loyalty program and in customers buying from more than one product category and/or brand representing our best customer cohorts in terms of frequency, retention and average spend – and thus CLV.

1-800-Flowerscom Inc. Q1 2022 Earnings Call Transcript

What should investors expect from the company over the next two years?

We have built significant momentum in our business over the past several years and we have never been better positioned for solid, sustainable growth than we are today. Consumers are looking to connect with others and express themselves more than ever – sentiments that we believe will be a long-lasting impact of the pandemic.

We will continue to invest and innovate in areas that elevate the customer experience and help people express, connect, and celebrate. And, we will focus on deepening our relationships with customers and creating a real sense of community, through communication, experiences, and content initiatives designed to create interaction and frequency outside of transactions. We are confident that we will continue to drive long-term shareholder value by leveraging the strengths of our unique business platform.

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