Greetings and welcome to the Torrid Holdings, Inc. fourth quarter fiscal 2023 earnings conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Chinwe Abaelu, Chief Accounting Officer. Thank you. You may begin. Good afternoon, everyone, and thank you for joining Torrid's call today to discuss our financial results for the fourth quarter and full year of fiscal 2023, which we released this afternoon and can be found on our website at investors.torrid.com. With me today on the call are Lisa Harper, Torrid's Chief Executive Officer, Mark Mizicko, Torrid's Chief Commercial Officer, and Paula Dempsey, Torrid's Chief Financial Officer. Before we get started, I would like to remind you of the company's safe harbor language, which I'm sure you're familiar with. Management may make forward-looking statements, including guidance and underlying assumptions. Forward-looking statements may include, but are not limited to, statements containing the words expect, believe, plan, anticipate, will, may, should, estimate, and other words in terms of similar meaning. All forward-looking statements are based on current expectations and assumptions as of today, March 28, 2024. These statements are subject to risks and uncertainties that could cause actual results to differ materially. For further discussion of risks related to our business, see our filings with the SEC. This call will contain non-GAAP financial measures such as adjusted EBITDA. Reconciliations to these non-GAAP measures to the most comparable GAAP measures are included in the earnings release, furnished to the SEC, and available on our website. With that, I will turn the call over to Lisa. Good afternoon, and thank you for joining us to discuss our fourth quarter results. Today I will begin with a review of our fourth quarter performance, highlight our accomplishments during the year, and then discuss our strategies for 2024. Then I'll turn the call over to Mark Mizicko, who will review our merchandising strategies and marketing plans. Paula will then review the financials and provide our outlook for fiscal 2024. We are pleased to report that our fourth quarter sales and EBITDA came in ahead of our guidance. While we are not immune to the current macro environment, we are focused on the levers we can control. Our disciplined inventory management enabled us to reduce promotions and drive higher full-price sales. For the quarter, we generated $294 million in net sales and $16 million in adjusted EBITDA. During the quarter, we observed strong customer engagement and a positive response to events like Black Friday and Torrid Cash, both of which exceeded our expectations. We saw positive regular price comp momentum and graphic tee s, knit tops, and bottoms, categories that we will continue to build on in 2024. Looking back on fiscal 2023, we made significant changes to improve the fundamentals of our business. We have touched just about every aspect from merchandising to marketing to sourcing. We are pleased to see sequential improvement in our regular price business as customers responded favorably to our holiday and early spring merchandise collections. Key highlights from 2023 are our improved assortment and optimized channel investments to maximize regular price sell-through, resulting in margin expansion, reducing our inventory levels, ending the year down 21% compared to a year ago, consolidating our sourcing base, positioning us to meaningfully reduce product costs in 2024, launching a new digital marketing platform leading to an increase in reactivated customers compared to a year ago. We made a great deal of progress in 2023 and now have a strong foundation in place as we move into 2024. We will build on the work we have done by remaining focused on our strategic priorities, improving our merchandise assortment, strengthening our marketing messaging, and optimizing our working capital through cost and inventory management. In terms of our merchandising, we will continue to evolve and elevate our collections to give our customers a broad assortment of relevant styles and fits. Our collection will reflect a better balance of casual and dressy that appeal to a wider age demographic. We will build on the success we saw with Trio Denim launch, expanding offering of graphic tees, and our core knit programs. Additionally, we are thrilled to relaunch a popular casual fabrication, challis, which is extremely versatile and supports an opening price point offering across our tops, bottoms, and dresses. We are pleased with the initial positive response we are seeing from our customers. In Curve, our intimate apparel brand, we will see the launch of new bras and innovation for the first time in many years. We will continue to invest in key items and programs. We know our price points skewed higher over the past few years as we moved away from a balance of casual in the assortment. Spring collections introduce a more casual assortment and broader pricing architecture across a good, better, and best cost-engineered in a way that offers value to our customer while remaining margin accretive. Moving to marketing, we are focused on increasing customer engagement and acquisition by leveraging insights from our new digital marketing platform. We are delighted to announce our casting call model search to find the new face of Torrid for 2025. Mark will provide more details in a few minutes. Turning to working capital, we are driving profitability and strengthening our balance sheet by improving our working capital strategy through product cost efficiencies and inventory optimization. Central to our cost efficiency drive, we renegotiated our supply contracts and consolidated our supplier base, securing cost advantages that directly bolster our bottom line. This effort is complemented by our focus on design-to-value strategies and production efficiencies, where we scrutinize every aspect of design and manufacturing to pinpoint cost-saving opportunities without compromising our quality standards. Parallel to these cost efficiencies, our inventory management leverages data analytics to accurately forecast demand, allowing for more strategic inventory procurement and reducing the risk of overstocking. This is bolstered by our product rationalization process, where we continuously evaluate and trim underperforming products, enhancing inventory turnover, and focusing on productive SKU offerings. Our mindset to chase inventory, supported by strengthening our supplier relationships, minimizes the necessity for large inventory holdings, increasing our market agility and reducing carrying costs. These measures are expected to drive sustainable growth and significantly improve our working capital efficiency while creating significant value for our shareholders, underscoring our unwavering commitment to operational excellence and financial performance. In closing, I am confident that the strategic transformations we've put in place position us for a future marked by sustained growth and a strong foundation in 2024. Before I hand over the floor to Mark, it's essential to recognize the relentless dedication and commitment of our team. Your tireless efforts and unwavering dedication to our customers are truly what set Torrid apart, creating an unparalleled and exceptional environment. Your contributions go beyond being recognized. They are profoundly valued. Thank you all for what you do. Now, turning it to Mark. Thanks, Lisa. I'd like to start today by sharing the progress we have made on a few of our key initiatives in merchandising, product margin expansion, inventory productivity, and buy accuracy, as well as marketing. Then I will briefly discuss some of the highlights of the fourth quarter. Our merchandising and planning teams remain focused on maximizing product margin expansion through better enterprise sell-through, optimized assortment investments by channel, and continued improvements in pricing and promotion. We continued to build upon the results of the third quarter with improvement in regular price sell-through and lower overall discounts, resulting in year-over-year product margin expansion of 140 basis points in the fourth quarter. We believe that our ending inventory position, down 21% as Lisa noted, positions us well to continue building on this momentum throughout 2024. We shared with you in our last call the early success we saw in the testing of clearance store conversions. We continue to be pleased with their performance and believe they will play a key role in our continued priority of maximizing inventory productivity. These clearance stores are allowing us to consolidate store markdowns and sell them more profitably, as well as freeing up space in our standard format stores to showcase a wider breadth of our otherwise e-commerce exclusive assortment. This advantage allows these clearance feeder stores to see incremental margin productivity from a combination of less markdown competition and additional regular price assortment. We believe this strategy will contribute to improvement in store traffic over time, as well with the wider breadth of assortment choice. Given the continuing success of these initial tests, we plan to convert additional stores to this format in 2024. Additionally, the optimization of assortment depth and breadth by channel began to pay off in the fourth quarter and will continue to be a strategic initiative for merchandising and planning teams throughout fiscal 2024 and beyond. Particularly, reducing the depth of e-commerce buys and allowing for omnichannel fulfillment programs like Ship to Store to fulfill web demand is facilitating enterprise-wide higher regular price sell-throughs and producing higher product margins through markdown avoidance. Lastly, we continue to see measurable improvement in the profitability and customer engagement of our promotional events, which in the fourth quarter included a Black Friday and Cyber Weekend event that met our expectations and saw significant margin expansion year-over-year, as well as a very successful Torrid Cash in January that further built on the momentum of October's event. Turning to marketing, we continue to see improved customer response to our marketing campaigns and touchpoints as we leverage the data from our new data platform and in partnership with our new digital marketing agency. We were able to take responsive action throughout the fourth quarter in optimizing our allocation of marketing spend across channels in order to maximize profitability and return and increase the performance of our customer file. We will maintain an emphasis on driving customers to our stores through cohesive omnichannel messaging, special in-store experiences, and dedicated loyalty events. Additionally, we will continue to leverage social media content to drive engagement and better connect with our customers. Our stores are the leading gateway for introducing customers to our brand. Those who first engage with us in-store are more inclined to utilize both our physical and online channels, becoming valuable omnichannel customers and spending three times more than single-channel shoppers. Finally, we are thrilled to be bringing back Torrid Casting Call in 2024, a nationwide model search for the next official face of Torrid. We ran this wildly successful campaign in 2019, and this year's will kick off in April and conclude in September. This will include multi-city casting calls, photo shoots, and styling consultations, finally culminating with a group of finalists who will gain invaluable mentorship from seasoned industry professionals who engage the contestants in professional development activities aimed at kickstarting their modeling careers. The ultimate winner will become the 2025 face of Torrid. To summarize, our team continues to make progress in our merchandising, planning, and marketing processes. We believe that many of the successes we began to see in the business in the fourth quarter will continue to lead greater margin expansion and improve customer file growth in 2024. With that, I will now turn the call over to Paula. Thank you, Mark. Good afternoon, everyone, and thank you for joining us today. Fiscal 2023 was a year of robust execution for our company, despite encountering a softer demand environment than we had initially anticipated. Our focus and resilience have been paramount, especially as we navigated through the challenges of the first half of the year in 2023. The second half, however, marked a critical turning point in our journey. We took strategic actions to establish a strong foundation for the future. Our performance improved in the latter months of 2023 while we executed on our core initiatives that we believe will drive our long-term success. I will now begin with a detailed discussion of our fourth quarter and full year, followed by our outlook for fiscal 2024. Our fourth quarter results came in ahead of our expectations on both the top and bottom lines. We generated meaningful year-over-year gross profit expansion driven by improved product margins as we began to see the impact of our product cost initiatives. We remained disciplined with inventory management, ending the year with healthy inventory levels. For the fourth quarter, net sales came in at $294 million compared to $301 million last year. This includes sales for the 53rd week, which were approximately $22 million. Comparable sales declined 9%. Gross profit increased to $101 million from $96 million last year, reflecting a gross margin increase of 250 basis points to 34.5%, driven by lower product costs and fewer markdowns. Store occupancy expenses were flat compared to a year ago. SG&A expenses in the quarter were $80.6 million or 27.5% of net sales, compared to $77.8 million or 25.8% of net sales last year. The increase is related to a one-time $1.6 million expense reversal in the prior year related to performance incentives. Marketing expenses in the quarter were $16.5 million compared to $15.8 million in the fourth quarter of last year. As a percentage of net sales, marketing increased 30 basis points to 5.6%, compared to 5.3% in the fourth quarter of last year. This increase is the result of a slightly higher investment in digital marketing. Our net loss for the quarter was $4.1 million or a loss of $0.04 per share versus a net loss of $3.9 million or $0.04 per share for the same period last year. In addition to GAAP measures, we believe that adjusted EBITDA is an important measure that we use to evaluate and manage our business. Adjusted EBITDA was $16.4 million or 5.6% of net sales, compared to $16.4 million or 5.4% of net sales in the fourth quarter of 2022. This includes the 53rd week impact of approximately $2.5 million. Turning to our fiscal 2023 results for the full year, net sales were $1.15 billion. We opened 36 Torrid stores and closed 20 stores, ending the period with 655 stores. Gross profit in the fiscal 2023 was $406 million or 35.2% of net sales. Adjusted EBITDA was $106 million or 9.2% of net sales, compared to $152 million or 11.8% of net sales in 2022. Despite facing some initial challenges in the beginning of the year, we experienced a turnaround in the second half that was marked by more stable traffic trends, robust product margins, and remarkable reduction in inventory levels. In addition, our focused efforts on digital marketing strategies in Q4 successfully re-engaged our customer base, leading to a 4% increase in customer reactivation. Net income for the year was $12 million or $0.11 per share, compared to a net income of $50 million or $0.48 per share for the same period last year. Moving to the balance sheet, our cash and cash equivalents were $12 million at the end of the quarter. Our total liquidity, including available borrowing capacity under our revolving credit agreement, was $115 million. Total debt at the end of the quarter was $312 million compared to $329 million in the fourth quarter of 2022. Our net debt to adjusted EBITDA was 2.9 times at quarter end. We made significant progress with our inventory levels, ending the year with inventory down 21% to $142 million compared to $180 million a year ago. Turning to our outlook for 2024, we expect consumers to remain cautious with their spending given elevated interest rate and inflation levels. While we believe this will limit our top-line sales growth, we expect to realize the benefits of our product cost initiative. We estimate full-year revenue of between $1.135 billion-$1.155 billion. In fiscal 2024, we expect to open 15-20 Torrid stores and close 10-15 stores. As a reminder, fiscal 2024 is a 52-week year compared to a 53-week year in 2023. Sales for the 53rd week were approximately $22 million, resulting in $2.5 million of EBITDA. We expect adjusted EBITDA of between $106 million-$116 million. This includes investments that are expected to increase SG&A as a percentage of sales by 100-120 basis points compared to last year. The increase is driven primarily due to the expectation that we meet our targets and have accrued for incentive compensation in 2024. We did not accrue for incentive compensation in 2023. We continue with investments in technology, including new product lifecycle and product allocation systems. Capital expenditure is expected to be between $20-$25 million, which includes investments in new systems and technology, as well as the opening of 15-20 new stores. Our guidance does not reflect the Consumer Financial Protection Bureau or CFPB's ruling to lower the maximum allowable charge for late fees, as it is subject to ongoing legal challenges initiated on March 7th, 2024. Should the court grant a stay in this ruling, we anticipate an impact on our net sales and EBITDA in the range of $11-$15 million for the last eight months of fiscal 2024. In response, we're actively collaborating with our credit card partners to lessen the impact if this goes into effect. Let me provide some comments on our expectations for the quarterly cadence for the year. For the first quarter, we project net sales to be in the range of $277 million-$282 million and adjusted EBITDA to be between $31 million and $34 million. There are a few factors impacting our first quarter sales. We have one Torrid Cash event planned for the quarter compared to two events last year. Given our more disciplined inventory management, we plan to move through less clearance inventory, which impacts top-line sales but is margin accretive. We anticipate that sales volumes will remain relatively consistent throughout each quarter and adjusted EBITDA to remain relatively consistent for the first three quarters, with a normal seasonal decline in the fourth quarter. This cadence is more aligned with our seasonality in 2019, a more normalized year for our business. Our guidance assumes continued traffic pressure impacting top line. The estimate also incorporates gross profit expansion throughout the year. We expect the combined effect of increased margins and sustained reductions in inventory levels to lead to improvements in working capital. As we look forward to the upcoming year, our journey reflects a path of strategic decisions, disciplined financial management, and a commitment to driving shareholder value. The past year has laid a strong foundation, setting the stage for sustained growth and continued innovation. With the continued support of our shareholders, the loyalty of our customers, and the hard work of our team, we're eager for the prospects to lie ahead. I will now turn the call over to the operator to begin the question-and-answer portion of our call. Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Thank you. Our first question comes from the line of Brooke Roach with Goldman Sachs. Please proceed with your question. Good afternoon, and thank you for taking our question. I was hoping you could speak a little bit further about the impact that you're seeing with regards to traffic, ticket, and conversion outcomes from some of the new product and marketing initiatives that you have underway at the company. And then specifically, can you help us bridge the path back to positive comp growth at Torrid and when you expect to see that inflection for your business? Thank you. Hi, Brooke. Thanks for your question. We anticipate pressure on traffic in the first half of the year, recovering in the back half. What we're seeing is improvement in stores slightly faster than we had anticipated. We think that this is because the opening price point key item programs that we've put into place are working as well as more casual product assortments. And so we are encouraged by the transaction values that we're seeing out of the store channel and the improvement there. We think that the back half of this year is the inflection point as we have anticipated a normalized traffic trend, more toward a flat traffic numbers in the back half, and anticipate the continuing kind of improvement that we're seeing from the inventory management, the regular price sales improvement, as well as the much more efficient investment in inventory nets that gross margin. We're not just looking at comp. We're looking at margin comp as a critical KPI for this year, which we're seeing expansion. We'll see expansion most of the year accelerating in the back half as well. Great. Thanks so much. And then maybe one for Paula. As you contemplate the margin outlook that you provided today, as well as some of the potential headwinds as you think about credit card income and mitigation factors there, how are you thinking about the path back to pre-COVID adjusted EBITDA margin levels, and what are the most important drivers that you expect to realize as you journey back to that level? Yeah, that's a great question. So I think as we think about the late fee ruling, we're still obviously working with our partners at this point. As I brought it up, this is an impact of $11 million-$15 million, possibly. But at this point, again, we're working with them to minimize that impact. More to come from that standpoint. But I think as we think about our EBITDA margin expansion throughout the year, we're going to see it really in one major form, really, which is going to be our gross profit expansion, which we're going to see more dramatically from Q1 to Q3 and easing it in Q4, right? We're going to start lapping that. As we think about to being more close to fiscal 2019, I would say that our cadence in general, whether it's sales from a top-line perspective or even SG&A, will be much more aligned with fiscal 2019. Thank you so much. I'll pass it on. Our next question comes from the line of Alex Straton with Morgan Stanley. Please proceed with your question. Great. Thanks a lot. Super helpful overview of the initiatives you've done this year and the focus areas as we look ahead. Maybe for Paula, where do you think we should initially see signs of these efforts showing up in the P&L first? And then perhaps both for Paula and Lisa, what KPIs are you focused on as a management team? I know, Lisa, you mentioned one, but maybe just a quick summary of what from your end you guys are super focused on? Thanks a lot. Yeah. I would say, Alex, that you're going to start seeing in the P&L, you're going to start seeing a gross profit expansion. That's going to be the first place you're going to see. So this year, we're very, very focused, and obviously, it results from everything that we all of the strategies that started last year. But we're going to see the results is really going to be through expansion of gross margin, which we did see that already in Q4 of fiscal 2023, and we're going to continue to see that throughout the year. I would say from an SG&A standpoint, you're going to continue to see our SG&A almost at the same levels as Q4 of fiscal 2023 from a dollar standpoint. And there's, as I mentioned, two reasons for that, right? One is we're back with the incentive compensation in 2024, which we did not have in 2023, as well as we are continuing with some heavy investments in technology at Torrid with new product lifecycle, product allocation systems. And not only that, we are in the second half of the year going to start looking into our ERP upgrade. But I think in general, you're going to see on the P&L, really, it's going to be in gross profit. One other thing, though, from SG&A, what we're experiencing right now and what we started seeing in late Q4, even early I mean, even late Q3, actually, we're seeing improvements in store labor expenses, and we expect to leverage that this year, which is a great sign. Then other KPIs I mentioned, product margin comp expansion is probably the biggest mover this year. The other thing I would reinforce is the kind of rationalization between channels. As we're seeing a faster than planned recovery in the store channel, that leverages fixed expenses at a faster rate so that there's a positive momentum there, not just with the pure dollars, but with kind of the underlying leverage of the fixed expenses related to the stores. I think we've done a good job with store payroll. And I think the other piece of that is looking at how we're turning inventory. So obviously, a very dramatic shift in inventory down 21% at the beginning of the year. You'll see that continuing to leverage as we move through fiscal 2024, as we're very focused on turning that inventory more quickly and the investments required lower investments required in order to generate the top-line sales and the margin dollars that we're talking about. So for the year, it's product margin comps, it's working capital investment and inventory improvements, and it's that kind of channel redistribution kind of with the store recovery that are all going to have positive impacts on the gross profit. Ultimately, positive comps in both channels is our goal by the end of the year moving into 2025. That helps exacerbate and increase the leverage that we've been able to generate with margin expansion. Great. Good luck. Thank you. Our next question comes from the line of Jeff Lick with B. Riley Securities. Please proceed with your question. Thanks for taking my question. Congrats on a good end of the year and fourth quarter. Lisa, I was wondering if the five initiatives I've counted that you started talking about sometime in 2Q or 3Q of last year, gross margin optimization, sharper price points, the casual assortment, the marketing data platform, and then the clearance store conversions. I was just wondering if you could kind of walk through when do you start how much more do you have to go into 2024 before you start to lap those? And then I'm just curious, with respect to your guidance and then these initiatives, if things could go better, where do you see things where it could go better and there would be upside? Sure. So gross margin is a little bit of it in fourth quarter. It'll increase as you go through this year, and we won't be lapping anything until we get to the back end of fourth quarter of 2024. So we have a full year of expansion there. Opening price point, we just launched that as well. It's exceeding our expectations, particularly in the store channel. And so that is brand new as well, and that kind of rolls out and is refined as we move through the balance of the year. Casualization started in winter of last year, so really more like September, October, with the first movement into kind of this casual, casual chic mindset and minimizing the dressier side of the assortment. So you have that for at least three more quarters, but then refinement beyond that. I think some of the things that I would say on a product basis, we have the right silhouettes in denim now. While we had the new products, the new shapes, the new silhouettes of denim, we weren't invested appropriately there. We've corrected that and have moved more appropriately into those mixes. So there's product improvements as well in the casualization. Graphic tees are very, very good. We've appropriately invested in the graphic tees and in knits. Those are also improving. I think the challis dress program is exceeding our expectations, particularly in the store channel. So some of those things that we've already invested in in casual are off to a very strong start, and we expect that to continue through the balance of this year. The data platform right now, we had good initial results. I think it's a little challenging during the holiday period as the cost for digital marketing changes pretty dramatically. We're continuing to test that and anticipate continued kind of improvement and opportunity associated with an increase in marketing spend. We'll be able to rationalize that. We're very cautious about that. It's easy to move week to week in terms of those investments. What we're doing, some A/B testing on that so that we can really give you a full understanding of what we think the opportunity is there in the back half of the year. And then clearance centers. Mark mentioned in his comments, and we're happy with how those are working, and we anticipate rolling out additional. We actually just opened one, I think, last week, and it's exceeding our expectations. Each of those stores have 8-10 feeder stores that we see gross margin expansion even above the chain expansion related to being able to take second and third markdowns out of those stores and expand the assortment. Over half of our stores, based on our tests, can handle an expanded assortment either by being a feeder store or by having additional space and less space dedicated to clearance as we are more regular price-driven at this point. So there's expansion related to that. I think that we'll have the first half of the year, we have another eight or so clearance centers that we're aiming for, and we'll continue to read that carefully and cautiously as we roll out that strategy. But we're at 4 today. We're at 3 through the end of last year. We'll look at adding another 8 or so into the mix and think that that'll impact 80-90 stores incrementally that are driving a higher gross margin improvement than we're seeing in the chain. Then your other question. Oh, I was just curious about what could go better, but you kind of answered that in your highly detailed answer. Yeah. I mean, I think that we expect the customer to still be a little. We're seeing traffic improve, but it's still negative, and we expect it to be negative through the beginning of the year and improve in the back half. I think that assumption is built into our guidance. If that changes or improves more quickly, if the model search drives traffic at a faster rate, that's an opportunity for second quarter as well. But we are forecasting it based on what we're seeing now, if that's helpful. Yep. Just a quick one from Paula. Would it be possible to break out for Q4's sales that you reported, the $293.5 million merchandise sales versus PLCC? The way that I would think about it is PLCC is usually about 1.2%-1.5% of our net sales in general. You'll continue to disclose that in the K, though, correct? We disclose in the K our total value of our private label credit card, yes. Correct. Okay. So I'll be able to get it when the K comes out. That is, yes. Okay. Great. Thank you. Correct. In a week or two. Thank you. Thank you. Our next question comes from the line of Corey Tarlowe with Jefferies. Please proceed with your question. Thanks. Good afternoon. I wanted to ask on promotions. So you've reduced promotions, and it seems like merchandise margins are on a good trajectory. Product margins are up, and inventories are down. So how are you thinking about the prospects for promotions ahead within the context of how you're planning inventories and clearance and markdowns, etc.? Yeah. I think some of the notable things that happened promotionally during the quarter were during Black Friday and the Cyber Weekend, where we discounted much less than we had in the prior year. And again, running up until the week before Christmas, again, we ran much higher year-over-year margin rates, less discounted. And then I think the other thing that was notable is that in January, we continued the momentum that we've been seeing building in Torrid Cash promotion, which is, as I've said before, our most productive promotion and had been really suffering at the beginning of last year. And we started to see a little momentum build in mid-year, some improvement in October, and then we saw continued improvement in the January Torrid Cash redemption. So I think the way that plays forward, we've gotten back to nearly where we expect the Torrid Cash promotion to be. I expect that it'll continue to improve and continue to remain our best. So that will be normalized. We'll have 4 of them this year versus the 5 that we had in 2023. The promotion period has pretty much been normalized. The issuance policies, we're pretty happy with what those are. I think thinking about day-in, day-out promotions, we're starting to see traction in the stores as we've talked about. With inventory levels down, it's not necessary to promote to move inventory to the same degree that it has been last year and even 2022 to some degree. So we're pretty pleased with our initial reads on how we can let off the gas promotionally and allow higher margins, lower discounts to drive the inventory. And of course, with less clearance inventory also, there's much less need to have clearance promotions to get through that. Understood. Thank you. And then just a quick one. How are you thinking about marketing expenses as we look throughout the year ahead? I think that you are also adding in an additional marketing event or an activation that you haven't done in the past. Curious what the other associated implications of that investment and other marketing expenses might be within the outlook for this year? Thank you. I think as a percent of business, the marketing spend is fairly similar to where it has been, slightly increased. The spend that is the additional spend as we continue to test in digital, the model search, etc., that is all being funded within that slight increase as a percent of revenues that marketing spend will be. As we learn more through the A/B testing, we would only invest if we see an incremental EBITDA contribution based on that investment. So more to comment the next time we talk with you guys because we'll have more definitive kind of results based on that. That might change the number slightly, but it all is predicated on incremental EBITDA contribution based on that investment. Great. Thanks so much. Thank you. As a reminder, ladies and gentlemen, if you would like to ask a question, please press star one on your telephone keypad. Our next question comes from the line of Dana Telsey with Telsey Advisory Group. Please proceed with your question. Hi. Good afternoon, everyone. Interesting to hear about the labor costs and nice to see the progress everywhere. How do you think about labor expenses? Are they coming down because of hours that are being reduced? Is it wage expense? Wage rates? rates? You're shifting wage rates. What do you expect to see going forward? Are there any other elements of the expense structure, either changes up or changes down, that we should account for in the margin outlook? Thank you. Hi, Dana. It's Paula. So what we're doing with our labor expenses, it's truly a couple of things. One is creating efficiency and higher productivity in the stores. That's the work, and we're seeing the results right now. We started doing this in the second half of last year, and we're finally collecting some of those positive results right now. So what we have done is definitely shifted some of the wages around, so we're seeing the benefit from that. And in addition to that, we're just becoming a lot more effective with how we spend our time in the stores, really, from labor hours. So those are the two items in which we're highly focused. I would add that we changed the leadership structure in the stores to rationalize kind of the right balance of leadership to hourly associates, and that's having a result in it. We also have had a new Chief Stores Officer join us with really a focus on sales culture, and I think we were more oriented toward a task culture. Even though our Net Promoter Scores and our CSAT scores in stores are in the high 80s, mid 90s, so the customer is having a great experience, we felt like we could improve that even more. And so it's not a rate issue. We've managed it really through structural shifts in what we're asking the stores to do and in the leadership structures in the stores. Got it. And then when you're thinking about new store openings this year, locations, off-mall, mall, any changes in sizes of store and regions? Yeah. It's a very small number of stores, and it will all be strip centers in Canada. Got it. And then, Lisa, just the competitive environment with the core customer base, how is it changing the competitive environment, whether online or physical, and how do you see your pricing given the better product cost that you're getting? Yeah. I would still say it's a very highly segmented space, a lot of small players in it. And so I don't think it's changed appreciably. I think the self-inflicted elevated retail, the sticker shock, has been mitigated somewhat by the efforts that we put into better mix of product, both casual as well as initial tickets, and rationalizing those tickets to the value of the product. And we are seeing, because of that, and I also think because of our inventory positioning, improvement in regular price sales, not just an initial markup but in regular price sell-through that is benefiting that. So I think that always stopping to reevaluate the appropriate value pricing of our product is critical, and I think we made some big shifts. We're seeing, as I mentioned earlier, our core programs working well, particularly in the store environment. We think we have some opportunity in how we market them online to improve that, but beating our forecasts in both categories, opening price point core items as well as what we've done in the challis programs, which are part of the opening price point strategy. So I think we're making progress there. Then shifting toward more casual product has also brought the average retail down in the store, but it's not really impacting the average unit value going out the door. That's still positive. So I think one of the concerns people had was if you're going more to opening price point or changing those initial tickets, that you'd have a challenge on your average ticket price out the door, and that we're actually not seeing an impact to that. Thank you. Thanks, Dana. There are no further questions at this time. I would like to turn the floor back over to Lisa Harper for any closing comments. Thank you. Thanks, everyone, for joining us today. We really appreciate your focus on the business and looking forward to talking with you in the interim as well as when we release first quarter later this year. Talk to you soon. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.