Greetings, welcome to the Wolverine World Wide, Inc. second quarter fiscal 2021 results call. At this time, all participants are in a listen-only mode. A 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. I would now like to turn the conference over to your host, Mr. Brett Parent, Vice President of Strategy and Investor Relations. Please go ahead, sir. Morning, and welcome to our second quarter 2021 conference call. On the call today are Blake W. Krueger, our Chairman and Chief Executive Officer, Brendan Hoffman, our President, and Mike Stornant, our Senior Vice President and Chief Financial Officer. Earlier this morning, we announced our financial results for the second quarter 2021. The release is available on many news sites and can be viewed on our corporate website at wolverineworldwide.com. If you'd prefer to have a copy of the news release sent to you directly, please call Allison Malkin at 203-682-8225. This morning's press release and comments made during today's earnings call include non-GAAP disclosures, which adjust, for example, for the impacts of environmental and other related costs, net of cost recoveries, costs related to the COVID-19 pandemic, including air freight costs, credit loss expenses, severance expenses and other related costs, and foreign exchange rate changes. These disclosures were reconciled in attached tables within the body of the release. I'd also like to remind you that statements describing the company's expectations, plans, predictions, and projections, such as those regarding the company's outlook for fiscal year 2021 and 2022, growth opportunities, and trends expected to affect the company's future performance made during today's conference call are forward-looking statements under U.S. securities laws. As a result, we must caution you that there are a number of factors that could cause actual results to differ materially from those described in the forward-looking statements. These important risk factors are identified in the company's SEC filings and in our press releases. With that being said, I'd now like to turn the call over to Blake W. Krueger. Thanks, Brett. Good morning, everyone, and thanks for joining us. I hope everyone on the call is safe and well. Our long-term strategic focus on our consumers, digital and DTC capabilities, and product and design innovation, especially in performance categories, is fueling robust demand for our market-leading brands. Earlier this morning, we reported strong financial results for the second quarter that significantly exceeded 2020 and our expectations, and also easily beat 2019. Revenue was approximately $632 million, a record high for Q2, representing growth of 81% versus 2020 and a double-digit increase compared to 2019. The Wolverine Michigan Group's revenue was up 63% year-over-year, and the Wolverine Boston Group's revenue was up 111%. Both groups were up double digits compared to 2019. Adjusted earnings per share for the company was $0.67. Our order backlog remains at historically high levels, and momentum in the business continues to accelerate despite the macro COVID-19-related supply chain headwinds facing our industry and many others. Certainly, our proactive approach to combat these headwinds has been very effective and is also reflected in our strong Q2 results. Given the company's excellent performance and the trends in the business, we have again raised our outlook for fiscal 2021 and now expect revenue in a range that is $150 million higher than we anticipated in our original February guidance, delivering meaningful growth over 2019 at both the high and low ends of the range. Our brand portfolio strategy and international distribution base is also fueling accelerated momentum as the company is not dependent on any single geographic region, consumer group, or distribution channel. We have positioned our consumers at the heart of our strategy, and that has changed the nature of our company, with approximately two-thirds of our brand revenue now positioned in performance product categories like hiking, running, and work. Categories that are tightly aligned with today's consumer trends. At the same time, the company has developed a strong DTC-focused global distribution model. Year-to-date, our DTC e-commerce business has more than doubled in revenue relative to 2019, and our DTC stores are up nearly 20% versus 2019. Together with the DTC channels operated by our distributor partners around the world, about one-third of our global revenue is now generated through direct consumer dialogue and interaction, enabling enhanced brand shopping experiences, a wealth of direct consumer insights and data, and a more efficient business model. We see this accelerated momentum continuing for the foreseeable future. While consumer lifestyle changes related to the COVID-19 pandemic have significantly bolstered demand for performance product categories. The underlying trends are long term in nature, existing prior to the impact of the pandemic, and are expected by industry and consumer trend experts to persist. Consumers have become increasingly focused on health and wellness over the last several years, and running, hiking, and the outdoors have served as primary activations of this mindset. Participation in running in the U.S. has increased every year over the last five years, up by a mid-single-digit CAGR over this time, and a significant majority of new runners say they plan to continue running in the future. Participation in the outdoors, and hiking in particular, has also increased every year during the same time frame, up by a high single-digit CAGR even before last year's 16% spike, adding nearly 21 million new hikers in the U.S. alone. This spring and summer, national parks are shattering attendance records. More people are continuing to get outside, and this renewed interest in the outdoors is expected to continue into the future, especially as consumers begin to travel again. The more need-based work category has also showed strong growth over the last several years, supported by healthy macro industry conditions and workwear fashion tailwinds. According to the Bureau of Labor Statistics, warehousing jobs have more than doubled since 2005, and construction companies are expected to hire hundreds of thousands of additional workers this year. Looking ahead, the passage of a major infrastructure plan in the U.S. would further boost momentum in this category. Our brands are capitalizing on these fundamental trends, and we expect continued strong consumer demand over the long term, especially for Saucony, Merrell, Wolverine, and our work brand, and Sperry as well, which will launch products in the active sport category next spring. These trends and our visibility into future demand give us confidence to increase our outlook for this year and plan for double-digit growth in 2022. For our call today, Brendan Hoffman will provide some additional insight on the drivers of our robust Q2 revenue growth. Mike Stornant will review our Q2 financial performance and improved outlook in more detail, and I'll conclude with some final remarks. With this, I'll now hand it over to Brendan. Thanks, Blake. In the second quarter, our two largest brands both drove significant growth and achieved all-time record quarterly revenue. Merrell revenue grew 88% year-over-year, or nearly 30% compared to 2019, with DTC up nearly 40%. Merrell.com grew mid-single digits against last year's better than doubling of the business, translating growth of more than 150% versus 2019. Merrell stores were up significantly compared to last year's Q2 revenue due to lockdowns and up high teens versus 2019. Led by the robust growth of almost 180% in the U.S., four of five regions contributed very strong double-digit growth year-over-year for the brand. Merrell continues to focus on cultivating its well-established product franchises while delivering innovation through key new products. The brand's performance category more than doubled in Q2, driven in large part by the launch of the all-new Merrell Moab Speed and Moab Flight, which build on the success of the world's number one hiker, the Moab, and the brand's vision of faster, lighter footwear for the trail. Both collections quickly exceeded sell-through expectations, sold out on merrell.com, and became top sellers for the brand during the quarter. The Merrell Antora 2 and Nova 2 trail runners also continued to perform very well, more than tripling year-over-year. Merrell's lifestyle business also grew very strong double digits during Q2. The iconic Merrell Jungle Moc nearly doubled year-over-year, and the newer Merrell Hydro Moc more than tripled. Merrell also introduced its 1TRL capsule collection on merrell.com, which reinterpreted existing styles with fresh, trend-driven colorways and fashion-forward storytelling with great success. This collection is focused on younger, fashion-forward consumers demanding authentic, outdoor-influenced style. Merrell is generating significant brand heat and consumer interest, and the brand's slate of product and marketing stories for the back half of the year are poised to fuel continued strong growth over both last year and 2019. Looking ahead, Merrell possesses a substantial growth opportunity globally, particularly in EMEA, where revenue nearly doubled in Q2, and in Asia Pacific. Outdoor is trending around the world in both performance and fashion, and Merrell is capitalizing on its heritage and brand positioning. Moving to Saucony, Q2 revenue grew 129% over 2020, or 65% versus 2019, an impressive performance. Saucony.com was up over 20% despite comping against a nearly tripling of the business last year, resulting in more than 250% growth versus 2019. All regions contributed triple-digit growth year-over-year. Saucony's incredible momentum continues to be fueled by product design and innovation. The road running category more than doubled in Q2, propelled by the launch of the new Saucony Ride 14, Endorphin Pro 2, and Endorphin Speed 2, three of the brand's top four franchises, all of which grew triple digits in the quarter. The innovative Endorphin collection continues to generate heat in the marketplace and delivers substantial growth for the brand. Saucony's trail running business more than tripled in the quarter, and Saucony Originals, the brand's heritage lifestyle sneaker business, was up very strong double digits. Kicking off Q3 earlier this month, Saucony launched the Triumph 19, a follow-up to its award-winning predecessor. The brand also introduced the Endorphin Shift 2, which has received rave reviews within the industry, and extended the Endorphin franchise into trail running with the all-new Endorphin Trail, bringing Saucony's revolutionary SPEEDROLL Technology for maximum speed and PWRRUN technology for lightweight cushioning to the trail. Saucony continues to deliver a consistent flow of powerhouse performance product and trend-right lifestyle product, and we are now seeing this translate into continued robust growth for the brand. Moving forward, Asia Pacific is a big opportunity for Saucony, with the region almost tripling in Q2. Saucony stores and core technical product are performing well in China as the brand's joint venture there begins to ramp up. EMEA more than doubled in Q2 and presents a meaningful growth opportunity in both performance and lifestyle, fueled by the Saucony Originals Italian product design and marketing hub. Saucony's runway for growth remains significant. In Q2, our work business accounted for nearly 20% of total revenue and continued to deliver strong growth. With Wolverine, the leader in the U.S. work boot category, up over 70%, CAT Footwear up nearly 50%, and with strong contributions from our smaller brands. As Blake indicated, we expect consistent strong growth in the work category. With the continued growth of Merrell, Saucony, Wolverine, and our other work brands, our performance business almost doubled versus 2020, an increase of nearly 40% over 2019. The Sperry brand rebounded year-over-year in Q2 with triple-digit growth. The brand's DTC business was up nearly 50% in the quarter, driven by the excellent performance of Sperry stores. The brand's full price business continues to perform well, with gross margin expanding well over 400 basis points in the quarter. Sperry's new Float collection, a fun and affordable injected version of the boat shoe, vaulted into the brand's top-selling styles, expanding price tiers for the brand and reaching a younger consumer. The boat category has shown positive growth, particularly in men's, and Sperry gained market share in this key category. From a fashion standpoint, there are clear indications that we are at the forefront of a boat shoe trend. Sneakers was the brand's largest category and biggest growth driver in Q2, up more than two and a half times over last year, driven by new collections like Sperry Soletide and existing franchises refreshed with trend-right materials and colors. Moving forward, Sperry anticipates accelerated growth in its performance active and athleisure business. In spring 2022, the brand will launch its new Sperry Sport collection, which responds to macro consumer trends with more trend-right performance-based product. In the coming months, Sperry plans to build on our energy created by recent collaborations with Rowing Blazers, Netflix's "Outer Banks," and Good Humor and Popsicle Ice Cream, and product capsules with John Legend and Rebecca Minkoff. The brand also intends to leverage the easy on/off trend with the launch of the new Sperry Moc-Sider and the Cozy Float collections, extending the success of the Float franchise into the fall/winter season. We expect continued strong year-over-year growth from Sperry in the back half of the year. Finally, during the second quarter, our consolidated DTC business grew in the high teens compared to 2020, up nearly 70% versus 2019. Stores grew up almost 20% compared to 2019, up significantly versus last year's lockdown-hampered business. E-commerce grew almost 100% over 2019 and was essentially flat to last year's record quarter. Looking at the back half of the year, the product lines are very strong across the brand portfolio, which will also drive growth in the digital channel. We believe the strong product, coupled with improved merchandising practices and healthier inventory positions, will drive growth in the second half as well as next year. We will continue to invest in digital and AI to improve site experience and drive conversion gains. In the next couple of months, we will launch our first mobile app with Merrell as well. We have pivoted to a more dynamic e-commerce development model to enable faster implementation of enhancements and new capabilities, which will also help us extend improved functionalities to our international sites more quickly. E-commerce has more than doubled 2019 revenue year to date. Although consumers have started to shift some of their purchasing back to stores as markets reopen, our DTC e-commerce business and the online business of our wholesale customers still represented almost a half of our revenue in the U.S. I'm now going to hand it off to Mike to review the second quarter financial results and our increased 2021 outlook in more detail. Mike? Thanks, Brendan, and thanks to all of you for joining us. Let me start by reviewing the company's second quarter financial performance and some of the key drivers of our over delivery, and then I will cover our improved outlook for 2021. Second quarter revenue of approximately $632 million represents growth of 81% compared to the prior year. While Merrell, Saucony, and Sperry were the strongest performers, nearly all brands in the portfolio delivered substantial growth. All regions grew nicely in the quarter, with the U.S. and EMEA meaningfully beating expectations. Adjusted gross margin of 44.5% improved 230 basis points versus the prior year due to a favorable product mix and higher average selling prices. Merrell and Saucony both easily exceeded gross margin expectations in the quarter, another indication of their strength in the marketplace. Adjusted selling, general, and administrative expenses of $201.8 million were $72 million more than last year and $35 million more than 2019, primarily due to increased revenue volume, increased marketing investment, and more normalized incentive compensation costs. Most major expenses levered better than expected as a percent of revenue, including our increase in marketing investment. Adjusted operating margin was 12.6% for Q2, an improvement of 750 basis points over last year and 150 basis points versus 2019. Very strong leverage on the company's revenue growth resulting from gross margin expansion and healthy operating expense management. Adjusted diluted earnings per share were $0.67 compared to $0.08 in the prior year. Reported diluted earnings per share were $0.53 versus a loss per share of $0.02 last year, and reflect specific COVID-19 related costs and certain litigation defense costs in both periods. Let me now shift to the balance sheet. At the end of the quarter, inventory was down approximately 14% compared to last year. A nice improvement compared to the 21% decline at the end of Q1. Our inventory position continues to strengthen as we make some progress against the supply chain headwinds impacting the broader industry. In Q2, we generated $25.4 million of cash flow from operating activities. The company finished the quarter with $306 million less debt compared to the prior year, and total liquidity of approximately $1.1 billion, including $346 million of cash on hand and nearly $800 million of revolver capacity. Our bank-defined leverage ratio continued to improve, ending the quarter at a low 1.2x. The company's balance sheet is extremely healthy. I will now provide an update on our outlook for 2021. The company outperformed in Q2, and the trends in our business are very strong. Our order book remains at historically high levels and continues to provide good visibility to our global wholesale and distributor businesses into 2022. Our direct-to-consumer businesses are performing well, including steady improvement from our store fleet. This momentum, coupled with the consistent strength of global consumer trends that align well with our brand portfolio, give us confidence to raise our outlook for fiscal 2021. The company now expects fiscal 2021 revenue in the range of $2.34 billion-$2.4 billion, growth of 31%-34% compared to the prior year. This represents an increase of $150 million from our original outlook in February, and results in growth of 5.6% versus 2019 at the high end of the range. We now expect adjusted diluted earnings per share in the range of $2.20-$2.30. Reported diluted earnings per share are now expected in the range of $1.85-$1.95, include net litigation defense costs and incremental airfreight costs caused by the COVID-specific disruption in the supply chain. The global economic environment continues to improve, but pandemic related volatility remains. We have factored into our outlook the current headwinds that we have visibility to today, including logistics costs and supply chain delays. In this dynamic marketplace, our team has done a remarkable job to improve our ability to service the accelerated demand we continue to see for our brands. Our balance sheet is very strong, the company is poised to lean forward as we deliver higher growth in 2021, with very strong prospects for 2022 and beyond. With that, I will hand it back over to Blake for some closing remarks. Blake? Thanks, Mike. Our accelerated growth and strong financial performance in Q2 are a testament to the company's strategic focus and increasing brand investments. Over the last several years, we've invested behind digital marketing, technology, talent, and e-commerce, as well as product innovation and design. These investments are paying off. Our brands have numerous growth opportunities in front of them. The company's balance sheet is strong, and we are confident as we plan for double-digit growth in 2022. The advantageous position we find ourselves in today is a credit to our team's expertise and relentless work. The global marketplace continues to be dynamic and fast-changing, and our people and company are excelling in this environment. I'd like to close by thanking our team members around the world for their tremendous efforts in making this a pivotal year for the company. With that, I'll now turn the call back over to the operator. Operator? Thank you. At this time, we'll 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 your line is in the question, too. 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. Your first question comes from the line of Steven Marotta with C.L. King & Associates. Please proceed with your question. Good morning, everybody. Thank you for taking my question. I appreciate it. Mike, can you talk a little bit about the current supply chain disruptions, the length of time, the difficulty in getting product here, and how that affects your outlook for the second half sales and earnings cadence again from a quarterly basis? Thanks. Sure. Yeah. The industry's definitely dealing with this challenge across the board. Here at the company, I think we've done a great job of managing and being proactive where we can be to offset some of those risks, as you're seeing in the outlook, which has improved here. In the back half of the year, we have well-known disruption in some of the Vietnamese factories that we're in. Even with some of that downside exposure, which is reflected in our outlook as we mentioned, we feel confident that we can continue to deliver growth in the back half of the year. I think as we look at the position we have with our inventory today, continues to improve. By the end of the year, we would expect our inventory positions to be up nicely over last year and over 2019 levels. I think, again, the aggressive position we're taking in terms of buying inventory and some of the tactics we've deployed have helped us kind of navigate what's been a really choppy supply chain situation. That's helpful. Thank you. Brendan, you mentioned that you have indications that we're currently on the bubble of a new boat shoe trend. Can you talk a little bit about, in detail, what those indications are and how quickly you think that could catch fire? Thanks. It's really exciting for us to see that with Sperry. We're really just seeing it on our own website. We're hearing it from our retail partners that they're seeing the uptick, seeing it really strong in men's right now, and all the data points we get and the information we get from our (uncertain) group show it as well. Really feeling confident that we're at the precipice here of that trend, which obviously only enhances everything we're doing with Sperry. I'll jump back in queue. Yeah, Steven, I'd also say, I think this was the second quarter in a row we saw that category increase in the market here in the U.S. where we get information. I'll jump back in queue. Thank you. Your next question comes from the line of Jim Duffy with Stifel. Please proceed with your question. Thank you. Good morning, everyone. Hope you guys are doing well. We sure are. Yeah. Mike, I wanted to focus for a moment on the SG&A, just as it relates to potential for leverage with any revenue upside in the back half of the year, versus 2019 year second quarter SG&A growth accelerated. You mentioned some incentive compensation and incremental marketing expense. If we're modeling versus 2019, should we expect leverage in the back half of this year? Is the incentive compensation all trued up to appropriate levels, or is there more of that to come in the back half of the year? Yeah, there's more of that to come, Jim, in the back half. We allocate and expense that over the full year, and expect now based on the performance of the business, which is obviously exceeding our expectations on the top line and the bottom line, that our incentive comp results will be very positive and more normalized. We're also investing pretty heavily in our e-commerce business and our direct-to-consumer businesses across the channels. You're seeing a shift from 2019- 2021 in the way that we're investing in the business, but also just the nature of the direct-to-consumer business model, which is at a much higher level. We've more than doubled it in the first half of the year. We're still on track to do that for the full year. The shift in SG&A expense has a lot to do with our focus on direct-to-consumer, and that business model requires a higher level of variable SG&A. Understood. Thanks. Moving up the P&L, as it relates to the gross margin outlook, some clear inflationary pressures. I joined the call late, maybe you mentioned this in prepared remarks, but did you speak at all to pricing power, just given the demand strength that you're seeing across the industry? Yeah. Frankly, we believe the consumer's been paying higher prices throughout most of this year. There's been significant less promotions across the industry. That has really seemed to have no impact on demand, at least the demand as we see it for our family of brands. We think there's pricing power yet available. We think there will be price increases in the industry, input costs going up, obviously logistics costs going up. We'll start to see some of those price increases yet this year, you're seeing it in some industries like toys and some other consumer categories. You'll see some more selective price increases, judicious price increases, in 2022. Mike, do you have a view for product cost inflation from your channel partners as we look out to 2022? We do. I think on the product side, on the input cost side, I think we've been able to manage that pretty well, especially for the spring season, Jim Duffy, in that first half of the year. Good visibility to that. Obviously, the challenges and some of the cost pressures are coming more from the logistics side and distribution side of the supply chain, where we've seen pretty tremendous increases in freight rates, both inbound and outbound. I think that's a cost pressure that we factored in as we start to plan our spring business and think about 2022. On the input cost side or the product cost side, it's been managed very well. Thank you very much, guys. Thank you, Jim. Your next question comes from the line of Jonathan Komp with Baird. Please proceed with your question. Yeah. Hi, thank you. First, Mike, can I just clarify, I know the guidance for earnings now adjusting for $0.35 of items. Can you just maybe highlight what's included in that currently? We have the litigation costs that we continue to have related to the legacy issue that we've spoken about in the past, and that continues to be included in our non-GAAP adjustment. We've included mostly air freight and some other COVID-19 specific costs that we've adjusted out consistent with the last several quarters. Okay. The air freight, is it still, I think you said $15 million-$20 million last call. Do you think that continues beyond this year at all, or just current thoughts on the level and if it'll continue? It's hard to predict that right now, Jonathan. Obviously, we're seeing a demand for that this year, and have provided a little bit more coverage for that, just given the uncertainty of the supply chain. As far as how that plays out next year, it's hard to predict. I will say that I think our brands across the portfolio have taken a much harder position on inventory, a much stronger position, I should say, more aggressive to position us better for the spring demand and fall demand for next year. Supply chain teams are getting well ahead of that. I think that will be indicated in our strong year-end inventory position. That will help take some pressure off of some of the air freight demand that we're seeing this year. Okay, that's helpful color. Thank you. I want to ask a broader question on the revenue outlook for this year. Q2 was up double digits against 2019. It looks like the second half, you're assuming more low to mid single digit growth versus 2019. Can you just maybe frame that up? Q2, did you have some benefits from shipments that were going to happen in Q1 or any other factors as we think about the second half that's driving your outlook there? Maybe as a follow-up, any more detail on how you're thinking about 2022 given the comment about double digit growth? Thank you. Yeah, I'll take the first part of your questions. I think right now we're in a normalized position. Pretty much what we predicted in Q1 occurred. We had a pour over from Q1 into Q2 and about the same amount from Q2 into Q3. Q2 really represents a very strong performance on a normalized basis. At this time, given some of the logistics issues, it's a little hard to predict exactly the split between Q3 and Q4, but we expect strong growth in the back half of the year. When we look ahead, we've been receiving orders much earlier from our wholesale partners and international distributors for 2022 product. As a company, we're sitting today with a lot more insight and visibility into next year's business levels, demand by geographic regions, and at the wholesale level. This is something that is a bit unusual. I think all retailers appreciate the fact that they need to place their orders a little bit earlier if they're going to be assured of a product for the coming year, given some of this year's disruption. That's really enabled us to, with some confidence, look at double-digit growth next year. I think just that's also helping the last question on supply chain and air freight for next year, getting these orders in earlier, allowing us to work with the retailers on new expedited ways to get goods to them, whether it be what we call the fast boat, whether it be door-to-dock, where we're shipping it right to them. I think as we look at 2022, we'll be much better prepared, both from our side and their side, to mitigate the cost we had to incur this year. All right. Thank you very much. Thanks, Jonathan. Your next question comes from the line of Erinn Murphy with Piper Sandler. Please proceed with your question. Great. Thanks. Good morning. I guess my question is still on the global logistics outlook. Could you share what your Vietnam exposure is currently? Are you needing to shift production for some of the temporal factory closures, or are you just writing out the disruption? I have a couple of follow-ups. Yeah. There's been some closures, as we all know, in southern Vietnam, primarily around Ho Chi Minh City. Vietnam is certainly a significant source for the industry as a whole and for us as well. At the moment, less than half of our Vietnam factories were closed. Factories are starting to reopen after the two-week government shutdown. We don't know exactly what the future will hold, but we've factored all the current facts into our guidance for the rest of the year. I guess the shutdowns in Vietnam are largely two weeks in nature. So there wouldn't be, with that kind of shorter timeframe of disruption or closure, there wouldn't be any significant shift in production to other countries or factories. We have people on the ground there as well as throughout Asia. It's something we're managing every day right now. Just to clarify, most footwear companies have somewhere between 25% and 40% exposure to Vietnam. Is that in the zip code for you guys as well? Yeah. On the high end of it, yeah. Probably at the high end. We'd be around 40%. Okay if you look back on a historical basis. The good news there, Erinn, is we dual source a lot of our products, right? We're already in other factory locations, in other countries for source of supply. If this worsens, we'll have dual source capabilities to manage through it. Got it. Maybe Brendan, for you. You've been prioritizing e-commerce across the portfolio. Can you share a little bit over the next 12- 18 months, other areas of investment you're focused on? I know that Merrell app is coming up soon. Any other brands that you're really focused on supercharging their e-commerce capabilities? Well, I think from a brand standpoint, all of them will benefit by the investments we're making on re-platforming technology, data collection, data mining. Saucony right now is top of mind for us with their growth and some of the catch-up there. They're doing a fantastic job on their e-commerce growth and really prioritizing saucony.com and both performance and Originals. They are for sure. Sperry, a lot of their rebound is coming by being able to tell their story directly through sperry.com and then have that cascade through their other partners. In the Work Boot group, we're seeing huge growth there as well. That's becoming a very viable channel. I would really say, Erinn Murphy, it's pretty wide-based, which is exciting, and we'll continue to make investments to fuel that both customer facing and behind the scenes with some of the technology. Got it. Just last question for me is around M&A. I am curious how you both are prioritizing M&A as you look forward. Are you looking at a lot of deals? Just curious, given where that balance sheet is right now and how you are prioritizing that versus organic growth opportunities ahead. Thanks. Well, yeah, of course, we're putting available cash, all that's necessary into the organic growth and paying down debt and returning capital to our shareholders. We continue to be very active in the M&A as we have been historically. We have a pretty well-established set of criteria we use. We are looking at not just potentially footwear brands, but also businesses that might bring some new strategic competencies like apparel, vertical integrated brands, digital brands. We frankly remain pretty active in kicking the tires and taking a look at properties. We have a long track record of success in bringing brands into the company and growing them. Thank you. Thanks, Erinn. Your next question comes from the line of Sam Poser with Williams Trading. Please proceed with your question. Thanks for taking my questions. Good morning, everybody. I was just wondering, in the back half of the year, you flowed through versus 2019 in Q2 pretty dramatically. Your revenue was up 11% and your EPS was up like 28%. The back half of the year, your guidance for the flow through doesn't seem to be near as good as it is in Q2. Can you give us some color on why that is and what might change that? You mentioned that you were getting very good response to your digital marketing and so on and so forth. I think the expectations for the effectiveness of those investments still remains really strong, Sam. A lot of the flow through in the back half has to do with some of these supply chain costs that we've been talking about. Those are meaningful, and they're very much back half weighted, too. That's important. There's some areas of conservatism built into that because of the uncertainty. Overall, really, when I think about the drivers here in the first half year performance versus the back half, it's really the back half weighting of the incremental supply chain costs. How many of those COVID-related air freight and stuff, how are you going to delineate what is on regular operations versus one time in nature there? Yeah. We've done that based on the outlook that we provided and the separation of those topics. We have ocean freight logistics, other logistics costs, distribution costs, several other costs related to supply chain that are having a heavier weight on the back half of the year, unrelated to air freight. Thanks. I was wondering if you could just give us, I know it comes out in the Q, but if you could give us the channel information for the Michigan group and the Boston group prior to the Q coming out? I don't have that in front of us, Sam, right now. I would tell you that all of our channels, including wholesale, grew versus 2019. I don't have the split out between Wolverine Michigan Group and Wolverine Boston Group right in front of me. We can probably get you that information. Yeah Pretty solid performance across the board by channel and by geographic region as well. The profit flow through was very strong on both sides and on both groups, because we saw growth from all the brands, and we saw really nice leverage, really across the board too there. There's really no distinction between the two groups when it comes to profit performance or flow through. Lastly, on the gross margin. The air freight's coming out of the margin. How should we think about the gross for the back half or the full year, given what you're telling us? Is it going to be like 200 basis points less than what it was in the first quarter or first half of the year? How should we think about that? Yeah. Again, just to reiterate, like we said many times, we're only excluding what we're considering extraordinary air freight costs. We've got $10 million of air freight costs in the results that we're referring to. I'd say for the full year, our gross margins will be down a little bit from the first half performance, which they typically are based on just the gross margin performance in the fourth quarter, et cetera. Margins for the full year, we're expecting to be in that 43%-43.5% range, and operating margins approaching 12% for the full year. I think we're not changing the level of promotions. We're selling things at full price, as Blake said. That's continuing into the back half of the year. It's just some of the input costs that hit margin that are way heavier. Then more normalized mix in the back half, which just changes the margin profile a little bit. Yeah. Just to confirm, are you expecting things to normalize at all, more towards promotional activity? Or how are you judging sort of the seasonal promotional activity in the back half versus what you saw in the front half, adjusted for seasonality? We're selling things at full price. It'll be an interesting Christmas without all the deep discounts. It's going to be a great palate cleanser for the industry. We're excited at the AURs we're seeing, both in our own channels and through our retail partners. Okay. Well, thank you guys very much, and continue to succeed. Thanks. The next question comes from the line of Mitch Kummetz with Pivotal Research. Please proceed with your question. Yeah, thanks. I guess I've got a few. First off, I just wanted to follow up on Jonathan Komp's question earlier, because he was asking about shifts, and previously you were pretty specific about the slippage, Q1 to Q2 to Q3, I think it was $40 million for each. Is that still kind of what you saw in the quarter and what's expected for the third quarter? When I say it was basically a net wash, basically the information we gave you in Q1 came to fruition. We had a little bit of a pour over from Q1 to Q2 and a similar pour over from Q2- Q3. Our overperformance in Q2 was fundamentally driven by accelerating demand and also a lot of the proactive steps we took in the supply chain area earlier in the year. Got it. That really drove our performance. Okay. You raised your sales guidance by $100 million. I know that's $150 from earlier in the year, but from where it was last quarter to this quarter, that's gone up $100 million. How much of that $100 million was upside in the quarter versus a better outlook for the back half? With regard to upside in the quarter, can you maybe specifically say what surprised you positively compared to what you were anticipating internally? I'd say that on the guidance, Mitch, it's about 50% what we over-delivered in the quarter and 50% in the back half of the year. Better outlook, higher confidence in delivering on the supply chain. All the things that Blake mentioned about demand, though, that continues to be the strongest metric. Order book has strengthened since the last call we had. Our outlook on demand is very strong. Where we have caution in the outlook is to do with the supply chain, as you would expect. Even with that, we have enough confidence to raise the outlook like we did. Okay. Then lastly. Go ahead, sorry. No, no. That's all I had to say. Okay. On Sperry, I know you gave kind of the two-year numbers on Merrell and Saucony. I'm not sure if you gave it on Sperry. I heard of kind of a 40%, I don't know if that was in reference to work boots or Sperry. What was the two-year growth on Sperry? I'm curious how that compared to the first quarter. In Q2, Sperry would've been down mid-teens compared to 2019. I'd have to look up Q1 and get back to you, Mitch. That was a nice improvement to Q1, Mitch, and I think we're going to continue to see that gradually improve in the back half of the year as well. Okay. That's helpful. Thank you very much. Good luck. Your next question comes from the line of Jay Sole with UBS. Please proceed with your question. Super. Thanks so much. Blake, I just want to follow up on the comment you made, I think a couple of times in the prepared remarks about double-digit growth for 2022. Can you just maybe elaborate that out a little bit more? Is that a number versus 2019? Is that a number versus the new updated guidance for 2021 that you just gave? Sort of what are going to be the main drivers? Are we talking about double-digit meaning 10%? Is it more like 15%, 20%? Maybe can you frame that up for us a little bit more, that'd be helpful. Thank you. Well, I probably won't go beyond double-digit this morning, we have unprecedented visibility into our order book for next year right now. Certainly at a greater level than we've ever had historically. Demand remains very strong across the portfolio. Pretty much what we experienced in Q2. With a high level of confidence, we're looking ahead for double-digit growth versus 2020, not 2019. 20- 2021, excuse me. Yeah. Not the prior year. It looks very strong right now, and it's across Merrell, Saucony, Sperry, across our Wolverine brand. And just- Got it. Go ahead. No, please go ahead. I was just going to add something on Sperry just that relates also to the last question with first 2019. In our own channels, we're up against 2019 in Sperry. I think that's a more leading indicator because that's where we're able to tell the message and talk directly to consumer. I think the wholesale business, we're seeing that bounce back and I think that's another positive sign as Blake talks about 2022 is the emergence of Sperry. Yeah. Maybe if we can talk about sell-throughs a little bit, because obviously there's a lot of fiscal stimulus in March and April. Did you see the sell-through for the brands collectively improve throughout the quarter? Sort of what's your read on back to school, and what does that mean for, say, your kids business, your Keds business, and obviously the portfolio overall? Yeah. I would say right now in general, I wouldn't bet against the consumer. Saving rates have tripled. Stimulus money continues. The consumer's been locked up for 18 months. They want to travel. They want to frankly buy some stuff and experience some stuff that they haven't over the last 18 months. Right now, we see continuing strong demand. We see a strong back to school. It's hard to predict what the COVID-19 situation's going to be like on back to school. Right now it looks like in the U.S., almost all K-12 children will be returning to in-classroom experience. We continue to see strong consumer demand. Yeah. Just on the Keds, our e-commerce this month in our Keds group is double last year. That's a real strong sign that back to school is happening. Got it. Great. Thank you so much. Thanks, Jay. Your next question comes from line of Dana Telsey with Telsey Advisory Group. Please proceed with your question. Good morning, everyone, and nice to see the progress on the results. As you think about the order book that you talked about, it sounds like there's an acceleration globally. Any way to expand on that, what you're seeing overseas, what you're seeing in the U.S., and how you're thinking about the upcoming holiday season? Thank you. Yes. I would say as we looked at Q2 first of all, our growth was really evenly split between the USA and international markets. As you know, Dana, about half of our pairs are marketed in international markets. We are seeing strong demand across virtually every country and international market at the same time, including the U.S. We think it's going to be a good back to school season. We think it's going to be a good holiday season for consumer soft goods, and our brands in particular. We're energized right now. The backlog would reflect that too, Dana. When you look at the nice distribution of demand across the business for our distributor businesses and third party markets, our own businesses in Europe and Canada, the backlog metrics or trends that we're seeing are very strong across the regions. Got it. Inventory levels, how do you think inventory levels and where do you see them being at the end of the third and the end of the fourth quarters? We're very excited about the fact that we're starting to turn that corner right now. We were down about 14% at the end of Q2. Was a little bit lower than expected, our revenue obviously outperformed, right? We were able to really, at the end of the quarter, turn around a lot of goods and get them out the door. That was very positive, and our ability to service the business in Q2 was much stronger than Q1. We'd expect inventories to be up year-over-year at the end of Q3, by the end of the year, up strong double digits, based on our current outlook. Supply chain can always impact those projections, at this point, based on what we have on order, what's on the water, and what we're already securing in the warehouses, we feel good that inventory positions are going to continue to strengthen throughout the balance of the year. Thank you. You're welcome. Your next question comes from the line of Susan Anderson with B. Riley FBR. Please proceed with your question. Hi. Good morning. Nice job on the quarter. I'm curious on Sperry, just to follow up on all the comments. Thanks for all the details there. I'm just curious, the last time you saw a strong boat trend, maybe if you could talk about when that last time was, and then just kind of the performance you saw on Sperry. Also, it sounds like it's performing better at retail than wholesale. Are you seeing those wholesalers yet start to indicate they want, I guess, more orders for the brand? Yeah. I'll take the second part first and then let Blake comment on the historical trends. My comment was, our own channels are always going to be the leading indicator because we control those. We control the inventory. We control the messaging. We're seeing tremendous enthusiasm. It started, I think I mentioned on the last call, it started for holiday with we added some new players in the Sperry team, the new product launches have gotten a tremendous reaction. We're starting to see those online in our retail stores, we'll see that lift the wholesale performance as we get to the back half of the year and certainly into 2022. I'll let Blake comment. Yeah, if you look back, the U.S. has always had a boat shoe category resurgence from time to time. We're probably in the very early innings of that right now. Historically, that's lasted for several years when it starts. We're trying to be there in the market with fresh boat shoe product like the Float and several other offerings from John Legend on down, and the early signs are good. We've had growth in the U.S. in the category the last couple of quarters, that's also very encouraging. Great. Thanks. Also, can you maybe talk a little bit about just the product offering for Sperry for this fall? Do you have anything new coming out? Or maybe talk about the boots for fall. We have a lot of new product. Blake just mentioned Float. We have the collab with John Legend that launches in September. We're doing some really cool events and concerts around that. John and I did something with Footwear News last month that was very well received. We have Sperry Sport launching for holiday and spring of 2022, as well as updates to the existing franchises. I think the product line has never been stronger. I've gotten great responses from some of my industry friends about what they're seeing and some of the previews I've given them. As I mentioned, the wholesale accounts are really excited about what they're seeing for the back half of 2021 and into 2022, and I think it's a credit to the team and the product development pipeline. Great. That sounds good. Just one more question on the orders. Overall, the orders for fall, it sounds like you feel very good about that. I guess I'm curious, it sounds like they must have accelerated from the first half, particularly as a lot of wholesalers are seeing themselves stuck without product. Maybe if you could talk about just the magnitude, I guess, of the orders, if you could. Are there any early reads for spring 2022 orders? Yeah. I would say in general, we don't give out specific backlog information. As we've said, demand built throughout Q2 has continued to build really throughout the first half of this year. Our order backlog continues to build for 2022, which gives us confidence to focus and plan today for a double-digit increase next year. It's extremely strong indications as reflected in our order backlog. Yeah, I almost don't want to use the word accelerated because I think it's the new normal. We've reached new levels of demand for a lot of our brands. Some of it's an acceleration, but a lot of it's just the new baseline that we're building off of. Great. That sounds good. Thanks so much. Good luck in the back half. Thank you. Thank you, Susan. Your final question comes from the line of Laurent Vasilescu with Exane BNP Paribas. Please proceed with your question. Good morning. Thanks for squeezing me in. Mike, I wanted to ask about the full year guidance. The high end implies about $125 million incremental revenues over FY 2019. Remind me, but I think your own e-commerce is going to reach $500 million effectively, let's say about $250 million. Just trying to understand the puts and takes here on how are you thinking about the wholesale business for FY 2021 versus FY 2019? Any nuances would be appreciated by brand. I think for us, the focus on our digital business has been pretty prominent, and that shift has been consistent over the last several months. That growth in e-com that you referenced is really important to the overall performance of our brands across really the whole portfolio. That continues to be the case. We're seeing our wholesale trends continue to improve, and they were very strong in Q2, up low single digits over 2019 levels in our own markets. Again, the strongest categories for us are the ones that we've mentioned here several times around outdoor performance, running, and work. Those are going to continue to carry the day here for the balance of this year and be the strongest drivers of the overall growth versus 2019. The lifestyle brands are closing the gap, so we're seeing progressive improvement in those brands from the first half of the year into the second half of the year and have higher, more positive outlooks for that category in 2022. That's very helpful. Thank you for that. Following up on Erinn's question with regards to Vietnam, I think you do break out the percentage range in your latest ESG report, obviously, that's at the company level. Maybe can you give us some color on which brands have a greater exposure to Vietnam? I would assume it's maybe some of the performance, maybe you can give a little bit more color on that. That would be very helpful. It's across the brands, Laurent. Again, we have a good amount of work boot business in Vietnam, along with those performance brands that you mentioned. I would say that it doesn't necessarily impact any particular brand. We're constantly monitoring that, and I would say, obviously, for our larger businesses, they're more exposed from a volume standpoint just because they're bigger, but not necessarily because we have more concentration of those constructions in Vietnam than other places. Again, I want to emphasize, we do have a nice diversification of sourcing supply outside of Vietnam right now. We've moved some of our production back into China, even in this year, just to provide that dual sourcing capability and risk mitigation, and it's serving us pretty well right now. We're keeping a very close eye on what's happening in Vietnam, and we'll continue to monitor that to the extent it impacts our outlook. Very helpful. Last question. Great to hear about the double-digit growth for FY 2022. Just to make sure, is that just fully organic? That's not anticipating any M&A? Is that correct? That is correct. That's correct. That's great. Okay. Thank you, Blake. Okay, best of luck. Thanks, Laurent. Ladies and gentlemen, we have reached the end of the question and answer session. I would like to turn the call back to management for closing remarks. On behalf of Wolverine World Wide, I'd like to thank you for joining us today. As a reminder, our conference call replay is available on our website at wolverineworldwide.com. The replay will be available until August 29th, 2021. Thank you, and have a good day. This concludes today's conference. You may disconnect your lines at this time. Thank you all for your participation.