Good morning, and welcome to the 1800flowers dot com, Inc. First Quarter twenty twenty one Conference Call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded.
I would now like to turn the conference over to Joe Petito, Senior Vice President of Investor Relations and Corporate Communications. Please go ahead, sir.
Thank you, Chris. Good morning and thank you all for joining us today to discuss 1800flowers.com's financial results for our fiscal twenty twenty one first quarter. For those of you who have not received a copy of our press release issued earlier this morning, the release can be accessed at the Investor Relations section of our corporate website at www.1800flowersinc.com. Our call today will begin with brief formal remarks and then we will open the call to your questions. Presenting today will be Chris McCann, CEO and Bill Shea, CFO.
Before we begin, I need to remind everyone that some of the statements we will make today may be forward looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the applicable statements. For a detailed description of these risks and uncertainties, please refer to our press release issued this morning, as well as our SEC filings, including the company's annual report on Form 10 ks and quarterly reports on Form 10 Q. In addition, this morning, we will discuss certain supplemental financial measures that were not prepared in accordance with generally accepted accounting principles. Reconciliations of these non GAAP financial measures to the most directly comparable GAAP measures can be found in the tables accompanying the company's press release this morning.
The company expressly disclaims any intent or obligation to update any of the forward looking statements made in today's call, any recordings of today's call, the press release issued earlier today or in any of its SEC filings, except as may be otherwise stated by the company. I'll now turn the call over to Chris McCann.
Thanks, gentlemen. Thank you to everyone who has joined our call this morning. As you can see, our results for the first quarter really demonstrate the benefits of our business platform, which has positioned us to deepen the relationships we have with our customers and to drive sustainable long term growth. For the quarter, we achieved 51.5% revenue growth, driven by 85% e commerce growth. This reflects the momentum we have in our business as we continue to drive strong profitable growth across our three business segments.
In fact, Q1 represented the sixth consecutive quarter in which our three business segments, Gourmet Food and Gift Baskets, Consumer Floral and Gifts and BloomNet each recorded solid year over year growth. And we see strong momentum in our business continuing based on some of the key macro trends that we see today. Trends that quite frankly have been accelerated dramatically by the current environment, condensing what may have taken five years into less than one year for sure. First, the tremendous shift of consumers to e commerce shopping, where we are positioned as a leader with our all star collection of brands. Second, the increase in nesting, as people are spending less time traveling and more time at home, everything centered around the home, people are seeking to add more comfort and convenience to the new stay in place lifestyle.
And third, the prevailing sentiments that have emerged from these challenging times. Specifically, people's need to connect and express themselves to the important people in their lives. With our vision to inspire more human expression, connection and celebration, we are uniquely well positioned to benefit from and build on these trends by leveraging our business platform, which includes our all star collection of brands, our advanced technology stack, our manufacturing, distribution and logistics capabilities and our marketing capabilities with our integrated and growing customer file. With our leadership positions in floral, gourmet foods and now personalized products, we can solve for more of our customers' needs to connect with more of their recipients for more occasions, less increasing lifetime value. Over the past several years, our platform has enabled us to execute well on our strategy to expand our product offerings, evolve our marketing to focus on engagement, accelerate our customer file growth and enhance customer loyalty.
And our results illustrate that we are weeping the benefits and the investments that we've made in these areas. For example, we expanded our product offerings organically by adding new product lines such as our expanded collection of house plants and succulents from the one-eight hundred Flowers plant shop that have been wildly popular for us. Our Harry and David Gourmet line including Harry and David wines and the popcorn factories tins with popcorn. Now we further broadened our product offerings with the acquisition of Shari's Berries last year and Personalization Mall this year. We have enhanced and expanded our digital marketing capabilities and as always, we remain hyper focused on delivering exemplary customer service.
The combination of strategic investment, strong execution and focus on our customers has brought us to where we are today, a leader in our industry, driving e commerce growth in our first quarter of more than 85%. As we enter the holiday season, we will continue to leverage our platform and drive our momentum. We expect the demand for our everyday gift solutions will remain high and we are gearing up to satisfy as much of that demand as we possibly can. Now no doubt we'll face some challenges as well virtually all retailers as the third party shipping companies are facing capacity constraints and qualified labor is not always at our preferred levels. We are working to proactively manage these issues and execute against our plan for strong growth.
And as Bill will discuss in a few minutes, our outlook for Q2, which as you know is our seasonally largest quarter is for record revenue and profits. Before I turn the call to Bill, allow me to take a moment to provide you with some color on the integration of our latest acquisition Personalization Mall. Put it succinctly, we could not be more pleased with the acquisition of Pemol and with the great progress that we are making in our integration process. Pemol offers a tremendous assortment of products that can be personalized from glassware to picture frames to grill blankets. And we have a wonderful holiday assortment, which I encourage you to visit in Browns.
In addition, Pemall is among the industry's broadest range of personalization technologies, including laser engraving, photo sublimation, as well as a dozen more capabilities. And with our highly automated processing capabilities, P. Morloff is one of the industry's fastest turnaround times with orders often completed and shipped the same day as audit. As you may have already noticed, we've integrated P Mall onto our multi brand website and into our passport loyalty program. In terms of cross brand merchandising, we've integrated P.
MOL into our co branded holiday gift guides, including our holiday gift and seasons of sharing lookbooks. We're leveraging our customer file to introduce P. MOL to millions of new and existing customers in our everyday and holiday season communications. And we've already begun to leverage our digital marketing teams for P. Mall with content and creative development across a broad range of digital channels.
As a result, we anticipate P. M. O. Will be a strong top and bottom line contributor in the upcoming holiday season for sure and for our full fiscal year. One last point, I'd like to touch on another important area where we are seeing accelerated growth.
In addition to our revenue growth, we continue to see accelerated growth in our customer finals, as well as strong double digit growth in membership in our passport program and multi brand customers. As we have emphasized in the past, these are our best performing customer cohorts in terms of paid purchase frequency, retention and lifetime value. The continued strong growth in our customer files along with the growth of our passport program and multi brand customers bodes well as we enter the key holiday shopping period. Now looking ahead, we have strong momentum across our three business segments. We continue to grow our customer files at a rapid pace and our customer behavior metrics continue to improve.
And our latest acquisition, Pmall, is already proving to be an excellent fit on our platform and a great addition to our all star collection of brands. I'd now like to turn the call over to Bill.
Thank you, Chris. As Chris noted, we have started fiscal twenty twenty one off with strong momentum carried over from last year and we are pleased with the strong top and bottom line growth that we achieved in our first quarter. Our first quarter was also successful from the standpoint of our closing of the Pemol acquisition and the completion of an amended credit facility, which provides added financial flexibility and strengthens our already strong balance sheet. As a result, we are well positioned as we enter the key holiday season and we anticipate the momentum we see across our three business segments will enable us to deliver strong results for the period. Now breaking down some highlights from our first quarter.
First, in terms of revenues, total consolidated revenues increased 51.5% to $283,800,000 compared with $187,300,000 in the prior year period. Excluding PeeMall, which we acquired in August, total consolidated growth increased 40.6. This growth was driven by strong e commerce demand, which increased 85.1% during the quarter. Gross profit margin for the period was unchanged compared with the prior year period at 40.7%. This reflected increases in gross profit margin of 90 basis points in both our Gourmet Food and Gift Basket and Consumer Law and Gift segments offset by a reduction of five sixty basis points in BloomNet, primarily related to product mix.
Operating expenses as adjusted improved eight twenty basis points to 43.5% of total sales, reflecting the strong revenue growth in the period and our ability to leverage our operating platform. Operating expenses as adjusted exclude the impact of the company's non qualified deferred four zero one compensation plan and one time costs primarily associated with the acquisition of PIMOL. As a result of these factors, we improved our adjusted EBITDA by 128.7% or $14,500,000 to $3,200,000 compared with a loss of $11,300,000 in the prior year period. Our adjusted net loss for the period also improved nicely to $6,500,000 or a loss of $0.1 per share compared with an adjusted net loss of $15,300,000 or $0.24 per share in the prior period. Turning to our segment results.
In our recently renamed Consumer Plow and Gift Basket and Gift segment, which now includes Pmall, we grew revenues 78% for the quarter. The one-eight hundred Flowers brand grew approximately 55% on the largest revenue base in the industry, thus further expanding its market leadership position. Gross margin in this segment increased 90 basis points to 40.6% compared with 39.7% in the prior year period, primarily reflecting contributions from Pemore. Segment contribution margin increased 125.7% or $10,700,000 to $19,200,000 compared with $8,500,000 in the prior year period, primarily driven by the one-eight hundred Flowers brand, which accounted for more than $8,000,000 of the increase. In our BloomNet business, revenues increased 28.7% to $32,700,000 compared with $25,400,000 in the prior year period, reflecting significant growth in wholesale products, including fresh fall and hard goods and growth in order volumes, both from the one-eight hundred Flowers brand as well as from florist to florist orders.
Clearly, the decision we made to help florist back in the early days of the pandemic, including waiving membership fees and providing various products and services at reduced prices is paying off as more florists are buying more products and services from Lumenet in addition to fulfilling increased order volumes. This profit margin for the quarter was 45.3%, representing a decrease of five sixty basis points compared with 50.9% in the prior year period, primarily reflecting product mix. Segment contribution margin increased 24.7% to $10,400,000 compared with $8,400,000 in the prior year period. In our Roaming Food and Gift Basket segment, we grew revenues 26.3%. This was driven by e commerce growth of nearly 100%, offset in part by decline in wholesale orders for the holiday season of approximately $15,000,000 and a loss of approximately $5,000,000 in revenues associated with the closing of the Harry and David retail stores in fiscal twenty twenty.
The strong e commerce growth was seen in each of our brands for everyday occasions such as Birthday, Anniversary, Sympathy and Get Well among others. Customers also continue to embrace the Harry and David Gourmet line and Harry and David wines, both of which grew significantly during the quarter and continue to attract a younger shopper to the brand. Gross profit margin increased 90 basis points to 38.9% compared with 38% in the prior year period. Segment contribution margin as adjusted improved 54.8% or $3,600,000 to a loss of $3,000,000 compared with a loss of $6,600,000 in the prior year period. Now turning to our balance sheet.
Our cash and investment position was $11,000,000 at the end of the first quarter. Inventory was $192,600,000 compared with inventory of $172,500,000 at the end of last year's first quarter, primarily related to PIMO. In terms of debt, we had $217,500,000 in debt, including $25,000,000 borrowed under our revolving credit facility. In August, we closed on an amendment to our existing credit facility. The amendment adds an incremental $100,000,000 in term loan and expands our revolving credit line of credit of $200,000,000 to $250,000,000 All components of the credit facility mature in May 2024.
The amendment provides added financial flexibility and further strengthens our balance sheet. Now turning to guidance. Due to the continued uncertainty in the overall economy relating to the ongoing COVID-nineteen pandemic, we are not providing guidance for our full fiscal twenty twenty one year at this time. Providing the fiscal second quarter, the strong e commerce demand that we carried into this year continued through our first quarter and through October, the first month of the current fiscal second quarter. Based on this growth momentum, we anticipate achieving total consolidated revenue growth for our second quarter in the range of 22% to 26% compared with the prior year period.
This anticipated strong revenue growth in the quarter reflects expected e commerce growth of more than 40% including contributions from Pmall, somewhat offset by the lower wholesale orders and reduced retail revenues reflecting the closing of the Harry and David retail stores. Regarding bottom line results for the second quarter, we anticipate that the strong e commerce revenue growth combined with contributions from P mall will help offset certain headwinds, including increased costs from third party shipping vendors, higher labor costs, higher operating costs due to the COVID-nineteen pandemic and the lost contribution in the wholesale and retail channels during the quarter. As a result, we anticipate driving adjusted EBITDA and EPS growth in the range of 18% to 23% for the quarter compared with the prior year. I will now turn the call back to Chris.
Thanks, Bill. So as you can see, we had an excellent start to fiscal twenty twenty one. Our top and bottom line results for the first quarter represent a continuation of of the growth momentum that we built for the past several years. In our gourmet floral and gifts business, one-eight hundred Flowers brand continues to extend its market leadership position for strong e commerce growth on the largest fed revenue base in the industry. This is now complemented by the acquisition of P mall, which is already proving to be an excellent fit on our platform and in our All Star collection of brands, making us a leader in the fast growing category of personalized products for gifting and home decor.
In BloomNet, we are further expanding our market share position with increasing order volumes and growing wholesale business. In our Gourmet Food and Gift Baskets segment, we are continuing strong e commerce demand for Harry and David's expanded product offerings, as well as a growing assortment of innovative on trend top products from The Popcorn Factory, Cheryl's Cookies and our other great gourmet brands. In addition, we're continuing to grow our customer file across the enterprise with accelerated new customer growth, increased demand from existing customers and growing membership in our passport program. And perhaps most important, we've begun to engage with our customers differently through an open two way dialogue such as our weekly celebrations pulse letters that Jim and I send out to customers designed around empathy and emotion rather than a transaction. These efforts are helping to deepen the relationships we have with our customers and build customer loyalty as our customer file evolves into an interactive customer community.
So as we head into the key holiday season, we're very well positioned to deliver again an excellent customer experience and drive continued strong top and bottom line results. With that, I turn it to Chris to open the call for questions. Chris, would you please repeat the directions again for the Q and A?
Of course, sir. Ladies and gentlemen, we will now begin the question and answer session. Our first question comes from Dan Kurnos of The Benchmark Company. Please go ahead.
Yes, good morning. Chris, just on the KPIs you gave around Passport and Multi Brand, I just wanted to be clear, were those year over year growth rates? And if so, is there any color you can give us on sequential improvements and maybe some color around, again, like you did last quarter, the profile of new customers coming to the site? Are they taking what's the percentage chance they take Passport and become multi brand? And then on Pmall, it sounds like you're probably further along the integration path.
And I think you were talking about on the last quarter, that's a good thing, I think, especially if there's reduced mobility, it feels like personalization should do well this holiday period. Is there anything I know it's super early and you just closed it and integrated it. Is there anything you can kind of tell us and what you're seeing from that particular customer channel? How they behave relative to sort of your traditional customer set and whether or not they are more or less inclined to browse other brands?
Sure, Dan. Thank you very much for the question. As we look at the numbers that I gave you on the Passport, we're seeing double digit growth rate. That is year over year, not sequential. We don't really report on quarterly sequential numbers.
With our seasonality business year over year comparisons, we can feel much better. What we're seeing is good double digit growth in both people becoming multi brand customers as well as people joining the Passport program. As we do that and with the accelerated growth that we're seeing in new customers, we're also seeing and I think I mentioned this last quarter as well, we're also seeing an increased conversion rate or take rate from both existing and new customers very importantly into the Passport program and a nice lift on that increased conversion rate year over year. We don't publicize the number, but it's been a nice lift that we're seeing. So all of that's very encouraging for us.
And what we're seeing in the everyday customer file is a larger percentage of our customers every day being Passport members and or multi brand customers. And with that drives the increased frequency, the increased spend that comes along following that first purchase. So working very, very well for us that we're seeing now on the Passport and the multi brand efforts. And still I would say, we're still early stages on some of our cross brand merchandising capabilities and cross brand marketing capabilities. So that leads me then to your answer on your question on personalization mall.
Very early, we're very pleased with the progress that we're making on the integration. We're thrilled to have it up on our website. We just got it up this week. So I really don't have any strong indication of cross brand migration. We got the tab up there.
What we did see was some good response to the communication we sent out to our passport members as well as to the general customer database as we had to inform them of their new log in or the fact that their log in capability would now work the Pmall log in credentials would work on the one-eight hundred Flowers platform as well. We saw some good feedback in response to that. So the P. Wall business on its own is performing ahead of our expectations. And the early, very early indications that we have are that those product line will be very well received by the one-eight hundred Flowers existing customer base.
Got it. That's helpful. And then maybe just one quick follow-up and then one for Bill. Just in terms of sort of the forward growth trajectory, Chris, because this is becoming sort of more of a talking point. I know that you guys still it feels like your customer base, you're just starting to scratch the surface.
How do we think of the balance between growing the customer file and expanding wallet share? Do you have a sense of kind of what wallet share you have currently as a percentage of your existing customers gifting budget?
No, we don't really look at the wallet share so much. What we're focused on really is our internal metrics to customer behavior metrics. We're seeing a frequency retention and thus lifetime value. So that we're seeing move nicely in the right direction and that's what really uses really good strong confidence and sustainability of our growth rate going forward.
Okay, fair enough. And then just for Bill, obviously, you mentioned kind of the plethora of headwinds that you're facing. Is there any way to quantify kind of what you think the margin impact is from COVID and sort of what are you putting in place? Are you giving up maybe some margin to try
to get
either I know you usually do this ahead of like Valentine's Day, but are you giving up some margin to try to get sort of pull forward in demand so you can make sure you get everything out? Or are you doing other things to try to increase the flexibility of shipping dates like you had around Mother's Day, which is a lot tougher around the holiday season obviously?
Yes, Dan. As we've mentioned, we're not like we're very similar to many companies out there that face the headwinds that we have mentioned, those headwinds being higher shipping costs, higher labor costs and COVID related expenses. So that has an impact on us. We've demonstrated significant leverage in the model in Q4 and Q1 of this year. Our guidance does not show that same level of leverage, but still showing kind of record numbers in our second quarter for both top line as well as bottom line.
The ability to move, yes, we as much as you'd like to incentivize customers to buy early with perishable products, it's hard for them to accept shipping shipping early. And that's where the challenge is with the shipping with our third party shippers is having that delivery during the months of December and as we get into the months of December. So we continue to look at incentives to do that, but it doesn't move the needle that significantly.
All right. Thanks for all the color guys and another nice print.
Great. Thank you, Dan.
Thank you. The next question is from Alex Fuhrman of Craig Hallum. Please go ahead.
Great. Thanks very much for taking my question. I wanted to talk also about just shipping issue and of course seeing a lot about the streams that there's going to be on the supply chain this year. Just wondering how much visibility you have into delivery times and what sort of estimates in terms of times you're quoting customers versus what you normally would? Is there any concern that that could result in a shorter shopping season this holiday season?
Yes. I think the significant shift in consumers to e commerce has put quite a bit of strain on the capabilities of third party ship and ship herd. And I've been reading many stories about FedEx, UPS, USPS, well documented in the media. So all retailers, including ourselves are facing these constraints, higher cost constraints on volume. We've built that all into our guidance.
We're navigating through these challenges. We work very closely with our primary shipping partner, which is FedEx. And even with the constraints on shipping capacity as well as the higher cost, We anticipate record top and bottom line results in the second quarter.
Yes. And I think based on the fact that we work so well and so closely with our primary ship of FedEx specifically, I think Alex, we do have very good visibility into shipping times that we're able to then should we see a challenge in just our communication and our customers' expectations around that. That's what we're always trying to manage. So I think the answer is yes, we have good visibility into it. We have a team that manages that extremely well.
We're very confident that we can navigate through the challenges in this holiday season, produce the numbers that Bill gave and we gave his guidance for this holiday, which is four x over what our growth rate was last year and still provide a great customer experience.
Great. That's terrific. Thank you very much.
Thank you, Alex.
Thank you.
The next question is from Linda Bogenweiser of D. A. Davidson. Please go ahead.
Thanks. Hi. So I think there's been some investor questions around how well you think you can maintain or retain the customers that you're gaining here during the pandemic. So maybe you can comment on that in terms of kind of retention. And also, I think your average purchase rate is about 1.7 times per year, maybe at least for floral.
Is there any indication that that's actually increasing because people are participating more in e commerce gift giving? Thanks.
Sure. Thank you, Linda. Thanks for that question. Now as we looked at our business and the momentum that we've built over the past few years, it's very encouraging to see that just continue to grow. So it's been several years now that we've been building that growth momentum, increasing our customer file, new customers as you pointed out.
Then we look at what's been the impact of the pandemic on business in general. And it's really been a binary impact of certain businesses like restaurants, bars, retail, brick and mortar retail stores have just been devastated by it. Then there's businesses like us, e commerce businesses that have reaped the benefits of it. And as we said early on, we've been leaning into that opportunity to grow our customer file even more aggressively with fantastic new customer acquisition growth rates that we're seeing. And why it's because it's behind the three trends that we see coming out of this pandemic.
The trend is a dramatic shift to consumers to e commerce shopping from offline to online. Now that went from 14% up to 40% of sales. It's probably moderated somewhere between 3040% right now. But that's not going away. That's not changing.
Then we look at the second real trend of nesting and how our products like plants and floral and gourmet food gifts fit so well into that trend. And now we've really enhanced that even further with the personalization mall product line in front of the trend of nesting. And then the third real trend that we're seeing that we believe we are so well suited for with our vision to inspire, expression, connection and celebration is that we've all learned that there is a strong human need to stay connected to the people in the alliance and people turning digitally looking to companies like ours to help them do that. So you take those components, the momentum we had, the trends that we see that we're so well positioned for, the benefits of the platform that we've built over the years, the customer file size and the increasing behavior metrics that you asked about. Yes, we are seeing increased behavior metrics of frequency and retention and customer lifetime value.
Then you add in that the acquisition we just did with Personalization Wall, and we think we couldn't be better well positioned for long term sustainable growth when you combine all of those factors together.
Great. Thank you. And then also, can you I think in the past periods at least, you had given some concessions to BloomNet Florist, maybe some waiving or something of fees or something of that nature. Can you update us on if that's still going on or if that's something in the past? And can you quantify that?
And does that affect the revenue line or the gross margin line of BloomNet? Or can you just give a little more color on that?
Well, Linda, thank you very much again. Yes, as Bill mentioned in his remarks, in fact in Q4 when the pandemic really first started to hit, we gave some concessions and reduced pricing to our florists, waiver on some fees and other ways marketing programs that we could help the florist. That's what we do. That's our business is to help our florist compete and to grow. And in that mode, our focus was to make sure we helped our florist survive, which they've done very nicely.
That's turning around and benefiting us now, as we pointed out with the growth of people choosing to send their orders through BloomNet as opposed to some of the other competitors in the market and purchasing more from BloomNet in the wholesale products, again, as opposed to other competitors in the market. So we're seeing that customer loyalty. Bill, I'm not sure if that brief quantified from the last quarter, right?
Yes. Back in Q4, that's the reason why the revenue growth was slightly below double digits and the bottom line contribution margin was negative in the fourth quarter. But as you saw in Q1, as we just reported in Q1 with growth almost 29% in the quarter with contribution margins up $2,000,000 in the quarter. Clearly, the decisions we made back then were the right ones.
Yes, it's a good team. That BloomNet team is really doing a good job taking care of the florists.
Thank you. That's all for me. Thanks.
Thank you, Linda.
Thank you. The next question is from Anthony Rybczynski of Sidoti and Co. Please go ahead.
Yes, good morning and thank you for taking the question. So I may have missed this, but as far as the customer file growth is concerned, so are you seeing this growth across all of your brands or is there any one brand that stands out? And then as far as your customer file, just wondering when you look at the customer file for Pemol, can you give us any indication as far as the incremental growth the customer filed because of Hemal acquisition?
Thank you, Anthony. As we look at the customer file growth, first of all, it is across all brands, and that's important. With that said, keep in mind, the two lead brands in customer acquisition efforts are our two largest brands to date our two largest brands of one-eight hundred Flowers and Harry and David. But the growth is across all brands. And really also the same thing that we're seeing with the growth obviously of multi brand customers, but of Passport customers, the growth is also across all brands where they're really recognizing the value and the total solution that we're bringing to the market for them.
So we're very, very pleased with the visibility we have there. As we look at the PMOL numbers, I forget the twelve month active numbers about $1,500,000 1 point 8 million dollars in that range, $1,500,000 to $1,800,000 12 month active customers from PMOL that we'll be adding into our file. And again, what we see there and one of the things we're very excited about is, A, the expanded product line that helps to solve for more of our gifting needs, the broader range of price points on the Pmall product line is more lower price point items in there. That the expanded product line, lower price points, we believe will help drive the frequency of usage across our customer base even further as we give our customers more products to meet more of their recipients at more price points to really just help drive lifetime value for us.
Got it. Okay. Thanks, Chris. So as far as those 1,500,000 to 1,800,000 active customers for PEMol, do you have a sense as to what the overlap is with your current customers? Just want to get a sense as to like if you're picking up brand new customers or not?
It's a there's enough turnover there to give us just like in Harry and David, there was enough crossover in the file to give us strong confidence in our ability to grow multi brand purchasing. So there's enough crossover there, not a significant amount. So the majority of those customers really are new to file.
Got it. Okay. Thank you for that. And then as far as the wholesale and retail headwind that you saw in Q1, can you give us maybe Bill maybe just a breakdown between the headwind that you saw if you could just separate wholesale versus retail drag that you had in the quarter?
Yes, Anthony. So in Q1, it was about $20,000,000 combined, about $15,000,000 for wholesale down year over year and about $5,000,000 by not having the Harry and David stores open this quarter.
Got it. Okay. All right. Well, thank you and best of luck.
Thank you.
Thank you. The next question is from Michael Kupinski of Noble Capital Markets. Please go ahead. Thank you
and congratulations on your quarter and thanks for taking my questions. I know that in the past during the midst of COVID that you indicated that you weren't seeing any product disruptions from China and I know that this is a big inventory quarter. So I was just wondering if you can just give us a sense of the whether or not you have shifted products, your suppliers away from China and what the type of increases in your inventory that you have seen?
Yes, Michael. Thank you. I think as we look at the inventory, we've been very fortunate that first off, the imports from China for us are not a significant part of our supply chain. And even early on, we saw some disruption, not a lot, more just late shipping getting in and that caused a little bit of problems back in the March, April time period. Things have got better since then.
And really the big concern was as we moved into this holiday season, what would happen as far as inventory coming in components that we bring in from China. While they run a week to two weeks late sometimes, that does not cause a major disruption and we've been able to utilize that and service our customers appropriately without any major interruption. So that's worked out well for us. We've looked at shifting some capabilities, some sourcing out of China and we've done a little bit of it. But even really as we studied it more and more, I mean, the other geographies just really aren't set up like China.
So even with some of the challenges, even with some of the tariffs coming out of China, we're still better off sourcing there than many other places around the world, although we continue to look at mitigating any risk that might exist.
Got you. In terms of PMOL, I was just wondering in terms of the revenue trajectory there given the impact that that business has probably seen in terms of COVID. And then also if you could just talk a little bit about I know that the Governor of Illinois has placed additional restrictions in certain areas of the state, whether or not any of those restrictions have affected PMOL given that it's based outside of Chicago.
In Q1, we kind of gave the results kind of pre both with and without Pemos. So kind of go through the math and understand that about 10 points of our growth related to Pemos. So it's about 20,000,000 or so in the quarter. Q2 is by far its biggest quarter, almost 50% of its revenues are in Q2. One of the attractiveness of P.
Mall is that it is EBITDA positive, contribution positive in all four of its in all four of its quarters. But certainly this upcoming quarter is very important to it as nearly half its revenues are during this quarter. We have not seen any disruption in Pmall since our ownership is growing very nicely year over year.
Right. I would say, Bill, that what really since we've owned Pmall and started the integration process and really looking, as I mentioned, getting the digital marketing team involved, looking at the creative, the content, etcetera, We're seeing nice growth rates ahead of our expectations in P mall. As far as the announcements from Governor Pritzker, they have not affected our facilities in the Chicagoland area at this point. And we think we're very well positioned that we won't have any interruptions. Of course, in this pandemic, you never know, but the visibility we have right now is we're confident that we will not be interrupted.
I know longer term that you had anticipated that there would be some consolidation among your facilities and that P malls, state of the art facilities offers some opportunities to move some of your inventory and products to that location. Does that does the COVID situation and the issues with Governor Pritzker, given the fact that Illinois has been probably more restrictive in many ways than other markets, does that kind of derail that plan in terms of any of the potential consolidation into that facility?
Michael, not so much as far as especially anything to do with Illinois or any of the restrictions in Illinois. We have mentioned previously some of the efforts that we had planned for this calendar year were delayed early on by the pandemic. So automation facilities and automation projects in some of our facilities as we just weren't able to bring the people into the facility back in the March, April, May timeframe to do the work that was needed. So that will pick up more post holiday now as we move into January, where we'll be able to do that. But that really had was not Illinois specific quite frankly.
Most of that work was focused on our facilities in Ohio and our newest facility in Atlanta. So while there was a delay, we see those picking back up again now post holiday.
But that was unrelated to people?
Right. True.
Got you. Well, congratulations again. Thank you.
Thank you, Michael.
Thank you. The next question is from Doug Lane of Lane Research. Please ahead.
Yes, hi. Thank you. Good morning, everybody. You mentioned that the Pemol acquisition contributed about $20,000,000 Do you have a number for what the sales were lost from closing the Harry and David stores?
Yes, it was about $5,000,000 in the quarter. In sales? $5,000,000 in sales in the quarter. We're about $20,000,000 down in the kind of the retail wholesale channels of our business, $15,000,000 being wholesale and $5,000,000 being retail sales.
Okay. And then you haven't talked about any numbers around Pemall since it was announced way back pre COVID. Do you have any updated kind of numbers we can look for from sales and EBITDA from that acquisition this year?
Yes, we don't provide guidance on a brand by brand basis. We have filed an AKA, so there was filings out there. With respect to the historical profitability and size of PIMOL. For the year ended 02/29/2020, PIMOL did about $170,000,000 in revenues and just under $25,000,000 in contributed or EBITDA.
And as I stated earlier, we're very pleased with the growth that we're seeing since we've been operating the business.
No, it sounds like the business has come back at or better than where it was before it was shut down in the spring, that's for sure. Can we focus on the December here, obviously going from your seasonally smallest quarter to your seasonally largest quarter. And Chris, how do you look at the biggest constraint in the growth in the December? Is it generating the demand, which seems to be there or you're more concerned about capacity? Because this is a big quarter and these are big growth numbers from a sales standpoint.
And we know about the bottlenecks at the third party shippers, but then even internally at Harry and David and just your whole infrastructure, how should we think about just bottlenecks from a capacity standpoint?
Thank you, Doug. I think as I mentioned earlier, as we look at the things that have developed in this pandemic and some of the trends that we've seen, we've seen things we've seen this accelerate change more than anything else in so many different fields. We've seen this accelerated growth in e commerce, not just for our business, but for many businesses. We've seen it accelerate changes in healthcare and everything else. So I think what we've seen is an accelerated growth rate for our business and that brings certain challenges with it for sure.
We have the third party shipping challenges that Bill spoke about that we've been mentioned. We have other labor challenges out there. But we are also at the same time accelerating our internal capabilities. So what was planned for five years ago now has to be planned for one year from now. We're doing that.
The team is built for that. The team is responding well to that. And we're driving, as I mentioned, to capture all of the demand we possibly can at this holiday period.
Yes, Doug. As our guidance indicates, we expect record top and bottom line numbers in the second quarter. The growth rates are not the same as Q4 and Q1, but looking at our business on a sequential basis, not really relevant as you indicate with the kind of the size of the second quarter and the shift that the holiday gifting by far the second quarter is our largest quarter. But we continue to see very strong e commerce demand. We anticipate that carrying forward through the holiday season.
But as we've stated, we have to offset the revenue declines in our wholesale and retail channels. The challenges that you mentioned with the third party shippers with some internal labor, they're not unlike every retail or any commerce company out there. But with that said, the guidance we're providing is for our fiscal second quarter to be strong growth in the second quarter. The midpoint of our range is $150,000,000 worth of growth in the quarter. And as a reminder, we're forecasting 22% to 26% growth.
That's four times the growth rate that we achieved in Q2 last year, the holiday quarter last year. So we're anticipating a very strong second quarter. Okay. Thank you. That's very helpful.
Thank you, Doug.
Thank you, Vrain. Thank you.
Thank you. Our next question is from Tim Vahringle of Northcoast Research. Please go ahead.
Thank you. Just one quick question for Bill on the wholesale portion of the Gourmet Food Gifts Baskets segment. Typically, there is a lot of noise between when your partners take delivery of the gift baskets and I was wondering if you could help clarify if there were any shifts between the first and second quarter, do you expect a similar $15,000,000 loss number in the second quarter? Any more clarity there would be great. Thank you.
Yes. So as we indicated, wholesale was down $15,000,000 in the first quarter. I think, as we've kind of alluded to in many of our conversations prior to this, that we have some insights into where wholesale demand was going to be for this holiday season. The big box guys make their decisions in the spring. So we're really in the kind of the height of the pandemic and all are being very conservative in their buying for holiday gift baskets.
And so that channel for us was going to be down and that e commerce was going to make up for that. So in Q2, both retail and wholesale will be down more than they were in Q1. The start of the kind of the wholesale season is September and it runs through September through November. We saw the impact of wholesale being down about $15,000,000 in September. It's going to be down slightly more than that in Q2.
And retail will be down significantly more than the $5,000,000 it was down in Q1 because of the whole just because of the holiday nature of this quarter.
Right. And with that being offset by the strong e commerce growth that we've been talking about that will certainly help us to offset those declines?
Yes. Again, all this is built into our guidance. So the 22% to 26% growth that we have, the over 40% e commerce growth offsets the declines in wholesale and retail and still achieves again record top line numbers. Thank you.
Thank you very much. We have no further questions in the queue. And I'd like to hand the call back to the management for some closing remarks.
Great. Thank you, Chris, and thank you everyone for joining us on the call. Let us know if you have any additional questions, please don't hesitate to contact us. Certainly, we'd like to wish everybody a very happy and different Halloween this season. And also I encourage you to visit our line up with All Star brands to see what we have for the fall season, the holiday season, especially I mentioned the great line of the products that we have in P Mall for this holiday season and we're just still very excited about.
So thank
you and we look forward to any follow-up questions you may have.
Thank you very much. Ladies and gentlemen, this conference call is now concluded. Thank you for attending today's presentation. You may now disconnect your