Good afternoon ladies and gentlemen, and thank you for standing by. Welcome to the Deckers Outdoor Corporation’s first quarter fiscal 2010 earnings conference call. At this time all participants are in a listen-only mode. Following the presentation we will conduct a question-and-answer session. (Operator instructions) I would like to remind everyone this conference call is being recorded. Before we begin, I would also like to remind everyone of the company’s Safe Harbor language. Please note that some of the information provided in this call will be forward-looking statements within the meaning of the securities laws. These statements concern Deckers plans, expectations and objectives for future operations. The company cautions you that a number of risks and uncertainties, some of which maybe beyond its control, could cause Deckers actual results to differ materially from those described in this call. Deckers has explained some of these risks and uncertainties in its earnings press release and in its SEC filings, including the Risk Factors section of its annual report on Form 10-K and its other documents filed with the SEC. Among these risks is the fact that the company’s sales are highly sensitive to consumer preference, to general economic conditions, to the weather and the choice of its retailers to carry and promote its products. Deckers intends that all of its forward-looking statements in this call will be protected by the Safe Harbor provisions of the Securities Exchange Act of 1934, as amended and the Securities Act of 1933 as amended. Deckers is not obligated to update its forward-looking statements to reflect the impact of future events. I would now turn this conference over to the President, Chairman and Chief Executive Officer, Mr. Angel Martinez. Please go ahead, sir.

Thank you operator and welcome to everyone joining us on the call today and listening via web cast. With me are Zohar Ziv, our Chief Operating Officer; and Tom George, our Chief Financial Officer. As you saw from our press release issued today, after the close the first quarter ended up being stronger than we anticipated. Particularly from an earnings perspective, diluted EPS increased approximately 47% to $1.37. That was also driven by another record first quarter for the UGG brand, with Q1 sales topping $100 million for the first time, combined with a very strong start for the year for the Teva brand. Our retail stores both domestically and overseas were key drivers of our Q1 results, highlighted by same-store sales growth of 28.2% during the quarter. We witnessed strong consumer demand for the UGG brand spring line, particularly boots like the Lo Pro, the Cardy and the Classics in spring colors. In addition, our new sneaker line led by the Avera [ph] performed extremely well. The arrival of warmer weather in March coincided with the introduction of UGG sandals and flip-flops in our stores, resulting in healthy sales over the past months. In addition, our eCommerce business was also above plan, and it was the combination of these two high margin businesses that drove the majority of the sales and earnings upside. Four years ago, as part of our growth strategy we made the decision to expand our retail distribution with our company owned UGG Australia stores. These results demonstrate clear evidence of the strong payback on this strategy. The performance of the UGG brand in our department specialty and independent store base has also been solid. The selection of spring products at our wholesale accounts is broader than a year ago, as retailers are getting more and…

Thanks Angel. For the first quarter of 2010 net sales increased 16.2% to $155.9 million versus $134.2 million for the first quarter of last year. Including sales from the whole sale division as well as retail and eCommerce businesses net sales of UGG products increased 14.2% to $104.4 million versus $91.4 million for the first quarter last year. Net sales of Teva products increased 21.4% to $43.2 million in the first quarter compared to $34.6 million in the same period of 2009. Combined net sales of the company's other brands were $8.4 million for the first quarter of 2010 compared to $7.3 million for the same period last year, a 15% increase over last year. Included in these numbers are global retail store sales of $23.1 million up 66.1% from $13.9 million in the first quarter of 2009, driven by five new stores and the same-stores sales increase of 28.2%. Sales for our eCommerce business, which are included in the brand sales numbers as well increased 13.8% to $18.4 million for the first quarter compared to $16.2 million for the same period a year ago. Most of the Q1 sales and earnings upside was driven by the retail stores and eCommerce, which at this early stage in the roll-out of stores is more difficult to predict than our prebooked wholesale business. In summary, on a combined basis total consumer direct sales, both retail and eCommerce combined for Q1 were 26.6% of sales compared to last year 22.4% of sales. Also included in the brand sales numbers, domestic sales for all brands increased 14.7% to $117 million compared to $102 million in the first quarter of last year and international sales increased 20.8% to $38.9 million compared to $32.2 million in Q1 2009. International sales were 25% of total sales up…

Well, thanks Tom. On our year end conference call in February, we outlined how we plan to grow each of our brands this year, while also investing in the business for the long term. Let me quickly review these strategies and update you on our progress. For the UGG brand, the business currently falls into three primary areas, domestic wholesale, domestic consumer direct and international. Our domestic wholesale strategy is centered on driving higher productivity by expanding our floor and shelf space and increasing unit volume with our current account base of national department stores, specialty shops, regional chains and independents. We continue to have success in improving our presence with the majority of our accounts thanks to a much expanded UGG brand product offering for both spring and fall holiday. This spring, we have seen a strong consumer reaction to our diverse selection of boots, sandals and flip-flops, and as I said earlier the initial response to our new sneaker line has been very strong. We recently completed our fall pre-book process, and we are very pleased by the trends we are seeing in terms of the broad mix of products being ordered by our wholesale accounts. Early indications point to nice gains for our women's casual boots, including metropolitan, Soho, [ph] Surf and our cold weather collections for men and women, featuring Beaud's [ph], Adirondack II [ph] and Hilgards [ph]. We had solid growth in new categories such as our wood bottom claws [ph] and boots. And our sneaker collection featuring the Ryland, [ph] the Evera and our sneaker bottom boot, the delaine [ph]. We are excited about this new UGG sneaker collection, especially the opportunity for the fall and back-to-school season. As we have not had a viable sneaker product to properly address this large segment of…

Thank you. (Operator instructions) Our first question is from the line of Jeff Klinefelter with Piper Jaffray. Please go ahead.

Hi, congratulations everyone, a fantastic start to the year. Wanted to ask you a couple of questions, first on UGG. You mentioned, or I think Tom mentioned, the gross margins would be expected up for the balance of the year. A big part of that, the retail mix, but also some product margin improvement. Is that coming from sourcing improvements or sourcing leverage? Is that mix? Where are you seeing that and putting it in context with any sort of sourcing inflation that the industry might have been anticipating?

I think it is a combination of various factors Jeff. I think one of the things I mentioned is that we made an investment in PLM, which is product life cycle management software, and one of the key benefits of that going forward is that we should be able to be a lot more precise about the utilization of materials, the right materials in the right factories for the right constructions. So long-term we should see some benefit on the margins there. The other benefit of doing that is it allows us to spend more time getting it right with the consumer, and it can allow us to compress our actual product creation cycle giving us more time to be closer to the market. We really haven't seen much impact yet on any sort of pricing increases in raw materials, although we do anticipate that there will be some of that going forward next year.

Okay, there's two other quick things. I know a lot of questions today. On your UGG, given the very successful growth and evolution of that brand in the US, how are you thinking about that differently, if you are, for the UK and Benelux, as you take that direct in the next year in terms of rollout, number of points of distribution, retail versus wholesale? Anything strategically you've picked up on that will accelerate the brand growth over there? And then just lastly on Teva, do you feel like you're taken a lot of share in that business or is it your, and Pete's impression that that category is really starting to turn around nationally?

Well, let me start with Teva, I think we're taking share. I think the brand’s authenticity and heritage as a core outdoor brand, and the fact that it is performing well, the product is compelling, certainly much more useful customers in the target end responding to the product. So, yes, I think we're taking share. I also think that the category is coming to life. I think that retailers have gotten very smart about understanding the need to make the outdoor more useful definition for people. Everybody is working very hard to get that age-group appeal down from the mid-40s to the mid-30s and 20s. So over time I think we are just positioning very well to take advantage of new approaches in marketing by our retailers, and we want to be one of the lead brands in this new face of the outdoors. When it comes to UGG and rolling it out around the world, not just Europe, you know, those markets benefit tremendously from the insights we get in selling the line here in the US. Obviously, new introduction of sneakers that I was mentioning, the fashion product, new innovations with fabrications and materials, all of those things allow us to be more precise in the merchandising story around the world. That and the retail stores overseas give us a sense of what that local consumer expects from the brand. So the retail stores act as a great model for refining what the wholesale assortment needs to be as each season comes along. We become much better wholesalers because we have those retail stores.

Okay, great. Thank you. Congrats again.

Thank you Jeff.

Thank you. Our next question is from the line of Todd Slater with Lazard Capital. Please go ahead.

Thanks and congratulations to everyone, especially to Pete.

Yes, thank you Todd. I am sure Pete will appreciate that.

Well, just following on Jeff's question with respect to Teva, can you give us a sense of the profit outlook you have for this year and could the earnings growth, especially domestically, keep pace or exceed revenue growth?

Yes, Todd this is Tom. Yes, given we do have the international distribution, we have been Benelux counter direct with Benelux, which has an operating margin improvement relative to dealing with a distributor. We are expecting some improved profitability, obviously improved profitability outlook for Teva in 2010.

Right, but if you exclude, that was my point about domestic. If you exclude the international, what's that look like? Are we also picking up some profit margin in that business domestically?

Yes, we are.

Great. Okay, that is great. Just on the -- looking at the second quarter and the $0.25 number guidance, if we back out the international investments, the nickel or so earnings growth about 19%. That's well below the first quarter trend. So, I guess with the UGG and the Teva performing so well and I'm assuming the DTC, the direct-to-consumer likely to continue, increase in mix. Could you talk about what seems like a lot of conservatives in there, is there an Easter shift impact or something else in the gross margin or expense side that we should be aware of that we haven't factored, in addition to, the international investments?

I think the thing to consider there is that we said on the call though the margin is up some because of some of the mix as well as being direct. With Teva there is a larger amount of SG&A we need to address this year compared to a year ago in the second quarter, one being five additional stores, net of being just traditional infrastructure relative to a year ago this time we have invested in. So that plays into what influences our guidance there right now.

That's pure infrastructure in the smallest revenue quarter.

Not, pure infrastructure. Remember, we have five new stores as well now in the second quarter of 2010 relative to a year ago.

Got it. So those five stores all come in Q2? One in 2Q?

Yes.

Okay. Terrific. Thanks very much and best of luck.

Thanks.

Thank you. Our next question is from the line of Scott Krasik with BB&T Capital Markets. Please go ahead. Scott Krasik - BB&T Capital Markets: Hi. Thanks for taking my question. Angel, have you gotten to the point now where you need to really start to segment what retailers get what UGG product because the line has grown so much? And could that have a beneficial impact on your margins going forward when you get there?

Well, we have always done that. Actually the process that we use in working with our retailer is more of a business management process. We are very selective as you know about which retailers carry UGG, but also in a given environment let us say a mall with say four or five retailers carrying the brand, we are very conscious of which product works in which retail environment. Not to have everybody all in a feeding frenzy over everything we make. Obviously, there is a fairly broad cross-section of retailers that carry the classic, and carry slippers plus the fashion product isn't for everybody. The sneakers, for example, are not for everybody. And so we have been managing this now pretty well for quite a while. Going forward I think the trend lines and the sell through at each retailer will allow us to be more intelligent about that. You know, we will able to dial in a retailers mix and assortment being very specific with their consumer and not every retailer obviously, has the same consumer target. So just in a broad-based example, our Nordstrom versus Journey’s you're going to have a very different mix in Nordstrom than you are going to have in Journey’s. And the more we learn about the Journey’s customer as distinct and separate from the Nordstrom customer, it is going to allow us to dial in that assortment in a much more precise way. Scott Krasik - BB&T Capital Markets: Okay. So, you're doing it already. And then, the other question is on the non-footwear component of UGG's, in terms of, growing those to be a bigger part of the business.

We are very excited about that. We think that the handbag business is an important part of our accessories growth area, which we think there is a natural affinity obviously between footwear, especially boots and bags. But beyond that, we think that the tests we have been doing in outerwear have been very successful so far. And we anticipate developing that to include more than outwear, and that will include knitwear, sweaters, and as you know, we have been doing a great job through our licensee with cold weather accessories. Those have become very, very popular in the winter selling season. Scott Krasik - BB&T Capital Markets: Has non-footwear component has that hit the railing, is it meaningful at this point?

It is still evolving, still developing. You know, really that has kind of been us wanting to make sure we got the product right. We really feel confident going into this fall that we got the product dialed in where we want it to be, and you will see an ongoing improvement from a revenue perspective in these kind of accessory non-footwear products over the next few years. Scott Krasik - BB&T Capital Markets: Okay, thanks. Good luck, guys.

Thank you.

Thank you. Our next question is from the line of Mitch Kummetz with Robert W. Baird. Please go ahead.

Yes, thanks. Let me add my congratulations. Angel, can you just give us your quick thoughts on what's happening at retail right now? To what extent are retailers chasing and how are you reacting to that? It sounds like you've got some fill-in orders on Teva in the first quarter. Are you expecting that in the second quarter? Seems like your inventory is pretty well positioned in order to accommodate that. And is the fill-in opportunity really within Teva more than the other brands and is that kind of how you would view it over the balance of the year too?

I think on the Teva business they're in good shape with the right inventory this year, and in good shape with fill-ins through the balance of the spring and going into early summer. We are also in good shape on the simple brand with some fill-in business. Ahnu and TSUBO bought their inventories very close to orders. So more limited fill-in opportunity there. We're chasing it with those two brands because we are getting some good sell throughs. In general, the general thing I'm hearing from retailers is the improved environment. You know, a lot of people are chasing inventory, brands have become resurgent, you know, so it's important to have the right brands. The consumer has been out there. I think, just kind of got tired of not shopping, you know, I mean, American shop. This is what we do. So entertainment value being necessary shopping is the primary form. People are out there and they are looking for brands. It's pretty interesting. It has caught a lot of people by surprise because people are expecting a storm that would be you know, more intense deeper into this year. Maybe we are resurging you know, sort of a fall but we are getting good sell throughs in the spring.

Got it. And then speaking of the fall, I think you mentioned on the Simple business that your pre-books there are up 30%. I don't think you gave it for UGG and Teva. I don't know that you care too. But if you could just give us a little more color in how those two businesses are setting up for the back half in terms of the wholesale orders there?

Yes, we are very satisfied with the trends that we see. You know, it's really about as I said on the -- on my prepared comments, the spread in assortment of product with UGG. So you know, really looking at the presentation of the brands of the consumer, what we find especially through our own stores is that consumers love to see the assortment, and they are willing to try the brand for a non-classic product which is, and they are very satisfied, and they come back for more. So, you know, it's important for us to make sure that story gets translated to our wholesale customers. I'm very happy with the trend we are seeing in terms of those kinds of orders, non-classic orders. On the Simple side, we came up with a shoe called the BIO-D this year, and that's really what's -- it is that and the ecoSNEAKS are really driving the performance of the brands. So we feel you know, pretty comfortable. The Teva side, great strength in the fall closed toe product. That's been an exceptionally powerful insight we’ve had that the consumer is ready for a new brand in outdoors. And Teva as a heritage brand seems to be filling the bill, especially with the technical product we've got. Fall looks like it is setting up pretty nicely.

Okay. That's good to hear and lastly, a question for Tom. On the SG&A, your guidance is now for 26% of sales for the full year. I think coming off of Q4 you guys were seeing 25%. Given where the sales expectations are for the year, looks like you expect SG&A to be up maybe, looks like about $13 million more than what was in the guidance before. Could you tell us where that's coming from? Are you guys looking to spend a little bit more investing in the brands, just based on the strength you're seeing or is there anything else, any other bucket where you guys are looking to increase the spending?

Mitch in terms of the guidance for the total year for SG&A, the 26%, I think that's where we were at, you know, the prior guidance we were at 26%. What drives it, you know, the SG&A year-over-year is relative to the direct distribution now in the Benelux for Teva. Now we have operating expenses there. You know, the addition of the stores, not only the ones weren’t at full-time last year but open up full-time this year plus the 10 new stores. So that, and then some more infrastructure, but for the most part it stores in international distribution that drives the SG&A year-over-year.

Got it. All right. Thanks, guys, good luck.

Our next question is from Sam Poser with Sterne, Agee. Please go ahead. Sam Poser - Sterne, Agee & Leach, Inc: Good afternoon. Can you hear me?

It sounds like you're in the shower. Sam Poser - Sterne, Agee & Leach, Inc: Sorry about that. How are you? A couple of questions, number one, can you break out the international, the revenue, for the quarter please?

Yes, hang on. International sales for the quarter were $38.9 million. Sam Poser - Sterne, Agee & Leach, Inc: Okay, great. Then with the Teva increase, how much of that can be attributed to the Benelux. I mean on sort of like how much of that increase could be attributed to the Benelux and, I guess, to France?

Yes, approximately a third of the Teva increase is attributable to having a direct model now. Sam Poser - Sterne, Agee & Leach, Inc: Just in those two countries?

Well, yes. Direct model just in those two countries, right. Sam Poser - Sterne, Agee & Leach, Inc: So, next year when you direct in the UK that theoretically could be very helpful as well? So we get some idea of how much power the conversion to these direct businesses have?

Well, you know, I think one of the things that's different from Benelux versus UK, we had a very strong distributor model, distributor operating in the Benelux with Teva doing a great job for a very long time. We did not have that in the UK. So the UK has got ways to go with the Teva brand. We know that the consumer is there. We know there is a market. We know there is great distribution. We know there is a solid outdoor industry there. So we've got some building to do, but we don't have as developed as Teva business to begin with in the UK that we had in Benelux. Sam Poser - Sterne, Agee & Leach, Inc: But when we look at, say, the UGG business which is very well developed in the Benelux and in the UK, we could expect to see that kind of acceleration or that kind of impact?

You know, obviously my -- we're pretty aggressive in how we want to grow the business. Yes, there is a market, there are great distributors, I mean there is great retailers. It's a competitive environment, probably a bit more competitive than the Benelux was. You know, brands, outdoor brands being highly evolved there. So, -- but yes we're certainly not being squeamish about setting aggressive plans. Sam Poser - Sterne, Agee & Leach, Inc: And the timetable for the new, for the stores would be, I guess, September, October like usual in the second, in the third quarter really?

We like to get them open in that quarter, yes. Sam Poser - Sterne, Agee & Leach, Inc: And you're just not talking about the cities as of yet, I gather?

No, we're still in the final stages of these negotiations. I would rather not talk about that yet. Sam Poser - Sterne, Agee & Leach, Inc: Okay. One last thing. Tom, when we're looking at the SG&A, I mean, what's the balance? Is really Q2 going to be the highest percentage of SG&A of any of the quarters, as we look at it?

Yes. You know, Sam -- like we indicated with the guidance, with the revenues for the second quarter historically, the lowest revenue quarter there with a large amount of fixed overhead, fixed SG&A we have in place that's going to drive the highest SG&A as a percentage of sales. Sam Poser - Sterne, Agee & Leach, Inc: And I mean with that number, would pretty much almost be in line with the first quarter, I would guess? In actual dollars?

You know, pretty reasonable there. You know, we -- pretty reasonable to assume that. Sam Poser - Sterne, Agee & Leach, Inc: All right. Well continued success. Thank you.

Thanks Sam.

Thanks.

Thank you. Our next question is from Chris Svezia with Susquehanna Financial. Please go ahead.

Good afternoon everyone, and congratulations. I guess just on the Teva business for a moment. Angel, when you think about the improvement that you've seen and kind of right sizing the business, improving inventories, and you've mentioned, in the past there's always been an REI businesses has really been talked about. It's obviously one of the key retailers. You're obviously talking about some opportunities here at Dick's and what's going on there, and obviously mentioned Nordstrom as well. I guess, as you think about that business this year, can you just talk about door growth relative to just increasing penetration in existing doors? Just kind of how we should be looking at that?

Well, I think you are going to see door growth from all of those retailers with the brand performing the way it has been. You have to look at last year as was a true test year for Teva, even though the brand have been, you know, those have been our customers for a long time. We were down to what you might call a pilot flame, in terms of you know, growth. We needed to have some product sold through solid double digits, so we could have more open-to-buy, so we can get better foundation which is what we started this year with, and the performance of spring is yielding more door growth as we look into fall for the new fall product as well as you know, for spring ’11. So that's all great. Then there are other retailers like TSA, like Sports Authority where you know, they've been very -- they have been a good customer for a long time, but now we're starting to see great performance and sell through especially on the Mush product, and that's opening the door for a variety of other sandal opportunities, as well as the closed toe. And keep in mind we've also got closed toe for spring. So it isn't just closed toe for fall that is helping us. It's close toe for spring. I think it made a big difference this year because suddenly on a rainy day we are not out of business in the spring and that's important. We have product that will sell you know, in any environment.

I'm not sure about this. But is Bass Pro, Cabela's, and Gander Mountain, places like, that play into --

That's right. Those are good growth opportunities for us. We've had excellent conversation with them and a lot of excitement over the direction of the brand.

Okay, all right. And my other question is on the eCommerce business. I know first half, sort of until you got until about midway into the third quarter last year it was a tough business for various reasons. I'm just kind of curious, just remind us exactly what changes you've made to that business on the eCommerce platform. And you know you saw some nice growth here. Can we just extrapolate that that's pretty sustainable here at this point?

Yes, Chris, I think this one, this is Zohar.

Hi, Zohar.

Hi, some of the things we've done, we have really, you know, focused into increasing both the visitor and the conversion rates into the site. For example we brought a new you know, marketing director and focused on the business to really how we drive more traffic to the site in conversion and that you know, playing a nice results according.

Okay, all right, thank you very much and best of luck.

Thank you.

Thank you. Our next question is from the line of Andrew Burns with Thomas Weisel. Please go ahead.

Hi, this is Andrew in for Jim Duffy [ph]. You mentioned UGG sneakers as an opportunity for back-to-school. Could you give us some color on the growth of this product line, in terms of, SKU's and distribution. It seems like there's opportunity to put the product in a lot of doors in fairly short order?

Well, I mean we are not going to put the sneakers in place as we wouldn't put other products. So it's not like you're going to see the sneakers in athletic specialty stores or necessarily, you know, outside of our normal distribution for UGG. What it gives us however, is unique and distinctive sneaker product that we haven't had in the past. You might, I mean, they're almost like dress sneakers, I guess you would say, and when you look at the price points that people are getting for sneakers, $150 to $160, you know, a mixed price UGG point very, very reasonable, $130, $120. We are -- look we have a high top, we've got a low top, we've got a slip on. There is, I think, in the men's three SKUs, I can't recall, I'm sorry how many SKUs we have in the women. A lot of color. It's just a fun new, very young, you know, statement that we are making in a quality way. So sell throughs never lie. So we are really happy with that.

Great, and last call you mentioned switching to a wholesale model versus distributor, in UK and Benelux, would have about a $40 million benefit to sales in 2011. With the improving back drop and your current business momentum, is it fair to say that the number might be larger looking at it here a few months later?

Well, that would -- you know, we are not given 2011 guidance at this point in time but you know, what that $40 million number was sort of an apples and apples comparison of the lift we would get relative to our expectations at that point in time. So it is a function of what volume of business we do in 2011. So we’ll just have to see how that shapes out as time goes on.

Thanks, and last question can you break out the Simple brand revenue for the first quarter?

We are right now, you know, we sort of moved towards all the other brands other than Teva and UGG, other brands that we just do that together at this point in time.

Great. Thank you.

Our next question is from the line of Howard Tubin with RBC Capital. Please go ahead.

Thanks guys. Great quarter. Just a question on inventory, you've done a great job managing inventories. They're nice and lean. How should we think of inventory at the end of 2Q? Will it be up kind of in the 4% range again or should we expect it to increase a little bit more than that?

I think inventories that the end of the second quarter could be you know, could be, you know, in the ballpark to where they ended up relative to the comparison from the first or may be higher. Just have to see you know, how things go. As we mentioned on the call we are, really there's been a great concerted effort. We're seeing a lot of benefits of bringing in inventory closer to when we actually sell it to our customers. So, and I think net-net you know, it could be a similar comparison or maybe even slightly up.

Got it, thanks. Can you just remind us for the fall season, is your pricing pretty consistent this fall versus last fall?

Yes.

Great, thanks.

Our next question is from the line of Omar Saad with Credit Suisse. Please go ahead. I'm sorry Mr. Saad disconnected. Our final question is from the line of Chi Lee with Morgan Stanley. Please go ahead.

Hi, good afternoon guys and congratulations, and I guess I just made it. Can we go back to the first quarter gross margin, because I understand qualitatively what drove the expansion, but can you help us better understand what the magnitude of each of those drivers were, between the direct to consumer mix shift, perhaps some organic gross margin improvement in the domestic wholesale business? Just trying to get a better understanding of that 600 basis point improvement.

Right. This is Tom. I will give you some color on that. There were -- there was, part of it was relative to having direct distribution with Teva like you said part of it was the direct mix, and then there was improved margins and, you know, it splits relatively you know, equally. There is little bit, you know, let's say 1% to 2%, maybe relative to Teva and the direct mix is about 2% and then improved wholesale product margins is maybe too a little bit higher than that. So that’s sort of the split what drives that.

Okay, that's really helpful and I guess Tom, question for you just on the accounts receivables provisions. I mean, it seems this point last year you guys were still taking a lot of provisions for the receivables. Have you seen that trend reverse? In other words, are you starting to see somewhat of an earnings tail wind, as you perhaps, don't need to take those provisions and may even be reversing some of those at this point?

Yes, I think you're correct. I mean, we've got you know, lot of improvement in the quality of our receivable base relative to a year ago. So we have been able to you know, cut back on some of our provisioning for bad debts.

Okay, great, and then just lastly, I wanted to clarify. Angel, I know you talked about certainly strengthening fall bookings for UGG, but I think last call you had mentioned that you were expecting domestic wholesale business to potentially be up in the mid single-digit range for UGG. Would you care to update us on where you think that business could be this year, given that you increased the guidance for the overall UGG business? Thanks.

Hi, we haven't broken out what we expect by brand, but I like the trends that we are seeing and I'd stay consistent with what I said last time. We anticipate because of new product introductions the ongoing momentum of boots in the marketplace and overall the amount of spread and assortment we’ve gotten at retail and ongoing, you know, growth in UGG business consistent with where we've been. You know, I don't really want to break it out anymore than that.

Okay, thank you.

Thanks.

Thank you. I will then turn the call back over to management for any closing comments.

Well, again I want to thank you all for participating on the call. I want to send a note of congratulations and appreciation to our worldwide Deckers organization. I think you're seeing the results of an ongoing commitment to developing our team and increasing the amount of talent we bring into the organization and being intelligent about the investments we make to grow our business going forward. So, we look forward to the second quarter call. Thank you all very much.

Ladies and gentlemen, this does conclude today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.