Yahoo Finance’s Brian Sozzi, Julie Hyman, and Myles Udland speak with Kontoor Brands CEO Scott Baxter about the company’s first ever Investor Day.

Video Transcript

MYLES UDLAND: Let's take a look at shares of Kontoor Brands. They're up just a fraction this morning, about seven-tenths of 1%, but over the last year, the stock has gone from around $15 a share to, as we see here on the screen, closer to $65. The company's fresh off its latest investor day. Joining us now to discuss, Kontoor Brands CEO and President Scott Baxter.

Scott, thanks for jumping on the show once again. So let's just kind of talk through what you guys announced as you get on this two-year anniversary from being spun out as a new publicly traded company and now outlining a new set of, I think, two-year projections, maybe three-year projections, on where you see the business headed here.

SCOTT BAXTER: Yeah, you know, what we did really-- and thanks for having me on the show-- is we talked about coming out of Horizon 1 two years ago, spinning off, becoming a public company, building the infrastructure of that company, rolling out a new ERP system, reinvigorating these two great brands-- Wrangler and Lee. And now we've lighted into Horizon 2, where we start to grow the company. And we think that there's really big opportunities to grow the company geographically, categories, and channels, and we're pretty excited about the future going forward.

BRIAN SOZZI: Scott, I haven't heard a lot of retailers say in their investor day presentations-- or at all-- they're going to try to accelerate their US wholesale business. And I think that was a surprise to some, because department stores, they're closing down like crazy. How do you plan on doing it?

SCOTT BAXTER: Yeah, you know, our business isn't department store. That's not really the core of our business. Our big customers in the US we talked about are Walmart and Target, you know, folks like that, and we think that they're what we call the winners in this marketplace. And our core is so important to us and we think that that core of Wrangler and Lee consumer in that business still has a lot more room to run, and we think through innovation and sustainability and some of the real capabilities that we have and that we're highlighting as a company, we think that there's growth opportunity ahead for us. So, as you compliment that with our initiatives around our own D2C and our own digital, we think there's great opportunity for those too.

BRIAN SOZZI: And Scott, we've heard from some retail executives of late that the back-to-school shopping season could be pretty big. How are your bigger customers, like a Walmart, like a Target, planning for this upcoming season?

SCOTT BAXTER: You know, everyone's trying to bring in as much inventory as they possibly can. We think that we're positioned really well because we have a lot of new products that are coming up for the fall. We think that the fact that over the last couple of years the consumer has really come back to these brands-- Wrangler and Lee-- and there's a lot of excitement.

I mean, we've created some really interesting demand creation platforms and some collaborations. You know, a really nice collaboration we just had with H&M globally. Our Georgia May Jagger is now the face of our women's Wrangler line-- our Heritage line-- which we're really excited about. We think those types of things are going to generate some real interest from a back-to-school standpoint. And then, simply, you just have to remember, there was no back-to-school last year and kids weren't shopping last year, so we think that there's pent up demand.

JULIE HYMAN: Scott, you mentioned globally, and I want to talk a little bit more about your global aspirations. I know you guys have started to make some early inroads in China. But what does that plan look like to expand more? Because most of your sales are still here in the United States.

SCOTT BAXTER: Yeah, you know, we are the leading denim provider in China with our Lee brand. We've been there for over 25 years and we have a really solid platform and foundation there and it's a premium expression of the brand. And now we're introducing Wrangler, and we just recently introduced it digitally and we think that was the right way to introduce it to the consumer there. And to complement that, this summer we're going to be coming up with a brick-and-mortar strategy too.

So, to be able to have our two big global brands in China and to actually be launching Wrangler from anew is really exciting for us because we think that there's a really nice big growth opportunity for a lot of years to come for the Wrangler brand. But the beauty of it is, is that we already have a platform and we already have people in China, and so we can go ahead and get our synergies from our big platform that we already have there as we roll out the Wrangler brand going forward.

BRIAN SOZZI: Scott, full and fair disclosure, I'm actually wearing a pair of comfortable jogger pants right now. And I suspect a lot of people that are still working from home are still wearing their comfortable jogger pants. How are you going to convince them later this year that they need to get back into jeans?

SCOTT BAXTER: Well, there is a couple of things. You know, if you think about the jogger pant, we just kicked off a line of clothing-- all-terrain gear-- that has many different styles of jogger pants. Very similar for both male and female. We just kicked off on our website today-- actually this week-- four-way flex, which is a jogger pant. It's a [INAUDIBLE] it's got four-way flex, incredible stretch, so it competes right in that athleisure category. Lee also has some similar options, both male and female.

So we're doing a lot in that category already ourselves, and we think by complementing that with denim-- and denim looks so good and everybody loves to wear denim-- and, you know, the fabrications that we have in denim right now, Brian, are so outstanding and so comfortable in the way people can dress them up that there's a big opportunity there. And the casualization of the world gives us a big opportunity with that also, so a complementary approach to having both of those categories four our lines.

MYLES UDLAND: All right. Scott Baxter, president and CEO of Kontoor Brands. Scott, always fun. Thanks so much for jumping on and we'll talk soon.

SCOTT BAXTER: You bet. Take care. Thanks, everyone.