Hibbett Inc (HIBB) 2011 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by, and welcome to the Hibbett Sports fourth-quarter and year-end 2011 conference call. During today's presentation all participants will be in a listen-only mode. Afterwards we will conduct a question and answer session. (Operator Instructions). As a reminder, this conference is being recorded Friday, March 11, 2011.

I would now like to turn the conference over to the Executive Chairman Mr. Mickey Newsome.

Thank you, operator, and good morning everyone. I have with us also our President and CEO, Jeff Rosenthal; our Senior VP of Merchandise and Marketing, Becky Jones; our Senior VP and CFO, Gary Smith; and Senior VP of Store Operations, Cathy Pryor.

We will all be available for questions when it comes to that time. We appreciate you being on the call today. We appreciate your interest in Hibbett Sporting Goods.

Before we start Gary Smith will cover the Safe Harbor language.

In order for us to take advantage of Safe Harbor rules I would like to remind you that any projections or statements made today reflect our current views with respect to future events and our financial performance. There is no assurance that such events will occur or that any projections will be achieved. Our actual results could differ materially from any projections due to various risk factors which are described from time to time in our periodic reports with the SEC.

Thank you, Gary. Now our President and CEO will speak with you.

Good morning. As you know from our press release this morning, our fourth-quarter's earnings per share were $0.44 versus $0.40 a year ago, a 10% improvement.

Overall sales for the fourth quarter were up 3.8% and same-store sales were up 1.3%. Our operations teams have continued to improve our customer service with the number of items per transaction up 1.94%.

Sales by month were November was up 15.02%, December up 1.13% and January down 11.62%.

We continue to invest in technology to help us grow in the future, with replenishment systems, assortment planning and price optimization, labor-management and many other systems to make sure that we are successful for many years to come.

For the year Hibbett opened 45 new stores, closed 14 stores and expanded 14 high-performing stores, bringing the store base to 798 stores in 26 states.

For the physical 2012 the Company expects to open 50 to 55 new stores, close 10 to 15 stores, and expand approximately 15 high-performing stores.

Our first-quarter sales have improved greatly through yesterday. Comp store sales are up approximately 8% on top of 17% last year. Our inventory and aged inventory and assortments are in great shape. And we look forward in having a great year again this year.

Thank you, Jeff. Now our Senior VP of Merchandise and Marketing, Becky Jones, will speak with you.

For the fourth quarter activewear apparel was our strongest performing department, with the comps in the mid-20%. All genders showed strength with double-digit increases. Our fleece programs were driven by The North Face and Under Armour, and the Nike Dri-FIT performance product was also quite strong.

Our licensed apparel was off double-digits, with special events impacting the total. Auburn National Championship product delivered half the volume, as Alabama did in 2009. We were pleased with the sell-through of the Auburn National Championship product, as the buy was planned appropriately and allowed us to achieve a higher sell-through rate than a year ago.

NFL business selling was off last year based to the weakness of the Saint and Cowboys specifically. Our NBA business continued to be strong in the fourth quarter, and MLB accessories grew with the Fighting Tornado necklaces being hot.

Licensed business has normalized at this point. We don't have special events going forward, so we do see positive trends in the future.

Our footwear had low single-digit negative comps in the quarter. Our lifestyle urban products did not perform at the register due to the shift of rapid tax refund checks. Those items that did show strength were Air Force 1, Air Max, LTDs and Command.

The running category continues to be good across all genders. Reebok Zig, LunarGlide, Nike Shox, Max + 2010 were all strong performance.

The casual business saw nice growth with Paolo and Timberland leading the way. And we will take our learnings from the fourth quarter and capitalize on this growth opportunity going forward.

The toning category saw double-digit increases for the quarter. And our kid's basketball was up double-digit comps, led by Reebok, adidas, and Nike, respectively.

Our first-quarter trends in footwear are up double digits. We feel strongly about the future with the footwear business.

Equipment ended the quarter with a nice performance in football, up double-digit comps; basketball, high single-digit comps; and soccer, double-digit comps. As expected, fitness did not perform with the lack of TV items. Overall top performing suppliers were McDavid, Shock Doctor and Nike.

The accessory business was up low 20% comps for the quarter. We continue to see consistent performance in socks. And sunglass programs continue to show strength and are a growth opportunity.

We had good growth in our gift card program, and marketing up in the 20% range for the fourth quarter. We began a third-party program and we will look to grow this avenue in the future.

We will continue to build on the marketing reach in 2011 by focusing on our MVP loyalty program and our mobile marketing venues.

For the first quarter all categories across-the-board are positive comps in all regions in the Company are positive comps.

Thank you, Becky. Now our Senior VP and CFO, Gary Smith, will speak with you.

Fourth-quarter sales were $173.2 million, a 3.8% increase from the previous year. Fiscal comps were up 1.2% versus a 9.6% increase in the previous year. Gross profit rate increased 69 basis points on top of 136 basis point improvement in the previous year.

The increase was in product margin rate, as age and shrinkage rates improved and we were less promotional. We had a slight deterioration in occupancy and warehouse leverage.

We lost 111 basis points of leverage on SG&A as sales were less than planned in the quarter, but SG&A grew less on a per store basis than it did in the previous three quarters.

Depreciation and amortization was under last year's dollars due to declining leasehold improvement dollars, as it costs us significantly less to get into a new store.

The favorable tax rate was due to the exercise of incentive stock options in the quarter.

Operating income as a rate to sales decreased slightly from 11.37% to 11.14%, but increased in dollars from $19 million to $19.3 million. This was on top of a 278 basis point improvement in the prior year.

As Jeff mentioned, diluted EPS came in at $0.44 versus last year's $0.40, a 10% improvement.

Now a couple of important highlights on this terrific year-to-date performance. Comp store sales were up 9.75%; total sales up 12%; gross profit up 159 basis points and $34 million. The expense lines leveraged 35 basis points, and operating income was up 223 basis points and 40%. EPS was up 43% and $0.48.

From a balance sheet perspective, the Company ended the quarter with $75.5 million in cash versus $49.7 million last year, with no outstanding bank debt.

Inventories increased 3.2% over the previous year, but were down slightly on a per store basis. We spent $10.5 million in CapEx for the year.

We also purchased 225,000 of our own shares in the quarter for $7.8 million. For the year the Company has purchased over 1.4 million shares at over $37 million. As a reminder, we have approximately $212 million left under the remaining repurchase authorization.

Thank you, Gary. Now, operator, we are ready for questions.

(Operator Instructions). Dan Wewer, Raymond James.

So, Mickey, I guess, what happened with the Auburn licensed apparel confirms what you have always said about Auburn fans, huh? (laughter).

No, Auburn was very strong. It was about 50% of Alabama, but we probably had a higher gross margin on Auburn. We probably overreacted a little bit on Alabama, (multiple speakers). We could put Alabama in several states, and we don't put Auburn in as many stores.

There you go. Well, so, I guess my first question is just revolving around what happened in January with the 11% drop in same-store sales. And in comparing that with other sporting goods retailers, other specialty athletic footwear retailers, they didn't see the same hit that you saw in January.

How would you go about reconciling your performance compared to the peer group during that month?

Dan, we came out -- and it really kind of started a little bit with weather right after Christmas. And then the first week of January we were positive comps, and we thought we were in pretty good shape. And then we had ice storms through Georgia, Mississippi, Alabama, Texas, Arkansas, Oklahoma, so we had an additional 32% of our stores close this year just because of the weather.

Then, unexpectedly, we did not plan on a tax shift at the end of the month, which also impacted us. And our average income is, for the US, it is around $42,000, $43,000. Our average income in a lot of our cities is around $33,000. So they really are dependent on those tax refunds. (multiple speakers).

Jeff, when you look at the --

Dan, one other thing on that subject. These numbers are quarter numbers. For the quarter we are up over 1%, but if you took NFL out and college out, which is Saints in Alabama, we would have been up 4.5%.

When you look at the strength that you are seeing quarter to date, do you think the -- how do you get your arms around how much of that is just simply the delay in the tax refund from a year ago and how much of it is just true underlying business growth?

We think it is about a 20% transfer from the fourth quarter, Dan. (multiple speakers).

I think the last question I have right now, have you thought about the NFL lockout and how that might impact -- if in fact the lockout goes through, how that would impact your license business in NFL and --?

Yes, we have looked at it, and it would be less than 1% of our business.

Less than 1%?

Yes.

Okay, great, thank you.

Rick Nelson, Stephens.

I would like to ask about store growth and the real estate market. Are you seeing any changes in terms of the lending environment for developers? And maybe if you could discuss the Blockbuster, Movie Gallery opportunity?

We are not seeing any new construction. Last year we did 45 new stores; 6 of them were new construction. The year before we did 42 new stores and 19 were new construction.

I just got back from a shopping center convention and, man, it is just not any new construction going on now. We are going to continue to open in Movie Gallery spots. We did about 15, 16 of them last year. We will do some Blockbusters. And a lot of developers are chopping up old abandoned Wal-Marts or any other abandoned building, and that is not really new construction, but we are seeing some opportunities there.

But the thing that has gotten me encouraged about new stores for this year is the performance of our new stores last year. We are running about 30% over pro forma on those new stores last year. That gives us a lot of encouragement about getting a little more aggressive going after these markets where we need to have a heavy store. So we think new stores could start to increase again.

Mickey, how do you think about the capital allocation decision now? I am curious (inaudible) you are sitting on $75 million in cash and no debt on the balance sheet, if you can't get the stores, or do you (multiple speakers).

Certainly we would like to invest in new stores, but it is costing us less and less to get in on a regular basis. So I think the next priority would be in the stock buyback.

Also, I want to ask you what you think the sales drivers are going to be to overcome the very tough compares you have throughout at least the early going of this year? And how much further can you push the outerwear category come the fall?

Well, we really feel like our footwear business is really hitting stride at this point in time. It is not only from the assortment and the trend that is going on, but it is the way that we are sending it to the stores and making sure that we are buying it with -- making some good stands on products that can go to further doors down from an allocation perspective.

So is there is the trend that is going on for us, as well as the way that we are treating that inventory that is really going to benefit us for the future.

As well, we see are our activewear business being very strong, specifically in women's and kid's as a total. But across-the-board activewear has a positive trend. And it is the same thing. We have good product from our suppliers and we're able to allocate that to more doors, because we are really looking at the way that we approach assortment planning.

We have seen now three years of gross margin expansion. What would be the outlook there for the new year?

We still see a lot of room to expand. We have seen opportunities on not being as promotional as we were. And as we continue to grow with our vendors we are getting more discounts, more containers and those type things, so we still feel pretty good about expansion in our gross margins.

Okay, thanks a lot. And good luck.

Sean McGowan, Needham.

A couple of questions here as well. So dovetailing on your gross margin commentary, what are your expectations on SG&A leverage in the upcoming year, given your sales forecast?

As Jeff mentioned, we have significant investments in IT, with allocation plan rolling that out. He mentioned price optimization, which we will start working on this year. So we're probably going to need a 3 to 4 comp on the SG&A to make -- to lever that. Not as much on occupancy and warehouse, but more on the SG&A line.

Okay, thanks. Regarding the strong performance so far in the first quarter, would you attribute any of that to weather that you would consider unusual or anomalous or more favorable than a year ago?

Not really. If you took February 1, we actually had even more stores closed then we did a year ago. So I think it is just that the business is healthy across-the-board that is the main reason, and some of the tax shift.

And we are getting past the Alabama and the Saints too, that is happening.

Right. Then the last question, and I know it is still kind of early in the year, but do you know of any sales tax holiday shifts that are upcoming for the summer months?

We don't know as of yet.

You won't know that until June. It is amazing how late they make those decisions.

Okay, well, thank you very much.

Sam Poser, Sterne Agee.

You have said that the comps for the quarter would have been up 4.5% ex the Saints and the Tide, but what would have been for January ex the Saints and the Tide?

I don't have that number.

Well, we said with NFL -- it is more about the NFL -- it would be another 1.5% maybe.

That is in February.

In February, yes.

We don't have exactly, Sam, for January.

I guess if we think about it, we had -- if you were to take the negative -- the puts and takes, you had weather, you had the tax shift, and you had the Saints and Alabama last year.

Correct.

How would you -- of the negative effects, how would you look at each one of those for January?

We keep talking about that internally a lot. And we have a differences of opinion, but in my opinion the tax shift and n weather were the two main things.

And, also, what the weather did to us too, which I didn't bring up, is we had ice storms. A lot of our containers go through Atlanta. And it delayed getting shipments to our stores, which put us also two weeks behind on getting new product to the stores. And when we started getting product to the stores our sales started coming back.

But a lot of other -- a lot of your counterparts faced a lot of those same issues. Maybe not as direct to the weather, but the weather has been terrible all over the place until recently. And they didn't face those issues.

So the one place where you really differentiate from the other people in the industry is that bonus that you got from the Saints and the Tide. So I would love to just understand what the conversation is internally that you're having, because it just sounds to me like that was a bigger (laughter) -- it sounds to me like that was a bigger -- I mean, just based on the differential from some of the other retailers and the comp that you are up against because of that last year, my impression is it is a bigger -- it had a bigger effect.

Well, Sam, you can't specifically measure any of this hardly, so it gets down to opinions. I would probably lean toward your opinion. But we got some others that lean the other way. It is that late shipment thing, that involves merchandise not getting to the stores in early to mid January. It got there in late January and February; that is a biggie there.

Right, and then (multiple speakers).

Go ahead.

Go ahead.

Our effective buying income of the average heavy customer across our chain is like 33,000, and the national average is 42,000. So the tax refunds probably meant more to us, the delay in them, than it did to some other people.

Okay, and then lastly, what is your effective -- how are you looking at the toning business this year? What are the big drivers in footwear as you see it looking into fiscal '12?

The toning business is still going to be around and it is still a relatively decent business. It is certainly not going to be a big growth factor, but it is stabilized, and we do think that it is going to be out there at least for this next year.

So compared to what we did in toning for the last year, I would expect to be maybe somewhere close to that, but I don't see it as a growth vehicle in women's particularly.

What we do see strengthening is running. Running continues to be big across-the-board from the lightweight and in many suppliers. That seems to be what our consumers are really looking for, and we are in really good shape there.

Then improvement in your urban doors, it was showing a little bit of promise. What kind of differential are you seeing urban, non-urban right now?

It is pretty close right now. The [net] comp gains are about the same, Sam.

Thank you very much, and success this year.

Mark Mandel, ThinkEquity.

A couple of numbers questions here. CapEx for 2011, Gary?

That would be in the $12 million range.

And on the gross margin breakdown, can you give us the specific breakdown that you gave us last quarter in terms of product margin, occupancy and warehouse?

Occupancy and warehouse delivered 6 basis points. So the gross margin was up 75.

And in terms of the tax rate, what should we assume on a going forward

37.75%.

Including the fourth quarter? You don't expect any true-ups or any adjustments in the fourth quarter of 2011?

We wouldn't expect the same amount of iso-exercises that we had this year.

Okay. Then, finally, on the expense side, was there any -- did you have any opportunity to flex down expenses in the fourth quarter? You mentioned stock options, I believe. Is it because earnings were up so strongly for the full year, is that what the performance figures are based on? There was no (multiple speakers).

That's correct. It is based on the full-year performance. Coming out of the nine weeks of December we were at a mid-single-digit comp. We felt January was going to -- it really started out pretty strong for us the first couple of days. And then by the time the weather hit and the tax refunds really didn't have a chance to flex down much later in the stores.

When you think about it, the third and fourth weeks of January are probably the third and fourth largest weeks in the fourth quarter. So we really have to be staffed to handle the volume that comes through the doors then.

Okay, then finally on the store opening plans for the current year, I think you may have mentioned this in the last call. Are you striving to have a more even spread in terms of quarter-by-quarter openings?

I think we will do a little bit more first quarter than we did last year. And probably a little bit more even than we were last year.

Got you. Okay, great. Have a good year.

Anthony Lebiedzinski, Sidoti.

A couple of questions here. First, as far the store openings are these mostly in existing markets or do you plan to enter any new markets this fiscal year?

We are going -- we won't enter any new states, but we are trying to do isolated markets, and most of them so far are going to be isolated markets. Now we will do some around a large market, 20, 30 minutes away from an enclosed mall, but they are mainly small, isolated markets in existing states.

Also, do you have any comments as far as what you anticipate the impact from higher fuel prices on your customers and also freight expenses?

Yes, maybe up to 10 to 15 basis points, Anthony.

The higher fuel costs, it is going to affect everybody sooner or later. It is no way -- we got different opinions internally on that. My own opinion, if we have a store in Hazard, Kentucky, and you do major shopping you got to go to Louisville, you may go to Louisville less and stay home and buy it in your local area.

But you could also make the case that when you are in a small isolated market you've got to draw from a wider area. So we are not sure how it is going to affect us. Sooner or later it will affect everybody if it stays that way.

And also, your guidance for the year, does that assume any share buybacks?

It does not.

All right, thank you.

Chris Svezia, Susquehanna International Group.

This is Tom Haggerty in for Chris. How are you guys doing? Just a little color maybe on the cost side. Have you seen price increases starting to flow through to your vendors? And looking forward, where are you planning your ASPs versus units?

Well, as far as cost increase for products we are seeing a little bit of that. We don't really think it is incredibly impactful if you take a footwear piece that was $88 last year and maybe a new model would come out around $92, it is not that big of a shift for the consumer that is looking about for that product, because it is all about what is the right item.

From a cotton perspective, we are just -- we are not dependent really upon cotton as a -- total business in apparel, we are not that driven there. We have some items, but it is not impactful to our total assortment.

Our average selling point -- price will be going up. We continue to sell higher priced footwear. And we are probably not as promotional, so we will see our average selling price go up.

Would you think units, maybe it would be flat or -- I mean, would you get most of your comp out of the ASP or are you looking at higher units?

It is hard to say, but I would think we would be up in units too. I think we will gain some marketshare.

Maybe, Gary, on the occupancy side, you guys had good leverage last year on obviously really strong comps. With your new store growth plans where do you see those coming in? And do you have a good amount of actionable leases this year?

I would think if we get where we think the sales are coming in, we would probably leverage the warehouse and occupancy line maybe 20 to 30 bips. And [Mickey] and I have talked about the number of leases we had done this year versus last year.

How many new store leases?

I mean do you have like a good amount of actionable leases to -- that would affect your occupancy (multiple speakers).

That we are going to renegotiate?

yes.

Oh, yes. We will have well over 100 of those that we will renegotiate.

Probably 20% to 25% of the base.

Yes, at least.

Okay. Where do you think your leverage is? Is it still in that 1% to 2% range?

For warehouse and occupancy?

Yes.

Oh, yes.

All right, well, thanks, guys. Good luck.

Christopher Horvers, JPMorgan.

A question on the gift card program. How big was that, and how much bigger was it year-over-year? Do you have a view on how quick the redemption period is in terms of how long that benefit could last into the first or second quarter?

The gift card program for us is -- it is a small part of our business overall at this point in time. We are really in the avenue of taking advantage of growing that and ensuring that we offer that up.

Year-over-year it was a decent amount. Of course, it was a double-digit increase, but it is not impactful from a total. We just see it as an opportunity to grow.

As far as how long it takes for the consumers to come back in, I can't really gauge what that timing is at this point in time. We think they bring it back specifically after the holidays. The fourth quarter is the largest piece of it. We think that they bring it back in the first -- late fourth quarter, first quarter, but I don't know the exact to that.

Okay. I'm not sure if you covered this or not, but I understand the weakness in January. Did you speak to what the driver of the slowdown in December was? It just seems odd, that volatility in December.

We were a little disappointed in our footwear sales in December. One of the main reasons was we weren't as promotional as we were a year ago. So we're a little disappointed on our top line for the month of December. Yes, but we increased our margin quite a bit in December in footwear.

And Alabama and Saints affected our December sales also.

Yes.

When you look at it too, this December was up against a 15 comp the year before. So if you look at the two-year stat between November and December you get pretty much the same amount of run rate.

That makes sense. Then as you think about just overall, Becky, in terms of your expectations for average ASP increase in the footwear category this year?

Maybe 5%.

Wow. Okay. Thank you very much.

Peter Benedict, Robert Baird & Co.

Just a couple here. First on the D&A, Gary, should we assume that is relatively flat in '11 versus '10, maybe down slightly?

It should be, yes.

Then on the operating margin, 11.1% this year, you're about 100 basis points from your prior peak. Help us understand what type of operating margin expansion is assumed in reaching the lower end of your earnings guidance. And then the upper end of the earnings guidance, should we think about that prior peak being in play this year?

Well, if we had an extra week we would do that. (multiple speakers). Taking a look at where we are now at and how clean that inventory is, and if we can get a mid-single-digit comp to a high-single-digit comp, we could be at the upper end of 11% and maybe knocking on 12%.

Okay. Then the first quarter -- the product margin in the fourth quarter was very good. It has been good all year. What is your view on the first-quarter product margin opportunity? I know you have a lot of -- you have a tough comparison, but it sounds like the inventory is clean. Can you just give us a sense of maybe the magnitude of lift you are assuming here for the first quarter?

I don't know. You know, our age is in such better shape that --

Certainly last year when we had $0.59, that was up $0.55 from -- or 55% from the $0.38 we where the previous quarter. Most people had us in low 60 range basically due to the tough comp that we are coming up against.

But hopefully if we are able to hang onto some of this, and even going through the fourth quarter where we had minimal increase in comp store sales, we still posted a very decent gross margin rate increase.

So I wouldn't want to say that we do a 60 or 70, which is probably on top of a big number we had last year, because we had a record first quarter last year at 15% operating margins. It is going to be tough, but certainly the cards are aligned with where the inventory is and the volume is, we might be able to certainly increase that product margin rate.

Okay, thanks very much.

David Magee, SunTrust Robinson Humphrey.

(technical difficulty).

John Lawrence, Morgan Keegan.

(inaudible), Gary, would you remind us a little bit of the cadence in the breakdown of the first quarter by months in terms of comps last year, first of all?

February was a 17, March was a 17, and April was a 5.

Okay, and then secondly, can [you all] speak to a little bit when you look at the opportunities on the system side and everything that you've got going on there? Talk about the price optimization, allocation. How do the drivers of those shift as you employ some of those initiatives over the next year to 18 months?

This year we are starting the price opt, which we feel will help us maybe late this year, but really affect us next year, by the time we get it in and functioning the way we want it to be. We are putting in -- we have already put in assortment planning. We should start to see some benefit from that this year.

We have put in labor management, which will continue to get us better at scheduling the right people. So there is still a lot of room from opportunity from systems that we feel we can grow with.

Great. And that has been -- part of that is the success in accessories being replenished (inaudible).

Yes, replenishment has continued to comp double digits on top of double digits. We still haven't maximized what we can do in our replenishment. And we continue in to enhance our replenishment, both from a personnel standpoint and being on the latest technology of replenishment.

Great, thanks. And last question, Gary, I assume the difference in the guidance from low to high is whether or not you will leverage on the comp for the year. Is that -- on the SG&A side is that basically the gist of it?

That is correct.

Thanks, guys, good luck.

Mark Smith, Feltl and Company.

First off just housekeeping. I just want to make sure I heard it right. Comping now at 8% currently through the quarter, over 17% last year.

Yes.

Okay, perfect. Second, you were asked earlier on kind of urban versus non-urban. Can you guys talk about are you seeing some impact -- positive impact from rural economy, just with farmer incomes, any benefit from that now, or do you expect to get any bump from that here this year?

Farming?

Yes, we have seen in some of the heartland stores, the Nebraska's, the Kansas', the rural, probably are at the top of the comp chain. And also probably their unemployment is a little lower than what we'll see in the other -- we have seen in the other states.

Lastly, can you just talk at all about the ROI or any of the initial results that you have seen on the expansions that you guys did this year?

Certainly, we see by a factor of about one-third an increase in sales comp base is the increase in square footage. So our goal is to get back to the same dollar amount the first year and the second year to get to the same percentage amount.

So they have been highly productive. And that square footage comes on at the sales rate a little bit higher than if we just put it in for a new store.

We are going to expand at least 15 this year. And we've probably got 80 to 90 we would like to expand, but you have to wait until the real estate is available and the right opportunity is there.

Perfect. Thanks guys.

Sam Poser, Sterne Agee.

Just real quick, I just wanted to understand -- on the gross margin for the year, how are you looking at the gross margin for the year, number one?

Number two, when you think about the first quarter alone, given the comparisons that you have, you've got February up 17, March up 17, and then April up 5, but the comparisons ease dramatically considering the Easter shift and everything. So would you look at the comp guidance being more front-end loaded than back-end loaded, if that makes sense?

It doesn't.

Well, I mean -- you've got -- you're up against big comparisons through the middle of March now. You're halfway through March -- or one-third of the way through March, and then you've got -- but Easter is going to make -- the Easter shift is going to make April easier and you're up against an easier compare there.

Correct, that's true. We will lose a little bit at the end of March, because of the shift, and we should get a little bit back in April.

Yes, there will be a shift.

Then as far as the gross margin for the year?

We don't get into that.

All right, well, thank you, and good luck again.

Mr. Newsome, we have no more questions on the telephone lines at the moment. I will now turn the call back to you. Please continue with your presentation or closing remarks.

Thank you. We are proud of the fact that in a tough economy last year we had our greatest year ever in terms of earnings per share and net income dollars. Comp store sales up 9.8%, we are proud of that. We opened 45 new stores, and these 45 new stores are performing 25% above their pro forma sales. That gives us a lot of encouragement to find more and more new stores going forward.

Comp store sales for the first 40 days of the current quarter are very strong. We know there is an additional 400 markets in our 27-state area that we want to open a new Hibbett store when real estate becomes available.

We are a much improved company on year-over-year. We intend to keep improving and growing our bottom line.

Thanks for being on the call today. We look forward to speaking with you on May 20 at nine o'clock Central Standard Time with our first quarter results. Thanks for being on the call.

Ladies and gentlemen, that does conclude our conference call for today. We thank you for your participation, and ask that you please disconnect your lines. Have a great day everyone.

Thank you.