SpartanNash Co (SPTN) 2012 Q4 法說會逐字稿

Good day, and welcome to the Spartan Stores Inc. fourth-quarter and full-year 2012 earnings conference call. All participants will be in listen only mode. (Operator Instructions) After today's presentation, there will be an opportunity to ask questions. (Operator Instructions) Please note, this event is being recorded.

I would now like to turn the conference over to Katie Turner of ICR. Please go ahead.

Good morning, and welcome to Spartan Stores fourth-quarter and fiscal year 2012 earnings conference call. By now, everyone should have access to the earnings release for the fourth quarter ended March 31, 2012. For a copy of the release, please visit Spartan Stores' website at www.SpartanStores.com under For Investors. This call is being webcast, and a replay will be available on the Company's website until May 31, 2012. Before we begin, we would like to remind everyone comments made by management during today's call will contain forward-looking statements. These forward-looking statements discuss plans, expectations, estimates and projections that might involve significant risks and uncertainties. Actual results may differ materially from the results discussed in these forward-looking statements.

Internal and external factors that might cause such differences include, among others, competitive pressures among food retail and distribution companies, the uncertainties inherent in implementing strategic plans and general economic and market conditions. Additional information about risk factors and the uncertainties associated with Spartan Stores forward-looking statements can be found in the Company's fourth-quarter earnings release, fiscal annual report on Form 10-K, and in the Company's other filings with the SEC. Because of these risks and uncertainties, investors should not place undue reliance on forward-looking statements. Spartan Stores disclaims any intention or obligation to update or revise any forward-looking statement.

This presentation will include non-GAAP financial measures as defined in Regulation G. A reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures and the other information required by Regulation G is included in the Company's earnings release issued after market close yesterday. And it is now my pleasure to introduce Mr. Dennis Eidson, President and CEO of Spartan Stores for opening remarks.

Thank you, Katie. Good morning, and thank you for joining our fourth-quarter and fiscal year 2012 earnings conference call. With me this morning are members of our team including Executive Vice President and Chief Financial Officer, Dave Staples; our Executive Vice President of Merchandising and Marketing, Alan Hartline; our Executive Vice President of Retail Operations, Ted Adornato; and our Executive Vice President of Wholesale Operations, Derek Jones. I will begin by providing you with a brief overview of our business and financial performance for the fourth quarter and fiscal year, and then Dave will share some more specific details about the fourth quarter financial results as well as our outlook for the first quarter and fiscal 2013. Finally, I will provide some closing remarks and we can open up the call and take some questions.

I am pleased with our ability to generate fourth quarter financial results ahead of our expectations through disciplined management of our expenses and working capital. We achieved these results despite a continued challenging economic environment in many of the market that we operate in the quarter, which contains an extra week, both the distribution and retail segments contributed to our consolidated net sales growth. The extra week of sales, combined with productivity improvements and tight cost controls, enabled us to report an increase in earnings from continuing operations of approximately 37% and an increase in adjusted EBITDA of 9% as compared to the same period last year. Our ability to consistently generate strong cash flow from our operations enabled us to return capital to shareholders through our quarterly dividend and share repurchases while also repaying the $45 million balance on our revolving credit facility, which Dave will discuss in more detail in a few minutes.

Now I will focus on our distribution segment results for the quarter in a little bit more detail. Our distribution segment sales increased approximately 9% for the quarter as a result of the extra week of sales versus prior year. Our consistent distribution sales performance is something I believe is noteworthy. If you were to compare our top line results with the public company peers we compete with, you would see that the distribution segment has significantly succeeded those results. This performance is a testament to the quality of our distribution customers and their ability to navigate in a challenging environment and to our associates as well as programs that serve our existing customers as well as attract new ones.

We continue to focus on delivering value in our distribution and retail segments as the consumer is still experiencing a challenging economic environment. Our exceptional private brand offering is experiencing increased acceptance. During the quarter we launched 125 new items for a total of 500 for the year which is an increase of nearly 15% versus last year. This has helped drive the fiscal year 2012 unit penetration in our retail stores to 25%. Our current private brand penetration rate for the quarter and the year exceeds the national average by over 141 and 139 basis points respectively. New product introductions increase our value offering for distribution customers while providing the end consumers with even more choices.

Going forward, our distribution team will continue working to increase our existing customer penetration and focus on adding new customers in adjacent markets as well as enhance our value-added service offerings to generate increased sales growth. Net sales in our retail segment increased approximately 6% for the fourth quarter due to the extra week of sales, higher fuel retail prices and increased fuel volume. These gains were partially offset by a decline in comp store sales of 3%, excluding fuel, which was in line with our expectations and consistent with the guidance we provided last quarter. The Michigan economy continues to slowly improve from its previous lows, however, overall consumer discretionary spending is still negatively pressured, specifically in our northern and southeastern markets due to a lack of job creation in the state, high fuel prices, and an increase in food inflation. As the Michigan economic industries continue to show progress, we're hopeful that employment growth, a key driver of our business, will begin to follow by the second half of fiscal '13.

We continuously strive to improve our value proposition to the consumer, and our Yes loyalty program provides us with a strong opportunity to do so on a consistent basis. As previously mentioned, we completed the rollout of our Yes loyalty program to the remainder of our chain, and it is now universally available at any of our traditional supermarket locations across the state. To date, we are pleased with the approximately 850,000 households that are using the program and nearly 51% active e-mail addresses that we have on file. In fact, over 82% of the transactions and 92% of the supermarket sales were generated through the program during the fourth quarter of fiscal '12. We believe this participation will continue to grow in the coming months as more households embrace our point -based reward program as an innovative approach to providing value and improving the overall shopping experience.

During the first quarter of fiscal '13, we launched an extensive sales and marketing campaign around the Yes loyalty program entitled Yes Is More. This program is multifaceted beginning with a 90-day price reduction and price freeze on key items the consumer values, as well as providing even more ways to save with the Yes card. We expect this program to appeal to the consumer in Michigan who continues to be pressured by the difficult economic environment, as well as those who have become more value conscious. In addition, our 66 pharmacies are becoming even more relevant to the consumer as they search for both convenience and value.

We believe our pharmacy program combines both of these elements in a way that gives the consumer the best overall program available in the marketplace. Our 4.9% and 4.1% comparable store increase in script count for the quarter and the year on a 13 and 53 week basis respectively is a testament of this program's strong acceptance. Additionally, our fuel program continues to resonate well with our consumers, and we continue to look for innovative ways to use it with our other promotional programs. We will continue our focus on the Yes loyalty rewards, fuel rewards, and pharmacy rewards initiatives in fiscal '13 as we strive to achieve further improvements in our retail segment.

One more new and very exciting way we're looking to further address the expanding need for value from an increasing segment of the population is through a new store format, Valu Land. Over the past year, we have been experimenting with the banner Valu Land and have converted to small location to this format. In the fourth quarter fiscal '12, we remodeled and converted an additional smaller location to this format, and we recently opened our first net new Valu Land early in the first quarter fiscal '13. During the remainder of the year we plan to open three to five additional new Valu Land locations. This new store concept enables us to target an increasingly value conscious consumer by leveraging either our existing real estate or real estate in markets not currently served by our distribution customers or corporate retail.

Valu Land is a neighborhood grocery store offering all these central products at everyday low prices that will be as good as any in the market. Valu Land is differentiated from current limited assortment competitors through an increased assortment of quality fresh produce and meat and a much broader assortment of products in general with approximately 7,000 SKUs available. This is increased assortment will include a top national brand in each of the product categories. Valu Land on average will be approximately 18,000 to 20,000 square feet versus our current traditional store prototype of 48,000 to 50,000 square feet. Consumer traffic and transactions will be supported by five weekly two-page circulars highlighting great values and our key individual items that will be at the best price in the marketplace. While we are still early in the development and testing of the new format, we are excited about the potential for organic growth opportunity it could provide in certain existing markets as well as locations outside the state of Michigan.

Before turning the call over to Dave, I will provide you with a brief update on our capital plan. And during the fourth quarter, we didn't have any major remodels or new fuel centers. We closed one store in the quarter, and we remodeled and converted one store to the Valu Land format. In fiscal '13, we plan to complete one store relocation in our Family Fare market, six major remodels, opened two new fuel centers and opened four to six new Valu Land locations. From a competitive perspective, we experienced no new supercenter openings in the fourth quarter and do not expect any openings to affect our retail locations in fiscal '13. With that overview, I will turn the call over to Dave for more detail on the fourth-quarter financial results as well as an outlook for the first quarter and fiscal '13. Dave?

Thanks, Dennis, and good morning, everyone. Consolidated net sales for the 13 week fourth quarter increased 7.6% to $614.8 million compared to $571.5 million in the year-ago quarter. Both the distribution and retail segments reported increased sales during the quarter. The extra week in this year's fourth-quarter contributed $49.8 million of consolidated net sales. Distribution and fuel sales represented 44.2% and 7.2% respectively of consolidated net sales compared to 43.6% and 6.1% respectively in last year's fourth quarter. The consolidated gross profit margin for the fourth quarter decreased 70 basis points to 22% from 22.7% last year. The decline in gross margin was primarily due to a shift in the mix of sales between the business segment and within distribution. The impact of the 53rd week, as well is lower retail margin rates, partially offset by a LIFO credit in our distribution segment. Fourth-quarter operating expenses were $115.6 million, or 18.8% of net sales, compared to $113.9 million, or 19.9% of net sales in the same period last year.

Our expense leverage was improved by the shift in mix of sales, the impact of the extra week of sales, lower incentive compensation as well as lower occupancy expense. These items were partially offset by increased healthcare expenses, credit card fees and a one-time sales and use tax adjustment versus the fourth quarter of fiscal 2011. Adjusted EBITDA for the quarter increased 9.6% to $28 million, or 4.5% of net sales, compared to $25.5 million, or 4.5% of net sales last year., primarily as a result of the extra week in this year's fourth quarter. Earnings from continuing operations for the fourth quarter of fiscal 2012 increased 37% to $10.5 million, or $0.46 per diluted share compared to $7.7 million, or $0.34 per diluted share last year.

Fourth quarter of fiscal '12 earnings from continuing operations benefited from the extra week of sales, and the fourth quarter of last year included an after-tax charge associated with restructuring costs. Excluding these items, fourth-quarter earnings from continuing operations would have increased 16.7% to $9.1 million, or $0.40 prior diluted share compared to $7.8 million, or $0.34 per diluted share in the fourth quarter of last year. In addition to the impact of and 53rd week, we anticipate the fourth quarter of fiscal 2013 will be negatively impacted by $0.05 to $0.06 as a result of the net effect of favorable items realized in the fourth quarter fiscal 2012 that will not continue into fiscal 2013. These items predominately relate to the LIFO credit realized in the quarter due to the lower than anticipated inventory levels in our distribution segment, favorable incentive compensation expenses and favorable occupancy costs.

Turning to our operating segments, fourth-quarter net sales for the distribution segment increased 9.1% to $271.6 million from $248.9 million in the year-ago period due to the extra week of sales. Fourth-quarter operating earnings for the distribution segment increased 24.5% to $17.3 million compared to $13.9 million in the same period last year. The operating earnings increase was principally due to lower incentive compensation expense versus last year's, the impact of the 53rd week and a LIFO credit due to the lower inventory position, partially offset by higher healthcare and benefit cost. In our retail segment, fourth-quarter net sales increased 6.4% to $343.1 million compared to $322.6 million in the same period last year. The higher sales will were due to the extra week of sales, increased fuel retail selling prices and increased fuel volume, partially offset a decline in comparable sales excluding fuel of 3%, as Dennis mentioned.

For the purpose of reporting comparable store sales, we use 13 week quarters. This comparable store sales decline was in line with our prior guidance and expectations as a result of cycling the Yes loyalty card at VGs in the prior year's fourth quarter, the shift in the new year's holiday and unseasonable weather. We estimate that these items impacted our comparable store sales run rate by up to 2%. Retail segment operating earnings for the quarter increased 8.6% to $2.3 million compared to $2.1 million in the fourth quarter fiscal 2011. The operating earnings increase was principally due to the 53rd week, lower incentive compensation expense as a result of less compensation earned and the timing of the quarterly provision versus last year, as well as reduced occupancy expense, driven principally by ongoing cost containment initiatives and unseasonably warm weather. These items were partially offset by higher healthcare expense, credit card fees and the one-time sales and use tax adjustment.

We continue to report strong levels of net cash provided by operating activities of $93.7 million for fiscal 2012. Total net long-term debt was down $19.6 million to $111.5 million as of March 31,2012 versus $131.1 million at the end of last year. As a result of our strong cash flow generation, we began repurchasing shares during the fourth quarter. Shares repurchased during the fourth quarter of fiscal 2012 and the first quarter of fiscal 2013 to date were approximately 700,000 a 600,000 respectively.

This share repurchase activity used approximately 50% of the authorized $50 million repurchase program. Additionally, as we previously reported, the Company repaid our entire outstanding balance on our revolving credit facility early in the fourth quarter of fiscal 2012, and as a result of $45 million payoff, interest expense related to the facility is expected to be reduced by approximately $1.1 million in fiscal 2013. This reduction in interest expense will be partially offset by the increased amortization of the convertible debt discount, additional capital leases related to a store relocation and a lease renewal. Going forward, as result of our $165 million of availability under our revolver and our consistently strong cash generated from operation, we believe we have significant capacity to execute our initiatives as well as continue to return capital to our shareholders through the quarterly dividend or timely share repurchases. A great example of our continued focus on increasing shareholder value is our board of directors' approval to increase the Company's quarterly cash dividend by 23% to $0.08 from 6.5% per common share, which we announced yesterday. The dividend is payable on June 15, 2012 to shareholders of record as of the close of business on June 1, 2012.

Now, focusing on the fiscal 2012 year results briefly, consolidated net sales increased 4% to $2.6 billion compared to $2.5 billion last year. The higher annual net sales resulted from the extra week of sales totaling $49.8 million and increases in both distribution and retail fuel sales, partially offset by a comparable store sales decrease of 1.6%. As a reminder, for the purpose of reporting comparable store sales, we used 53 week years. Adjusted EBITDA for the year increased 5.2% to $109.7 million, or 4.2% of net sales compared to $104.3 million, or 4.1% of net sales last year. The 53rd week contributed $2.4 million to adjusted EBITDA.

I will now provide further detail on our outlook for the fiscal -- for the first quarter and fiscal year 2013. We anticipate that the first quarter of fiscal 2013 financial results will likely fall slightly below the prior year's results on an earnings per share from continuing operations basis. This expectation as the result of two store grand openings, the promotional costs associated with the Yes campaign, as well as our believe that the first half of the year will be challenging as Michigan's job creation lags the overall economic improvement. We expect slightly negative quarterly comparable store sales early in fiscal 2013 as a result of the slower jobs recovery. As a point of reference, at the end of fiscal 2012, there were approximately the same amount of citizens employed as there were at the end of fiscal 2011 despite a lower unemployment rate.

We are optimistic that Michigan employment outlook and the overall economic environment continue to improve during the second half of the year generating a positive sales trend. As a result of our sales expectation and continued expense management, we anticipate that our fiscal year 2012 financial performance will exceed the prior year's earnings from continuing operations, excluding the impact of any unusual items that do not reflect the ongoing operating activities of the Company. For the full year of fiscal 2013, we expect capital expenditures to be in the range of $43 million to $46 million with depreciation and amortization ranging from $39 million to $41 million and total interest expense approximating $13 million to $14 million. This concludes our financial discussion, and I will now turn the call back to Dennis for his closing remarks. Dennis?

Thanks, Dave. We are wordy this morning. More than normal. Going forward, for fiscal '13 and beyond, we believe our strong balance sheet and consistent cash flow generation provides us with the financial strength to pursue appropriate strategic growth opportunities in both the retail and the distribution segments. This also gives us the financial flexibility to return capital to shareholders through quarterly dividends and/or share repurchase programs.

We remain intently focused on continuing to improve sales growth and profitability as we enhance the value propositions to the consumer and achieve additional operating efficiencies while managing the controllable aspects of our business. We continue to believe that programs like our Yes loyalty rewards, pharmacy rewards and fuel rewards will continue to help improve our consumer relationships and long-term top line sales results as we deliver value and convenience. We will continue to differentiate our go-to-market strategy from our competitors and strengthen our value-added partnership with our distribution customers to increasingly position Spartan Stores as a leading grocery distributor.

In addition, we are excited about the potential for organic growth from our new value store format, Valu Land. While still in the development phase, we believe this new format will further balance our food retail offering and provide potential opportunities for our distribution customers in Michigan, as well as give us a solid platform for our retail unit growth in adjacent states. Going forward, our executive team remains confident in our long-term business strategy and continues to focus on disciplined and balanced growth in order to position Spartan Stores for increased success long-term. And with that, we will now open up the call for any questions.

(Operator Instructions) Karen Short of BMO Capital Markets.

Hi, good morning, this is actually Ryan Gilligan on for Karen. On the LIFO credit in the distribution business, is that a LIFO liquidation, and why is that different than the LIFO charge at retail?

I will answer that for you, Ryan. Yes, it was a LIFO liquidation. What happened is, we ended up with lower year-over-year inventory levels in our distribution segment, and that generated that liquidation in the quarter.

Okay, thanks. And then on Valu Land, can you talk about initial volume trends? Or maybe talk about the changes in volume trends at the stores that were converted to Valu Land?

This is a test; it's new. I don't think we want to give out a whole lot of information on volume at the moment. I would say this -- we are meeting the kind of expectation we thought we would get in the store. The dollar volume is diminished by the fact that the retail prices are so low compared to conventional supermarkets. So, the tonnage increase is significantly greater than the dollar volume sales lift.

Okay, that is helpful, thank you. And can you use the loyalty card at these stores?

You are not required to use a card at Valu Land.

Okay, and then maybe can you talk about your inflation expectations for this year?

Inflation has been -- we have come out of some really lumpy inflation quarters, and produce was recently very deflationary in our fourth-quarter, and meat was very inflationary, and I think we're going to continue to see some lumpiness. Dairy has started to go a little bit deflationary on us now, but, Ryan, we look at the USDA forecast for food at home, and we are saying 2.5% to 3.5%, and I guess that seems to jive with what we expect. I think that long-term number for food at home has been at like 2.8% over the last 20 years or so. I think we're going to have a more average year.

That is very helpful, thank you.

(Operator Instructions) Scott Mushkin of Jefferies & Company.

Hi, good morning, this is actually [Brian] on for Scott. Thanks for taking our question. Can you talk about the competitive environment you see in recent months? Our pricing surveys and recent results from other operators have showed maybe price competition has ramped up decently. Just wanted to get your thoughts on what you've seen in your markets, and maybe how much is coming from any moderating food inflation.

Yes, I think the pricing environment has not changed a lot for us. I wouldn't characterize anything going on in our markets here as irrational, and I think I've said that in the last couple of calls. Although I will tell you, I think everybody is challenged a little bit on this -- the tonnage question. And we're seeing tonnage harder to come by in certain categories like proteins, where that inflation has been pretty significant. More recently, we have seen produce was very deflationary. Now, we are just slightly deflationary, and we are starting to get some tonnage gains in that category. Our primary competitors are Meyer, Walmart and Kroger. I think Meyer and Walmart have a pretty consistent gap in their pricing. I don't think it's moved significantly, and I think the market is relatively stable in that regard.

Okay, appreciate the color. And just wanted to touch on your expense leverage. If you take out the favorable weather and the extra week, just wanted to dig into how much you think is repeatable in '13, and maybe going forward?

I think as you looked at that, Brian, we called out the $0.05 to $0.06, and so that included the LIFO impact as well. But I think as we gave the guidance, we thought $0.05 to $0.06 of those benefits in the quarter wouldn't move forward, and that is excluding the 53rd week.

Okay, great. Thanks for taking the questions.

Michael Lavery of Sidoti & Company.

Good morning, gentlemen.

Good morning, Mike.

Just had a quick follow-up on Valu Land stores. Can you remind me where the four existing ones are located, and then where the three to five -- what kind of markets you are going to target with those?

Sure. The first two stores we opened were in Marion, Michigan and Leslie, Michigan. Those were small volume stores, one was a Glen's, one was a Family Fare, in primarily more rural environments. The third store we did in the fourth quarter was a Glen's we converted in a community called Claire, Michigan, another rural marketplace more in mid-Michigan. And the one we opened in the first quarter is in a more urban setting in Lansing, I think it may technically be in Lansing Township on the west edge of the community of Lansing. The prospective locations, we haven't finalized or formalized. We have quite an extensive list that we're plowing through at the moment, and I don't think we're ready to divulge those at this time.

Okay, that's fair. Is it fair to say that the openings are in response to where maybe you have seen some competitive pressure from some of the other deep discount stores out there?

No, I wouldn't say that necessarily. If you think about our retail business model, we have the Fresh Market stores that certainly appeal to the upper end consumer. It seems to be in less impacted by this recession, and we've got our Family Fare, Glen's, VGs that is more mass appeal, but we didn't have anything in the portfolio that appealed to that more value-conscious consumer like a Aldi or Save-a-Lot. To some degree, even dollar stores in that regard.

So, I think about this less in terms of the brand and core geography, and more where we find a demographic profile we think is being underserved, even by the existing value players. Because this model is significantly different than what you would see from an Aldi or a Save-A-Lot, not only in the number of SKUs, but far more significant presentation and produce and meat. And the fact that we have the leading national brand in virtually every one of the core center store categories, as well as the price alternative, we think we have differentiated it enough to be very, very appealing to that consumer who wants value, but feels like she is not getting enough choices in the current landscape.

Great, thanks for the color. Very helpful.

Chuck Cerankosky of Northcoast Research.

Good morning, everyone.

Good morning, Chuck.

Dennis, if you could step back and look at the Michigan economy in northwest Ohio and northern Indiana in places where you trade on the wholesale side, how would you describe the retail acquisition environment as you look at it strategically?

I think the acquisition environment has likely gotten better, but we have been relatively opportunistic in the acquisitions that we have made, and they have been roll-ups of existing customers, and they have been for a number of different reasons. We will continue to be opportunistic there. I think it's important that our distribution customers do know that we are a potential exit strategy. And not all of these businesses have the luxury of a successor in the family that necessarily wants to take over the business, and that's been the nature of most of what we have done. I think valuations likely are getting a little bit more realistic, but there hasn't been a lot of M&A, as you know, in the space.

Do you see the same economic headwinds affecting you, perhaps shortening their time horizons as to when to sell?

I think that's a possibility. We are talking in generalities, I think that is possible.

Okay. All right. Could you give us what the fuel comps per -- or fuel gallon comps were in the quarter?

We actually were negative comp gallons in the quarter, and that really hasn't happened in almost a year. As a matter of fact, it has been a year. We were negative 2.1% on comp gallons for the quarter. I think part of that is the fact that fuel got so high, and we are feeling that. I think it was $0.31 a gallon more than it was at the same time last year. Once you start pressing up against that $4, and getting close to that number -- we actually were over $4 for a bit -- boy, you see that pullback. It is pretty amazing. And Michigan is one of the markets where pricing on retail fuel does move, sometimes daily. It's an interesting business to be in.

You may have mentioned this when you were discussing inflation a few minutes ago, but what inflation rate did you see in the fourth quarter? I might have missed it, if you said it.

We saw inflation -- actually, both retail and wholesale were about the same, 3%. But it was really disparate by category. Produce in the fourth quarter was nearly 9% negative, meat was like 6%, 7% positive, and then everything else fell somewhere in between. So, very, very lumpy.

And then finally, on that fourth quarter fiscal '13 comparison where you are going to be negatively impacted by $0.05 to $0.06, Dave, can you break down what the components of that are? I imagine most of it is going to be that LIFO comparison, but what else -- what other pieces should we be thinking about in there?

It's really the LIFO component, and then it's occupancy expense, and it's comp -- incentive compensation.

And the occupancy is utilities mainly?

It's a mixed bag. It's utilities, rents, property taxes. We've had a number of efforts put in place to reduce rent, reduce property taxes, but certainly utilities with the weather was a part of it.

I guess I'm trying to figure out, other than the extra week, why wouldn't some of these things continue -- extra week --.

Parts of them will continue -- parts do and parts don't, right? Sometimes when you do a lot of property tax work, right, you get a multi-year resolution, so you file your objection to the valuations, and it takes one, two, three years to get that finally settled. And then they have to settle from the point that you filed your objection. Rents sometimes work the same way when you are negotiating a reduction. Sometimes you get a little bit of a retroactive work there. And then certainly, the weather component of this. We are not anticipating mowing our lawns again in March this year, thank Heaven.

(laughter) All right, thank you.

And ladies and gentlemen, this will conclude our question-and-answer session. I would like to turn the conference back over to Mr. Dennis Eidson for his closing remarks.

Thanks, Denise, and thank you all for participating. In closing, I would like to thank our valued consumers, our independent retailers' associates, suppliers, and our shareholders for their continued support of Spartan Stores. Thank you.

The conference has now concluded. We thank you for attending today's presentation. You may now disconnect.