Good day and welcome to the Asbury Automotive Group First Quarter 2014 Earnings Call. Today's conference is being recorded. At this time, I would like to turn the conference over to the treasurer, Mr. Ryan Marsh. Please go ahead, sir.

Thanks, Lea, and good morning to everyone. Welcome to Asbury Automotive Group's first quarter 2014 earnings call. Today's call is being recorded and will be available for replay later today. The press release detailing Asbury's first quarter results is issued earlier this morning and is posted on our website at asburyauto.com. Participating with us today are Craig Monaghan, our President and CEO; Michael Kearney, our Executive Vice President and COO; and Keith Style, our Senior Vice President and CFO. At the conclusion of our remarks, we'll open up the call for questions and I'll be available later for any follow-up questions that you might have. Before we begin, I must remind you that the discussion during the call today is likely to contain forward-looking statements. Forward-looking statements are statements other than those which are historical in nature. All forward-looking statements are subject to significant uncertainties and actual results may differ materially from those suggested by these statements. For information regarding certain of the risks that may cause actual results to differ, please see our filings with the SEC from time-to-time, including our Form 10-K for the year ended December 2013, any subsequently filed quarterly reports on Form 10-Q and our earnings release that we issued earlier this morning. We expressly disclaim any responsibility to update forward-looking statements. It is now my pleasure to hand the call over to our CFO, Keith Style.

Good morning, everyone, and thanks for joining us today. Earlier this morning, we reported first quarter EPS from continuing operations of $1.03, a 34% increase from last year's first quarter and an all-time record for Asbury. We are thrilled with the way our stores performed this quarter, especially in light of the challenging weather conditions we faced in many of our geographies. Once again, our performance was driven through growth in all areas of the business and continued expense discipline. Total gross profit for the quarter was up $24 million or 12% with 80% of the incremental gross profit coming from used cars, finance and insurance and parts and service. We remained focused on balancing growth and expenses. We were able to leverage the significant gross profit we generated during the quarter with our improved cost structure resulting in SG&A as a percentage of gross profit of 69.4%, 220 basis points lower than the first quarter of 2013. Our flow-through for the quarter was 49% and we continue to target a flow through of around 40% over the remainder of the year. Turning to capital deployment. During the first quarter we spent 13.3 million on CapEx to upgrade our stores, expand service capacity and invest in our technologies. As we discussed in our prior call, we are budgeting CapEx of $60 million for 2014. This includes 45 million associated with our core annual capital plan. In addition, there are a few projects that are unique to 2014 which are included in our CapEx budget for the year. They include construction of a $5 million facility related to a recent acquisition and $10 million in construction costs to prepare owned properties for franchises that currently operate in leased facilities with the intention of relocating these franchises near the end of the lease term. During the first quarter we repurchased $9.4 million of our common stock or 182,000 shares. In 2014 we plan to continue our base annual share repurchase program of approximately $30 million with additional repurchases on an opportunistic basis. We had 61 million remaining under our Board authorization per share repurchase at the end of the quarter. Finally, from a liquidity perspective, we ended the quarter with $6 million in cash, 63 million available in floorplan offset accounts, 84 million available on our used vehicle line and 160 million available on our revolving line of credit. In short, we have plenty of liquidity to support our capital allocation plans in 2014 and the financial flexibility to invest in our strategic growth plans in the coming years. Now, I'll hand the call over to Michael to discuss our operational performance. Michael?

Thank you, Keith. We are extremely proud of our company's performance in this quarter. Our gross profit increased 12% through growth in all of our business segments. This growth helped produce a record operating margin of 4.7% compared to 4.3% in the prior year period. For the balance of my remarks I would like to remind you that everything I will be covering with respect to operational highlights will pertain to same-store retail performance during the first quarter. New vehicle revenues increased 7% and gross profit increased 9% compared to the prior year. Our new vehicle unit sales were up almost 5% outpacing the industry growth of 2%. New vehicle margins for the quarter were up 20 basis points compared to last year at 6.3%. On a sequential basis, our new vehicle margin improved slightly by 10 basis points. Our gross profit per unit retail benefited from strong luxury sales in the quarter as well as improved margins at a number of our midline import stores. I believe we can maintain new vehicle gross profit per unit retail in a range of around $2,000 to $2,100 a unit. Based on the pace of sales we saw throughout March and continuing into April, our 2014 business plan for a SAR of around 16.2 million remains unchanged. We ended the first quarter with $592 million of new vehicle inventory or 63 days supply on a trailing 30-day basis. We are comfortable with our existing overall new vehicle inventory levels in light of the current pace of business we are seeing in our stores. We monitor a number of our individual brands very closely as we continue into the remainder of 2014. Used vehicle unit sales increased 10% over the first quarter of last year. As we progress through the balance of the…

Thank you, Michael. We've been working very hard over the last five years to make Asbury one of the best-in-class automotive retailers. Our first quarter operating margin of 4.7% speaks to our progress and demonstrates the strength of our team, the quality of our brand portfolio and the benefits of our operating footprint. Our team continues to prove their ability to quickly identify, adapt and execute effective systems and processes in a dynamic marketplace. I would like to highlight one of the important pieces of this transformation, our used vehicle operations. Over the last three years we have grown used vehicle unit sales in excess of 55% and grown used vehicle gross profit by close to 35%. We remain excited about the opportunities we see in the used vehicle market and believe there is now an opportunity for us to take our demonstrated used vehicle retail and talent, technology and processes and expand into a standalone used vehicle retailing model. This year, we plan on opening two freestanding used vehicle stores which we are branding as Q auto. Here are a couple of details about our plan. We expect our first door to open in Tampa, Florida this June with the second store opening this fall in Jacksonville, Florida. We believe it will take a store approximately 18 months to achieve run rate revenues and profitability. We estimate the launch of this initiative may reduce EPS by $0.08 to $0.12 per share in 2014. We estimate incremental 2014 capital commitments related to this initiative maybe up to $25 million. This would be in addition to the 60 million of CapEx Keith mentioned earlier. With respect to our previously stated capital allocation plan, we view our Q auto investment as an incremental capital allocation decision that we believe will generate an attractive ROI. Our three-year balance capital allocation plan remains on track. We are targeting core CapEx of 30 million to 35 million per year excluding future acquisitions, lease buyouts of approximately 10 million per year as we work towards owning 75% of our real estate, the acquisition of an additional 500 million of annualized revenues over the next three years and the return of capital to our shareholders by repurchasing a baseline of 30 million of our common stock per year in an ongoing share repurchase program with additional shares on an opportunistic basis. We are very excited about our accomplishments and look forward to the opportunities we see ahead of us. Finally, I'd like to express my sincere appreciation to Michael for all he has done for our company. He has been a huge contributor to our success. The good news is that he won't be retiring until early next year so we have ample time to work through a transition. We will now be happy to take your questions. Operator?

Thank you. (Operator Instructions). We'll take our first question from Rick Nelson.

Thanks very much. Congrats, Michael, on your pending retirement. I'd like to start with the used car counts, I have a few questions here. How it differs from CarMax, if you could talk about the targeted economics and the return on capital that you're expecting from this business?

Rick, it's Craig, I'll hop in. Michael may jump in behind me. This is about Asbury. We look at the success we've had in used cars. We like the technologies we have in place. We think we've got a great team and we feel like we have a pretty good handle on the markets that we do business in. So these two stores that we're talking about are in our backyard. We've got a great team committed to this. We've been doing a fair amount of homework. We think we can generate ROIs here that could potentially be quite attractive in a sense that we're giving it a shot. And I'd say we'd feel remiss if we didn't give it a shot. It's going to take a little bit of time to see how this plays out and what we're doing here today is just calling to your attention that we've committed some capital that's going to cost us a little bit of money to get these things launched and we're going to see how they go, and we'll get some concrete information; then we're going to come back to tell you about it.

Hi, Rick. It's Michael. Just to add onto that from Craig, as you know, a number of years ago, we introduced what we called preferred selling which is a technique that we have in a number of stores, so we've developed that process working differently with the consumer. And a number of years ago we introduced a vehicle acquisition internal process that helps us evaluate inventories, move inventories, capitalize on trade-in values. So as Craig said, it's a normal expansion of what we think we've done a good job with over the last number of years and it's a pure Asbury play.

And do you plan, given the capital requirements of this format to [flow out] (ph) the acquisition pace as you build out the used cars?

Rick, at this point it's just two stores. Like I said earlier we're sticking with our core capital allocation philosophy. We're still targeting $0.5 billion in acquisitions. I think we need to give this thing a chance and see how it goes before we can say a whole lot more about it.

Okay, fair enough. Also, I'd like to ask about the weather impact in the quarter. It didn't seem to hurt your results very much, very strong performance. If you could speak to that and how sales have recovered post the storms. It seems like March and April were very strong months?

Rick, this is Michael. We did have some weather. We've all had to deal with it. We think we have a great team out there and we press them to do whatever they have to do to make up for difficult weather conditions and they performed accordingly. March was – I would say the last part of March is as strong as I've ever seen sales in a 5 to 10-day period, just remarkable amount of sales, a lot of activity at all levels, Internet activity, floor traffic activity, parts and service activity. So we were very encouraged with that and as I mentioned in the script, we are happy with the pace that we see going in April.

Very good. Thanks a lot and good luck.

Thanks, Rick.

We'll take our next question from John Murphy of Bank of America.

Hi. This is Liz Suzuki on for John. On the standalone used vehicle concept, is there a target volume per store or store size that you're aiming for? And will these be smaller than your existing stores or larger?

Liz, it's Craig. At this point I wouldn't say that there is a target. We've looked at different size – potentially different size stores for different markets but I think we're really at a point in time now where we just need to go out and launch these two stores and see how they perform. We'll see what the market brings I guess is the answer.

Got it. And how low do you think your SG&A as a percent of gross profit can realistically get if we continue to see the SAR climb higher, excluding the investments in the used car standalone?

This is Keith. Obviously we've done a good job this quarter on controlling our expenses. You remember last year and as part of our capital allocation plan this year is while we continue to buy back leases, that's been beneficial. Last year there was some heavy lifting too in the compensation area that we're recognizing this quarter and that will roll into next quarter as well. I'll take it this way and say we're still targeting the 40% flow through and then the rest will just be math and weather issue I guess too.

Okay. And the 40% flow-through is including the investments in the used standalone?

That is not. That's in the core business.

Got it, okay. Thank you. And just one last one. On your parts and service business, how much of the mid-single-digit growth you expect is organic growth that would be driven by the industry fleet dynamics, and how much incremental growth do you think Asbury can generate from company specific initiatives?

Liz, it's Michael. That's a great question. I think that we all benefit from the rising tide. There is a lot of car parts that's out there that's getting to be older, so we will benefit from that. I think our initiatives, our tire initiatives, our quick service initiatives, our follow-ups that go along with that, our dream service initiative, our expanded hours is additive to that. I don't think I can give you a number right now. It's something we have to get back with you on, but I think that in combination that they will continue to provide us with the single digit growth and I think our teams are taking full advantage of the customer base that's out there.

Great. Thank you.

Next, we'll hear from Scott Stember of Sidoti. Scott Stember - Sidoti & Company: Good morning.

Good morning, Scott. Scott Stember - Sidoti & Company: With the weather seasonally not impacting you guys as bad as expected, could you maybe point to some other items where you were able to outperform the industry the way that you did? Maybe talk about brand specific performance, some of your top brands, how you performed versus the industry?

Yes, Scott, this is Michael. I'll take a shot at it and maybe Craig can jump in if he wants to. I didn't want to diminish the impact of the weather. It did have an impact and I just want to make sure that people understand our teams I think did a remarkable job in dealing with it. So, we did have weather issues. But luxury was very strong for us in the first quarter, very good in the growth side as well as the volumes. We had a number of our midline import brands that contributed substantially to the gross profit margin. In terms of pre-owned, we have internal targets. We have a very strong dedicated culture towards a pre-owned business and we just continue to push it. So I think that that is a result of – the pre-owned is a result of continuing to talk about it, the culture that we've created on how to maintain trades, how to take more trades at the desk, managing our inventory very carefully and the way we price them on the Internet. So I think it's all of those and above that contributed to the results we saw in the first quarter. Scott Stember - Sidoti & Company: And just circling back to that point on the profits and the midline imports, is that something that you're seeing at the industry level with the OEMs becoming a little bit more rational with pricing or is it a combination of that plus what you guys are doing internally to manage the business?

I think that there were a couple of incentives that were out there that we took advantage of this year in the first quarter. I think there is some processes we put in place in some of our midline stores that has taken a while to take hold, but it has. I think that's part of it. And I think there is some rationalization. I think the production of inventory at least in the recent months has seem to rationalize to the pace of sales. Scott Stember - Sidoti & Company: Okay. And just the last question circling back to the used car standalone concept. Out of that $0.10 to $0.12 that you would expect to come out of 2014, can you talk about how much actually hit in the first quarter?

Scott, it's Craig. There's I would say virtually no expense in the first quarter. The 8 to 12 we talk about will flow through the remainder of the year. This is something we have to work through. I think for planning purposes I would assume that you'll see that spread relatively evenly once we get to June. So from June on is when we'll see the bulk of expense come. Scott Stember - Sidoti & Company: Okay. And just a follow-on, how would you expect that to flow into 2015 or are we not looking that far out yet?

We're not looking that far out and for planning purposes I wouldn't plan on anything. Scott Stember - Sidoti & Company: Got you. Great. Thank you so much.

Now we'll hear from Bill Armstrong of CL King & Associates. Bill Armstrong - CL King & Associates: Good morning, gentlemen. On the Q auto, I was curious why you chose Tampa and Jacksonville. What was it about those markets? I know you guys already have a big presence there. CarMax has a couple of stores in each of those markets. So I was just kind of interested in the thought process on how you came to choose those two markets as your test markets.

Fair question, Bill. I'd start with these are markets we know well. They are markets where we have a presence. They are markets where we do a very good job selling used cars. I'd even go beyond market and maybe get to – we know the streets, we know the intersections, we know where cars sell well. We were able to identify facilities that we could get at what we feel were attractive price points. So we could get in here and give this thing a shot with a reasonable amount of investment. It's not a whole lot more complicated than that. Bill Armstrong - CL King & Associates: Were these existing buildings or did you have to break ground?

One of these buildings is a lease to buy, so we had leased the facility. We have an option to buy it. And the second facility is a building that we own that we are vacating as we are nearing the completion of Jacksonville. Just to be specific, in Jacksonville we own the facility. It's a 12 store today, does quite well. The store is being relocated a few miles down the road. That store will be converted to a Q auto store. That's the store that will open in the fall. The store that will open here in June is in Orlando and that's – I'm sorry, that's in Tampa, Brandon and that's the lease to buy. Bill Armstrong - CL King & Associates: Okay, great. And then I think maybe this one for Keith. I was wondering if you could just maybe detail what buckets may have contributed the most to the SG&A leverage in terms of the different buckets within SG&A?

Yes, let's start by going back to the flow-through ratio that we achieved this quarter. That was at 49%. That's higher than our target. If we exclude rent, for example, that would bring us down to the mid 40% to 44%, so that's a chunk of that. And that's generally where we expect to be, 40% to 45% flow through and targeted 40% for the rest of the year. So some work on comp plans last year that benefited the quarter but it was mostly rent and comp plans that push us over our target. Bill Armstrong - CL King & Associates: Got it, okay. Thank you.

Now we'll hear from Brett Hoselton of KeyBanc.

Good morning, gentlemen.

Morning, Brett.

I'm going to start off with the Q auto. And my first question just basically taking a long step back, Craig, I think as you well know a number of people have tried an initiative along these lines and have not been as successful as CarMax. And I guess what I'm wondering is, as you've looked at those and then obviously looked at CarMax and some of these others, do you have a sense of why is it that you think or what are you doing differently that is going to allow you to potentially be successful versus some of these other folks that maybe who have tried in the past and not been successful?

That's a very fair question. I would tell you that we have not entered into this lightly. We've done a lot of homework. I've got some experience personally with the old megastore concept, so we're well aware of the fact that there have been a number of failures. But I come back to what we said earlier. This is not about what everybody else has tried or the way they go about it. This is essentially just an extension of what we already do today. Michael mentioned that we have a number of stores that we already operate on a preferred selling model, so we have quite a bit of experience with that. That's the model that we will be using in these stores. We've spent a tremendous amount of time and energy building out our technology infrastructure here. The technologies that exist today are significantly different from the technologies that were in existence even five years ago, certainly 10 years ago when none of these other initiatives struggled. So we feel very good about those platforms. As you've seen in our numbers, our used vehicle teams have done a phenomenal job. We feel like we've got tremendous amount of knowledge about how that market works and then we get down to more granule level, specifically where these stores are physically located, we know those locations, we know what the stores in those areas are able to do selling used cars and we just put that altogether and we feel quite confident that this thing has got a real shot and its worth giving a try.

Hi, Brett. This is Michael. I would just add one thing to that that I think a number of calls over the years that we've been asked the question that the pre-owned market is huge compared to the new vehicle market and there's this huge opportunity out there and as we have seen our teams grow, I think this is the logical extension and the next step.

I'd add one more point, Brett, if I could just to add to that. We're sending about 30,000 cars a year to the auction. Many of those cars just end up on the competitors' line. And so one of the fundamental questions we ask ourselves is there an opportunity to keep more of those cars in our system and generate an incremental sale? And we sincerely believe there is and we actually feel we'd be remiss if we didn't take a shot at this.

And then as you kind of work through some of the pro forma numbers for Q auto, how would you compare the return on invested capital associated with that investment versus potentially spending $25 million to purchase a dealership or something along those lines, a new car dealership?

Brett, I don't think we're at a point yet to talk about specific numbers with respect to ROI. Obviously we feel that we've got pretty attractive investments here. The one thing I would say though that's just fundamental is that we don't have to pay Blue Sky. And as you're well aware, Blue Sky is a very significant piece of any capital that we put into an acquisition. In some instances Blue Sky can be half the purchase price. There is no Blue Sky here. And so I think that's one of the things that leads us to believe that this could be quite an attractive opportunity, but it's very early in the game. We've got a lot of learning to do and so we just want to give it a shot to see where it goes but we're very optimistic.

Do you think it has the potential to do better than a new car dealership from an ROIC standpoint? And again, I know you're just guessing here. Well, you obviously have some pro forma numbers as well and I know that you're very thorough. But does it have that kind of potential? I mean is it in the ballpark? Is it slightly less?

Here's what I'd rather do, let's let these stores run for a little while and let's see how they're doing and then we'll talk about that. But I come back and say that we've got balanced capital allocation plan and we like that plan a lot. We think this is another leg that we can add to that plan, and we believe it has the potential to be quite attractive.

Okay, fair enough.

The Jury is still out. We need to see how it goes.

Okay. And then just on the throughput, obviously very strong in the first quarter, had some nice tailwind it appears. I guess I'm kind of looking at your last year. You had very good throughput in the first quarter, so it's not as though it's an easy comp. What's going to cause the deterioration as we kind of move through the second, third and fourth quarter again?

Yes, Brett, this is Keith. We have about $36 million of capital deployed to buy out leases last year that was largely in the second and third quarter. You'll see when we release our Q in a couple of days' time here. Rent is actually down over $1 million quarter-over-quarter. When we move through the second quarter and third quarter that becomes a little bit higher hurdle unless we're able to deploy more capital in that area. We're always doing that opportunistically but it is on an opportunistic basis. That's point one. The second point and I keep on pushing on this is we did do some work in the compensation area last year into third quarter as well, and we see that as a little higher gate to get over in second and third quarters as well that we don't have in our quiver this year.

And then finally, just kind of switching gears, thinking about acquisitions, you've got that target of 500 million over the next three years in revenue. I was hoping you could just maybe briefly talk about the current environment, whether it be deal flow relative to where you were 6 to 12 months ago, valuations relative to where you were 6 to 12 months ago. Where's the environment at this point in time?

Brett, it's Craig, I'll take a first shot and Michael may or someone else may want to jump in as well. I would say deal flow is tough. There is always the conversation, so there's always people who want to talk but actually getting things done is a challenge. If we just step back over the last 18 months, we've acquired about $200 million worth of revenue, so we do find opportunities and we just rolled in this Land Rover store. There is a couple of conversations that we've got going on right now, but I would – I think the word tough is realistic. I mean let's just face facts. Car sales are good. There is a lot of great product out there. Interest rates are low. Many of us in this industry are realizing record profits and I think a lot of potential sellers ask themselves whether or not now is the time that they want to sell the store. We're always looking. We're happy to be a buyer but it's got to be at a price that makes economic sense for us and our shareholders.

Excellent. Thank you very much, gentlemen. Great quarter.

Thank you.

Our last question comes from Rod Lache of Deutsche Bank.

Good morning, everybody. Congratulations. The clarification also on the Q stores, first of all the 25 million, is that basically just capital investment or is that including some of the operational investment? And then operationally, do you envision the sourcing of vehicles to be different from your existing business? And is the business model different than the typical new vehicle franchise with respect to the F&I or the fixed operations and that sort of thing?

It's Craig, I'll take a shot and maybe Mike will follow-up. You asked a number of questions there. Let me maybe speak big picture first. I'll go back to that I mentioned we send 30,000 cars a year to auction. We are working on the mechanisms to move at least a portion of those cars to Q. Other than that, Q is very much a standalone operation and we've made efforts internally with the way we're structuring and organizing it that it is really a standalone format that want to be separate from our traditional retailing model. That said, we do want to take advantage of a lot of the skill sets we have here. So I would tell you that our real estate team is part of this initiative, our IT team is part of this initiative, our marketing people are involved with this initiative. So we want to take advantage of the skills that reside within Asbury, but we want this to have a very different look and feel than a traditional car store. Michael?

Rod, so as Craig talked about the sourcing of vehicles, we are developing the business rules for how we will sell cars to this entity of course. There is a number of vehicles that reside in what we call our used car bank at any point in time during a month and we'll now make those cars available to be purchased. But essentially they'll go to the auction. They'll be on the Internet asking for people to come in and sell their car to us. They'll be soliciting other dealers and smaller local auctions for our vehicles, so that's the source of cars. They'll have access like anybody else does to take off lease vehicles, take those vehicles in. As far as you mentioned something about how was it different than a franchise dealer in our parts and service, we will of course offer service after the sale to our buyers. We will do that from the very beginning. Our preferred selling process is very much – I don't like to use the word one price but it is what we call the preferred price. This isn't the exact model. It has been extended through the finance and insurance process. We'll have a different approach to the consumer in the showroom that has been developed with our partners, some of our strategic partners helping us develop that. So, it will look different, it will feel a little different but it is a pre-owned retailing store that will provide preferred selling, one-stop shopping for the consumer, very heavy on the Web as well as driving presents.

And the 25 million, is that a capital investment or including some operational investments?

No, we're trying to help you out with this information that we've given. The 25 million is pure capital. The $0.08 to $0.12 is primarily the operating losses that we expect to incur this year.

And Craig, you alluded to your prior experience with megastores. Is the primary difference for you guys now looking at this that the IT tools have become more sophisticated in being able to manage this kind of an operation? Is that the primary learning that you would point to as increasing the chances of success?

I think there is two learnings and that's certainly one of them. Technology is very different. We operate in a very different world. We've got different skill sets. We understand the importance of the Web and the importance of the Web to the used car buyer. We recognize at the end of the day even a used car now is a commodity. Number two is the capital commitment. My used car experience was around the concept of a megastore which was a huge facility, 20 acres or more in many instances that required tremendous amounts of capital just to get it up and running. The stores that we're working on are stores that will have a much smaller footprint and we've got a tremendous focus on return on investment. So, we are very much looking at how much cash is this investment going to tie up? How big does this lot have to be? How many service days do we have to be? How big the showroom have to be? And what kind of throughput do we think we can get and ultimately what's the return on investment?

Okay. And lastly, just on your existing used vehicle business, you alluded to the fact that the comps become a little bit tougher now. Are there adjustments that have been made to that business since that inflection occurred last year in the June quarter that would allow you to continue to drive some pretty strong momentum even against these comps? And how should we be thinking about how you manage the grosses in that business? I think there's been a little modest downtick in profits starting in the back half of last year. Where do you see that going?

Rod, this is Michael. I'll answer them in reverse. So, yes, we did see a little pressure on it. A lot of that is quite honestly self induced as we grew the volume. So sequentially our margins have improved a little bit, so I'm happy about that. That's philosophical in culture to get that back in line. I think we can maintain where we are. I don't want to start getting out on a ledge too far, but I think we can maintain where we are now and continue to grow the volume and the single-digit number that we talked about in the script. So to address what changed, where was the inflection shift on that? A number of years ago we started processes. We talked about rolling it out. We rolled out how we do things a little differently. It took a while to get it in all the stores. We developed a team that helped us work and train. But fundamentally we now have all of our stores bought into it. So the culture begins at the store where we have the general managers of our stores have bought into the process, see the results of the process, manage the process. We do the vast amount of our acquisitions at the store level. We do the gross profit management at the store levels. So that's the cultural shift as it takes a while for everybody to buy in and I'd say that that's where we started with that and we're very, very deep into the way we do business today and I don't expect that to change.

All right. Thank you.

Thanks, Rod. That wraps up our questions. We appreciate your time today and look forward to seeing you again next quarter.