Diane Dayhoff - Vice President-Investor Relations Craig A. Menear - Chairman, President & Chief Executive Officer Edward P. Decker - Executive Vice President-Merchandising Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services Bill Lennie - Executive Vice President-Outside Sales & Services Kevin Hofmann - Senior Vice President & President-Online, The Home Depot, Inc. Mark Holifield - Executive VP-Supply Chain & Product Development

Peter S. Benedict - Robert W. Baird & Co., Inc. (Broker) Christopher Michael Horvers - JPMorgan Securities LLC Simeon Ari Gutman - Morgan Stanley & Co. LLC Seth I. Sigman - Credit Suisse Securities (USA) LLC (Broker) Michael Louis Lasser - UBS Securities LLC Seth M. Basham - Wedbush Securities, Inc. Jessica Schoen Mace - Nomura Securities International, Inc. Daniel Thomas Binder - Jefferies LLC Matthew J. Fassler - Goldman Sachs & Co. Scot Ciccarelli - RBC Capital Markets LLC Kate McShane - Citigroup Global Markets, Inc. (Broker) Gregory Melich - Evercore ISI

Good day, ladies and gentlemen, and welcome to The Home Depot fourth quarter and fiscal 2015 earnings call. Today's conference is being recorded. At this time, I would like to turn the conference over to Ms. Diane Dayhoff, Vice President of Investor Relations. Please go ahead, ma'am.

Thank you, Nicole, and good morning to everyone. Joining us on our call today are Craig Menear, Chairman, CEO and President; Ted Decker, EVP of Merchandising; and Carol Tomé, Chief Financial Officer and Executive Vice President Corporate Services. Following our prepared remarks, the call will be open for analyst questions. Questions will be limited to analysts and investors and as a reminder we would appreciate it if the participants would limit themselves to one question with one follow-up please. If we are unable to get to your question during the call, please call Investor Relations department at 770-384-2387. Now before I turn the call over to Craig, let me remind you that today's press release and the presentations made by our executives include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations and projections. These risks and uncertainties include, but are not limited to, the factors identified in the release and in our filings with the Securities and Exchange Commission. Today's presentations may also include certain non-GAAP measurements. Reconciliation of these measurements is provided on our website. Now, let me turn the call to Craig. Craig A. Menear - Chairman, President & Chief Executive Officer: Thank you, Diane, and good morning, everyone. Fiscal 2015 was a record year for our company. We achieved sales of $88.5 billion, the highest in company history. We also recorded the highest net earnings in company history and fiscal 2015 earnings per share grew 15.9% to $5.46. Sales for the fourth quarter were $21 billion, up 9.5% from last year. Comp sales were up 7.1% from last year and our U.S. stores had a positive comp of 8.9%. Diluted earnings per share…

Thanks, Craig, and good morning, everyone. We were pleased with our performance in the fourth quarter, as sales exceeded our expectations. We saw strength across the entire store as well as continued growth in our online business. Sales were aided by milder weather and great events, including the strong Black Friday and gift center. All of our merchandising departments posted positive comps. Appliances, tools, building materials had double-digit comps in the quarter. Lighting, plumbing, hardware and indoor garden were above the company average, and decor was in line with the company average. Outdoor garden, millwork, lumber, kitchen and bath, paint, electrical, and flooring posted mid-single-digit positive comps. Pro-heavy categories saw significant growth during the quarter, as we saw double-digit comps in siding, pneumatics, circuit protection, fencing, fasteners, and exterior doors. Our recent assortment update in roofing continues to drive excellent results, as we saw double-digit comps in roofing in the fourth quarter. And we continue to see strength in core maintenance and repair categories, with double-digit comps in pumps, security lighting, water heaters, electrical tools, construction adhesives, ladders, and caulks. Cleaning, bath fixtures, door locks, and pipe and fittings also had comps above the company average. We believe that more favorable weather trends in the quarter aided sales growth by approximately $100 million. Our customers took advantage of the milder weather and were able to complete more outdoor projects. For example, we saw double-digit comp sales in pressure washers, hardscapes, mowers, outdoor power, concrete, and pressure-treated decking. Black Friday, gift center, and storage events provided great values and were well received by our customers. Our strong Black Friday helped drive double-digit comps in categories like portable power and appliances. Our gift center performed extremely well, and we saw double-digit comps in tool storage, power tool accessories, and hand tools. In…

Thank you. We'll take our first question from Peter Benedict from Robert W Baird. Peter S. Benedict - Robert W. Baird & Co., Inc. (Broker): Hey, guys. Thanks for taking the question, first question just an accounting one, I guess. How are you going to deal with the Interline Brands sales as we move through 2016? Once we anniversary that, do those go into the comp base, or are they going to be separate? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Yes, Peter, we're going to put Interline into our comp base. We think it's important to operate as one Home Depot. So as a result, as you think about the shape of the year, the comps in the back half of the year will be higher than the comps in the first half of the year. Peter S. Benedict - Robert W. Baird & Co., Inc. (Broker): Okay, perfect. That's helpful. And then the numbers don't seem to suggest you've seen any impact from the wealth affect whether it be the energy markets or the stock market. I mean, obviously everything at big ticket very strong, but as you peel back the information, is there anything you're seeing in terms of consumers may be starting to pull back on any of the higher ticket stuff, again the consolidated numbers don't seem to suggest that? Thank you. Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Peter, we're not seeing that. Our business was good and continues to be good. Peter S. Benedict - Robert W. Baird & Co., Inc. (Broker): Okay, great. Thanks very much.

We have Chris Horvers from JPMorgan.

Thanks, good morning and fantastic quarter. Craig A. Menear - Chairman, President & Chief Executive Officer: Good morning, Chris.

I'm trying to understand the underlying tenor of demand you mentioned about $100 million lift to comps from weather, looks like about 50 basis points was weather benefit across all three months or was it mainly a November and December impact? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: If we look at our comp performance, we saw double-digit pop in the U.S. in December and that was really weather driven. December was the warmest month on record in 121 years. And Ted, didn't we see a lot of strength in outdoor categories?

Yes, so clearly both our Pros and consumers were able to continue with outdoor projects. But really we're seeing comp continue to be strong across the entire store. And while we appreciate the $100 million-odd benefit from weather, we don't look at this as a weather story in our fourth quarter. Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Goodness no, we grew our sales by $1.8 billion, so $100 million of growth on $1.8 billion is not a weather story. Craig A. Menear - Chairman, President & Chief Executive Officer: And it's geography as well, Chris. We saw strength across really all the markets.

Understood. And then do you look at that $100 million as a pull forward, and sticking with the weather, being the first and second quarter tend to be volatile, so how are you thinking about that $100 million, and how are you thinking just how perhaps the spring plays out. I know it's easier to look at on the halves, but as we model out the quarters, how are you thinking about the first versus the second quarter? Craig A. Menear - Chairman, President & Chief Executive Officer: Chris, generally you don't see a pull forward from Q4 into Q1 or vice versa. Generally, it plays the bathtub effect between first quarter and second quarter as spring breaks, so we don't believe it's a pull forward. Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: As we built our plan, we did build the first quarter as the lowest comping quarter for the year, but that's principally because as we exited the year, as Ted commented, we had commodity deflation in our sales. That commodity deflation continues into the first quarter, so we built the plan to reflect this.

Thanks very much.

And we will take our next question from Simeon Gutman from Morgan Stanley. Simeon Ari Gutman - Morgan Stanley & Co. LLC: Thanks, good morning, nice quarter. Craig A. Menear - Chairman, President & Chief Executive Officer: Good morning. Simeon Ari Gutman - Morgan Stanley & Co. LLC: For Craig or Carol and following on this theme, this was I think the second strongest U.S. comp since the housing recovery for Home Depot, and it comes when other things in retail are getting a little shaky. We talked about weather a little bit. But can you give us examples that you can share of any housing markets that may be longer in the tooth of recovery that just continue to chug along? Craig A. Menear - Chairman, President & Chief Executive Officer: Actually, the overall variability that we saw in the quarter by market was directly in line with what we saw last year. And you do get a little bit more market variation as you're in winter months based on how winter breaks. So really, there's not a lot of big variability. Simeon Ari Gutman - Morgan Stanley & Co. LLC: Got it, so just underlying strength. And then I may have missed this in the prepared remarks. But on Interline, can you share with us how it performed versus expectations, anything on sales or margin? And I realize it's early and I don't think – a lot of the integration is just getting started, but do you have a sense of how much overlap there is with the Pro, your Pro and spending on Interline Brands maybe outside of the Home Depot today? Craig A. Menear - Chairman, President & Chief Executive Officer: We're obviously in the early days of the integration efforts. And we have worked hard across – as we shared, we have a common vendor base. We're working through the programs with our vendors. We have reduced redundancy in the business, and now we're really getting into more of the focus on the sales side of it and the sales driving initiatives. As we called out, we're excited about the fact that we'll begin to sell our paint brands to the multi-family operators in the Interline company. Bill Lennie is here and he might want to comment. We're starting to see some success in crossover, but it's very early days. Bill Lennie - Executive Vice President-Outside Sales & Services: No, it is. We have seen some wins on some initial account engagements. And so what that does, it really validates what we see as the value of the Interline acquisition. It's just that synergy about being able to sell across channel. And then as Carol articulated, we're working on that vision of one Home Depot that allows our customers to shop either in store, online, or through Interline, and having greater access to a broader range of goods. Simeon Ari Gutman - Morgan Stanley & Co. LLC: Okay, thanks.

And we will take our next question from Seth Sigman from Credit Suisse. Seth I. Sigman - Credit Suisse Securities (USA) LLC (Broker): Thanks, guys. Good morning and congrats on the quarter. Craig A. Menear - Chairman, President & Chief Executive Officer: Thank you. Seth I. Sigman - Credit Suisse Securities (USA) LLC (Broker): I wanted to just follow up on that last question, but specifically on gross margin. Carol, you're guiding to flat gross margin, which is pretty consistent with everything you've said before. Obviously, Interline has a little bit of a near-term impact on that despite lower SG&A. Once you anniversary the inclusion of Interline, how do you think about the gross margin opportunity from either synergies with Interline or continued supply chain benefits or even lower input costs that some suppliers have talked about? And I guess what do you see as the offset to that? Thanks. Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Sure. As Craig mentioned, it's really easier to look at our business by half. So as you think about gross margin for 2016, the first half, because of the impact of Interline, will be down year on year. The back half will be up year on year. The back half will be up year on year because we'll be anniversarying Interline, and we'll see the benefits of productivity. We've talked to you in the past of our ongoing efforts to drive productivity within our cost of goods. We have a cost-out team that we set up several years ago that works directly with Ted and the merchants to drive productivity and first cost, which is our largest cost pool. You've seen us drive incredible productivity in our supply chain. For the year, we had 20 basis points of expansion coming…

And we'll take our next question from Michael Lasser from UBS.

Good morning. Thanks a lot for taking my question. It seems like one of the biggest surprises in the fourth quarter was the amount of market share that you were able to grab. And that's not even accounting for some of your non-traditional competitors like department stores. That's just your building material flows. So do you have a sense like where it's coming from? Are you seeing capacity come out of this system from some of your traditional competitors and that maybe enabling you to gain share? Or have you altered the way you do business such that these share gains are accelerating? Craig A. Menear - Chairman, President & Chief Executive Officer: Well, I'd say that certainly it's something that we focus on all the time. The customer is clearly investing in our space, so we're in a good asset class as it relates to housing. But incredibly proud of the team's efforts, whether that is the merchants to be able to deliver incredible values, our stores and our online team to be able to execute against that, our supply chain team that delivered, and the nimbleness of our supply chain to be able to react to kind of both weather patterns that happened during the quarter. Just really, really pleased with the effort that the team put forth in total.

Do you have a sense whether your share gain, and it would seem to suggest based on your commentary about the different business segments, whether your share gains were larger on the Pro side than they were on the consumer side? I'm not including Interline, I'm just talking in the core business. Craig A. Menear - Chairman, President & Chief Executive Officer: Right. I mean, what I would say is the measure of share is something that's incredibly difficult to get at overall. We do believe we're taking share in the market, but the finite number, it's pretty tough to get at. Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: And it really depends on what you're talking about. Looking at double-digit positive, I suspect that was the Pro customer. In fact, we know it's the Pro customer through our consumer insights. Appliances contributed 50 basis points of our comp growth in the quarter. Most of that is consumer. So you really have to look at the category of business and what was driving each.

And can you tie those share gains to some of your Pro initiative like the credit initiative, the Pro Xtra initiative and some of what you've done recently? I think it's important just to get a sense for how long these market share gains can last? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Sure. I'll speak to the private label card perhaps. Craig A. Menear - Chairman, President & Chief Executive Officer: Sure. Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: We just rolled out our new value prop in January, so you really can't attribute the strength in Pro, which by the way grew faster than the consumer in the fourth quarter. You can't attribute that to private-label card, but we're very excited about what that new private-label card is offering to our Pro customers. As you know 60 days to pay, fuel rewards, 365 day returns, its early days but we are liking what we see, our new accounts are up over our target. Our Pros are enjoying on average $25 off at the pump when they're using their fuel reward card, so we really like what we're seeing and we think that's going to bode well for 2016. So you can't attribute that, but some of the other initiatives that we've introduced are really helping drive the business. Craig A. Menear - Chairman, President & Chief Executive Officer: Yeah, Michael, what I think is happening and we're just very pleased with the performance across all the categories, is we are focused on having the right brands, the right assortments; we've done a lot of work. We've talked about our assortment planning tools, we feel we have the right line structure in the store with right brands in the right price points. We're focused on everyday value and convenience for our Pro and our consumer customers and I think this is resonating.

Thank you so much, good luck. Craig A. Menear - Chairman, President & Chief Executive Officer: Thank you.

And we have a question from Seth Basham from Wedbush Securities.

Thanks a lot, and good morning. Craig A. Menear - Chairman, President & Chief Executive Officer: Good morning.

Just to follow up on Michael's question, as you think of 2016 and your comp forecast, ex Interline, would you expect the Pro to be a larger driver of your comps in 2016 than 2015? Craig A. Menear - Chairman, President & Chief Executive Officer: I think we're focused on actually growing all of our segments. We're focused on growing the Pro customer, the DIY customer, the do-it-for-me customer as well as our digital customer. And so we haven't really thought about it as one being radically outsized versus the other. We look at transactions and ticket as a balance of growth as well.

Got it. A follow up. As you think about the composition of traffic and ticket into 2016, you're looking for a balance, what does that dictate in terms of your expectations for the housing market? Do you expect housing prices and turnover to be about in line with 2015 or do you expect any change? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: We actually expect some changes. So let me walk you through those changes if I may. First what I'm going to do is walk you from where we exited in the U.S., a comp of 7.1% to the guidance of 4.5%. That's a 260 basis point delta and the drivers of that are threefold. First it starts with GDP, we're using GDP growth forecast of 2.1%, GDP in the United States in 2015 was 2.4%, so those 30 basis points coming off the top because of slower GDP. Secondly, on home prices, we anticipate home prices to be up next year 3.5%, that's good. It's down from the growth that we experienced in 2015 of 5.4%, so that's another 30 basis points of growth coming off the top. And then there's 200 basis points of market share coming off because we don't feel market share into our growth forecast. So that gives you 4.5% comp estimate for 2016. A few other housing numbers since you asked, I gave you the home price estimate that we're using, we anticipate housing turnover to be up 4.4% of units, household formation to be up considerably, we're forecasting 1.9 million household forms, that's up a lot this year it was about 1.3 million households. The other thing is that we're really spending time trying to get a better understanding is the impact of the age of the housing stock. As you know 65% of the homes in the United States are older than 30 years and there's external research that shows that spending on older homes is higher. John Burns would suggest it's something like 7.5% higher, our own internal research suggests it's 8% higher, so this aging housing stock bodes very well for us. And if we could take you back to the last mild recession, and I'm talking a lot here and I apologize, but if I take you back to the last mild recession of 2001, the housing stock was a lot younger 10 years ago. So this is a good new story for us.

Got it. That is a good new story. And just one last follow up. Obviously, you don't factor in market share gains, but anything execution wise that you think will change that could impact the market share gain trajectory in 2016? Craig A. Menear - Chairman, President & Chief Executive Officer: No, I mean, we're going to continue to focus on what we've been doing. So, no. I don't see any major change.

Great, thank you and good luck.

And we have a question from Jessica Mace from Nomura Securities.

Hi. Good morning and congrats on the good results. Craig A. Menear - Chairman, President & Chief Executive Officer: Thank you.

My first question is about the SG&A guidance. I just wanted to clarify that 40% of sales growth includes the data breach expenses from last year? And if there is anything else we should be factoring in as to why that would be lower than the 50% of sales growth guidance you gave at your analyst day? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: No. I'm confirming that you understand that completely.

All right, great. Thank you. And then I had a question on the interconnected retail. You showed some good progress in that channel. What are the other near-term milestones we should be looking for in that channel? Craig A. Menear - Chairman, President & Chief Executive Officer: We're continuing to clearly roll out the investment we've made in our direct fulfillment centers. So we're continuing to assort those buildings which will give us the capability where we put products across all three buildings to be able to get product to our customers in two business days or less. So you'll see us continue to shrink lead times for our customers. You will continue to see us invest in enhancements through search, visualization as it relates to not only photography, but video for our customers. We know that our customers engage in that. And Kevin Hofmann is here who runs our online business. Kevin, I hope you have additional comments to make to that. Kevin Hofmann - Senior Vice President & President-Online, The Home Depot, Inc.: Sure. And just to continuing to develop better experiences for our customers. Mobile experiences are a big focus for us as well. And as Craig mentioned, we're also rolling out our buy online, deliver from store functionality through the year. And we think our customers will be excited about that. Craig A. Menear - Chairman, President & Chief Executive Officer: The great news for us is 40% plus of all the orders that happened in our digital space, our customers choose to pick that up in one of our stores. They're conveniently located, they're safe. They know that the product is going to be there, they don't have to worry about it not being on their doorstep. And that's a great opportunity for us as it drives more traffic to our stores.

Great, thank you very much.

And we have a question from Dan Binder from Jefferies.

Hi, thank you. My question is regarding online. I was wondering if you could give us the growth rate in the quarter? I think you gave us for the year. And what do you think the top two or three things that are helping the strong conversion there? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Yes. Our online sales grew $230 million or 23% in the quarter. For the year, total online sales were $4.7 billion. That's 5.3% of our total sales up from 4.5% from last years. Really pleased with the growth. Craig A. Menear - Chairman, President & Chief Executive Officer: Kevin, do you want to comment? Kevin Hofmann - Senior Vice President & President-Online, The Home Depot, Inc.: So key things driving the growth is really what we talked about. Great mobile experiences, great end-to-end interconnected experiences. Our focus is not just the transaction online, but as Craig said, over 40% of our orders actually end up in the store in one way, shape or form. So what we found is a lot of our online experiences are really about tying the customer back to the store side shopping journey. And when we look at the total enterprise conversion rate, just very, very pleased with our progress there. Whether they convert online or whether they convert in the store, that's really the customers' decision. So really great progress, we set all new records during our Cyber Monday event and our Black Friday event, and really, really strong momentum.

And then my follow up, I was just hoping maybe you could comment on a few things. First, what your commodity deflation assumptions are for Q1? What the breakdown was of the $90 million of extra expense in Q4? And what you may be seeing in wage pressures across the company or regionally? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Happy to. So the commodity price deflation pressure, again, we don't forecast future deflation. So our forecast is inflation, deflation neutral, but because we have seen prices come down that has a year-over-year impact. It's about 50 bps in the first quarter. Looking at the breakdown of expenses. Of the $90 million that were over our plan, about one-third of the dollars were related to store maintenance, snow removal and the data breach, the data breach specifically being $9 million. And then the rest was in our bonus and Success Sharing. As Craig pointed out, all of our stores are eligible for Success Sharing. We're going to have the highest second-half payout in our company history, so we're excited about that. And then, Dan, the third question?

It was regarding wage pressure that you may be seeing either regionally or as a company, how it increases and so forth? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Yes, so thank you for that question. As we told you at our investor conference, we do have some people costs coming at us, both in terms of wage pressure as well as higher medical costs due to prescription drugs. All of those pressures have been addressed in the guidance that we have given you.

Great, thank you.

And we have a question from Matthew Fassler from Goldman Sachs. Matthew J. Fassler - Goldman Sachs & Co.: Thanks a lot and good morning. Craig A. Menear - Chairman, President & Chief Executive Officer: Good morning. Matthew J. Fassler - Goldman Sachs & Co.: My primary question relates to your big-ticket sales trends. That comp growth in tickets of $900 or more, I think, is the second strongest on record on both a one-year and a two-year basis. A couple elements there, you mentioned custom kitchens. I'm just curious whether those megaprojects are gaining more traction. And also, does the Pro growth that you're seeing, and particularly the acceleration in some of the Pro categories doing better, disproportionately impact that big-ticket zone of your sales?

I would say, Matt, on big-ticket, we like the progress we're seeing in the momentum. You specifically mentioned the kitchen cabinet business. That was a strong double-digit comp for us. And what's encouraging is the pipeline of quotes in our system are at record highs. And even now after such a strong Q4 going into Q1, we have a very robust pipeline. Just across the whole store, appliances obviously is a big-ticket item that continues to grow. And our service businesses, we have nice traction with our home interiors business and exterior business, whether it's kitchen installs or roofing, siding, windows. So seeing really across the business. Matthew J. Fassler - Goldman Sachs & Co.: And if it's possible to dissect the acceleration from the 8% growth, really high single digits that you've seen year to date to the 12% number, would you say that either DIY or Pro is disproportionately behind that pickup? Craig A. Menear - Chairman, President & Chief Executive Officer: Actually, both.

The installs, certainly consumer, right? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Appliances, consumer.

Appliances, consumer, roofing has a tendency to be Pro. Matthew J. Fassler - Goldman Sachs & Co.: Great, thank you for that. Craig A. Menear - Chairman, President & Chief Executive Officer: Matt, the only point on that is as we look at – we talk about our top classes that still haven't recovered from peak. And we're still, as much as we've recovered in aggregate all of the lost sales, there's still $2.5 billion in key categories. And those tend to be bigger ticket items, so special order kitchens, countertops, and all manner of millwork still remain below the 2006 peak. So we're watching ticket carefully, as Carol said. But from all indications, pipelines are strong and sales continue with good momentum. Matthew J. Fassler - Goldman Sachs & Co.: Great. And then just a couple of cleanup points on the expense line. Carol, you spoke about the impact of Interline on gross margin rate. Can you talk to the impact, if any, on the expense ratio? And then the D&A guidance does suggest a bit of a pickup. Is that primarily related to the deal, or is there something else within that number? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: The D&A pickup is related to shorter-life assets being put into service. We're investing into IT in a big way, and that capital tends to have a shorter life. And the impact of Interline is really reflected in the overall expense growth factor for the quarter. We were around 52%-ish. That's really because of Interline. If you back out Interline, it was more like 40%. Matthew J. Fassler - Goldman Sachs & Co.: Great, thank you so much. Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Yes.

And we have a question from Scot Ciccarelli from RBC Capital Markets.

Good morning, guys. Craig A. Menear - Chairman, President & Chief Executive Officer: Good morning.

So a bigger question, I guess two questions technically, on e-commerce. We've obviously seen e-commerce disrupt so many retail sectors. So I guess the two questions are number one, how do you think about the risk of consumers potentially getting increasingly used to shopping for your category, especially with the growth of your own platform online? And then two, in your opinion, what makes home improvement different than what we've seen in so many other retail sectors where the box guys tend to battle market share losses and margin compression over time? Why would you be immune to that in your opinion? Craig A. Menear - Chairman, President & Chief Executive Officer: I think when you look at the business in total, there's a combination of factors. There are segments of our business – we've shared in the past that we believe the best business model is in the store. And the customers, they're smart, they have a tendency to gravitate to the best business models. And so we think there are elements of things like concrete and soils and mulches that make sense, and that's where the customer will find the best value to purchase the product. There are other categories that are enhanced by the digital experience. As Kevin was just sharing a minute ago, where our customers actually start their shopping experience online, but then finish in store. And then there are clearly categories that are, if you will, at risk to transfer online because whether it's breadth of assortment or ease of shipping. And candidly in those categories to date, for the most part we actually see growth in both channels. And so the digital business in large part has been incremental growth for us, and we see that opportunity to continue.

But do you think there's a risk that as people get more used to shopping at some of those categories that you're terming at risk that you can wind up seeing increased margin compression down the road because obviously that's something we've seen in a lot of other retail segments? Craig A. Menear - Chairman, President & Chief Executive Officer: We run this as one business as a portfolio. We've built out the capabilities in the tools to give visibility to our merchants to manage this across channels. So it's all built into our forward look that we shared at our investor conference.

Got you, all right. Thanks, guys. Craig A. Menear - Chairman, President & Chief Executive Officer: Yes.

We'll take our next question from Kate McShane from Citi.

Hi, thank you. Good morning. Craig A. Menear - Chairman, President & Chief Executive Officer: Good morning.

My question is on Project Sync. I know that was a big focus of your analyst day and you had mentioned in the prepared comments that it's been rolled out beyond Houston. Can you give us any more detail about where else this has been rolled out to and can you remind us when you see this being completed? Craig A. Menear - Chairman, President & Chief Executive Officer: It is in the process of rolling out in additional southern areas of the country and this is a multiyear effort.

Okay, thank you. And then my follow-up question was just on exclusivity of product. Again, in the prepared comments I think you said that was a differentiator for the Pro, do you have a percentage of what you're offering or sales percentages is of exclusive products to the Pro customer? Craig A. Menear - Chairman, President & Chief Executive Officer: Honestly, we haven't calculated that. We talk about our private brands in the 15% to 20% range, but not yet talked about the exclusive products

Okay, thank you. Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: We'll go back do the calculations. I don't know what it is. Craig A. Menear - Chairman, President & Chief Executive Officer: Yeah.

Nicole, we have time for one more question.

We will take our final question then from Greg Melich from Evercore ISI.

Great, thanks. I have two parts to it just to sneak one in. Carol, I just want to make sure I got the SG&A thing right in the guidance. If it's 40% of sales growth we should be taking 40% of 5.5% when we think about SG&A dollar growth, is that right? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: So you should be taking 40% of the sales growth we gave which is 6%.

Okay. And then the second question is, on working capital. So I hate to end on this, but try to find something wrong with these numbers, inventory was up a lot but payables were up too, what do you have in your $10 billion of cash flow guidance for working capital on 2016? And do you feel good about inventories where they are? Are they too hot, too cold, just right? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: So our inventories are in the best shape we've seen and I've been here, this is my 21st year, so I can speak from authority, they're in really great shape. We have one-tenth improvement in inventory plan for 2016 and Mark Holifield is here and I would say we might want to try to get even better than that, but that's the plan. Mark Holifield - Executive VP-Supply Chain & Product Development: Just one thing, just color on inventory, one thing to keep in mind is last year we had the West Coast port disruption which led to artificially lower inventory, so we're actually very pleased with where our inventory is and on top of that, we're very, very pleased with where our in-stock is compared to last year which we're really seeing a material improvement in-stock versus last year because we're overlapping those port disruptions from last year.

Great. So it's fair to say the $10 billion of cash from operations might include a couple hundred million from working capital, but there's no massive move either way? Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: That's correct.

Okay, great, good luck. Carol B. Tomé - Chief Financial Officer & EVP-Corporate Services: Thank you. Craig A. Menear - Chairman, President & Chief Executive Officer: Thank you.

Thank you for joining us on our call today, and we look forward to reporting our first quarter earnings at the end of May when we'll talk to you then.

And once again, ladies and gentlemen, that concludes today's conference. We appreciate your participation today.