Brian Tunick (JP Morgan): Can you get back to 25% to 26% gross margin you had in 2002 and just sort of walk us through your thought process there?
Michael Balmuth: Operating margin at least for the third quarter looks to be down based on our guidance, down 20 basis points, up 30 basis points. Included in that guidance, there is a process that we went through and a more conservative look at the third quarter where we believe the competitive trend will be. We have also maintained that over the long term, we believe we can incrementally get back to 30 to 50 basis points on an annual basis. That is if we perform from a sales standpoint. Although we are making progress, chipping away at it, we just want to make sure that we are realistic because we have come into what looks to be a difficult back half.
Dana Telsey (Telsey Advisory Group): Given the sale of the Liz Claiborne brands and the changes in the apparel manufacturing industry, does it make sense for you to buy a smaller brand, a private label within your stores or does that just not fit?
Michael Balmuth: Buying a defunct label or doing private label does not fit with our strategies. We have looked at it and it is just not where we want to take it. We would rather continue to buy branded product and if we ever want to do make-ups, we would rather do it with people who have brands that are known across America.
Dana Telsey (Telsey Advisory Group): Can you talk about the integration and the openings of the 46 Albertsons stores and are there other real estate deals out there that could potentially be like that?
Michael O’Sullivan: As we open stores, we are looking for new real estate, but we would not comment on any specific opportunities that are out there.
Rob Wilson (Tiburon Research Group): How would you classify your product from a 30,000 foot level of good, better, best and have there been any changes in the last 12 months?
Michael Balmuth: Within our apparel and apparel-related products, better would represent in the low 20% of our inventory and the rest would be what we consider moderate.
Rob Wilson (Tiburon Research Group): Has there been any shift in the last 12 to 18 months?
Michael Balmuth: Area by area, there could be, but in the overall, it isnot material.
William Keller (FTN Midwest): Do you still expect CapEx around $290 million at the back half of the year?
Michael Balmuth: We are still at the $290 million for the year and we have not broken that out relative to what that cadence would be. The biggest piece of that will be building new stores and then also be some investments in our distributions in our network.
William Keller (FTN Midwest): Can you give a selling square footage at the end of the quarter?
Michael Balmuth: Our boxes are uniform in size. Ross is about 25,000 feet. You can do the math to calculate the footage and dd''s is between 20,000 and 25,000.
Rob Schwartz (JL Advisors): On the last call, you spoke about availability of product and how you thought it benefited you in the second half. When this quarter you expect to see the impact in the stores and your sales numbers from this product?
Michael Balmuth: It will vary by area. Its impact in terms of sales line, we would expect to do better than we would have had the retail environment not become potentially more promotional. There will be changes in our stores as we are becoming more significant as we roll through this season.
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