Gross margins for the first and second quarter are expected to be below the prior year, particularly as we accelerate our promotional activity which will lead to lower merchandise margins. However, the rate of decline in margins are expected to moderate in the back half of the year as we realize the benefits of lower buying costs and anniversary our increased promotional cadence begun in the fourth quarter of fiscal 2008. We anticipate occupancy costs to decline in the low single digit range for the first half of the year in dollar terms.

Selling, general and administrative expenses before marketing expenses for the first half are expected to decline in the 7% to 9% range on a reported basis. The drivers here include, as I discussed previously a streamlined store of field management organizations, reduced corporate office personnel, significantly reduced merit pay increases, payroll reductions for senior management that George touched on, reduced spending on our various benefit programs and other G&A spending levels.

Our marketing spend however will increase over the prior year first half in support of our merchandising initiatives as well as higher marketing costs associated with our marketing alliance with David’s Bridal. Net interest expense is expected to decline as we increase our cash reserves from continued gains in free cash flow. Our effective tax rate for the first half is expected at 38%, up from the prior year comparable period of 37%.

The last item that impacts the numbers concerns the foreign exchange rate translations. Our current outlook includes a 19% decrease in the exchange rate from the prior year first half. The impact in the first half reduces the reported total sales growth rate over the prior year by up to 200 basis points. The impact to reported profitability for the first half will approximate a drag of up to $0.04 per share.

The outcome of these operating expectations is estimated to result in diluted earnings per share for the first half of the fiscal year in a range of $0.45 to $0.65. We expect first quarter results on a diluted earnings per share basis to be breakeven to a mid-single digit loss and that the second quarter will drive the majority of first half estimated earnings which is due to the seasonality of our tuxedo rental business favoring the second fiscal quarter of the year.

Capital expenditures for the year are targeted in a range of $50 million to $55 million, approximately $33 million store related, $9 million technology related and $11 million distribution center related. 60% of our spending is expected in the first half of the year. We have identified new store growth of up to 10 stores to opportunistically take advantage of industry consolidation.

Depreciation and amortization is estimated at $85 million for the year, $43 million of which for the first half. Taken as a whole these guidelines would result in free cash flow as a percentage of expected earnings for the first half to range from 125% to 135%. That concludes our prepared remarks and we will now open the call to your questions.

Question-And-Answer Session

Operator

Thank you, sir. We will now begin the question-and-answer session. As a reminder, if you have a question, please press the “*” followed by the “1” on your touchtone phone. If you would like to withdraw your question, please press the “*” followed by the “2”. If you are using speaker equipment you will need to lift the handset before making your selection. Please ask one question and one follow up and re-queue for any additional questions. And our first question is from the line of Brian Tunick. Please state your company name followed by your question.

Brian Tunick – JPMorgan

Hi guys. Brian Tunick, JPMorgan. Maybe George share with us your thoughts about what’s the right amount of time that this BOGO event will go on in the first half of the year just so that we understand, and then maybe Neill give us a little more color on the low single digit decrease in the occupancy side, what’s happening there and should we expect that to continue in the back half?

George A. Zimmer

Well, the BOGO event, Brian, is being reconstituted so that it can run indefinitely and what I mean by that is that we’re making 30 second commercials which have a nice story with the BOGO message being just a part of the overall message. So we’re actually planning on running this on a regular basis.

Neill P. Davis

Brian, as to your question on occupancy we do expect a continuation of occupancy dollars to decline in the back half but just remember that as we get into fourth quarter we’ll be beginning to anniversary some of our initiatives to lower that cost.

Brian Tunick – JPMorgan

And so, if you guys become a BOGO everyday kind of business obviously that should have a permanent impairment on the merchandise margins. Is that how we should think about it or are you buying obviously different now?

George A. Zimmer

Well, it’s too early to say I would say. We’re anticipating that there will be some merchandise margin degradation but it’s all a function of volume and right now we’re hopeful.