Consumables continued to drive sales, while the sales of discretionary categories were more challenged reflecting last year’s benefit from the stimulus checks. For the full quarter we expect comps will increase between 2% and 4%. This year we have seen strong expansion of gross margin driven by lower transportation expense, better inventory shrinkage, and higher purchase markups, which have offset increased mix pressure.

As we look to the fourth quarter we expect that these trends will continue but may moderate somewhat. In addition, as Howard discussed, we are accelerating some significant investments to position longer-term returns. As a result, we expect to incur additional expenses this quarter related to our efforts to realign space in our stores to accommodate the expansion of high growth consumable categories.

We estimate that these investments combined with our aggressive rollout of store of the future, will pressure SG&A expense in the fourth quarter by around $8 million to $12 million but will support longer-term revenue growth. As a result of these expectations, we now project that earnings per diluted share could be between $0.39 and $0.43 for the fourth quarter.

Reflecting our performance year to date, and our expectations for the fourth quarter, we now project that earnings per diluted share for the full year will be between $2.03 and $2.07 as compared with $1.66 in fiscal 2008.

Now I’ll turn the call over to Howard for some final remarks.

Howard R. Levine

Thanks, Ken. Since the beginning of this year we have indicated that the fourth quarter would be our most challenging quarter as we anniversary strong comp performance. While we continue to believe that the underlying trends remain strong, cycling last year’s stimulus checks will create some short-term noise.

In addition, we are investing aggressively in our store of the future project and also in efforts to realign space in our stores to accommodate stronger customer demand. These investments will add incremental expense pressure in the fourth quarter, but will position us to drive sustainable growth beyond the current quarter.

Throughout our 50-year history we have continuously invested in strengthening and expanding our capabilities to serve our customers better, while also delivering short-term financial returns. This balanced approach has enabled us to successfully weather a number of challenging economic cycles.

As we evaluate the current economic environment, we believe that we have a unique opportunity to increase our market share as value becomes a stronger driver of shopping trips among customers of all incomes. To ensure that we capitalize on this opportunity, we are investing aggressively to improve the in-store shopping experience and increase customer loyalty.

I’m very pleased with our performance so far this year, but I am even more excited about the opportunity that lies before us. I believe that the investments we are making in building strong employee teams, enhancing merchandise capabilities, and improving the shopping experience will enable us to deliver sustainable, profitable growth over the long-term.

Now operator, we’d be happy to take some questions.

Question-and-Answer Session

Operator

Thank you. We are now ready to begin the question-and-answer session. If you wish to ask a question, please press star one. As a reminder, if you press star one during the company’s comments you are not placed in the queue. If you would like to ask a question, please press star one now to enter the queue. Also, as we have limited time remaining, please confine your comments to one or two questions. One moment please for the first question. I think our first question comes from Charles Grom with JPMorgan. Your line is open.

Charles Grom – JPMorgan

Hi. Good morning, everybody. Just, Howard, on the 2% comp in June, can you give us a little bit of color on week-to-week trends and I guess how much the calendar shift and advertising adjustment that hurt the last week in May helped out the first week in June.

Kiley F. Rawlins

I’ll do my best to try and answer that, I think that as we’ve talked about, June benefited from really two first of the months, so the first of June as well as the first of July, similar to what we saw in last year. But as we’ve talked about the first of the month money last year fell a little bit into the May period. It did not do that this year and so we saw a little bit of noise toward the end of the third quarter reflecting that shift.

As you also mentioned our promotional activity around the first of June also moved into the June period so there’s quite a bit of noise around the first of the month this year. You combine that with some of the beneficial weather we had last year when it finally got hot as well as the stimulus checks and the impact there, it’s pretty hard to get to a specific impact as it relates to just the first of the month.