Our new ranges for comparable store sales growth of 3.5% to 5.5% and identical store sales growth of 2.9% to 4.9% encompass our cautiousness on the low end and our optimism on high end. We also want to point out that our idents improved 224 basis points from the first half to the second half of 2009. So while we continue to face easier comparisons over the remainder of Q2, we face a significantly higher hurdle in the back half of the year.

Our operating margin guidance range of 4.3% to 4.5% for the year assumes lower year-over-year improvement in gross margin excluding LIFO than we have produce on average over the last three quarters. We do not expect to sustain those higher levels of improvement once we anniversary the shift in our pricing strategy that occurred in the first half of last year.

Additionally, we have been taking advantage of buying opportunities to pass through values to our customers, but it is difficult to predict to what extent these opportunities will continue. We are committed to maintaining our relative price positioning and this might mean a higher level of price investments going forward. We also expect slightly higher G&A of 2.9% of sales for the fiscal year.

Our expense discipline is continuing and even with stronger comps, the lessons we have learned over the last two years are not going to be forgotten. That said, spending last year was limited to must haves and certain costs from 2009 were deferred. So we expect some increases in our cost structure now that we feel more confident about our sales momentum continuing.

In the first quarter, we beat Street estimates by $0.06. Currently, the Street consensus for the remainder of the year is $0.84. Our new EPS range of $1.20 to $1.25 implies $0.88 to $0.93 for the remainder of the year which at the midpoint is $0.07 above the Street’s $0.84 consensus. As currently reflected in Street estimates, we typically see higher weekly sales in our second and third quarters, which drives stronger bottom line results and then sales tend to drop in the fourth quarter which is seasonally our weakest quarter.

Our business model clearly has been highly successful with our company ranked number 324 on the Fortune 500 list of the largest U.S. public corporations. In 2009, we were one of the top 20 best performing stocks on the S&P 500 index. As the world moves out of this recession, our positive sales momentum combined with our continued expense and capital disciplines should produce strong returns for our shareholders with fewer than 300 stores remain incredibly excited about the future growth opportunities for Whole Foods Market.

We are well positioned to take advantage of changing demographic trends and I expect our renewed emphasis on healthy eating to help further differentiate us and solidify our unique position within the food retailing universe. We will now take your questions, but ask that you limit your questions so that everyone has an opportunity too. Operator?

Question-and-Answer Session

Operator

At this time, if you would like to ask a question, please press the star and one on your touchtone phone. You may withdraw your question at any time by pressing the pound key. Once again to ask a question, please press the star and one on your touchtone phone. We will take our first question from Charles Grom with J.P. Morgan. Please go ahead.

Charles Grom – J.P. Morgan

Thanks. Good afternoon. Just on the ID improvement from 1Q to 2Q, pretty big uptick on tier like you spoke to. Just wonder, if we can dig a little deeper into that and how much of that is coming from traffic versus ticket and then also if you could speak to any color regionally on year-to-date results? Thank you.

A.C. Gallo

Hi, this is AC. It is a short period of time. So, it is a little difficult to project how, but what we can say is what we started to see in Q2 was in addition to the strong increasing pattern in our transaction count, we started to see an actual up tick in our basket size which is driven mostly by an increase in the number of items in the basket as our average price per item is still flat to slightly negative. That has been -- that was a big change. So people are putting more items in their basket and it is increasing our basket size.

Walter Robb

And this is Walter. Just to add to that, I think it is pretty clear that the transaction count or the customer count is driving this gain. We are gaining customers back. If last year we were losing, we are gaining them back now and they’re doing the thing that AC just mentioned. So.

Charles Grom - J.P. Morgan

Anything…

Walter Robb

We also had some tremendous, we had some holidays, great holidays that we referenced in the script. But we have got -- two years ago, we got -- we were negative on the holidays. This year, we were had nice incremental improvement on the holidays in terms of lift and had that in Super Bowl and had that in Valentine’s. So those are the things, all of those things seem to be working differently this year than last.