MNRO - NASDAQ

Good morning, ladies and gentlemen, and welcome to Monro Incorporated's Earnings Conference Call for the Fourth Quarter and Full-Year Fiscal 2023. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. [Operator Instructions] And as a reminder, this conference call is being recorded, and may not be reproduced in whole, or in part without permission from the company. I would now like to introduce Felix Veksler, Senior Director of Investor Relations at Monro. Please go ahead.

Thank you. Hello, everyone, and thank you for joining us on this morning's call. Before we get started, please note that as part of this call, we will be referencing a presentation that is available on the Investors section of our Web site at corporate.monro.com/investors. If I could draw your attention to the Safe Harbor statement on slide two, I'd like to remind participants that our presentation includes some forward-looking statements about Monro's future performance. Actual results may differ materially from those suggested by our comments today. The most significant factors that could affect future results are outlined in Monro's filings with the SEC and in our earnings release. The company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law. Additionally, on today's call, management's statements include a discussion of certain non-GAAP financial measures, which are intended to supplement, and not be substitutes for comparable GAAP measures. Reconciliations of such supplemental information to the comparable GAAP measures will be included as part of today's presentation and in our earnings release. With that, I'd like to turn the call over to Monro's President and Chief Executive Officer, Michael Broderick.

Thank you, Felix, and good morning, everyone. As we turn the page on fiscal 2023, I want to start off by thanking all of our teammates and customers for their contributions to the growth and prosperity of our company, and to our shareholders for their continued support. This was a foundational year of investment that sets the stage for a brighter future in fiscal 2024 and beyond. Before we get into the specific details, I like to acknowledge that our profitability in the fourth quarter fell short of our expectations. While disappointing, we are confident that this lower profitability was isolated to the quarter and does not represent the level of profitability that our strategy and initiatives are designed to achieve over the longer-term. We took decisive actions to improve our margins as the fourth quarter progressed, and profitability improvements from our actions have continued into the first quarter of fiscal 2024. I'll spend the first part of our call this morning with a brief reminder about our strategy, which serves as an important context, both to where we have been and where we are going as a company in the year ahead. After that, I'll provide an overview of the continued progress we've made, as evidenced by our sales results in the fourth quarter. I'll also discuss the factors that impacted our margins and profitability in the fourth quarter, and the actions we've taken to improve our margins and profitability, both as the quarter progressed, and into the first quarter of fiscal 2024. Lastly, I'll conclude with an update on the progress we've made to improve our corporate governance, which includes a planned recapitalization that will simplify our equity capital structure, as well as a plan to declassify our Board of Directors. Starting with our strategy, we operate in a business with growing demand for our products and services. We are a leader in the highly resilient and largely nondiscretionary auto services aftermarket. We have significant scale that gives us important competitive advantages over smaller players in our industry. We leverage our scale and the strength of our financial position to make critical investments in our business, our people, and our technology to deliver an outstanding guest experience. We've been actively addressing the staffing needs of our stores. We have built the labor capacity in our stores to meet customer demand. And we are now focused on continuously improving our in-store execution and properly training our new and existing teammates to maximize store productivity. We also have a strategy to improve our small or underperforming stores, which represent about a quarter of our overall store base. These stores have plenty of runway for growth ahead, and improvements in their performance represent a multiyear opportunity for our company. We are focused on gaining market share and driving traffic to our stores through competitive pricing and the right assortment to meet the needs of our customers. Developing a longer-term relationship with our customers is a key element of our strategy as we look to become their trusted vehicle advisor. Our core strength as a business is to provide retail customers with superior automotive products and services. We are focusing all our energies and resources on our retail store operations. Our strategy and initiatives have been designed to drive our business towards consistently delivering mid-to-single-digit comparable store sales growth. And we are committed to maintain a balanced approach between tire and service categories that will allow us to leverage our cost structure to deliver enhanced profitability at our stores. Also, an important focus of our strategy is cash creation. We are unlocking cash from the business by optimizing inventory and leveraging the strength of our vendor partners for better availability, quality, and cost of parts and tires in our stores. While we have made substantial progress on the sales and cash creation pillars of our overall strategy, we have significant opportunities ahead to expand margins. Now, turning to the fourth quarter results, driven by strength in tires and several of our service categories, we delivered mid single-digit comp store sales growth in the fourth quarter of approximately 5%. We continue to execute on our strategy to improve our 300 small or underperforming stores. These stores delivered comp store sales growth of approximately 7% in the fourth quarter, which is on top of a double-digit comp growth in the first nine months of fiscal 2023. Our comp store sales growth, of approximately 11% for this group of stores in fiscal 2023, shows that our strategy is working. As a reminder, comp stores sales at these stores decreased 8% in fiscal 2022 compared to fiscal 2020. The continued acceleration in sales at these locations is a direct result of our strategy to improve technician staffing levels, as well as our training initiatives that are allowing us to better meet customer demand. Comp store sales in our remaining stores were up approximately 4%. And while we delivered on our mid single-digit comp store sales expectations, our margin and profitability in the fourth quarter fell short of our expectations. Our gross margin in the fourth quarter was impacted by continued labor cost pressures and continued customer trade downs to opening price point tires. Although disappointing, I want to reiterate that we took decisive actions to improve our margins as the fourth quarter progressed. Encouragingly, our actions allowed us to exit the fourth quarter with a fiscal March that was the strongest month in terms of gross margin performance of the three-month period. And profitability improvements from our actions have continued into the first quarter of fiscal 2024. Consistent with the prior two quarters, we continue to see our customers trading down to a lower priced tire options. As our customers continued to look for more choice and greater value, tire sales of our opening price point tires were a larger proportion of our overall tire sales. And while several of our higher margin service categories returned to growth, a larger proportion of tire sales coming from opening price points was a drag on our overall gross margin in the fourth quarter. Recognizing the customers skewing their purchasing behaviors towards opening price points, we raised prices on our opening price point tire, which led to an improvement in our gross margins as the fourth quarter progressed. Encouragingly, our tire comp store sales grew mid-single digit. And based on third-party syndicated U.S. replacement tire data, we maintained our market share in terms of units versus the industry in the fourth quarter. While the fourth quarter is typically our lowest sales volume quarter of the year, cutting the critical investments we have made in our labor force for short-term profitability in the quarter would sacrifice long-term profitability of our service model and would not allow us to take advantage of industry tailwinds over the longer term. Rather than cutting these critical investments, we reduced non-productive labor cost including overtime hours in our stores, which led to an improvement in our gross margins as the fourth quarter progressed. We will continue to closely manage our labor cost and expenses to maximize store's productivity. Our operating expenses as a percentage of sales were higher in the fourth quarter primarily due to the divestiture of non-core wholesale tire and distribution assets, increased management employee cost, and higher marketing spend. Our business is well-positioned with the right strategy in place to take advantage of longer term industry tailwinds. While the current macro environment remains challenging, we continue to maintain market share in our tire category with a keen focus on driving traffic to our stores and serving the car care needs of our customers. The largely non-discretionary nature of our business gives us confidence that as long as our stores are properly set, our pricing is competitive with the right assortment, and we continue to improve our in-store execution, we will able to capture market share in both our tire and service categories. Our strategy and all of our initiatives are designed to restore our gross margins back to pre-COVDID levels with double digit operating margins over the longer term. Lastly, on to the progress we have made to improve our corporate governance. We announced some important governance enhancements this morning, specifically in agreement to eliminate the company's Class C preferred stock and an amendment to declassify our board of directors so that all directors will be elected annually. Both enhancements are subject to approval by shareholders at our annual meeting later this year. The specific details of the preferred stock conversion and board declassification are outlined in a press release we issued earlier today. But at a high level, we are confident these steps will make Monro a more attractive investment opportunity, simplify the company's capital structure, and enhance our corporate governance by placing all shareholders on an equal footing. The conversion agreement has been a core focus of the board for some time and is a result of a through and deliberate process informed by continuing dialog with shareholders. Specifically, the board appointed a special committee to evaluate, negotiate a recapitalization of the Class C preferred stock. Their work was supported by independent financial and legal advisors and has unanimous approval of the full board. We are very pleased to share these governance enhancements which we believe are in the best interest of all Monro shareholders. But we also recognize that good governance is something that should remain an area of focus. We will continue to assess potential actions to further improve Monro's governance including adding director candidates to the board who complement the skill sets and experience currently represented. And we will continue to seek active dialog with our shareholder base to further these efforts. In summary, fiscal 2023 was a foundational year of investment that sets the stage for a brighter future ahead. We delivered mid-single digit comp store sales growth in the fourth quarter. Our strategy to improve our small or underperforming stores through our staffing and training initiatives is working. While our profitability in the fourth quarter fell short of our expectations, we are confident that this is not representative of what our business can achieve. We took decisive actions to improve our margins as the fourth quarter progressed. And profitability improvements from our actions have continued into the first quarter of fiscal 2024. We will continue to drive our business towards consistently delivering mid-single digit comp growth with a commitment to a balance approach between tire and service categories that will allow us to leverage our cost structure to deliver enhanced profitability. Although we continue to navigate in uncertain macro environment, we have the right strategy in place to take advantage of longer-term industry tailwinds. We are focused on gaining market share and driving traffic to our stores through competitive pricing and the right assortment to meet the needs of our customers. Our in-store execution is firmly in our control and remains our greatest opportunity for improving our results. As our training and productivity initiatives continue to take hold, we expect to deliver sales growth and margin expansion that will improve our earnings. We remain on a path to return to our pre-COVID gross margins with double digit operating margin performance over the longer term. The important governance enhancements we announced to eliminate the company's Class C preferred stocks and declassify our board of directors will simplify our capital structure and will make Monro a more attractive investment opportunity. With that, I'll now turn the call over to Brian who'll provide an overview of Monro's fourth quarter performance, strong financial position, and additional color regarding Q1 and fiscal 2024. Brian?

Thank you, Mike, and good morning, everyone. Turning to Slide 9, sales decreased 5.2% year-over-year to $310.8 million in the fourth quarter, which was due to the divestiture of our wholesale tire and distribution assets in the first quarter of fiscal 2023. Sales for these divested assets were approximately $30 million in the prior year fourth quarter. Comparable store sales increased 4.5%. And sales from new stores increased approximately $2 million. When adjusted for one fewer selling day in the current year quarter due to a shift in the timing of the Christmas holiday from the third quarter in fiscal 2022 to the fourth quarter in fiscal 2023, comparable store sales increased 5.6%. Gross margin increased 150 basis points from the prior year to 33.4%, primarily resulting from 210 basis points of benefit from the divestiture of our wholesale tire and distribution assets as well as material cost and distribution and occupancy cost that were lower as a percentage of sales. This was partially offset by 160 basis points increase in technician labor cost due to an incremental investment in technician headcount as well as wage inflation. Total operating expenses were $97.6 million or 31.4% of sales as compared to $93.2 million or 28.4% of sales in the prior year period. The increase as a percentage of sales was principally due to the divestiture of our wholesale tire and distribution assets, increased store management employee costs, and higher marketing spend to drive additional sales in what is typically our lowest sales volume quarter of the year. Operating income for the fourth quarter declined to $6.2 million or 2% of sales. This is compared to $11.5 million or 3.5% of sales in the prior year period. Net interest expense increased to $5.9 million as compared to $5.7 million in the same period last year. This was principally due to higher year-over-year interest rates. Income tax expense was $200,000 which is compared to an income tax benefit of $2.4 million in the prior year period, which included a $3.1 million tax benefit due to differences in statutory rates from last year's in which net operating losses have been carried back. Net income was approximately $400,000 as compared to $8.6 million in the same period last year. Diluted earnings per share was $0.01, compared to $0.25 for the same period last year. Adjusted diluted earnings per share, a non-GAAP measure, was $0.08. This is compared to adjusted diluted earnings per share of $0.20 in the fourth quarter of fiscal 2022. Please refer to our reconciliation of adjusted diluted EPS in this morning's earnings press release and on Slide 9 in our earnings presentation for further details regarding excluded items in the fourth quarter of both fiscal years. During the fourth quarter, we completed our previously announced acquisition of four additional stores in Iowa and one additional store in Illinois. This acquisition is expected to add annualized sales of approximately $6 million. As part of our growth strategy, we continue to carefully review value enhancing acquisitions while maintaining our disciplined approach in evaluating multiples. We have significant capacity to be an opportunistic acquirer of businesses which fit into our overall strategic plan. As highlighted on Slide 10, we continue to maintain a very solid financial position. We generated a record $215 million of cash from operations during fiscal 2023, including $95 million in working capital reductions. This has reduced our cash conversion cycle by approximately 55 days at the end of the fourth quarter compared to the prior year period. Our AP to inventory ratio at the end of fiscal 2023 was 178% versus 79% at the end of fiscal 2022. We received $70 million in divestiture proceeds of which $5 million are currently being held in escrow. We invested $39 million in capital expenditures, spent $40 million in principal payments for financing leases, and distributed $36 million in dividends. Lastly, cumulative repurchases of our common stock were approximately $97 million under our share repurchase program, which authorizes us to repurchase up to $150 million of the company's common stock. Given the higher interest rate environment, we opted to pay down some of our debt in the fourth quarter to reduce interest expense. We have used our significant cash flow to reduce invested capital by $224 million during fiscal 2023. At the end of the fourth quarter, we had bank debt of $105 million, cash and cash equivalents of $5 million and a net bank debt-to-EBITDA ratio of 0.6 times. Now, turning to our expectations for the first quarter as well as the full-year of fiscal 2024, we are providing the following fiscal first quarter guidance. We expect to deliver total company sales in the range of $330 million to $335 million which factors in comparable store sales growth in the range of 2% to 3%. Our preliminary comp store sales are up approximately 2% quarter-to-date. Note that sales from our divested assets were approximately $24 million in the first quarter of fiscal 2023. We expect a gross margin rate in the range of 35.8% to 36.2% and a diluted EPS range of $0.36 to $0.42. And while we are not providing full-year guidance, we are providing color to assist in your modeling. We expect to drive higher year-over-year sales through continued mid-single-digit compared store sales growth and continued outsized performance in our 300 small or underperforming stores. This is inclusive of an extra week of sales in our fiscal fourth quarter. We expect to drive year-over-year improvements in our gross margin through a higher mix of service categories, opportunistic pricing actions, lower fixed distribution and occupancy costs as a percentage of sales due to a higher sales base and finally, productivity improvements from our labor investments with reductions of nonproductive payroll which will be partially offset by continued wage inflation. Total operating expenses as a percentage of sales are expected to be higher year-over-year due to increases in direct and departmental costs to support our store base as well as the impact of inflation. Our tax rate should be approximately 26% for fiscal 2024. Regarding our capital expenditures, we expect to spend approximately $35 million to $45 million in fiscal 2024. We also expect to continue improving our operating cash flow driven by continued working capital reductions. Our balanced approach of returning capital to shareholders through dividends and share repurchases as well as opportunistically completing value enhancing acquisitions will meaningfully increase our return on invested capital. And with that, I will now turn the call back over to Mike for some closing remarks.

Thanks, Brian. We're optimistic about our outlook for fiscal 2024, and beyond. Although we still have important work to do, we remain well-positioned to execute our growth strategy and deliver long-term value creation for our shareholders. With that, I'll now turn it over to the operator for questions.

Thank you. [Operator Instructions] We have our first question coming from Bret Jordan from Jefferies Group. Bret, your line is now open.

Hey, good morning, guys.

Good morning, Bret.

Morning, Bret.

Could you talk about price versus traffic in the comp?

Yes, I'll address that. Comp was, you already know, about 5%. It was driven through flat customers, and the rest, obviously, was price.

Okay. And then could you talk about regional performance of the stores, West versus the Southeast and Northeast?

Across the board, it wasn't a lot of change. But if there's anything I would highlight it's the West was stronger and then the Northeast slowed down. And some other retailers talked about it, so I'll bring it up, there was some weather event, although we didn't focus on it, and everything's kind of normalized as we've gone into Q1.

Okay. And you talked about working capital, obviously being $95 million to the plus. What's left in the tank there as you've shifted from an internal distribution model to more outsourced supply, could you give us a ballpark for what we might expect to come?

Bret, we're not providing specificity around the future opportunity. There's work to do to take advantage of further opportunities we have to reduce working capital. But there is opportunity there. And we expect that, in fiscal '24, working capital reductions will play a large part of our continued strong operating cash flows.

Okay. And then the monthly, and I'll get out of the way, the monthly [indiscernible]?

Yes, sure. Yes, absolutely, January was around 8, February, 5, March around 1, and then we said we were up 2 quarter-to-date.

Thank you, Bret. We have our next coming from Brian Nagel from Oppenheimer. Brian, your line is now open.

Hey, guys, good morning.

Good morning, Brian.

Morning.

So, the first question, Mike, in your comments you talked about some of the corrective actions you took on the expense side. I was wondering if you could just elaborate a little further on that. And as we're thinking about this now against -- said you're improving sales, are there further actions you're going to need to take on the expense side, whether it be in the cost of sales or the SG&A or is this more or less a one-time adjustment, and you'll get the benefits going forward?

I like the work that the team put in place in Q4. Brian, let me just regroup. We were very clear, and I've been here for two years now, very clear on three big initiatives; sales, margin, and cash. Seems like the sales, now we have two quarters in a row, mid single digits, and that's always been the expectation. Cash, it speaks for itself. We had a record year in cash, and we're talking about actually having another strong year in '24. It's all about the margin. And I would say that I've been disappointed in the margin. I wasn't happy with January results. And I made adjustments, and the adjustments were using price. I'm very focused on having a balanced approach between service and tires as I see my customer account shifting and skewing to more opening price point, I made the adjustment. I would say that I'll continue making those adjustments; it's a very balanced approach. I do not want to be an only-tire provider. I believe Monro's greatest strength is that we are full-service provider. So, the pricing actions that we put in place are literally to continue the focus on a balanced approach to the business. Now, on the payroll front, great work on the teams. That's just good management, what I look at on a week-to-week basis, where we're really just managing payroll on an everyday basis, and addressing any unproductive labor, making sure people are taking their lunches, making sure they go home on time, really talking about having a balanced approach to an employee's life; I think it's just good retail. That will continue in Q1, and in '24, and beyond. I would say that we finally got traction on our expanses. I finally have traction on our margin. And I look forward to having a strong Q1. We talked about, for the first time in my two years, giving guidance. So, we're confident in our initiatives, and they will carry forward.

That's helpful. And then the second question I have just with respect to top line. So, the goal here has been mid single digits, you got that in the fiscal of Q4. And recognizing month-to-month in your company and your business can be very choppy, but right now you're not running [it] (ph). I would say you're doing it [chilled] (ph). How should we think about the current run rate here versus that goal of getting to mid single-digit-type comps?

I think some of the initiatives that we put in place were abrupt. And they were put in place for a reason. And I would say that we are still focusing on the process at Monro, really creating the Monro way, it's still our greatest opportunity, is that we are more relevant to our guests that are coming in, doing a better job in our stores. And we're still very much focused on mid-single digits. Now, on the tire category, we shifted. We absolutely took advantage of a customer. Our customers were skewing to value; we made price adjustments up and down in order to shift from OPP up through our product screen on the tire side. If we're more expensive than we were before, we might not have attracted the lowest-price consumer who is looking for the cheapest tire. So, that might have slowed down some of the categories. But I do want to recognize that we didn't do anything in our brakes. We had double-digit break comps in January, and that slowed down through the rest of the quarter. And that had nothing to do with pricing. That had nothing to do with our store execution. It had everything to do with probably a customer that was deferring, and they're still trying to figure out their own personal balance sheet. We're very focused on getting that service mix back and obviously having a healthy tire screen.

Thanks, guys. I appreciate it.

Thank you, Brian.

Thank you, Brian. We have our next question coming from Daniel Imbro from Stephens. Daniel, your line is now open.

Yes, thanks. Good morning. Thanks for taking our questions.

Good morning.

I wanted to follow up on that last question or that last answer, Mike. That last question around opening price tire points, you raised prices. I think in your prepared remarks you said, in the fourth quarter, you maintained tire share. I think if I look at the last couple quarters, you've been saying you're gaining share in tires. So, I guess it sounds like there was a shift there or a willingness to kind of pause the market share gains. I'm just curious how the competitive set has responded or are others raising price, are you the only one? And as we look forward, could that continue to limit share gains or how do you think about the competitive long-term impact of raising these prices with consumers facing this pressure?

So, Daniel, the way category management works, we are very focused on gaining market share. Now, we want to have the right mix of market share. So, I don't want to be the low-cost provider of tires in the marketplace, and I want to be really clear on that. I have a strong assortment of tier 3, tier 2, and tier 1 tires in my stores. So, when I started seeing our customers skewing into tier 4 opening price point, that wasn't healthy for Monro, that wasn't healthy for our customers, and we addressed it. Now, the way going back to market share, it goes back to the strategy. I want to have a long-term relationship with my customers. Part of that has to be a value proposition that we are very careful to make sure we maintain, and it's in check. At this point in time, when I'm looking at flat customer count, I'm not happy with it, but we've stopped the bleeding of customer count at Monro. And that's something that I'm very proud of. One of the tools that we're using is price, another one is assortment. But the biggest one we have is store execution, and that's what we're focused on. So, when I look at our market share I'm going to say we maintain market share. I'm okay losing market share on opening price-point tires as long as I have a healthy relationship in my tier 3, tier 2, and tier 1 tires at the same time. Oh, and by the way, I want a very strong relationship on my service categories with my customers.

Yes, I got it. That's helpful color on the strategy, thank you. Maybe following up, on the underperforming 300 store chain, I think you said comped up a 7 in the fourth quarter, correct me if that was wrong. I think that is the narrowest gap that we've seen to the overall chain comp, call it 300 basis points of outperformance. I think the first part of this year, that that group was comping double digits pretty comfortably. Are we just towards the tail end of the improvement here, or what drove that narrowing gap versus the chain, and what does it take for you to reaccelerate that growth at this underperforming store base. Thanks.

No, thank you. Daniel. Important question, we do recognize that it slowed down, 7% was the number. It is a multi-year opportunity. Just like it declined over years, it's a multi-year opportunity, and we're still very much focused on it. I would say at this point in time that our results are not linear, but I do expect us to continue to grow double-digit comps in these underperforming stores, and that's what the team is focused on delivering.

And so, in the first quarter, if we think about that 2% to 3% overall comp, is that assuming the core chain is going to be closer to flat and this underperforming chain reaccelerates the double-digits or how are you thinking about in this first quarter guidance, what the breakdown is in the comp mix?

Yes, obviously, without getting into much specifics, we expect that the underperforming stores will be leading that comp higher and the rest of the chain will be positive, but not as high as the underperforming stores. So, we expect there to be a gap between the two store sets.

Great, I appreciate all the color, and best of luck.

Thank you.

Thank you. With our next question comes from John Healy from Northcoast Research. John, your line is now open.

Thank you. We just love to hear a little bit more thoughts about the M&A pipeline and what might be presenting itself to you in the current environment. And as you think about M&A, and I think you guys were active on the buyback front this quarter a little bit with the stock kind of at the point of I think you guys bought stock back at 44 or so. What becomes the priority at these levels? Is it the buyback or is it the M&A footprint for this year, do you think?

Thanks, John. I'll take that. I think that Mike talks a lot about balanced approach, and I think that's how we view our capital allocation strategy as well where we have a lot of optionality, given our strong financial position, a lot of liquidity on our revolver, and we're generating a lot of cash flow, so we can address all of our capital allocation priorities. And that's obviously our dividend, which we announced today. It continues to be share repurchase opportunistic there as well as opportunistic on M&A. So, for us, we are doing all the work that we would traditionally do around M&A opportunities and looking to grow our store footprint. We obviously have a lot of energy focused on our internal store operations at the same time. And that's where we talk a lot about our business on the call today, but we feel good that we can continue to deliver shareholder cash back to our shareholders while executing that. And I think our 0.6 times EBITDA leverage ratio really supports those comments.

Okay, fair enough. And just one housekeeping question for me. I think this year you guys are calling out a 53-week year versus a 52. Can you just remind us how that 53 week in Q4 typically impacts the P&L from a margin standpoint? And with that, is that extra week included in the mid-single-digit comp sales growth. So, just curious if that reflects a point or two from that calendar item?

Yes, the outlook that we had for FY'24 mid-single-digit as well as our color around gross margins and profitability is reflective of that extra week in March, the sales increase in March, it does have fewer fixed costs that tag along with it in that extra week, but does have some fixed costs. So, we'll get some leverage in that last week, as you would expect. We're not quantifying that specifically, but it is reflected in our outlook.

I appreciate it. Thank you.

Thank you.

Thank you, John. We have no more further questions on the line. I will now pass back to Mike for closing remarks.

Thank you for joining us today. This continues to be an exciting time to be part of Monro. We have a strong foundation to build upon to create long-term value for all our stakeholders. I look forward to keeping you updated on our progress. Have a great day.