Welcome to Bed Bath & Beyond's Third Quarter of Fiscal 2014 Results Conference Call. All participants are in a listen-only mode for the duration of the call. This conference is being recorded. A rebroadcast of this conference will be available beginning on Thursday January 8, 2015 at 6:30 pm through 6:30 pm Eastern Time on Saturday January 10, 2015. To access the rebroadcast you may dial 888-843-7419 with a pass code ID of 38655099. At this time, it is my pleasure to turn the conference over to Ms. Janet Barth, Vice President Investor Relations. Please go ahead.

Thank you, Jeanette. Good afternoon everyone and thank you for joining us today for our earnings call to review our third quarter of fiscal 2014 results. I am joined by Steven Temares, Bed Bath & Beyond’s Chief Executive Officer and Susan Lattmann, Chief Financial Officer and Treasurer. Before we begin, I would like to remind you that this conference call may contain forward-looking statements including statements about or references to our internal models and our long-term objectives. All such statements are subject to risks and uncertainties that could cause actual results to differ materially from what we say during the call today. Please refer to our most recent periodic SEC filings for more detail on these risks and uncertainties. The Company undertakes no obligation to update or revise any forward-looking statements as events or circumstances may change after this call. Our earnings press release dated January 8, 2015 can be found in the investor relations section of website www.bedbathandbeyond.com. For those of you who might not have had a chance to read the press release here are some highlights. Our third quarter of fiscal 2014 net earnings per diluted share were $1.23 which includes approximately $0.04 per diluted share of net benefits for certain non-recurring items, including credit card fee litigation. Third quarter net sales were $2.9 billion an increase of approximately 2.7% over the prior year period. Comparable sales, increased by approximately 1.7% in the third quarter. For the fourth quarter 2014, our model continues to show net earnings per diluted share in the range of approximately $1.78 to $1.83. We are now modeling full year net earnings per diluted share of approximately $5.05 to $5.09 which reflects our third quarter actual results and our current fourth quarter model. Later in the call, Sue will discuss our third quarter financial results in more detail as well provide an update on our modeling assumptions for the fourth quarter of fiscal 2014 and some preliminary thoughts regarding fiscal 2015, but first let me turn the call over to Steve.

Thank you, Janet. And again welcome to Bed Bath & Beyond, we’re thrilled that you’ve joined us. And to our listeners good afternoon and I would like to wish everyone a healthy and Happy New Year. The retail environment is ever changing and Bed Bath & Beyond has more than 43 years of experience navigating the challenges of this competitive and dynamic industry, this past holiday season reflects this continuing evolution in retailing as we saw more customers interact with us online and through their mobile devices than ever before. True to our history and as our successful track record shows well ever satisfied overall, we were able to meet the needs our customers and we are confident in our ability to prosper in this evolving retail environment. We continue to maintain our philosophy of providing great service and great selection at the right value. And now we can do this in more ways than ever. Our ability to interact with our customers wherever, whenever and however to express their life styles and habits and move through their various life stages creates a powerful customer value proposition and a loyal customer base. By combining our services and merchandise offerings together with the ability to utilize the significant data available to us about our customer’s preferences, we are excited to have the opportunity to become more dynamic and more relevant to our customers. As Janet mentioned and as Sue will discuss in more detail, Bed Bath and Beyond reported net earnings per diluted share of $1.23 which includes approximately $0.04 per diluted share of net benefits for certain non-recurring items, including credit card fee litigation. Our net sales of $2.9 billion and a comp sales increase of approximately 1.7% and we continue to model net earnings per diluted share in the…

Thank you Steve. Net sales for the fiscal third quarter were approximately $2.9 billion approximately 2.7% higher than net in the prior year period. Of this increase, approximately 60% was attributable to the increase in comp sales and the remainder is primarily from new stores. Comparable sales for the fiscal third quarter increased approximately by 1.7%, this year compared with an increase of 1.3% last year. The comparable sales increase this year was attributed to increases in both the average transaction amount and the number of transactions. Gross profit for the fiscal third quarter was approximately 38.4% of net sales compared to approximately 39.2% of net sales in the corresponding period a year ago. The decrease in the gross profit margins as a percentage of net sales in order of magnitude was primarily attributed to, first, an increase in coupon expense resulting from an increase in redemptions, partially offset by a slight decrease in the average coupon amount. And second, an increase in net direct-to-customer shipping expense, which continues to be impacted by a reduction in bedbathandbeyond.com’s free shipping threshold to $49 which is due to anniversary next month. Selling, general, and administrative expenses for the third quarter were approximately 26.4% of net sales, as compared to 26.1% of net sales in the prior year period. This 30 basis point increase in SG&A as a percentage of net sales was primarily attributable to increase technology expenses and related depreciation and increased advertising expenses partially offset by the year-over-year net benefits of certain non-recurring items primarily relating to credit card fee litigations. The increase in technology expenses and related depreciation as a percentage of net sales represented approximately 40 basis points for the quarter. The year-over-year favorable net benefits of certain non-recurring items as a percentage of net sales represented approximately…

Thank you, Sue. I would like to go back to something that I mentioned earlier. This past holiday season reflects to continuing evolution and retailing as we saw more customers interact with us online and through their mobile devices than ever before. The investments we continue to make in our omni-channel capabilities are to position our company for long-term success. Our primary focus has and always will be to take care of our customer, this has been our mission for the past 43 years and it continues to be the foundation for all of our efforts. Our objective is to continue to take care of our customers wherever and whenever and however they wish to interact with us, we are customer centric. The every evolving services and product offerings we can provide our customers together with our use of the growing data and analytic tools at our disposal to understand how to best serve our customers married with personalized marketing efforts will allow us to be ever more relevant to and do more for and with our customers over time. As we have repeatedly said, the success of our company is due to the tremendous efforts about more than 60,000 associates as well as our unique and decentralized culture that enables us to respond quickly to market and channel demands in changing economic conditions. Through the commitment of our associates and the greatly valued contributions of our mechanize and service providers, we look forward to continue to satisfy our customers and by doing so improving our competitive position in the merchandized categories we offer across the channels and within the countries in which we operate. As we enter a new calendar year on behalf of Warren, Len and our entire Board of Directors, we would like to express our sincere gratitude to all our associates, customers and business partners. And to all of our listeners we wish each of you a healthy and happy 2015. As always we look forward to answering your questions and appreciate the opportunity to speak with you this evening. Sue, Janet and Ken Frankel will be in their offices and will ensure that all the calls we receive will be returned tonight. If you have questions, we encourage you to call. Thank you.

Ladies and Gentlemen this concludes today’s conference call. Thank you for participating. You may now disconnect. [No Q&A for this event] End of Q&A